Mortgage Mastery ft. Jeff Leinan | Coffeez for Closers with Joe Shalaby Ep. 47

0:28What's up, everybody? employer for seasoned sales professionals known for stability and opportunity. Get ready for invaluable insights on mortgage banking and growth strategies from an industry leader. Please welcome co-president of Plaza Home Mortgage, Jeff Linen. Joe, thanks for having me. Appreciate it. Thank you, Jeff. Thanks for coming to the show. We appreciate you. We appreciate you for flying down here from Jacksonville, Florida. And, you know, this is going to be a great opportunity for both of us. Jeff, we like to start the show the way we start the show every single time, which is we like to ask our guests, what is your morning routine?

1:10What is my morning routine? Well, obviously, get up, and usually it's really coffee. Coffee quickly, right? Get that going, walk the dog, and then get going with the day, right? And see what can do and figure out. I really try to prioritize at least two or three things that I want to get done every day. Because I think most of us in life, we let life get in the way. So things happen. So if you don't have a plan, things will fill that time and you'll feel like, oh, I'm busy, but am I really doing the things I need to do? So I really try to set each day and say, hey, listen, these are the, you know, it could be one thing, could be two things, could be three things.

1:49I'm like, no matter what I have to get make progress on these things this is forward progress for me so those are really important for me and then you know you and then because things happen right you fill in the time with yeah you know phone calls and complaints and whatever else so for me that's super critical and then because you know I one of my sayings is day turns into a week turns into a month and if you're not progressing the things you've got to get done then you'll look back you'll say where did the time go so super important that I keep those on my on my to-do list every day A couple of top priorities, just bang them out.

2:20Yep. Nice. Now, you've been in the business for three decades. Yes. Okay. So you started what? In your teens, huh? 12. Yeah. Yeah. I've been around for a while. Yep. What got you started in the mortgage industry? You know, I think like a lot of people in the mortgage industry, it's a very financially rewarding industry or can be. Yeah. And I think, you know, we talk about this all the time. I don't think anybody goes to college or says, hey, I want to be in the mortgage industry. You know, they don't just go seek it out. They all fall into it somehow. So for me, it's an interesting story. I went to college.

2:52I was studying finance. I had a marketing degree as well, trying to figure out what I wanted to do. And I was living in Seattle. I was born and raised in Seattle. And I showed up at this place, and this guy who graduated a year from me, he was driving a brand new RX-7. Well, back in the day, that was a great car. It was a really expensive sports car. So I walk up to him. I'm like, wow, that's a really nice car. What are you doing? He goes, oh, I'm a loan officer. I'm like, a loan officer? What's that? And he goes, he's working at a bank. He tells me all about it. Next thing you know, I'm talking to people and, you know, 18 months later, 12 months later, I'm a loan officer.

3:26So I was driven financially into the industry. And then I started working on it. I'm like, you know, this is a great job. It's a great combination of sales, marketing, and finance. So you're out, you're speaking to people, you're selling, you're marketing your products. But at the same time, you also are solving some fairly complex financial problems sometimes too. So I think for me, the combination of the two and then the financial incentive, the ability to set your own paycheck really at the end of the day was super, super exciting for me. So you didn't pick the mortgage industry. You kind of just picked you.

4:01It picked me. Yeah. I knew what I wanted to do and it checked all the boxes. You know, having a background in finance and marketing, that is like the perfect combination to enter the mortgage sector. especially more importantly, like those two, that combination now more than ever is just, that's what you need to succeed in the mortgage industry. Yeah. It's the problems are complex that we face every day in the industry, the things we see, and they're actually getting more complex. Uh, but the same token, you don't have any problems to solve if you have any business. So you have to try to find the blend of the two.

4:34Agreed. Now, what year did you start at Plaza? So I've been in Plaza. Uh, I started in 2008, a really great time in our industry. How big was Plaza at the time when you started? I don't remember exactly the size of our headcount at the time. We were, I think at the time, just outside of the top 10 from a wholesale perspective. We've been around for 24 years, which is really a testament to our company and leadership and our founders because that doesn't happen a lot in our industry. Yeah. and what so you started how many years ago you said at plaza uh 2008 2008 so about uh wow 16 i know worst time ever to start yeah it was an interesting time period it was i actually started in october which is for those of us remember the the financial crisis that was right after the money market started freezing up and it was really the worst of the worst and uh october 2008 was the worst time it was the absolute worst so we i started right after that and i began and then about two weeks later, they started the interest rate cuts.

5:38And then it was, you know, it was sort of off to the races from there. Nice. Now, you chose Plaza Home Mortgage, or do they recruit you? Or how did you get started with them? So interesting story. Most of my career has been spent with big banks. I was at, you know, Chief of Mortgage Chase. I was at Washington Mutual. And obviously, Washington Mutual closed during the financial crisis. So I was looking at the industry and I'm like, you know, the banks are not going to want to be in this space. Yeah. For a lot of reasons. We knew that they weren't going to exit. So we knew he had to be, I had to work for an independent mortgage banker.

6:11So I wanted to work with somebody that had a good technology and the right opportunities. And so I, uh, Kevin Parra, who's one of our founders, I've known him for a long, long time. So I'd reached out and asked him what opportunities exist and came aboard and it really worked out well. It's been a great, great opportunity, great run. Now you're currently the co-president of Plaza Mortgage. What would you attribute that level of success? How did you achieve that level of success at Plaza Mortgage? I think it's really grinding, to be honest with you. I mean, it's a tough industry. It's feast or famine, as you know.

6:49There's times when it's just loans literally seem like they're falling out of trees. And then we have a different set of problems then. How do we get loans through the system? How do we get into the table? People are upset. It's taking too long. And those are, you know, relatively good problems. Yeah. But those markets come few and far between. And then we have other markets where it's, you know, I need to go find business. I need to stimulate and create opportunities. And that's been the case lately. 100 % has been the case lately. And I think similar, we also saw a lot of people come into the business or do a lot of things in 2000, 2021 was busy.

7:30And so we've seen a lot of people exit, but we need to continue to probably see the industry right size a little more, which is what's one of the interesting things about our industry. I think the peaks and valleys are really extreme. So it causes people to come in and people to leave. but I think it's really important that we figure out how we source business and grow and I think that's really been one of the keys to success. Now, where do you think you've developed that sense of such strong work ethic? You know, I think it starts with your parents, right? It starts growing up and it starts, you know, every generation wants to do better than the last generation.

8:11You know, my parents worked really hard. my wife is actually from Cuba and uh really I'll tell you a quick story about them it's super interesting so my wife came over in 1962 and her father at the time he owned a furniture company and so he was making furniture by hand and wood and he came over um because you know he wanted to leave the the regime so he came over with 50 in his pocket left his home left everything came over $50 in his pocket, two kids, and didn't have anything. First thing he did when he got to the country was he went and bought wood because he knew how to make things, and he built a hot dog cart.

8:47He started selling hot dogs. He then bought a Mr. Softie truck and then bought another one, and he continued to go. Then he found his way into the construction business and started developing homes. He's 89 now, but when he retired about five or six years ago, he was building 80 to 100 homes a year. Wow. Yeah. So, I mean, this is really... He worked till he was 85. He worked till he was 85 and he still works. I mean, he's got a real estate portfolio, but he's not day to day. But, you know, this country has a lot of opportunity. And I think if you work hard and you see it, you know, you can do a lot.

9:25You can accomplish a lot. Yeah, absolutely. Something I noticed as a common trait with the entrepreneurs that I have on this show is that, you know, they just outgrind everybody and everyone has different inspiration like i'm an immigrant you know so i have a what i call like an immigrant mindset or immigrant immigrant work ethic and my father who's still he's 73 now still works every single day you know he has a physician like he's just like something in that mindset of immigrants you know your your husband your i'm sorry your wife's uh father who's uh you know worked basically still till this day 90 years old almost still grinding every day it's just, you know, that sort of mindset is something that's very, very hard to instill in our children.

10:08How do you think you're instilling that grit mindset now into your children? That is a super good question and a really hard one. So I have one son. He's 22 years old. He just graduated college and then started his first job on Monday, actually. He's working for a consulting company in Virginia. And, you know, I don't know if you can instill it. You can try, but I think some of it's innate. And I think he's watched my wife's family, and he's watched me over the years, and especially in the mortgage industry where we mentioned it's feast or famine. So when times are good, it's great. But when times are bad, you're double grinding.

10:49They're not going to the Ritz this time. They're going to eat hot ramen. Exactly. Why did we go to the Ritz last year? And this year, we're at Motel 6 down the street here, right? so uh yeah it's i think you do your best i think you set goals for the kids i uh i actually rewarded my son for grades and i rewarded him all along the way for accomplishing things so i wanted to show him that there was efforts for uh you know for working hard and i think that's about all you can do now 2008 i want to talk about some of the challenges you faced at plaza in like 08 2009 2010 and then and then are they correlated or do you think they're similar to the challenges we're facing this time?

11:31I think it's a little different. I think 2008, 9, and 10, you know, the mortgage broker industry as a general was kind of under fire. Obviously, compliance was a really big deal. Underwriting was really tough, as you probably remember. And it was a different environment. There wasn't, wholesalers had really sort of dramatically reduced, or they were on their way, they were exiting, so there was less competition. I think today's challenge is a little different. I think today's challenge, people need to realize that a couple things. One, the world's changed. You can't walk into an office and find six or seven people anymore.

12:09You have to go find the people. Yeah, unless you come here and then you walk into a campede of humans. But there's a lot of people that just aren't going, right? It's remote, and you've got to meet them at Starbucks. You got to find whatever. I mean, we have in our company, we have our own set of unique opportunities with remote environment. You know, people are like, hey, you know what? I want to I miss going to the barbecue. I miss having this. I miss having that. But in the same token, I'm never coming back to the office. Right. Or I don't want to come back to the office. So that creates a different environment.

12:43But I think overall, the mortgage industry is is continuing to evolve and change. So as different as it gets, it also stays the same. And what I mean by that is people still need to solve problems and they still want connections and relationships. It's just how you go about establishing the relationships has changed. Right. Social media is a part of it. Where am I seeing you? You know, how when can we connect? How can we connect the phone? It's just life's changed. And I think for most people, they have to evolve and and see that I still need to connect with people. I just I'm going to do it a little differently now.

13:16So I think that that's really important. And then just the mortgage industry as a general, you've got obviously a really big, strong purchase market. You've got people who have challenges and they don't have the down payment or they've got credit concerns or whatever. So it's really about product, I think, and finding things that allow people to get into homes. I love it. Now, you've seen a lot of success. Obviously, you're the co-president of Plaza Home Mortgage, one of the largest mortgage companies in the country. What do you foresee in the future for the mortgage industry? You know, it's interesting.

13:49I think not a lot of tremendous changes. I think probably a little bit more consolidation still. We're still coming off of the 2020 highs, I think. So we'll probably continue to see a little more of that. I think that technology will continue to play a big role. We'll continue to source borrowers from different ways than we have in the past. And I think that that really is kind of the key. It's kind of what I mentioned earlier. As different as it is, it still stays the same. It's just we're going to go about things differently. So I think technology will continue to play a big role. But borrowers still want to connect with people.

14:28They want that trust factor. You know, NAR, National Association of Realtors, has great data. And one of the things that they showed recently was that aside from friends and family and other transactions, the majority, and I can't remember the exact number, but it was really high. It was like 92 % when 6 % were family relatives still want to use a realtor. even though they could probably not they could go online and find what they want but they want that that knowledge and they want that feeling of security they want that person to help them through the process they want that coaching yeah and they're willing to pay for it right they need that and want that i mean putting that all back on the homeowner is a lot and that's just additional stress because the home buying process is very stressful to begin with yes 100 they need that expertise so not having like you know we all don't need a personal trainer but if you have a personal trainer like it's much better than working out on your own 100 yeah like someone correcting your format like because you know you deadlift wrong you're breaking your back you're tweaking your back you're out for two months you know not able to work out so there's a lot of value to having someone coach you through the process and making sure that your form is correct the entire time Yeah, no, 100%.

15:49And I think that people need that. Need it and want it. Yeah, absolutely. Now, do you think there's a specific skill or a mindset that someone entering the mortgage industry must have to succeed in this environment? I think it depends on what role you're looking to fulfill. But if you're looking to be consumer-facing, let's say, or production-related, I think you have to be able – you have to be interpersonal, obviously. So you have to be able to explain things and you have to be able to simplify things for people and get find ways to help them understand. I played college tennis and I taught tennis for a while.

16:25I thought I was going to be a tennis pro for a little while. But one of the things I learned in teaching tennis is you have to you have to be able to say the same thing five different ways. Because I say it one way, it doesn't resonate. I say it another way, it doesn't. And finally, on like the fourth, I'm like, oh, now you have it. So I said it a different way and now now it's clicking for you. So I think that that's a good, important skill is you have to be able to communicate with people and find a way that they understand and it resonates with them. At the end of the day, you're helping people achieve their dreams.

16:54Whether it's homeownership, refinance, whatever it is, you're helping them achieve their dreams. And so you want to help them, you need to be able to communicate really well. Now, you've seen a lot of success as the co-president of Plaza. And you really don't have to grind as hard as you grind now. but how do you continue to find that motivation to grind as hard as you do? Because I love it. I love the industry. I love what we do. I love that we help people every day. We're helping business owners. We're helping them succeed in their business. We're helping put homeowners, many of them first-time homeowners, into homes.

17:31So we really get to help a lot of people. And I think that just keeps me going. Also our team, right? I love helping our team be successful. It's a challenging market. There's no doubt about it. So helping our salespeople, our account executives, our management team, finding ways to help them grow their business, keeping them uplifted every day really keeps me excited. Now you mentioned earlier that Plaza Home Mortgages has very good technology. How is Plaza right now utilizing AI? That's really good. We're actually formulating our AI plan right now. We'll probably use a lot of it internally first just to source information, which we're working on currently.

18:12And we're still working on trying to figure out the best way. There's obviously a ton of AI tools out there, and we're still figuring out where best to deploy it out to our client base. We'll first start internally. You're not going to use it for decision-making, underwriting? Not yet. Reviewing the documents? Yeah, we'll continue to watch that and see. We've deployed a lot of robots that do a lot of work for us today that we used to employ administrative people to help out. So we've saved a lot there. So we'll continue to review that and see what that looks like in the marketplace. You guys have deployed robots already?

18:50Yeah, we've got a lot of bots. Nice. So what are they doing for you? Everything, pretty much. Just to give you an example, when you order an FHA case number, that request used to come over and somebody would type in all those fields and how a bot does that and then takes the case and uploads it, sends it to the client, all automated. uh, a lot of emails. I mean, we've, we've really, really put everywhere we can. We have placed bots into place. That's good. You guys are ahead of the curve with, you know, ahead of a lot of lenders that are not implementing a lot of that stuff now. Um, now what I've noticed with, with Plaza, you got a lot of great leadership, a lot of, um, you know, a lot of great talent.

19:32How are you fostering talent at Plaza? Yeah. So, uh, you know, talent's always about development, you know, helping them achieve their goals, the associate, whatever that goal may be. And, uh, I think it's about communication. I think ensuring that you have, uh, meetings one-on-ones is super important for both sides, right? And to make sure that we're clearly communicating and we're, as a company, we're helping, you know, the associate achieve their goals and dreams. And also the other side, the associate wants to make sure that they're helping the company move the needle to wherever we are. So I think communication is super important and making sure that everyone's moving forward.

20:08So I think that's really, it's key to a lot of things. It's really the key in that process. Now, one thing I noticed about Plaza and one of the things, the key distinguishers with Plaza is that you guys are, you know, you're willing to take bigger risks, especially in the decision process for loans. How important is taking risks to your organization? Well, two things there. One, we are in the risk business. So we say we're in the mortgage business. We're really in the risk business, whether it's credit risk, interest rate risk, whatever it may be. That's the business that we're in. So I don't think we take any more risk.

20:44I just think we're really good at evaluating it. So we're able to look at loans and say, you know what, XYZ company may not be comfortable, but we are comfortable because we feel like we can assess it better. And we've got more experience. We've done it for 24 years. We feel comfortable that these are transactions that we can properly say that we think this is a good loan. So I think that's really – and we've really always focused ourself on product. So when you have a lot of product variability, you need to be able to have a lot of underwriting expertise that can also kind of follow that. So we do – I don't even know – seven different renovation loan products, I think.

21:24We do reverse loans. We do all these other products, so you have to have expertise in each one of those to really be able to properly assess it. Yeah, I mean, one thing you guys have done really, like where you guys just dominate the market is the lower FICO FHA. How long have you guys been crushing that market? We've been doing it quite a while. I don't know if I remember the day, but we've been doing it for quite a while. You know, we're really comfortable in that environment, and that space helps a lot of people. It helps put people into homes. um now tell me a little bit about yourself like how'd you grow up you know what what was life like as a child for you uh life was interesting i uh i grew up in seattle okay and uh you know uh you know my dad was a traveling salesperson uh my mom sales is in your blood yeah sales is in my blood right he traveled around uh and my mom uh worked evenings at the bank and you know it's pretty typical childhood.

22:19And I grew up, I was playing tennis, as I mentioned, and played high school, played a little bit of college, and quickly realized that I loved Seattle, right? Beautiful place, beautiful part of the country. By the time, I realized I wanted to kind of experience other parts of the country. So right after I graduated college, I moved to New York. I spent about 16 years there. And then, like all good New Yorkers, I eventually moved down to Florida a few years ago. So, you know, I've kind of traveled. It's going to take the weather. Yeah, yeah. It's a little easier lifestyle. I'll call it a little better weather.

22:52So that's it. I've been in this industry a long time. It's all I've ever done. Other than this and teaching tennis, it's all I've ever done. So I've really enjoyed it. As I mentioned earlier, I love helping the people. I love the complexities. Even as long as I've done this, there's things I come across every once in a while. I'm like, wow, I've never seen that before. I don't know how many. Still always learning. Yeah. I don't know how many industries you can say you've been doing this for 30 years, and you're like, wow, I've never seen that before. Such a unique business like that. It's just ever-growing, ever-growing.

23:24Now, you're so busy all the time with work and the family and everything. What are some of the things you'd like to do to slow down? Play tennis is a big one for me. Still playing tennis? Oh, absolutely, yeah. It's not pickleball now. It's still tennis. Yeah, still tennis. We've got some pretty good teams. We travel nationally sometimes. so we got some pretty good you're paying competitive tennis absolutely yeah yeah no i enjoy it uh so we still i still play a lot of tennis i don't really i enjoy golf but i don't really have time for it that's kind of a major time commitment yeah i don't enjoy that as much uh family time you know time at the beach obviously spending time you know with the kids um i think uh helping out in the community you know mal washington was a good friend of mine he was a former um Wimbledon finalist.

24:09And he has a great foundation in Jacksonville. So my wife and I spend quite a bit of time with the Inner City Youth Program there, helping there and working with them as much as we can. So you serve a lot with them, huh? Yeah, absolutely. That's the point of our life, right? Give back, to serve, do God's work. Absolutely. Now, did you ever play professional tennis? No, no, no. Played a couple years in college and that was it. So you played, what, it was D1, D2? Yeah, no, actually junior college at the time. Okay. Yeah, I had the opportunity to go to Division I, and I elected to go a different route for a while.

24:47All right, cool. So pivoting a little bit now, what is your favorite quote? So I've got a couple of them. One is sort of business-related, and one is more sort of strategic, I guess. I'll start with the business-related one, and I say this a lot. In fact, people probably already heard me, and that is bad news doesn't get better with age. In other words, you know, if you have something you need to do and you don't want to do it, our natural inclination is to put it off, whether it's bad news or a task or whatever. I'm like, you have to just take care of that. Bad news does not get better with age.

25:20Just tackle it. Be done. You'll feel better. And you'll go on. So that's sort of my day-to-day one that I try to live by and I try to instill in people. And another one is actually from Michael Jordan. And he said, and hopefully I get this right, he said, talent wins games, but teamwork and intelligence wins championships. And that's sort of the slow, you know, to me that tells me the slow game wins, right? Be thoughtful, be methodical about your actions, and, you know, long term you'll win. Especially in our business, like, you don't become the best lender by yourself. No, no, 100%. Your team and here at our organization, collaboration is why we're winning.

26:07Community is why we're winning. We win together. We're 900 independent brokers in one organization that are just sharing all of our ideas and all of our creative genius. That's a great quote. Yeah, I love it. I think it hopefully keeps you on task. now um what's the best piece of advice you ever received best piece of advice i ever received um i know it's probably going back to the quote i said which is is tackle tackle the things you don't want to do first right because we all have things whether it's you know working out or you know, whatever it is, tackle the things that you, you really don't or fearful or, you know, whatever it is, just get it done.