Growing with Grow Mortgage ft. Russell Petty | Coffeez for Closers with Joe Shalaby Ep. 32

0:03What's up everybody? Welcome to another episode of Coffee's Proposers. Today I'm sitting down with a mortgage phenomenon. One of the most brilliant young minds in the mortgage industry. and he's taking the state of North Carolina by storm. One of the greatest innovators and I think one of the best mortgage professionals of our generation. Please welcome the founder and CEO of Grow Mortgage, Mr. Russell Petty. Thanks for having me on, Joe. Appreciate it. What an intro. For coming on. Thank you. Thank you. So, Russ, I'd like to start the show with everybody with the same question. Yeah. And that is, what is your morning routine?

0:48Yeah, so I don't believe in necessarily a morning routine. It's just whatever it takes to hit the goal that day. So I always think, where am I going to be by the end of the year? And then I back that into monthly, quarterly, monthly, and then daily goals that I have to hit. So it's just whatever it takes to hit those. But most mornings, I would say, I get out of bed around maybe 6, 5, 30, 6 o 'clock. I grab my coffee so that I can actually function and then I have like my tasks very intricately laid out the night before So I know exactly what needs needs to get done that day And before I go into the office before I do anything It takes me about four hours every morning and I knock those tasks out for that morning And then once those are done, then I start actually opening email working and doing that sort of thing But until then like I'm on dnd you can't get a hold of me I get what has to be done for the day done, and then I go tackle the rest of the fires.

1:42Four hours of task management early in the morning. Yeah. That's a lot of tasks. Well, I think it's when you're the sharpest, right? Like once you first get up, like the longer you go throughout. I think Bezos said this. As a leader, as like a vice president, president, C-suite, whatever, you're really only making three or four decisions a day. Like you're making very important decisions, but you're not. The further you go through the day, the worse your decision-making kind of gets. So I try and knock all of that out as early as I can so I make the best decision I can for my people. I love that.

2:14And you obviously are making some great decisions for your company right now. I appreciate it. Appreciate it. So you're only 28 years old. Yeah. What year did you get started in the mortgage industry? I was 16, just about to turn 17. So I've been doing this for 12-ish years, I guess. Almost half my life. Just mortgaging it out, you know. And you started in IT? Yeah, so I started out, I was working on a worker's permit, fixing computers, doing data recovery for insurance companies. So if your house burned down, I would go in, get the data off your computer and that kind of thing. And I wanted to go into IT really bad.

2:50And I was going certification after certification after certification. Didn't like the job, which I think you've got to enjoy at least somewhat what you're doing. So I didn't like it, didn't like the people I worked for, at least the direct manager. So I ended up quitting, pumping my last like$4 into my 98 Firebird. And a glass door popped up on my phone that said this company needed a IT guy. So I called and I was like, hey, like, what do you need? And the guy said, our Internet's out. It's the last day of the month. I didn't know what that meant. I was like, I can fix it. So I drove over. I rebooted their router.

3:20And they thought I was Jesus incarnate. They're like, this is incredible. I think it was 10 people in the whole company. So I started Monday. They taught me. It was right. I remember my first big project I did for them, because when I started, I was just building out Encompass and doing general IT, but then Respa came out, and I had to learn Trid. I had to learn the three-day rule and LEs and CDs and build it all out, so I kind of just got dumped into the fire and then built out Active Directory, web design, anything IT-related I was doing for them, but that's kind of where I cut my teeth, and then I saw what mortgage people were making back then.

3:52This was a refi boom, and you remember right when Trid came out, rates were dropped as well so I was like how do I do that and Doug the owner was nice enough to let me you know learn from him and he really is probably the majority of the reason that I stuck with it is just because he gave me that opportunity in the beginning to get licensed and also do loans so I owe a lot of that to him that's awesome so you didn't do college you just went straight into the mortgage industry I did yeah because it seems like not only did you you know learn so much about the mortgage industry it's like you're like brilliant in the tech space as well And I guess that's a lot of it's due to your tech background.

4:29I don't know about brilliant, but I think this industry is behind in technology. I mean, if you look at it, the biggest players are not great technologies. No offense to these people, but people are still on Calix Point. I mean, they're still on Encompass. And it's like, 2024, we have AI, we have all this stuff. And you're dealing with DOS-based programs. So if it works, it works, I guess. but we're moving into in the next 12 to 24 months especially once AI grabs this industry it's gonna be a very different industry and if people aren't on that cutting edge of that technology and getting ahead of the game especially with artificial intelligence they're gonna have a big problem trying to compete with the loan officers that do so I try and make sure that my team is set up properly with the right technology to compete with the big the big players nice so I mean I was gonna save this for later but we could just dive right into this now How are you implementing AI in your business right now?

5:21Yeah, so we're working on a lot of things. The issue with AI, there's two issues with AI if you try and implement it into your mortgage company or any company. One is hallucination. So with mortgage, there's a lot of gray. There's not a lot of like, you know, if this, then that. So AI would really have to have a lot of data in order to make the right decision. AI as it stands today, a lot of these large language models, they don't, they're very generalized. So you can fine tune it, and that's very difficult to do. It's very expensive to do. We can get into that later. But with that being said, it could give wrong information.

5:55If it doesn't know for certain, it's going to give you an answer that may be incorrect. It may confuse things. So hallucination is an issue. The second issue you're going to run into is data security. So if you're using like a chat GPT or something like that, there's certain data you shouldn't give it because these AI models are very easy to trick into giving you the data that it has. So security and hallucination are a big issue. What we have been doing is we've been training our own LLM in-house that we host, that we secure, that is not available outside of us. It's our own LLM. We've been training that on our condition sheets.

6:27We've been training that on our processes. We've been training that on our sales meetings. We've been training that on anything we can find that I want it to know. So what we're trying to create with that is something where a loan officer can come to it, a processor can come to it and say, this is the problem I have. What is the solution? And it's going to give you credit risk data. It's going to learn to reason. and also be able to train in marketing, support, sales, and all of our internal systems. So if you ask it, you know, hey, I have a question on this loan, and this is the problem I'm having, it's going to be able to look at it, read it, and tell you the problem.

7:01Are you implementing that on chat? So you're building your own chat GPT LM on the chat GPT 4.0? Nope, on our own. If you build it on chat GPT, the security risk is just too great at the moment. Now, I'm sure people larger than I could call OpenAI and build something out with them. I know they offer that. It's just not something that we have done. We've kind of built it in-house. All of the technology I have, I want to own. I don't like to lose control of software that is integral to my business. So I try and keep it within my walls. We've experienced what happens when that happens. Yeah, we sure have.

7:36So I try and keep it in there. So it's our own tech completely. And then the second part of it we call her Rose. So the second part of Rose is she has OCR. So OCR is ocular. She can read things. So we can give her, you know, a sheet. Maybe an AE sends us a sheet of, you know, this is our flyer, this is our matrix. We can just upload that to Rose and ask her questions. And then she reads it and gives us answers. We can upload a, you know, whatever document, as long as it's not like a private document. We can upload that document. Rose will give us feedback and say, here are things you could do.

8:05So, you know, we're trying to make it where it's a loan officer or a processor, anyone in mortgage's best friend is kind of what we're building. That's awesome. So something like Angel. Yeah, a lot like what they're doing with Angel. Yeah. Pavan's been on a rampage building out Angel, but he's spent millions building that out. It's so expensive. It's so expensive. It's getting cheaper now as AI develops. You know, it's a lot like getting into, I guess, like smartphones back in the day or, you know, computers themselves. You want eight megabytes and it's$5 ,000. Now you go get a terabyte hard drive for you know 50 bucks yeah so the further we progress into AI the cheaper it's going to be to build it I mean as if you would have built that on chat GPT though it just cost you just a developer cost yeah but then you know let's say someone that wants to get our data could then interface with that and say give me the data and not only could they just take what we built instantly they could also get all of my customer sensitive data and that's why we built it and host it locally.

9:02Now, ChatGPT has mortgage built out LLMs already. Yes. Yep. How would your LLM differ from some of the ChatGPT like canned options that people have already built on their platform? Yeah. So, you know, with the canned stuff, it's very generalized. You can't really customize it. It's just kind of is what it is. And it's very general. For us, I wanted it to be very niched into what Grow Mortgage is about. What are our processes? What are our overlays? What are our ideals, our values? So when you talk to Rose, it's kind of like talking to an employee of the company. She knows all of our processes better than anyone.

9:40She knows all of the data. She knows that individual loan officer because we give them all an ID. So we're beta testing this now and when loan officer A messages Rose, she knows their disk profile. She knows everything about them, their data, their past closings, and it's all integrated in our CRM so she knows the actions that they're taking as well. So she knows how to coach them individually instead of just this general like here's what you could do to make the video. It's like hey I know that you're a green disc profile so I need to talk to you this way because you're Joe and this is the problem you have because I know what you're doing day in day out.

10:19This is what you need to fix and this is how I need to talk to you about it. So it's much more individualized than it would be if you were to just go to like a chat GPT and try and build a canned robot, you know, or canned AI, I should say. Wow. So you're tying it to the CRM, which then ties to their profile, which ties to their production. Right. And their disk. So it talks to them a certain way. But this is all in beta right now. Correct. So it hasn't been launched yet. No. And who's coding all this? Me, and I've got two developers as well that are helping me with it. Nice. So you know how to code as well?

10:52I do. And the developers are in-house? Yes. Yep. I'm doing the development wrong on my end. Oh, no. I'm outsourcing it. There are pros and cons to outsourcing. I mean, if they do the sprints the right way and that kind of thing, I mean, you can do outsource. It just depends on timeline and what your needs are. Yeah, yeah. We have a different model. You're doing it all centralized. But it's very fascinating how you're doing it. I love that you're on the cusp of all this because you're my buddy and I can always reach out to you. I appreciate it, man. Absolutely. So let's talk about out of all the businesses you could have got into, why did you choose the mortgage space you think?

11:28Yeah, so I mean, I grew up with not a lot of money. And seeing the opportunities that mortgage gave at a very young age and seeing those people, I was like, well, if they can do it, I can definitely do it. So getting into it at a young age, I was kind of thrown into it. And then I was like, well, this is all I know. I don't have a degree, I don't really want to do IT, and I enjoy doing this. So I was like, I'll just do this. I was never, you know, I mean, I closed a lot of loans to me. I was in Scotsmans and whatnot. I did well originating. I wasn't in love with originating, you know, and I told everybody that I've never told anybody like, oh my goodness, I can't wake up and go take another 10.03, can't wait.

12:08So, you know, when I opened Grow, I was like, I'm going to originate and that's what I'll do. And, you know, I'll just do it the way I want to do it and that'll make it easier. And as I did it and built the team, I was like, I really, really enjoy helping these people a whole hell of a lot more than I like doing loans. So now I've kind of pivoted away and I'm like, I can do mortgage and what all the mistakes, the endless amount of mistakes that I've made over the past decade, I can keep them from making it. So for mortgage for me, it's not that I'm like in love with the mortgage industry. I like it.

12:37I like helping the people and that sort of thing. But for me, it's the only thing that I really know. Like I say, I've done it for almost half my life and the mistakes that I've made, I can keep these other people that I see coming into the industry and just helping them. And I get so much more satisfaction from that. And it actually ties into the next question I have. You know, something I really admire about you is just your abundance mentality. And I talked about this a little earlier with you. And your willingness to go completely out of your way and help strangers in the broker community.

13:06And you're one of the only people that really just is always doing that perpetually. What motivates you to do that every single day? Yeah, so I mean it goes back to, I guess, my why, which I think everybody should have defined. For me, it's not let me go make a whole bunch of money. and buy all these cars and stuff. It's like, how can I help these people that not make the mistakes that I've made over 10 years? Like, how can I help them? And that's what I'm trying to do, whether they work for me or not. Like, we just started doing open coaching because, like, I feel like a lot of the coaching, and this isn't a diss on it, but I feel like a lot of the coaching out there is from people that haven't done it, you know, where they did it a long time ago, and it's not the same now.

13:40And not all, but a lot, you know, and I see... You're doing coaching for the whole community? For the whole community, anybody. Real estate agents, anybody in sales, loan officers, competitors in my market. I'm sending an invite to. We do not recruit after. It's just free coaching. And it's exact step-by-step of what I'm doing today that is working. Here you go. Go implement it. Have fun. And that's it. So, I mean, it's, for me, my why is to build the community and help those people not get their car repossessed in a realtor meeting like mine was, you know, like how can I keep them from making, going through the shit that I went through?

14:11And that's what it is, whether they work for me or not. That's what my whole, my whole thing is. How can I help them? Servant leadership. That's what it's about for you. And that's what every great leader that I've seen has really built their foundation on. So I hope you continue to just grow in every single aspect of your business. Appreciate it. Because it's exciting to see, and it's exciting to see your willingness to help your competitors. Because one of the things I do, I bring on all the competitors on the show. I don't look at those competitors. They're colleagues and they're friends. 100%.

14:47It's like, you know, we're here, we're in this together. Yeah, absolutely. There's no competition. Like, it's just you versus you yesterday. That's all it is. That's all it is. So the people, there's this misnomer that people have, like, oh, that's my competitor. I'm not going to tell him my trade secret. I'm not going to give him a leg up on me. I'll give it to him. It's fine. You can call me if you need something. I'll give you everything. So one of the things that a lot of people think we're crazy to do is start our own business. Now, why were you crazy enough to start growing on your own? Go out, get an office, sky rise.

15:32Instead of the comfy LO job that you went all on your own. Yeah. Yeah. Newlywed. Yeah. What made you think you could do that? Well, what inspired you to do that? So, you know, rates started going up. Mortgage industry, people were getting mergers, acquisitions. Everything was falling apart. Inventory was at the lowest it had ever been in 20 years. Rates hit 20-year highs. And I thought to myself, you know what, it's a great time to open a mortgage company. So I did. Which makes it even more crazy. Yeah. So, you know, I opened it up and I'm like, what could go wrong um and it it went great so you know it wasn't easy to build it during all of that but i figured if i can build it during this like imagine what it's going to be later yeah um i'm going to go that direction because everyone else is going that one i'm going to see what's over there right so you know opening it up for me i i was at a great company i was at a fantastic company um and i love the owner i love everybody that was there and i did not feel that I was building anything that was mine.

16:35I, you know, I was running a branch and I just didn't feel like I was building anything for me. I felt like I was building someone else's dream and I didn't like that. So I called him. We're still friends to this day. And I was like, Hey man, like I love it here. I am not as motivated and I'm, I don't have the drive that I had 18 months ago because I'm not building something that's mine. So I'm going to go open my own company. He was just as great about it as you could possibly be. Anything I can help, let me know. We're going to get you transitioned. We opened the company up. For me, it was I need to have just something in here.

17:10There's a lot broken in there. And one of those things is if I don't own it, why am I building it? If it's not mine, why am I building it? I don't want to build someone else's dream unless they work for, you know, I think your dream has to be so big you can fit everyone else's dream inside of it, which is a Lela Hormozy quote, big fan. And that was a big thing for me. but I couldn't build everyone else's dream inside of my dream that was inside of someone else's dream. It just didn't work out. So, you know, I just opened it up so that I could have control over everything, which is a positive and a negative.

17:39And I also wanted to be able to fit everyone's dream inside of not two but one. You got a lot of big dreams, and it's funny how you break it down in this, like, scientific way, you know. Now, one thing I want to ask you, because you have big dreams. and who has been like a role model that's really inspired you to you know think this big um i don't know i think i think a lot of it just goes back to wanting more you know like i said i grew up with not a lot of money uh it was tough time so i was like you know what can i do to not have that happen um and i guess thinking about it now you know growing up my best friend they were well off.

18:24You know, they did well. And I had one house that I lived in that was not great. And then I had one house that was like 12 ,000 square feet that I would visit him for a week at a time. And it was just that stark difference of like, this is possible. I could do this. I'm going to try and get something like that. And I guess thinking about it now, that's probably what initially sparked it. So I think a lot of people, if they're in a hard time, they feel it's out of reach to grab something better for themselves. And seeing that someone had created that for me at a young age 10 years old 12 years old you know I was like oh well that is possible and I don't have to have this feeling in here so I think that probably is a part of the drive of it and then once I got to where I wanted to be I was like well how can I get other people to have that and get them up so I think that's probably what it is as far as people that I follow Sharon who's been on here love Sharon follow everything he does Alex and Lela Ormosi if anyone knows anything about me They know I'm their number one fan.

19:21Love those guys. So those three helped me think a lot bigger than I ever thought. I guess just through their content and that kind of thing of like they've built all this stuff and here's how they did it. Giving away the how and then selling the implementation. So, you know, that's kind of, I guess, watching them takes that to even another level. And actually their stories are all very similar. And mine as well. It's that they all grew up dirt poor. Yeah. It's a superpower. It really is and I don't know if you have kids yet and I bring this up on my podcast frequently Do you have kids yet? I have one coming on the 28th.

19:54Okay, so Congratulations, thank you. Congratulations One thing that you're gonna you're gonna always be thinking about because I think about this frequently I ask people on the show a lot is how do we instill That same grip mentality because I grew up in a third world country. I had the same situation. I had a friend who was very wealthy and I was poor and he was giving me his shoes. And he was, you know, I got his hand-me-downs and I'm like, you know, I'll take your hand-me-downs but like, this kind of sucks. How do I get them first? I don't know. I want them first. Like I'm always getting your dirty shoes, which I'll gladly take your old Jordans.

20:36Now I'm always wearing Jordans. I'm a 42 year old man wearing Jordans. I got you, Zan. I don't know. Like just because I can buy them myself. Right, right. You know, I buy them for my kids too. But because they, like, because, you know, he always bombed for his kids, you know, the dad. So I grew up in that same mindset. And then I always, you know, one of the things that really invoked me was I can achieve this myself. But instilling that same grit that got us to where we're at in our kids is something I always think about. And, you know, maintaining that same work ethic that we have. Yeah. Because it's not normal.

21:11What you do is not normal. You outgrind everybody. You have something in your heart that just sets you on fire. Your why is like every day you wake up and hit the ground running. And you're young, so you have this massive ambition. But instilling that in future generations is something that is going to be top of mind for you. 100%. Especially once the baby gets here. you're going to be like, dude, this baby needs to be much better than me. Oh, yeah. She's going to be a monster. Watch out. So, you know, for me, I do jujitsu. I really enjoy jujitsu, and it's been a great outlet for this industry.

21:56Give me the chess. Yeah, exactly. And I'm going to put her in that the minute they tell me I can. Who's two? Is it two? I'm going to try and get her in there at one and a half, get an edge. Her name's Athena, so she'll rock it. But I think you have to make them do hard things. I mean, I don't know anything about this, but for me, that's what it was. You just got to put them through hard shit and make them get through it. So I'm going to make it very difficult for her for a while. And then I'm going to make sure that, you know, when I unleash her to the world, that she has done hard things. So because I think a lot of people, especially if they grow up with money and that kind of thing, they get unleashed to the world and they're like, oh, this sucks.

22:36I've never had to deal with anything this hard. She's going to deal with a lot of hard stuff. And then, but it's going to make her stronger. It's going to make her better. And then when I unleash her out, hopefully the plan is that she'll have dealt with something difficult by then. That's my plan anyway. Yeah, yeah. I always try to instill, you know, the kids doing hard things, especially in the morning. Yeah. You know, now I have four kids, you know, so it's like, guys, you got to swallow the toad first day in the morning. Yep. Every morning. Yep. Swallow the toad first and get your vitamins down, get your workout in.

23:08Yep. Go run, get dressed, laundry list, tons of chores before you even hit the ground running. 100%. Yep. And then my kids are just as regimented as I am. They grind all day. Then they go to activities. And they go to like, I make them do even more studies and then more school. It's like boom, boom, boom. We get home at the same time. Yeah. There you go. There you go. All of them. Yeah. From the two-year-old to the 10-year-old. But it's always like finding those additional challenges. Like jujitsu is a great outlet, and I need to put them back in jujitsu because it is just that human chess element.

23:45But then when you stack jujitsu and baseball and basketball, it's a lot. Absolutely. And then school and then tutoring. Right. It's quite a bit. One thing I found, too, that's really instrumental in our family is like we're very faithful. church Sunday school you know very regimented like faithful community yeah you know it's part of our heritage as being Coptic is like living a faithful life sure so it's definitely something you want to like raise your children in the right path yeah absolutely what do you think has been like the your your reason to have such strong work ethic? I think I'm just dumb.

24:30Like I grab my phone the moment I wake up. That is immediately as soon as I wake up, I work. There's no like, oh, I'm going to lay. Like I immediately grab my phone and work and it does not get put down until I am going to sleep and that's it. And it's that way seven days a week. It's been that for 10 years. I don't know why I'm that way, I think I just believe in what I'm doing. You know, I believe in the mission and what I'm trying to reach and I know what it's going to take to get it there. And I know that I make a ton of mistakes, just a ton of mistakes. So I know that I need to work twice as hard as maybe the next person would in order to hit that goal, because I know I'm going to make twice as many mistakes as they're going to make.

25:13So for me, it's more along the lines of, I don't want to do it, but I have to do it. You know, it's, it's one of those things where like, if I'm going to hit the goal I want to hit, which is a lofty goal for anybody, and I'm not as smart as the next guy, I'm going to have to work twice as hard. I got to get in there earlier. I got to leave later. Like I got to be in here till two o 'clock in the morning, then back at 7 a.m. the next morning to hit it out because I have to catch up. So that's kind of been my thing of like, if I, even though I'm not smarter than them, I can outwork them. So it's not that I want to do it every day.