Getting to Know David Temko | Coffeez for Closers with Joe Shalaby Ep. 34

0:03What's up everybody? Welcome to another episode of Coffees for closers. Today I'm sitting with the president and CEO of C2 Financial, a legendary mortgage broker founded here in the state of California. This company has been around for decades and has reigned as the number one mortgage company for years and years. David Temko is heir to the throne of C2, taking over his father's legacy, and he continues continues to grow in every state, has a national presence, continues to dominate despite market adversity. Please welcome Mr. David Tamko. Thank you, Joe. All right. Thanks for coming. Thanks for having me.

0:50So a lot of people are always like, Joe, why are you always interviewing your competitors? Like, dude, we're so beyond that. We're pros. Absolutely. I was thinking about that. I was like, well, I'm sure the Bloods and the Crips have rapped on the same album before, you know they sure have no but it's cool man it's like there's only there's only what seven eight of us at our level and um and it's it's always an honor and every one of them has been in in that seat sat there right you know with me and it's kind of like you know we talk about bigger things you know like we're like a fluid relationship and uh we we grow together we get better together and and it's an honor to always have you know you guys are friends not not competitors to me so I love working with you.

1:31I love what C2 has done and continues to do in the mortgage community, empowering mortgage brokers just to get better, to grow, and help them thrive in a down market. Absolutely. You're always pushing these guys. Thank you and kudos to you for everything that you do for brokers. We lost Ron last year. It hurt all of us. It hurt all of us. I know you gave an awesome goodbye speech after his departure. when you had your, and I came out to that event, and that was a great event, and God bless you for carrying his legacy, his torch. Thank you, I appreciate that. Yeah, so I like to start. Big shoes to fill, for sure.

2:10I know, it is big shoes to fill, especially because he's just kind of like the godfather of the space, right? It's, you know, he was the first mega broker, and, you know, and he reigned as number one for so long, so. Yeah, they were, I mean, back then it was the only game in You worked at a bank or you worked at their company and then a lot of the companies that have the brokerages that are successful today You know have stemmed from working there and starting their own deal. You mentioned you worked for Windsor back in the day Yeah, that was him and him and Fred's shop and we take it from there.

2:40So yeah, I know the history Yeah, Windsor capital was the first one. This was pre crash. Yep All the way up to 2007, 2008. Yeah, so one of the first branches I ran was Windsor, so that's cool. So thanks for keeping me afloat. I actually made a lot of money. Good, good. So I like to start every podcast with the same question I ask everybody, and that's your morning routine. What is your morning routine, Dave? I wake up around 5.30 in the morning, and I generally have my bag packed the night before. so I get put on my gym clothes and and jam out I work out at 6 a.m. from 6 to 7 then I that or I'll jump in the surf if there's waves I live right by the beach but generally I'm at the gym or I'm doing something active around 6 a.m.

3:27and then I head into the office and the office around between 8 and 9 and take on the day love it love this same morning routine grind workout in my have a similar morning routine at the gym super early as well yeah how the way it's been A little small, but I'm sure, you know, pray for surf. So we'll get some swells, I'm sure, sooner than later, and I'll be ready for it. When was the last time there was some swell? Probably a couple weeks ago. I got out, even though it wasn't very good, I got out Saturday and Sunday. You know, got a little surfing before Mother's Day before I spent some time with the fam, so that was good.

3:59But, yeah, usually we're getting into some south swells because it's going into summertime. So there's some south-facing beaches in Southern California. Nice, nice. So what year did you start in the mortgage industry? I grew up in the business, you know, being the fact that my pops got in the business around in the early 90s. So it's kind of always around the dinner table. And then I, you know, started cleaning his office with my girlfriend in high school at the time and then kind of learning the language. And then I came home from college and I worked under top originators that we had at our company, just learning kind of how they went through their day, how they ran their business and just kind of got a lay of the land.

4:34But I remember after the crash, I was with my pops and all his best buddies that were kind of my board of directors. I considered them and I remember my pops was kind of like pulling us out like with a market cycle and I remember his His close friend that owned a ton of commercial real estate was kind of steady Eddie And I was like I want to get into that line of business And so I took off and did my own thing in commercial real estate sales and commercial banking Commercial brokerage for about 10 years or so and then I came back to the company and started our commercial division What year did you start the commercial division?

5:04Oh, that's been going for about six years now How's the C2 commercial? Great. We had our biggest month since its inception last month. So a lot of commercial loans happening regardless of market conditions. Yeah. And you're not doing like office buildings mostly, all multifamily? No, all of it. So office industrial, mixed use, retail, mobile home parks, all that kind of different, all those different product types for investors, as well as a lot of owner user stuff. So you're not focusing on the commercial side anymore. You've got someone to kind of fill those shoes for. Yeah, I mentored a gentleman, Brandon Landau, awesome person, extremely resourceful.

5:41And just, you know, I figured if there's one way to teach someone or mentor someone, it's just through osmosis. So I actually came back from L.A. to San Diego and was like, if you're going to learn from me, you're just going to hear what I'm doing and what I'm up to every day and the ins and outs of every deal. And that's kind of how he learned from me over the course of two years. And then when my pops passed, it was, you know, perfect timing for him to take over that division and for me to lead the company. That's awesome. So how many commercial loan officers you guys got? It's a pretty niche, specialized understanding or product market knowledge.

6:16So there's about five loan officers in that space, but it's mainly Brandon running the show. And we're trying to figure out how to scale that. It's a little bit different than the Ford side, but we did it on the reverse side, so it's kind of following suit. Those divisions have a tendency to be seeds that we water and then they grow and just takes time for it to be, you know, I heard you guys are growing significantly in the reverse space. I think you guys are like the number one broker in reverse right now. We are. We are the number one mortgage broker in the reverse space across the nation. We have more certified reverse mortgage professionals of any organization in the nation, which is like the highest designation you can get in the reverse space.

6:54And just honestly, we've been attracting just phenomenal talent that are really, really really great people and for as long as we've been in the business, we've had loan officers that now have a client base that might be, or they certainly have family that is in, it's a time that they want to take advantage of the equity in their home, staying home, retiring home, and reverse mortgages. A perfect retirement mortgage solution for that. Certified mortgage planner, what's it take to become a certified mortgage planner? A certified reverse mortgage professional. CRMP. CRMP, correct. So we actually have a C2 reverse certification.

7:33That's just a C2 designation? That's just a C2 designation, but it runs pretty parallel with getting your CRMP. So it's kind of like getting a DRE license. You're doing all the training to kind of get certified at a company, but it's actually to take a test and get your license. And so it's kind of aligned with that, but it gets you really well acclimated with what it takes to be a specialist in the reverse space. It's certainly something that is a different kind of language. It's a different product type. And I think it's super important for our loan officers to have the acumen, have the knowledge to deliver that to the people that are of need of it.

8:07So it's a protected class. I want to make sure that they're with people that know how to protect them. So you don't let all your loan officers do reverse mortgage. They have to have that designation, the C2 designation. That is correct. If they want to originate it on their own at the company. Otherwise, they can refer to somebody that does. Yeah, yeah. Nice. So how many designated LOs? I think it's about 300. 300? Yeah, of our 1 ,100 loan officers. So it's like a 20-hour course or something you guys offer? Yeah. Scott Harms and Shane Irwin are the leaders of that division. They've built out the curriculum, the syllabus, all that.

8:42And it's, you know, there's 101, 102, you know, there's a couple different, you know, channels and courses to do it. And you do it Zoom or in person? We do a lot of in-person meetings, but that course and getting acclimated and getting that designation is remote. That's cool. Yeah. But there's a Blue Door portal, so he does a phenomenal job and he keeps everybody super connected on the reverse side of things. So they do kind of a weekly call, monthly call, quarterly calls. And then at our events, we'll do a day of reverse, and we'll have speakers that are very notable in the industry that come out and speak for it.

9:18I was talking to an investor that just do reverse, and they were telling me on the wholesale side, I'm like, how many deals do you guys do? They're like, we just do like 20. I'm like, you do 20 deals, and you have all this back-end cost, and that's how you survive off 20 reverse mortgages in your wholesale lender. It's not that many deals for a wholesale lender. I mean, it's a niche product. It's not everybody that's, you know, it's pretty unique. It's definitely not as common as a foreign mortgage, you know, purchase or refi. So it's a pretty tight market, but there's certainly a need. And we have all the best wholesale lenders in the space, you know, at our company.

9:57Do you guys do more than 20 deals a month? We do. Yeah. So you do more than a wholesale lender. Yes, that is correct. You do more than the average wholesale lender. For sure. Crazy to think about that, right? how they could run their entire business on 20, when we're doing more than that a month, and we're doing a lot of other stuff too. Yeah, exactly. That's just like a small percentage of your business. For sure. So you were just cast in the mortgage industry. You didn't choose the mortgage business. You just basically, you know. Yeah, I mean, I think it's a testament to the fact that, I mean, my pops was my best friend and my greatest mentor, and he achieved my vision of success.

10:36And I think that, sure, I could have gone up and did my own thing. And I did my own thing. There really wasn't a place for me at the company until I went out and kind of learned my own craft and then brought that back. But it just worked out. You know, one thing I admire is that you managed to sustain that same grit that your dad did. Thank you. A lot of kids who would have been in your position would be like, oh, I'm just going to squander this away. So how do you think that your dad influenced your grit, your mindset? Well, you know, the saying goes that apples don't fall far from the tree. But, you know, I just appreciated his tenacity.

11:14I have a ton of energy. We're both real passionate guys. And just seeing kind of how he built his legacy for the family and what he created was just something that resonated for me. And it doesn't happen by, you know, sitting on your couch. He said that success is defined by hard work, opportunity, and a little bit of luck. You've got to be in the game, and opportunities will happen, and you'll find success. So that's how I do it. Yeah, I mean, the reality is you don't need to do what you do, right? You do it because you choose to do it. You do it because you love doing it. And it's me as a father just making sure, like, so how do I know my kids are going to not squander?

11:59you know, the success, right? Because it's a real issue amongst people who leave a legacy, you know, and you're grinding every day. You're, like, everywhere. Yeah. You know? Yeah. There's a movie. It's not, like, my favorite movie. I don't think that movie Dune. And there's a quote in it, and it was something like, the father was talking to his son, and he's like, there'll be a time in your life when you're called to lead. And the answer can be yes or no, but regardless of the answer, you'll always be my son. And, you know, there's a calling. People have a calling. You got a calling. Your son, you know, your children will have a calling.

12:29And mine was, you know, I was called and my answer was yes. And here I am. So it feels good. And you're managing 1 ,500 people and you're doing it with, and, you know, you're well spoken and you're kind of like a born leader, right? You have that already, that persona. So it's good that he raised you in that capacity. It's like, hey, this is going to be the guy. He was the man. He was the man. So what do you think has been your greatest source of inspiration to be an entrepreneur? I think that you'll never get to where you really want to go working for someone else. And that was always something that was, you know, told to me, taught to me that, you know, don't get me wrong.

13:15I think it's difficult to just walk into entrepreneurship out the gate. But I always knew that I wanted to be an entrepreneur and do my own thing and kind of run my own ship and, you know, make my own time to work. And so I studied business management with an emphasis on entrepreneurship. But when you graduate from college with that degree, it's like go out and do anything. It's not like you figured out like, you know, we're we're not trained. We're educated. We're like, you know, Europeans are more there's more apprenticeship. And so you come into something you're naturally directed to something that's in lineage of your family where, you know, it's like you graduate with that degree.

13:48You're like, okay, you know, I can figure out anything I want. I traveled around the world and did some backpacking bus line in New Zealand. I thought that would be great for California. And then I met somebody that did it and didn't work, you know. So, I mean, maybe I could have pulled that off. But it just, you know, I think this country was built on a capitalist mindset, an entrepreneurial mindset. And that's always been something that has resonated with me as being a, you know, red-boated American. And I think that that's something that I always wanted to do. And this is kind of the channel that I did, the path that I fell down or went down.

14:28But I think it's important to learn on someone else's dime. There's nothing wrong with having a job or a mentor or any of that stuff where you can learn a lot of mistakes from someone else that would happen to you if you're on your own right out the gate. that you can save a lot of time and a lot of money by learning from someone else that might have already made them, giving you some direction, and or finding things that, you know, why is it done like that? You know, that's how ideas kind of spawn, is like you are working at something, and you're like, this doesn't seem right. I think I could do it better this way.

15:04And then all of a sudden, you start your own business that way, right? And I think that that's how good businesses grow. Like, I always communicate to my team, my corporate staff, my, you know, the family of loan officers that we have, that this company was built on a suggestion box basis. And if you have an idea for something that you wonder why it's not working the way it is, I want to know because that's how we grow. That's how we get better. That's how the business gets better. And if they're thinking about it and not saying something, or they finally do say something, I'm sure that there's a hundred others that are thinking the same thing.

15:36They just haven't said something. So it's, you know, it's, um, that's, that's kind of how we grew. And that's, That's actually something I learned from my dad. I remember we'd be at restaurants and be like, if it was bad service, you should let them know. They should know. How are they going to get better if they don't know that this food's cold or that service wasn't good? So that's kind of how we got better over the course of years. Make sure people voice their opinions. Absolutely. Closed mouths don't get fed here. Exactly. Exactly. So you're totally resilient to market adversity. And what I want to ask you is, how important has taking risks been to C2 to grow in this totally crazy mortgage environment right now?

16:22Well, there's no question about it. There has been a lot of adversity with how quickly rates moved from two to three. Yeah, exactly. And that's certainly going to cull the herd and folks that are super refi heavy, which is everybody at that market, in that market, are going to have a rude awakening. And I sympathize. There's no question about it. As a company leader, I can't get on my high horse and say, you need to be doing all this volume and why aren't you doing that? The market speaks and we have to adjust. And this is the profession that we're in. We chose it. And And I think all things being said, if I look at the numbers of an average loan officer, let's just say a loan officer that's doing one loan a month, they're making a lot more than the average job across America.

17:11So I think it's a great profession to be in. And you cut your teeth regardless of market conditions. We all have to bob and weave and find opportunity. There's opportunity in every market. It does, through adversity, the strong will survive and will rise up and find a way. because I believe in the power of home ownership. And I believe that that is found through the broker channel. I mean, I've walked into a bank before and you got a banker with their thumbs in their armpits trying to figure out how to say no over the course of, you know, 45 days when you're in escrow period and that train's moving.

17:42And that's just not the way it should work. You know, I believe that brokers do have access to more sources of capital. They understand the nuances of how their clients make money and how they can be lended to. And their fiduciary responsibility is to that client where our bankers is to their shareholders. And I think that's just how better business is done and how we all win. And that's why we're here and why we're friends and why we can, at the end of the day, we have the same message. We're all about the power of home ownership and making that American dream a reality before everything's bought up by Blackstone and Vanguard and the Black Rocks of the world and you own nothing and you'll be happy.

18:19That's just not the way it works because if that is the way it works, well, we certainly won't be doing reverse mortgages either. Yeah, exactly. You know, nobody will be owning a home. So you've managed to maintain that, just like you said right now, your loan officer is still making money, still doing better than 98 % of Americans out there. So how are you helping loan officers continue to win in this environment right now? We have a platform that allows them to identify which lenders are going to be the most competitive in that moment for their client, whether it's a purchase or a refi. We don't provide leads.

18:54That's not something we do. It's never been something we've done. Generally, our splits are high enough to where they can dictate where they want to put their money to grow their business on our platform. We've got great branding, and we have a lot of collaborative events. You asked me earlier what C2 stands for. It actually kind of has been coined collaborative community. I like constantly crushing, but that's just my style. But I think that it's an opportunity to get together. we have an event called C2 Connect you've come to, where we have top producers talk about specific topics on panels.

19:30We have speakers. We have great ways for people to get those nuggets, those ideas when they get back to their desk and look at things a little bit differently, how they can connect with realtors more, how they can add more value to their book of business, the clients that they have that they may have refinanced into two or three percent. I just read an article this morning that consumers have more credit card debt than they ever have. They paid them a lot of debt through the pandemic just because they weren't spending as much. But now those habits have kind of come back. And sure, somebody might be in the 2 % or 3 % on their first.

20:04But if they have revolving credit card debt in their 20s, they can consolidate that, you know, into a first that's in a 6 % or 7%. And it might make sense from a blended rate perspective. So those details are in credit reports. And it's always looking deeper than just the eminent need. Hey, I'm buying a house. I got to jump in. I got to move quick. I got a 15-day escrow. Yeah, I can hammer that nail. but it's also kind of driving more value and understanding more about the customer. You know, okay, how are they making their money? On line 17, do they have real estate? Do they have interest? Are they paying interest on that real estate?

20:35Okay, we have a commercial division. People don't even know. Like, oh, I didn't know you could do that, you know? So it's just kind of peeling back the onion and finding ways to add more value to the customer and doing more and putting them in a better financial position. Yeah, that's great. You really got to dive deep right now. There's no cookie cutter, just order taking anymore. And stay in touch. I mean, that's really the deal. I mean, the best CRM is the one you use. That's kind of, you know, I remember my pops came up with a hat and it said, sit, stay in touch, you know, and gave everybody the hat.

21:04And it's like he was a big acronym guy. So it's all about staying in touch, keeping top of mind. And that's your book of business, your client base, your realtors, any COIs, CPAs, attorneys, whatever, whoever is in your sphere of influence that you can help. you know, have a partnership with and drive more value. I mean, that's how everybody's going to win. Business is hard. Might as well work with people you like because hard times are going to happen on transactions. You know, people are going to get frustrations. You know, have frustrations, it's going to be stressful. Work with people you like, do good business, do right by the customer, and you'll continue to be in a good spot.

21:39And these are going to come back down. You know, rates will come back down to the fours and fives. That's a healthy market. But the way inflation is, I think it might be a little while until we get there. It's going to be a while. So that was my next question. What do you foresee in the mortgage environment in the next probably year or two? I think things are pretty static. I mean, the Fed chair Powell just came out and said that they're not making a move. I don't think they're going to move anything up, but I don't anticipate anything coming down. You know, they said there's going to be three moves this year.

22:09I think we're a little late for that to start happening. Yeah. Things are still expensive. You know, we know we live in Southern California. It's pricey there. You know, the only thing that I think isn't expensive is getting a pimento cheese at the at the Masters event. You know, once you get in there, it's like a 250 for a sandwich. You're like and like six bucks for a beer. You're like, how is this possible? You know, any other event? I was just at a Tigers game. How is that possible? I don't know. They keep it. They keep it. Oh, gee, I tell you what. I went to get a coffee today and we're in Michigan.

22:38It was 450. Right. And Michigan for a cup of coffee. Like I used to laugh when it was five bucks a cup of coffee in Miami two years ago. and I was like, this is crazy. Now it's five bucks a cup of coffee everywhere. Right. Even Michigan. Well, that was when they called Starbucks five bucks. Now it's way more, right? It's like, but I mean, California, you know, getting, I think, McDonald's for a family to go eat, it's like 150 bucks. It's crazy. It's crazy. Gone are the days of$20 family meals at a little burger joint. I know, right?

23:12So right now, like, is there, Do you think there's a specific mindset that a loan officer has to have to be successful in this environment? You got to be tenacious. You got to go out and get it. You got to get back to your basics. If you think that deals are going to fall from the sky like they were through the pandemic when, you know, everybody that owns a home is refinancing, those days are gone. So, you know, and I think they have to get back to how they got into the business, which is just, you know, making the calls. You know, I started in commercial real estate in the boiler room. You know, I remember they said I was hired.

23:50I'm like, I'm pretty sure I'm hired and fired every day here. You know, it's like if I show up, I'm hired. If I leave, I'm fired. You know, it's like here's a desk, here's a phone, get to work, son. You know, and you build your database and you cut your teeth and you smile and dial and you're going to get kicked in the teeth. but you just, you know, I remember like you could do the, you could, you know, re-engineer the math, how many calls it takes to get a loan or get any transaction. And you, you know, every time somebody says, no, you could, before you hang up, thank you, sir. Um, I just made 50 cents click, you know, or whatever it is, however you want to work it.