Lending Strategies with Ease ft. Dawar Alimi | Coffeez for Closers with Joe Shalaby Ep. 43

0:28What's up, everybody? impressively increasing sales revenue in the last 12 months despite industry downturns. This success caught the private equity sector's eye, enabling further innovation. Lender Price now leads in the mortgage space, serving 22 of the top 30 wholesale lenders and managing about $30 billion in loans through its platform. Join us as we delve into DeWars' journey and the innovative strides LenderPrice is making in the mortgage space. Welcome, Dawar Alimi. Thank you, Dawar, for coming in today. Thank you for having me. Man, I'm so stoked. I've been trying to get you on this show for probably over a month and a half now.

1:09So I'm pumped that you're here. And more importantly, I'm really excited about all the massive strides that LenderPrice has made in the last year. You're just notifying me now, and I'm very proud of you for this. ReadyPrice is out of business. Like they were trying to gain market share. Like you put them out of the, out of the game. Well, I don't, uh, yeah, I mean, it's, uh, it's good for us. I don't like any vendor to go out, you know, uh, go out of business. Um, but you know, um, what I tell everyone at our company is, um, rather than focusing on, uh, competitors, just focus on what you do best and what we do best.

1:46Um, because the only thing that we can control is what we do, not what others do. I love it. I love it. Now, the way I like to start the podcast is like, you know, I like to humanize you a little bit because everybody's like, oh, who's this big CEO that they're bringing in here? And, you know, so we're going to dive right into it. So when you wake up every morning, like what's your morning routine consist of? Yeah. So it's interesting. So I actually wake up at four o 'clock. So my internal clock is 4 a.m. I love it. Mine too. And then immediately go out. I've got a very cheap coffee machine that just makes coffee.

2:20Not a jar. Or is it like a Keurig or just a regular old school coffee machine? A regular coffee maker. And I put the McDonald's coffee, right? Because before that, I used to go to McDonald's every day or let's say even Starbucks. And then I looked at my bill. I was like, oh, my God, I'm spending a lot of money. And then I looked at Amazon. I was like, hey, I could get the McDonald's coffee at my house. That's perfect. So that's what I do is I have my McDonald's coffee. I get on my computer, look at emails. And sometimes, you know, we use Gmail. I actually send out emails the night before and I actually schedule it.

2:57But real quick, all I do is just look at emails and then I go work out. I do HIIT training. That's my thing. I'm not a gym guy, so... What time do you do your HIIT training? Usually around 6 o 'clock, 6 a.m. I went today. Which one do you go to? F45. Nice. Nike just opened their vertical of that. I think they're going to take all the market share, just like lender prices doing to everybody else. Nike's going to put out F45. They just launched it. I'm at their pilot gym. They opened it in Santa Monica, Newport, Miami. So who's F45's spokesman? Mark Wahlberg. So Mark Wahlberg must be pissed, right?

3:35Yeah. He's going to be pissed. But I mean, for a while, I weighed close to 200 pounds. Today, I'm at 159. and I contribute that to obviously just eating right and intermittent fasting, obviously, right? We talked about that, so fasting and just exercising. For me, it's a way for me to have the energy that I need in the morning to get to work. It gets me through the day, but it also allows me to focus better. As a kid and my son, my son has ADD and I had ADD. so i have ad2 you know and then uh it kind of gets me to like focus better when i get to work yeah yeah i mean that's something it puts me in the zone too i i i have to do it i do it seven days a week right now it's like it's like an addiction you okay uh what the hit training or yeah hit training yeah i mean i don't uh i started off before um doing a lot more but i i've i've pared it down to like literally four or five days.

4:40And I really liked doing the weight training part only because I'm going to be 50 years old this year. Nice. You look great. 50 years old. What are we doing? You know, you know, and I think the reason why I did it is because when my kids were younger, they wanted to, you know, they started playing sports and I just couldn't keep up with them. And I said, I've got to do something about this. Plus I've got, you know, you know, history of, uh, of heart problems. My mother just had a triple bypass surgery and I was like, how can I reverse all this stuff? And I, and you know, at the end of the day, it's just doing what you're supposed to be doing, which is eating right and exercising and just try to get your body to a point where it's healthy.

5:23I love it. I love it. So that's, you know, I, I noticed that trend in, in, in leaders is they always got to take care of the, the human temple, right? That's it's. Yeah. I mean, it's like, if you're not healthy, you don't have the energy and you don't have the mental capacity to actually make tough decisions. Yeah, love it. Great advice. So I'm going to dive into how you got started in the mortgage space, and then we'll talk about how you got started in the fintech mortgage space. Okay. Okay, so when did you start in the mortgage space? And we could dive into our little history too. I've got an undergrad and graduated degree in computer science, but as an undergrad, I went to Cal State San Marcos.

6:01and when I graduated from Cal State with an undergrad degree on the day of graduation, so I was student body president. On the day of graduation, my parents were there and I was in the science section. And being Middle Eastern, right? There's two things that your parents want you. Yeah, that's it. Either a doctor or an engineer. Those are the two things. That's it, nice thing. We don't have a choice. Yeah, so then that day, I said, And so my mother's like, my aunts are there like, oh, my son, he's going to be a doctor and this and this and that. And with her accent, I was like, well, mom, it's computers.

6:43And she said, what? What is a computer? What did you do? I wasted my time. I came to this country and I did all this for you. And you just threw your life away, right? Now she's proud, by the way. But that's how I started. And then I ended up moving back with a bunch of guys in Pasadena. We rented a place and they were all in the mortgage industry. And I thought that back then I was an engineer working at GTE. Now it's called Verizon. So that kind of dates me back, right? And I started, you know, all my roommates were in the mortgage industry and they started bringing all these big checks, right?

7:23And then they're like, hey, look what I got and this and that. And then I just had, you know, a job. I had, you know, everything was fine. I had health care, the traditional things to do, right? And then so, you know, then I remember my friend Mike and my friend Omar and Danny, and they were looking at things, you know, I was looking at their paychecks. And I was like, that's not what you're making. That's someone's like, you know, down payment and this and that. And like, no, this is what I'm making. And because I've always had an entrepreneur spirit and heart, I decided to leave my nine to five job, just getting a salary and ended up working for a broker and doing it stuff.

8:05And I did that for a while. And then, um, then I learned the business and then again, Middle Eastern opening up, you know, your own business. And I ended up a brokerage, uh, first and then grew that into a wholesale mortgage company. Then I got opened up an escrow. What was the mortgage company that you started? Cornerstone lending. Cornerstone. Just a quick side note, guys, if you don't know, I think it was my first mortgage company job. I was just a runt in his office working at one of his branches. He didn't even know me. Well, last time, we had a mutual friend called Emil, right? He goes, hey, so Emil's doing fantastic.

8:41He's got this company called EMC. I'm like, really? I was like, who's Emil? He goes, dude, you remember Sleepy Joe?

8:49You're not sleepy. Yeah, no. You've got more energy than anyone here. I didn't even know how I got that name. That's crazy.

9:00That's so funny. Uh, so, so out of all, so that's how you entered the business out of the mortgage business. And when did you, when did you enter the FinTech business? So you started your own mortgage company and then when did you transition to starting a FinTech company? So I, so after I, you know, in 2008 to, you know, right before the mortgage debacle, you know, I had a wholesale mortgage company servicing brokers and, And just like with everyone that crashed at that time, I crashed with them, right? Because credit market froze. You couldn't do anything. Your warehouse lenders didn't. You lost all warehouse capacity.

9:36You couldn't lend, right? Yeah. So then I couldn't really push the wholesale mortgage company. And because I had an engineering background, my wife worked at Bank of America. and Bank of America at the time was having problems with short sales and loan modifications. The banks at the time didn't have a way to actually handle loan modifications and short sales and they didn't have an application. CoreLogic had something and then at Bank of America they were running everything through these things called stored procedures, SQL stored procedures. So I got brought in as a consultant. So my wife was at dinner with a team of executives there and they said that we have a problem.

10:19And then my wife's like, hey, my husband is an engineer and he knows mortgages, so maybe he might be able to help. Sure enough, I worked for them as a consultant, ended up running one of their groups that handled loan modifications and short sales, did that for a while. The entrepreneur in me came back and I said, I can't do this. And then sure enough, we were actually dealing with a lot of the treasury supplemental directives that the bank was dealing with it and getting fined. Thousands of loan modifications was down to a lot lesser number, and I felt like the problem was fixed. And then I got recruited with a company called CCG.

11:06It's a tax credit company. It was one of the tax credit companies at the time, and I became CTO at that company. and there was their, you know, I got introduced to, so they had two different, they had a payroll app that competed against Paychex and ADP and they also had a tax credit side. And again, on the tax credit side, what really attracted me to that business was, you know, the CEO said, this is how we deal with tax credits. So they have these enterprise zone tax credits and what we do is we go with all the Fortune 100 companies and we say, look, if we can save you X amount of money in tax credits, so basically you get a tax credit if you hire a former felon.

11:51You get a tax credit if you hire someone over the age of, I believe, 50. So the state of California, just like any other states, they have these tax credits and they would give you incentives. So all they would do is just itemize that. They had an electronic signature way of actually doing it because our software was connected inside, what was it called? It wasn't ADP. It was Taleo, right? And so anytime someone would, let's say Foster Farms would hire people, it would tally up all the tax credit, and then you would go back to a company, let's say EMC, and you go, hey, you've got$150 ,000 in tax credit.

12:41that you can use to reduce your corporate taxes. But if you use it, you have to give us 30 % of whatever you used. It sounds like an ERC business now. They brought the business back like that, ERC credit. Oh, they did? Okay. So I did that for a while, and then I met my partner, Lee Koo, there. And the other thing that attracted me is the architecture and how well the code was written. and Lee Koo was the chief engineer there and met with him. Interesting part with that is that I combined both technology groups into one and I let go a bunch of Lee Koo's family members that were working there. But we're still partners today, so he's our CTO.

13:26So he forgave me. And then we started LenderPrice. That's awesome. So you started LenderPrice. What year was that? 2015, 2016. Really, we incorporated in 2015. We really started in 2016. Yeah, right around when we started incorporating eMortgage Capital. And then you didn't gain, like when did you attract the eye of like Kevin Costner and Glenn Stearns? Like how did you get such big names to invest in your company? Yeah. So, you know, actually I created an LOS back in 2002 and failed at that. And then how does Kevin Costner even know about the mortgage industry? Well, so he didn't at the time, but the way that I got introduced to him was that when I quit CCG, Liku quit at the same time.

14:15I was like, what are you doing, right? And he goes, we're going to start this together. And we also started with a good friend, German Centeno. And he started, but then he left and he came back. And when we started it, we just started writing the code because I actually got a pass from my wife. So I said, Laura, I was like, I'm going to do something that I have a passion for. I want to build software. That's what I went to school for. And this is what I love. And she said, OK. And raising two kids, she's salaried. And I had no income. It was tough. And we started building the software. And as we're building the software, we knew that we had something.

14:52And then we got introduced to Rod Lake, who's Kevin Costner's partner. He came in. And he said, hey, I love this solution. he goes I want to invest and Kevin and Rod just wrote checks because that's what Hollywood people do and then so then I go what do I do and I contacted a the top real estate the top startup attorney in Pasadena Albert Lee and he said you can't accept these checks there's a process that's the way it's done in Hollywood you can't do this so then I was like okay and then my brother-in-law started a company called Quantifind. They compete against Palantir today. They got investments from Andreessen and Redpoint.

15:35And he said, let me connect you with VCs. And then we got connected to various VCs. We got other term sheets there. And then we ultimately went with Rod and Kevin as our first angel investors. Then Kevin said, hey, I've got this guy that I, that, that he had, that he went on a hunting, a hunting trip with. He goes, uh, he's this guy, Glenn Stearns, and he owns a mortgage company. And, and, and I don't know if you know him, but you know, he, you know, he might be a good, another person that we may want to get invested in. So Kevin Costner introduced you to Glenn Stearns? Kevin Costner introduced me to Kevin Stearns.

16:11Isn't that so funny? It's like, he's not even in the mortgage industry and he introduces you to Glenn, but Glenn goes dove hunting in like Europe all the time. And he always goes with like different mega celebrities. We both love hunting. Yeah. And then, so then we had a meeting at the Sunset Marquee and then Glenn was there and Glenn was like, you know, we were pitching him the software and he goes, I love this. And then he shortly, he invested after that. His wife's coming on the show next week and then he's coming on the show in a couple of weeks. So, so I think that in this situation, cause we got lucky because I don't think that we're in the right time from a timing perspective it was great right um but um just like you know business there's there's there's the vision and the passion of you actually doing something that you love and then there's the uh there's there's the lock right of who you meet that was pretty lucky yeah and everything just kind of the stars aligned for you to really kick lender price off yeah so yeah and then and then you started really like gain attract the big name mortgage companies like i was introduced to you a couple years ago maybe you know the nexa guys and all the big mortgage companies and you still don't know all of them i still got to introduce you a few of them yeah you do yeah and i got you just for coming on the show okay um but uh but now you're really like gaining steam and now with ready price out of the space we're working on loan sifter next yeah exactly yeah yeah well i've been gunning for them for a while so yeah yeah um we we got uh you know the the software really improved and enhanced uh it's uh ui so that's going to be a big help and then uh obviously you know how'd you get the the agreement with uwm i mean i i could have really helped you with that.

18:00Well, I mean, UWM has been, they've been in our solution. We're hoping to work out something with them soon. So I think by the time this airs, hopefully that that comes into fruition.

18:16But I think for us on the wholesale space, it was mainly working with the wholesale lenders and offering them a option outside of Loan Sifter. Because Loan Sifter is very, very expensive for the wholesale lenders. Very expensive. So we come at a fraction of the cost. And then for us, it was like increasing the user base. That was really important. So we increased the user base and gaining trust. And still till today, we have still brokers, as you know, users that use Loan Sifter and users that use our solution. And we're always trying to find innovative ways to try to get some of those loan sifters away.

18:57And some of them, you can't because it's just muscle memory. They love their UI, yeah. And we've come out with 2.1 to tackle that. But it's constantly like - Your new UI is superior to their existing UI. Yeah, our UI is. And then I think that what's important is listening, especially in software. And I think in any business, you've got to listen to your customers. Constantly be listening. I think that's a superpower that you have, you know, because you're in the weeds with us, you know, like I tell you, Duar, I just walked you up to my recruiter, like, what don't you like about, you know, like, I just like, that's, that's the kind of partner we need.

19:37Yeah. You know, someone who's in the weeds, like helping us get better, innovating with us. Like, and I tell my people all the time, like, I'm not going to work with a CEO that doesn't play ball. Well, also, cause you don't know what you don't know. Right. It's like, you know, you know, especially in software, like you think that you're building something right. And then you find out that what you build is not what people like. There's a great book in software. It says, Don't Make Me Think. The best software are the ones that you don't have to use a lot, that you could go in and out. So we're constantly obsessed about how can we make things easier?

20:12How can we make things more efficient? Because if we can make things more easier and efficient, it'll drive ROI for you. Yeah, I love that. And I love that you think like that because the experience that people have with Loan Sifter is nothing close to that. And Loan Sifter is not always innovating. They're not coming up with creative solutions with the brokers. There is no tech team or support team or any team that really help us get better or improve the way we're quoting. I love it with you. I'm like, Dior, let's build this API. Let's figure this. Let's tag it to this. Here you go. Yeah. well, you'll make it happen.

20:52So that's the kind of mindset that we need to grow. You know, the problem with the mortgage industry that we see as a whole, like whether it was Calix Point, whether it's Loan Sifter, whether it's Optimal Blue or Encompass or these big companies that don't, they're maintaining the status quo with their technology. And we do that not just for the brokers too, but we also do that for the lenders. So as you know, like the space right now um you know yeah you know conventional financing is tough you know you got a lot of people that have refinanced and during the sugar high i call it the sugar high in 2020 you know like that time where you could find anyone to refinance now you're looking for innovative products and a good example of that is our our our relationship with deep haven because when we got into uh when we started dealing with deep haven deep haven is a pricing engine client They're an enterprise client.

21:48They helped us understand how to build user interfaces and functionality that's needed for the non-QM space. So we do that as well, is that we partner. It's a true partnership. Because the hardest thing, I think, in the non-QM space is educating loan officers on how to sell, right? How to sell non-QM loans. Yeah. And it's also listening to our enterprise clients and listening to them and them telling us, this is how the UI should work. This is how the user experience should be. And hopefully that trickles down to other loan officers using it. So that just brings me to this question. You're working with the investors, these non-QM investors, and figuring out how to really optimize the pricing solution for non-QM lenders?

22:41Absolutely. So we came up with a thing called a configurable UI, right? Because non-QM, it's different in the sense that if you look at legacy pricing engines, the UI was very – you couldn't make any changes, right? Yeah. So we came up with a configurable UI where – think of it like your – like what are some of those websites that you could just drag and drop and – Jop form or something like that. Yeah, exactly. So that's our UI. So you can actually just create your own UI for non-QM. Or can you do it for hard money too? The hard money has nothing. You can do it for anything. It's flexible. You've got to help these hard money guys out.

23:18They're just stuck. I've got to introduce you to Valkyrie. It's a great bank, but they're just archaic. So, yeah. Well, that's the whole thing. So when we first architected our application, it's not just for mortgages. It's for all consumer lending products. So it's everything from, you know, I mean, we've got a fantastic home equity UI. You know, there's, you got to dominate. There's no, there's no market in the auto. We want to get into, I love it. Yeah. Yeah. And like, especially our banking clients, you know, like, you know, this is. Matter of fact, I'm just going to invest. Just give me a partnership interest and I'm just going to go balls to the wall and make all the intro.

23:56So, you know what we're doing? And I think this will be out by the time you guys, you know, have this live is, you know, we've had a great relationship with Chase, Chase Retail. So Chase Correspondent Lending is now our client. So we've expanded that relationship to Chase Correspondent. So the portal that everyone uses today, that if you're not going to sell loans to the agencies, Fannie, Freddie, Ginny, and if you're going to sell to Chase, you've got to use that portal. That portal is our portal, and that's going to be released at the end of the year. That's amazing. That's amazing. So let me ask you this.

24:34You know, you've been an entrepreneur, you've had several journeys in the, in your entrepreneur, you know, lifeline. What do you think has been like your biggest inspiration to start your entrepreneur journey? I mean, the inspiration is mainly just to be able to build a product that people can use. Because I could tell you this, like earlier on when we're developing and coding the application, John, who's my brother-in-law came to the, you know, came to our office And I was like, John, I go, you know, Quantifying is doing so well and you got so much money invested. And, you know, I can't wait till the company gets to that point.

25:09And he goes, Dwar, he goes, what you're doing right now where you have no money and then you're buying like you're paying$1.50 for a hot dog at lunch. Still, they haven't changed the price. Costco is still$1.50. Still one of the best deals. It is the best deal in America. In America, though, yeah. But that would be a lunch. And then he goes, this is the time that you're going to remember and you're going to cherish the most is when you don't have clients, you don't have anything else, and you're doing what you love, which is building software. You know, I would also, I'm going to tell you, because I saw this the other day, like, keep that immigrant or that.

25:46I don't know if you're an immigrant. I'm an immigrant. I came as a refugee. Yeah, yeah. Me too. So I came at five. And I've always maintained that immigrant poverty mentality. And people have always made fun of me. I saw something that really was cool to see. It was LeBron James is actually the cheapest person in the NBA. And in this video, they have like LeBron James. He packs his own lunch. He packs his own snacks. He doesn't pay for anything. He makes people, when he goes to dinner with the other guys, they all buy him lunch. And I'm like, that's why he's the richest guy in the NBA. You know, it's like he's maintained that he packs his own snacks.

26:25He doesn't buy snacks at the game. Like, it's unreal, you know? It would also be that his, you know, his snacks are probably healthy. Yeah, yeah, that's right. He's probably packing, like, you know, pistachios. I think that, you know, like you said, you know, you're an immigrant and I came here as a refugee. And I think that when you come here, you don't have the network. Yeah. So, like, you know, when my parents came here, they had nothing. You know, my father was a Maytag repairman. My mother was a hairdresser. And then so then my mother ended up opening up her own shop because, you know, that's what immigrants do.

26:53Like, you can't find jobs. So it's like you got to open up your own business. Yeah. And then hustle in your community. So then that's what you do. Yeah. And it's just instilled in us. Yeah. It's instilled in us. So you've seen a lot of success, a lot of challenges. What do you foresee in the fintech space in the future with the advent of AI? And I just told you about all the different AI platforms we're using. What do you foresee? How is this going to impact the enterprise? Number one, you know, so I've got a graduate degree in computer science, but the emphasis is in AI machine learning, right?