Self-Directed IRAs The Added Costs of Legal Opinions Loan...

Self-Directed IRAs

The Added Costs of Legal Opinions

Loan Originator Compensation

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Summer 2015

Points of Interest Summer 2015 Page 1

Inside This Issue From the President .................................................2

From the Editor ....................................................... 3

Sacramento Summary ...........................................5

Self-Directed IRAs .................................................. 6

Local Points of Interest ......................................... 9

2015 Summer Seminar ........................................ 10

Spring Seminar Photos ....................................... 14

Spring Seminar Sponsors ................................... 16

Spring Seminar Exhibitors ...................................17

PAC Contributors .................................................. 19

A New Leverage Risk to Consider – the Added Costs of Legal Opinions.................. 22

Consumer-Paid Transactions Under the CFPB Rule on Loan Originator Compensation .................................. 25

Get to Know Your CMA Board Members:Chuck Hershson

Odell Murry Michelle Rodriguez ........................................... 28

Stricktly Strickland ................................................31

Welcome New Members .....................................37

2520 Venture Oaks Way, Suite 150Sacramento, CA 95833

(916) 239-4080 – phone • (916) 924-7323 – [email protected]

www.californiamortgageassociation.com

Points of Interest is published by the California Mortgage Association, a voluntary trade association serving California mortgage and trust deed brokers and lenders.

2014-2015 BOARD OF DIRECTORS

Odell Murry – PresidentMAI Financial Services, Inc.

Stephen Pollack – Vice PresidentAnchor Loans, Inc.

Steve Anderson – SecretaryDFI Funding, Inc.

Mark Forbes – TreasurerF.E. Forbes Company, Inc.

Steve Belleville – Real Estate Lending Group, Inc.George Eckert – The Money Brokers

Noah Furie – Budget Mortgage CorporationGlenn Goldan – ReProp Investments, Inc.John Graziano – BaySierra Financial, Inc.

Charles Hershson – Fidelity Mortgage Lenders, Inc.David Herzer – Herzer Financial Services, Inc.

Elizabeth Knight – PLM Lender ServicesJoffrey Long – Southwestern Mortgage

Lori Randich – Redwood Mortgage CorporationMichelle Rodriguez – Woodland Hills Mortgage Corp.Pam Sosa – Standard Mortgage Financial Services, Inc.

Richard Temme – R.C. Temme CorporationRichard Wachter – Wachter Investments, Inc.

Michael Arnold & Michael Belote, Esq.Legislative Advocates

Phillip M. Adleson, Esq. Brad Rogerson, Esq. Legal Counsel Securities Counsel

CMA HEADQUARTERS STAFF

Jennifer Blevins, CMPDirector of Management Services

John BerkowitzPublications Director

Jen Gross, CMPMeeting Planner

Michael CochranWebmaster / IT Manager

Lexi HowardExecutive Director

Stephanie SchoenExhibits / Sponsors

Teresa ExciniaMembership / Advertising

Tricia Schrum, CPAAccounting

From the PresidentBy Odell Murry • 2014-2015 CMA President

Page 2 Summer 2015 Points of Interest

As my term as CMA President comes to a close, I would like to thank you all for the opportunity to lead

this wonderful organization. It has been both an honor and a privilege to serve as president, and I hope I have been able to make a positive impact on the future of CMA.

During the past two years, CMA has accomplished much and has reached many milestones, to the thanks of many, including our Vice President Steve Pollack, our Secretary Steve Anderson, our Treasurer Mark Forbes, our attorneys Phil Adleson and Brad Rogerson, our lobbyists Mike Arnold and Mike Belote, our incredible board members, various committees, and the CMA membership at large. Know that you made a difference, and be proud of your many accomplishments.

In the last two years:

■ Our Advertising and Vendors Committee, lead by Chairman Steve Rexrode, embraced new technologies to improve advertising methods for our vendors. For the first time, WiFi was provided for seminar attendees, sponsored by our vendors. We cherish our loyal vendors

Farewell Messageand greatly appreciate their unwavering support of CMA and its members. Many of our vendors and some of our members have sent CMA marketing materials to their email databases.

■ Our Amicus Committee, headed by Chairman Noah Furie and CMA Legal Counsel Phil Adleson, has done an outstanding job of staying on top of the many legal cases throughout the State of California, in addition to filing important amicus briefs on behalf of CMA where necessary. Noah Furie is a walking encyclopedia of mortgage policies and procedures; we couldn’t have a better person leading this committee. CMA hit the lottery when we engaged the services of attorney Phil Adleson. Phil has worked tirelessly and has prepared mountain after mountain of documents and training materials for CMA.

■ Our Education Committee Chairman Joffrey Long, in addition to doing an incredible job of bringing to every seminar the best private mortgage lending training programs available, established a new focus group/broker forum called The Basics of Private

Money Lending. Thanks to all Education Committee members, and, in addition to Joffrey Long, a special thanks goes to Lori Randich, Glenn Goldan, Rich Temme, and Phil Adleson.

■ The Dodd-Frank Committee, chaired by Michelle Rodriquez, broke down the very complex Dodd-Frank Act, and put in place several programs to address specific concerns, as well as created a three-part Dodd-Frank webinar series. Also, I would like to take this opportunity to thank Michelle for going the extra mile to update our organization and to draft several comment letters relating to items such as Amendments to the 2013 Mortgage Rules under the Regulation X and Regulation Z; and the Los Angeles City Foreclosure Registry Program. We also don’t want to overlook the enormous contributions made by Rich Temme, that we have all benefited from.

■ Our Ethics Committee and CMA Vice President, Steve Pollack, created and presented CMA’s revised code of ethics, which was then approved by the board.

continued on page 33

★ ELECTION RESULTS ★

Recently, the CMA held its annual election for six of the eighteen seats on its Board of Directors. Directors serve three year terms and one-third of the sitting Board has their terms expire each year. The election results were announced at the recent conference held in San Francisco and are shown below. Congratulations to all.

Steve BellevilleRobert BoxNoah Furie

Odell MurryStephen Pollack

Pam Sosa

Lexi HowardOur own Lexi Howard received a Juris Doctor Degree

from the University of The Pacific, McGeorge School

of Law on May 16. (She walks across the stage after

receiving her law degree with first-year law student

and cancer survivor Christina Godfrey.) She also

received an Outstanding Student Service Award, served

as Vice President of the Student Bar Association and

received the Public Law & Policy Certificate. The

amazing thing is that she completed all of the above

by attending night school while serving as the

Executive Director for CMA. We are all so proud of Lexi.

Our congratulations for a job well done!


From the Editor

bySteve Pollack

Editor, Points of Interest

t is hard to believe three years have passed since I drafted my first Points of Interest Editor’s message, “Rolling Up My

Sleeves.” In that Summer 2012 issue I wrote:

“I think all CMA members would agree that Points of Interest has grown and evolved into an excellent showpiece and informative resource over the last few years. Recently, this has been the work of current Board member

and former Points of Interest editor, Steve Leidner. I have been lucky to sit alongside Steve during this process to watch him at work ... my fervent hope is that I can live up to the lofty standards that have been set.”

In the three years since, it has been my goal to live up to those standards, and with this being my last issue as editor, I am happy to hand the pen back to Steve

Leidner knowing he will continue to guide and grow this publication as he resumes the editor’s role.

I look forward to continuing to serve the CMA, and I encourage all members to consider contributing their time and expertise to growing and improving our organization.


SACRAMENTO SUMMARYBy Michael J. Arnold & Michael Belote, Esq.

Legislative Advocates


We are in the middle of the first year of the 2015-2016 legislative session. The Legislature has been

quite busy with the 2,500 bills which have been introduced for consideration during 2015. Your CMA legislative team is actively following 102 pieces of legislation!

On May 14, 2015 Governor Jerry Brown released his “May Revision” of the 2015-2016 California State Budget. The Governor stated in his press conference that “the state is on the rebound.” He said that the finances of the State of California have stabilized.

In January, when the Governor released his initial budget proposal, he said there would not be much money available to increase spending. However, since then, the state has seen an unexpected increase in revenue. Over $3 billion more than anticipated has come in this year. Most of that new money, if not all, will be directed

to public schools and community colleges under the state’s education funding law. Any additional funds will be deposited into the state’s rainy day fund. Also, Medi-Cal costs have soared, with over 12 million Californians now obtaining their health care coverage under this government program.

We are pleased to report that our CMA sponsored bill, SB 647 (Morrell), is moving forward in the process. The bill passed the State Senate and is now awaiting further consideration in the Assembly. The bill will 1) set the LTV limits for land producing income from crops, timber or minerals at 60%; 2) clarify that a broker has no obligation to obtain a suitability questionnaire from current investors in years when no investments are made by the investors; and 3) eliminates certain unnecessary reporting obligations for

“whole note” investments.

We have been successful, working with other groups, in challenging the following proposals to which CMA has been opposed:

AB 244 – would have included a “successor in interest” in the definition of borrower with additional changes complicating the lending law.

AB 396 – would have prohibited the owner of a rental housing accommodation from inquiring about a criminal record of an applicant.

SB 8 – would have expressed legislative intent to expand the sales tax to services, including mortgage lending fees, etc.

CMA’s legislative advocates will be busy this summer with dozens of remaining bills that have passed the house of origin and will be further considered in the second house.

Page 6 Summer 2015 Points of InterestPage 6 Summer 2015 Points of Interest

Points of Interest Summer 2015 Page 7Points of Interest Summer 2015 Page 7

continued on page 8

ecause of the volatility of the f inancial markets, mergers & acquisitions within Wall Street, and

the “fear factor” perpetrated by financial advisors, for the past ten years Americans have been seeking other options for their retirement portfolios – just as 79 million Baby-Boomers come of age!

In 2012, $1 trillion in mutual fund investments were “redeemed or cashed in” by American retail clients due to the lack of confidence within the Traditional Asset sector, as reported by Sixty Minutes in June, 2013. In recent years, due to pressure from regulators (SEC, FINRA) to inform investors of return on investment (ROI), clients have begun to question the $15 billion in “hidden” mutual fund fees and dismal returns, that have been averaging 1-3%.

Additionally, the American Investor is asking questions which demand rational answers that are not being provided by

broker-dealers, which may explain why 49% of all financial advisors were fired by their client in 2014.1 Conversely, the Alternative Asset sector is making historical headway with an influx of capital mounting to $6 trillion as of the 4th quarter of 2014. Real Estate and Private Notes leads the Asset Class for American investors seeking alternatives to the dismal returns within traditional financial markets.

Fortunately, inquisitive and determined investors found their answer in I.R.S. Code Section 408, whereby one may invest their IRA or 401(k) in “any type of asset other than a life insurance policy or a collectible item,” thereby establishing the inroads to Self-Directed IRAs and 401(k)s. Major financial institutions and banks only provide Americans with the prospect of trading stocks, bonds, annuities and mutual funds within the confines of a Retirement Savings account, yet the specific group of investors

Self-Directed IRAs

byBelinda Savage

IRA Services Trust Company


Self-Directed IRAs – continued from page 7

with Self-Directed IRAs and 401(k)s (4-5% of all Americans) averaged ROI between 6-12%.

Self-Directed IRAs and 401(k)s have been in existence for 40 years, yet people are still asking, “What is a Self-Directed IRA”? As opposed to banks, broker-dealers and mutual fund companies that offer stocks, bonds and various combinations of those two asset sectors, IRA Trust Custodians are not in the business of selling you investments or providing investment advice. Trust Custodians are the “Switzerland” of IRAs and 401(k)s in that they provide, the investor or the Investment Sponsor, a service to custody clients’ retirement accounts which then can be invested in real estate, multi-family or commercial rentals or fix & flips, small businesses, technology start-ups, charter schools, vacation rentals, marina or hotel leasing, trust deeds and promissory notes. The investor chooses the project and the terms of that project.

Here is an investment example using simplified figures: Client has $100,000 in his 401(k), and plans to invest $50,000 into a fix & flip project with his brother, who is also contributing $50,000 to the property. Cost of the foreclosed house is $75,000 and it will require approximately $25,000 in rehab costs. Client establishes a Self-Directed IRA Account and transfers $50,0002 to establish the account. Then, the client authorizes the IRA to purchase the property with his brother as co-tenants in common. Brother of the client works with a contractor on the property to prepare it for sale. After refurbishing the property, client contracts the house to sell at $125,000. The brothers split the $25,000 profit and the client’s IRA receives a 25% ROI.

The key to wise investing is Education, Due-Diligence and associating with people who share your vision.

Belinda Savage may have developed her roots in the foundations of Wall Street, as an institutional bond trader in the Canadian

markets & Regional Operations Manager & Compliance Director for several national and regional broker/dealers, but she now has her focus on the leading growth sector: Alternative Assets for American investment portfolios, more specifically, retirement accounts on the Self-Directed Platform!

Ms. Savage has extensive experience and expertise within the financial markets and alternative assets- RE, Private Equity/Debt, Intellectual Property – permitting her to network with a multiplicity of professionals and associations throughout the U.S. – NYREIA, AICPA, FPA, California Mortgage Association and REIAs in CA and New York.

Presently, Belinda serves as a Consultant – Business Development – for the management team headed by Dr. Edwin Blue, Gary Shumm and Michael McNair at IRA Services Trust, which will expand their sales and marketing efforts on the West Coast and in the major metropolitan areas of America, as baby-boomers capitalize on the Alternative Asset sector.


ear Fellow CMA Members,

San Diego has arguably held a culinary precedent in California, given the history of Chino Farm

in Rancho Santa Fe. For over 60 years, the Chino-family run farm has served as the source of inspiration of many well-reputed chefs, including Alice Waters of Chez Panisse, Wolfgang Puck and Carl Shroeder of The Market Restaurant in Del Mar, to name a few. Visitors to the farm will discover an array of heirloom varieties of tomatoes (brandywine, cherokee purple, zebra et al.), cucumbers, mouse melons (a fruit that looks like a watermelon and tastes like a cucumber), cruciferous vegetables, cabbages, kale, lettuces, peppers, figs, and their unparalleled mara de bois strawberries, when they are in season.

Given the presence of Chino Farm in North County of San Diego, it is essential to dine at those restaurants that utilize Chino’s treasures of the earth. One of my favorites is The Market Restaurant in Del Mar where Chef Schroeder exclusively utilizes Chino’s produce, truly highlighting the brilliance of flavors that he imparts in his food. Every time I visit The Market, I order an “off the menu” salad item that comprises a mosaic of most of the produce sourced that day from Chino Farm. Whether you are vegan/vegetarian or not, order the vegetable platter entrée as a side for the table just to enjoy the diversity of preparations in Chef Schroeder’s creative use of Chino’s produce. The restaurant also has a bar/lounge that offers its own menu, including a pizza baked in a wood burning oven that equals the pie gold standard of the country (i.e., Una Pizza Napoletana in San Francisco,

Pizza Bianco in Phoenix, and Luzzo’s in East Village of Manhattan). In addition to the fine dining experience at The Market, Chef Schroeder also provides his dedicated fan base with a gourmet-gastropub alternative utilizing the same superlative ingredients from Chino Farm at the San Diego-based location, Banker’s Hill. Anything you order at Banker’s Hill will be to your comfort food liking and, like The Market, the produce will be season driven.

In San Diego you have the opportunity to experience “Farm to Table” dining at its best, thanks to the enduring passion, dedication, and integrity of the Chino Family who have blessed us all with greater jaw-dropping flavors that a chef like Carl Schroeder is extraordinarily skilled at harnessing.

The Market is located at 3702 Via De La Valle, Del Mar, CA 92014. The hours are Sun-Thurs 5:30 pm to 9:30 pm, Fri-Sat 5:30 pm to 10:00 pm. The bar opens nightly at 5:00 pm, (858) 523-0007, www.marketdelmar.com.

Banker’s Hill is located at 2202 4th Avenue, San Diego, CA 92101. The hours are Sun-Thurs 4:30 pm to 9:30 pm, Fri-Sat 4:30 pm to 10:30 pm, with a Sunday Brunch from 10:00 am to 2:30 pm (619) 231-0222, www. bankershillsd.com.

For culture, there are a few notable events. First, don’t miss the San Diego Padres who play

the Marlins on July 23rd and 24th. Second, check out the San Diego Symphony’s performance of The Divas of Disco Starring Radiance on July 24 at 7:30 pm. Finally, for the theatre lovers, check out Kiss Me Kate and Shakespeare’s Twelfth Night at The Old Globe.

Enjoy!

Culturally yours, Elliot M. Shirwo, Bolour Associates, The Entrepeneur’s Bridge Lender of Choice (www.bolourassociates.com). For more information on FOODWINEART, see www.elliotshirwofoodwineart.weebly.com.

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FIFIDDELITYELITYMORMORTGAGE LENDERSTGAGE LENDERS, IN, INC.C.C O M M E R C I A L • R E S I D E N T I AC O M M E R C I A L • R E S I D E N T I A LL

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• New Connections• New Concepts• New Knowledge• Connect with

Your Friends!

Your competitor just signed up.

Will you?

CMA San Diego. CMA

San

Dieg

o Join Us In San Diego • July 23-24, 2015

CMA

San

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goCalifornia Mortgage Association

WEBINAR MARKETING: More Clients, More Deals!

Securities: Protecting Your Exemptions, and What You Can Do

NEW Combined GFE/TIL: You Need It August 1 (2015)

Local Foreclosure Ordinances: Avoiding a Minefi eld

Employee Law Compliance: a Quick Brush-Up

Advertising – Good ... Advertising for Trouble – Bad

Attorney Roundtables & Speed Networking

Installation LuncheonWayne Bell*, Commissioner, California Bureau of Real EstateTom Pool, Deputy Director, California Bureau of Real Estate

Thursday Cocktail Hour

*Not confi rmed as of printing date.

California Mortgage Associationwww.californiamortgageassociation.com

Summ

er Seminar

General InformationLOCATION:

The CMA Summer Seminar will be held July 23 and 24 at the Wyndham San Diego Bayside Hotel, located at 1355 North Harbor Drive, San Diego, CA 92101. For room reservations, call the hotel at 619-232-3861 or 800-996-3426. Ask for the “California Mortgage Association” rate. Room rate is $179 per night for Standard/Single/Double through June 23, 2015 or until sold out. Discounted overnight self-parking is $20 + tax per vehicle per day, and valet parking is $32 + tax per vehicle per day. Discounted daytime event parking is $10 + tax per vehicle per day.

SEMINAR FEES:

Full registration includes all seminar events, materials, cocktail/networking reception and Friday lunch.

Registration received on or before

July 16, 2015

Registrationreceived from July 17, 2015

to date of seminar

CMA Regular Member $370 $420

Additional Attendee Same Company $320 $370

Educational Member $370 $420

Non-Member $570 $620

REFUND POLICY:

Cancellations received in writing on or before July 9, 2015 will receive a credit toward a future seminar. Cancellations not received in writing by July 9, 2015 will not receive any credit or refund.

CMA DISCLAIMER STATEMENT:

Views, statements, information, and materials provided at CMA seminars do not necessarily refl ect the views of the California Mortgage Association, its Offi cers, Directors, or Members. When considering any document, opinion, publication, or other material obtained at or from CMA or from any CMA event, attendees and recipients of the information are advised to seek qualifi ed counsel as to the suitability of that material or information for their own business operation or use.

MISCELLANEOUS:

Please wear name badges to all functions. Tickets are required for various events. Please be courteous of others and place mobile phones on silent mode. Program and speakers are subject to change without notice.

Thursday, July 23, 20157:30 am - 8:30 am Continental Breakfast / Networking in Exhibitor Area

7:30 am - 4:00 pm Registration

7:30 am - 4:00 pm Exhibitor Fair Open

8:30 am - Speed Networking – Build Contacts and Build Your Business!10:00 am MODERATORS: Pam Sosa, President, Standard Mortgage Financial Services, Inc.; Randy Newman, President, Total Lender Solutions Back by popular demand – bring a HUGE stack of business cards. You’ll be surprised by HOW MANY people

you meet! How much money are YOU losing, because you haven’t met people you see all the time at CMA? ... Scary! Be prepared to discuss what you offer – fast, and a lot! Find out who can help you! Maximize your exposure and your NET RETURN from the event!

10:00 am - 10:20 am 20 Minute Networking Break

10:20 am - Marketing – Yes! But Don’t Advertise for Trouble12:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp.; Martin T. McGuinn, Kirby & McGuinn; S. Guy Puccio, S. Guy Puccio & Associates You market and advertise your business – do you know the rules regarding advertising and marketing? How

much do you know about the BRE advertising rules, TILA, the DO NOT CALL, and other state or federal regulations? Comprehensive, practical overview of these rules along with a checklist you can take back to the offi ce. Don’t let your competitors turn you in, or regulators audit you, all because of violations of advertising rules.

12:00 pm - 2:00 pm Luncheon and PAC Drawings

2:00 pm - Distressed Property Ordinances – Your Roadmap Through the Minefi eld3:30 pm Randy Newman, President, Total Lender Solutions; Jeanee Chapman, Vice President, LRES Corp. 133 counties, cities or towns have passed ordinances regarding distressed property. Are they all the same?

No, no, no. Local “leadership” puts their own horrible stamp on ordinances and keeping up with them – it’s impossible. Got “distressed property” in your portfolio? This phrase covers a variety of descriptions. Get a list of all of the ordinances, fi nd out what to do, and avoid potential fi nes of $1,000 a day!

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment Break Sponsored by Ross Diversifi ed Insurance Services

3:50 pm - New GFE/TIL – Required in 7 Days, 8 Hours, and 10 Minutes from this Seminar!5:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp. You attended the seminars, webinars, received bulletins, and did the research. Now, you’re ready to use the

new Good Faith Estimate/TILA disclosure, called TRID. Are you? Here’s YOUR last chance to get questions answered before it all starts – August 1, 2015.

5:00 pm Seminar Concludes

Friday, July 24, 2015— Open to All Attendees —

Summer Seminar— July 23-24, 2015 • San Diego, CA —

REGISTRATION FORM

3 easy ways to register!

1. Register online at


2. Complete and fax this form

3. Complete and mail this form

Advanced registration is recommended. Call to confi rm space availability. Please check all applicable boxes.

Attendee Name: ______________________________ Attendee Name: ______________________________

Company: ______________________________________________________________________________

Address: ___________________________________ City/State/Zip: _______________________________

Phone: _________________ Fax:____________________ E-mail: _______________________________

Dietary Restrictions (please detail): ___________________________________________________________

PAYMENT OPTIONS

Check enclosed (payable to California Mortgage Association) Please charge my Visa MasterCard AmEx

Account Number: ______________________________________ Exp. Date: ___________ CID #: ________

Name on Card: __________________________________________________________________________

Billing Address: ______________________________ City/State/Zip: _______________________________

Signature: ______________________________________________________________________________

I am opting out of the onsite binder in favor of the eBinder data link in advance of the seminar. I understand I will not receive an onsite binder.

Please provide a CMA binder at a charge of $45 (we’ll send you a link to the eBinder, too).

Please contact me about sponsorship, exhibiting, and advertising opportunities.

Please mail or fax this form with payment to:CALIFORNIA MORTGAGE ASSOCIATION

2520 Venture Oaks Way, Suite 150Sacramento, California 95833

(916) 239-4080 • (916) 924-7323 Faxwww.californiamortgageassociation.com

7:30 am - 8:30 am Continental Breakfast

7:30 am - 5:00 pm Seminar Registration

8:00 am - 10:00 am Exhibitor Set-Up


Special Members-Only Focus Group Sessions:CMA Focus Group Sessions are open only to CMA Members.

8:30 am - Broker/Roundtables – Get Attorney ANSWERS on the Spot!10:30 am MODERATOR: Stephen Leidner, President, Lantern Financial Your questions – answered by TOP attorneys. They move from group to group, letting you ask them

DIRECTLY, getting critical knowledge and answers. Ask and hear from Dennis Doss, Ben Levinson, Martin McGuinn, Randy Newman, Michelle Rodriguez, Brad Rogerson, and Julia Wei. You’ll like the small size of the groups – giving you more opportunities to ask YOUR questions.


10:50 am - Got Employees? Get Legal – or Pay!11:50 am Pam Sosa, President, Standard Mortgage Financial Services, Inc. Are you the “HR Manager” in a small shop, or are you a LARGE EMPLOYER? Either way, you’re a target. Not

having clear policies in place, in writing, can get you a new relationship – with the Labor Board. That can cost you. Your employees may know the rules – do you? Don’t learn them from your employee’s attorney.

12:00 pm - 6:00 pm Thursday and All Day Friday are Open to All Attendees.

12:00 pm - Installation Luncheon2:00 pm KEYNOTE SPEAKERS: Wayne Bell*, Commissioner of the California Bureau of Real Estate Tom Pool, Deputy Director of the California Bureau of Real Estate

2:00 pm - They’re Securities. What’s Your Exemption?3:30 pm Dennis Doss, Doss Law; Brad Rogerson, HansonBridgett; MODERATOR: Don Hensel, President, Hensel Financial Loans you provide your investors ARE SECURITIES. You knew that. Question is, are they exempt from

registration? How? If you don’t do what is required to protect your exemption from registration – you’re selling unregistered securities. Big problem. What could you miss in preserving your exemption? Out of state investors? Borrowers? Can you do business with them? When? How? Get up to date on latest Federal and State exemptions, broker-dealer and investment advisor compliance. Whole loans? 10 investors or fewer? We’ll cover that as well.

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment Break Sponsored by Total Lender Solutions

3:30 pm - Webinars – The Way to Reach Millions (It’s Possible)5:00 pm Robert Box, President, Equity Funding Resources, Inc.; Sean Morsi, CEO Mor Financial Services, Inc. There are countless reasons to include webinars as part of your marketing strategy. WHY AREN’T YOU DOING

IT? Don’t know how? Bring your laptop for a step by step demonstration of how to host your webinar ... and reach thousands (it’s possible!)

5:00 pm - 6:00 pm Cocktail and Networking Hour Sponsored by SBS Trust Deed Network


EDUCATIONAL SEMINARFees are per person and include all functions unless indicated.

Registration received on or

before July 16, 2015


to date of seminar





Registration Total $______ $______

Voluntary PAC Contribution ($20 or more) $______ $______

TOTAL ENCLOSED $______ $______

— CMA Members Only —Please note which Thursday morning

meeting(s) you will attend.

Attendee Name:____________________________________ Broker/Roundtables – Get Attorney ANSWERS on the Spot! Got Employees? Get Legal – or Pay!


These sessions are open only to CMA Members.

Three

Networking

Events

EACH DAY

Don’t Miss

CMA JulyWyndham Bayside Hotel1355 North Harbor Drive

San Diego, CA 92101619-232-3861 or 800-996-3426



SEMINAR FEES:


Registrationreceived on or before

July 16, 2015


to date of seminar





REFUND POLICY:



Views, statements, information, and materials provided at CMA seminars do not necessarily reflect the views of the California Mortgage Association, its Officers, Directors,or Members. When considering any document, opinion,publication, or other material obtained at or from CMAor from any CMA event, attendees and recipients of the information are advised to seek qualified counsel as to the suitability of that material or information for their own business operation or use.

MISCELLANEOUS:

Please wear name badges to all functions. Tickets arerequired for various events. Please be courteous of others and place mobile phones on silent mode. Program and speakers are subject to change without notice.




8:30 am - Speed Networking – Build Contacts and Build Your Business!10:00 am MODERATORS: Pam Sosa, President, Standard Mortgage Financial Services, Inc.;

Randy Newman, President, Total Lender SolutionsBack by popular demand – bring a HUGE stack of business cards. You’ll be surprised by HOW MANY people you meet! How much money are YOU losing, because you haven’t met people you see all the time at CMA? ... Scary! Be prepared to discuss what you offer – fast, and a lot! Find out who can help you! Maximize your exposure and your NET RETURN from the event!


10:20 am - Marketing – Yes! But Don’t Advertise for Trouble12:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp.; Martin T. McGuinn, Kirby & McGuinn;

S. Guy Puccio, S. Guy Puccio & AssociatesYou market and advertise your business – do you know the rules regarding advertising and marketing? How much do you know about the BRE advertising rules, TILA, the DO NOT CALL, and other state or federal regulations? Comprehensive, practical overview of these rules along with a checklist you can take back to theoffi ce. Don’t let your competitors turn you in, or regulators audit you, all because of violations of advertising rules.


2:00 pm - Distressed Property Ordinances – Your Roadmap Through the Minefield3:30 pm Randy Newman, President, Total Lender Solutions; Jeanee Chapman, Vice President, LRES Corp.

133 counties, cities or towns have passed ordinances regarding distressed property. Are they all the same? No, no, no. Local “leadership” puts their own horrible stamp on ordinances and keeping up with them – it’s impossible. Got “distressed property” in your portfolio? This phrase covers a variety of descriptions. Get a list of all of the ordinances, find out what to do, and avoid potential fines of $1,000 a day!

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment BreakSponsored by Ross Diversified Insurance Services

3:50 pm - New GFE/TIL – Required in 7 Days, 8 Hours, and 10 Minutes from this Seminar!5:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp.

You attended the seminars, webinars, received bulletins, and did the research. Now, you’re ready to use the new Good Faith Estimate/TILA disclosure, called TRID. Are you? Here’s YOUR last chance to get questions answered before it all starts – August 1, 2015.




REGISTRATION FORM

3easy waysto register!

1. Register online at www.californiamortgageassociation.com



Advanced registration is recommended. Call to confirm space availability. Please check all applicable boxes.


Company: ______________________________________________________________________________


Phone: _________________ Fax:____________________ E-mail: _______________________________


PAYMENT OPTIONS



Name on Card: __________________________________________________________________________


Signature: ______________________________________________________________________________












8:30 am - Broker/Roundtables – Get Attorney ANSWERS on the Spot!10:30 am MODERATOR: Stephen Leidner, President, Lantern Financial

Your questions – answered by TOP attorneys. They move from group to group, letting you ask them DIRECTLY, getting critical knowledge and answers. Ask and hear from Dennis Doss, Ben Levinson, Martin McGuinn, Randy Newman, Michelle Rodriguez, Brad Rogerson, and Julia Wei. You’ll like the small size of the groups – giving you more opportunities to ask YOUR questions.


10:50 am - Got Employees? Get Legal – or Pay!11:50 am Pam Sosa, President, Standard Mortgage Financial Services, Inc.

Are you the “HR Manager” in a small shop, or are you a LARGE EMPLOYER? Either way, you’re a target. Not having clear policies in place, in writing, can get you a new relationship – with the Labor Board. That can cost you. Your employees may know the rules – do you? Don’t learn them from your employee’s attorney.


12:00 pm - Installation Luncheon2:00 pm KEYNOTE SPEAKERS: Wayne Bell*, Commissioner of the California Bureau of Real Estate

Tom Pool, Deputy Director of the California Bureau of Real Estate

2:00 pm - They’re Securities. What’s Your Exemption?3:30 pm Dennis Doss, Doss Law; Brad Rogerson, HansonBridgett;

MODERATOR: Don Hensel, President, Hensel FinancialLoans you provide your investors ARE SECURITIES. You knew that. Question is, are they exempt from registration? How? If you don’t do what is required to protect your exemption from registration – you’re selling unregistered securities. Big problem. What could you miss in preserving your exemption? Out of state investors? Borrowers? Can you do business with them? When? How? Get up to date on latest Federal and State exemptions, broker-dealer and investment advisor compliance. Whole loans? 10 investors or fewer? We’ll cover that as well.

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment BreakSponsored by Total Lender Solutions

3:30 pm - Webinars – The Way to Reach Millions (It’s Possible)5:00 pm Robert Box, President, Equity Funding Resources, Inc.; Sean Morsi, CEO Mor Financial Services, Inc.

There are countless reasons to include webinars as part of your marketing strategy. WHY AREN’T YOU DOING IT? Don’t know how? Bring your laptop for a step-by-step demonstration of how to host your webinar ... and reach thousands (it’s possible!)

5:00 pm - 6:00 pm Cocktail and Networking HourSponsored by SBS Trust Deed Network



Registrationreceived on or



to date of seminar













Three

Networking

Events

EACH DAY

Don’t Miss


San Diego, CA 92101619-232-3861 or 800-996-3426



SEMINAR FEES:


Registration received on or before

July 16, 2015


to date of seminar





REFUND POLICY:



Views, statements, information, and materials provided at CMA seminars do not necessarily refl ect the views of the California Mortgage Association, its Offi cers, Directors, or Members. When considering any document, opinion, publication, or other material obtained at or from CMA or from any CMA event, attendees and recipients of the information are advised to seek qualifi ed counsel as to the suitability of that material or information for their own business operation or use.

MISCELLANEOUS:

Please wear name badges to all functions. Tickets are required for various events. Please be courteous of others and place mobile phones on silent mode. Program and speakers are subject to change without notice.




8:30 am - Speed Networking – Build Contacts and Build Your Business!10:00 am MODERATORS: Pam Sosa, President, Standard Mortgage Financial Services, Inc.; Randy Newman, President, Total Lender Solutions Back by popular demand – bring a HUGE stack of business cards. You’ll be surprised by HOW MANY people

you meet! How much money are YOU losing, because you haven’t met people you see all the time at CMA? ... Scary! Be prepared to discuss what you offer – fast, and a lot! Find out who can help you! Maximize your exposure and your NET RETURN from the event!


10:20 am - Marketing – Yes! But Don’t Advertise for Trouble12:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp.; Martin T. McGuinn, Kirby & McGuinn; S. Guy Puccio, S. Guy Puccio & Associates You market and advertise your business – do you know the rules regarding advertising and marketing? How

much do you know about the BRE advertising rules, TILA, the DO NOT CALL, and other state or federal regulations? Comprehensive, practical overview of these rules along with a checklist you can take back to the offi ce. Don’t let your competitors turn you in, or regulators audit you, all because of violations of advertising rules.


2:00 pm - Distressed Property Ordinances – Your Roadmap Through the Minefi eld3:30 pm Randy Newman, President, Total Lender Solutions; Jeanee Chapman, Vice President, LRES Corp. 133 counties, cities or towns have passed ordinances regarding distressed property. Are they all the same?

No, no, no. Local “leadership” puts their own horrible stamp on ordinances and keeping up with them – it’s impossible. Got “distressed property” in your portfolio? This phrase covers a variety of descriptions. Get a list of all of the ordinances, fi nd out what to do, and avoid potential fi nes of $1,000 a day!

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment Break Sponsored by Ross Diversifi ed Insurance Services

3:50 pm - New GFE/TIL – Required in 7 Days, 8 Hours, and 10 Minutes from this Seminar!5:00 pm Michelle Rodriguez, Woodland Hills Mortgage Corp. You attended the seminars, webinars, received bulletins, and did the research. Now, you’re ready to use the

new Good Faith Estimate/TILA disclosure, called TRID. Are you? Here’s YOUR last chance to get questions answered before it all starts – August 1, 2015.




REGISTRATION FORM

3 easy ways to register!

1. Register online at




Advanced registration is recommended. Call to confi rm space availability. Please check all applicable boxes.


Company: ______________________________________________________________________________


Phone: _________________ Fax:____________________ E-mail: _______________________________


PAYMENT OPTIONS



Name on Card: __________________________________________________________________________


Signature: ______________________________________________________________________________












8:30 am - Broker/Roundtables – Get Attorney ANSWERS on the Spot!10:30 am MODERATOR: Stephen Leidner, President, Lantern Financial Your questions – answered by TOP attorneys. They move from group to group, letting you ask them

DIRECTLY, getting critical knowledge and answers. Ask and hear from Dennis Doss, Ben Levinson, Martin McGuinn, Randy Newman, Michelle Rodriguez, Brad Rogerson, and Julia Wei. You’ll like the small size of the groups – giving you more opportunities to ask YOUR questions.


10:50 am - Got Employees? Get Legal – or Pay!11:50 am Pam Sosa, President, Standard Mortgage Financial Services, Inc. Are you the “HR Manager” in a small shop, or are you a LARGE EMPLOYER? Either way, you’re a target. Not

having clear policies in place, in writing, can get you a new relationship – with the Labor Board. That can cost you. Your employees may know the rules – do you? Don’t learn them from your employee’s attorney.


12:00 pm - Installation Luncheon2:00 pm KEYNOTE SPEAKERS: Wayne Bell*, Commissioner of the California Bureau of Real Estate Tom Pool, Deputy Director of the California Bureau of Real Estate

2:00 pm - They’re Securities. What’s Your Exemption?3:30 pm Dennis Doss, Doss Law; Brad Rogerson, HansonBridgett; MODERATOR: Don Hensel, President, Hensel Financial Loans you provide your investors ARE SECURITIES. You knew that. Question is, are they exempt from

registration? How? If you don’t do what is required to protect your exemption from registration – you’re selling unregistered securities. Big problem. What could you miss in preserving your exemption? Out of state investors? Borrowers? Can you do business with them? When? How? Get up to date on latest Federal and State exemptions, broker-dealer and investment advisor compliance. Whole loans? 10 investors or fewer? We’ll cover that as well.

3:30 pm - 3:50 pm 20 Minute Networking/Refreshment Break Sponsored by Total Lender Solutions

3:30 pm - Webinars – The Way to Reach Millions (It’s Possible)5:00 pm Robert Box, President, Equity Funding Resources, Inc.; Sean Morsi, CEO Mor Financial Services, Inc. There are countless reasons to include webinars as part of your marketing strategy. WHY AREN’T YOU DOING

IT? Don’t know how? Bring your laptop for a step by step demonstration of how to host your webinar ... and reach thousands (it’s possible!)

5:00 pm - 6:00 pm Cocktail and Networking Hour Sponsored by SBS Trust Deed Network



Registration received on or



to date of seminar













Three

Networking

Events

EACH DAY

Don’t Miss


San Diego, CA 92101619-232-3861 or 800-996-3426


Pictures From the Spring Seminar – May 14-15 – San Francisco

To view this member-only content, become a member of CMA


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It’s easy to donate:Online at www.californiamortgageassociation.com

— or —Send the additional amount with your monthly CMA dues

— or —Write a check to “CMA PAC” and send it today to:

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PROTECT YOUR INDUSTRY – CONTRIBUTE TODAY!For more information contact:

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Pictures From the Spring Seminar – May 14-15 – San Francisco



Thank You to Our Spring Seminar Sponsors

— Wi-Fi Services for All Attendees —Fidelity Mortgage Lenders

& Mortgage+Care

— Thursday Evening Cocktail Hour —SBS Trust Deed Network

— Friday Wine & Cheese Networking —PLM Lender Services, Inc. &

Ross Diversified Insurance Services

— Tote Bags —The Mortgage Office

— Thursday Breakfast & Friday Breakfast —Total Lender Solutions

& IRA Services



Applied Business Software, Inc.2847 Gundry AvenueLong Beach, CA 90755

800.833.3343 – p / 562.279.7404 – fContact: AJ Poulin

E-mail: [email protected]: www.themortgageoffice.com

Product/Service: Loan Servicing Software

Armanino, LLP12657 Alcosta Boulevard, Suite 500

San Ramon, CA 94583925.790.2600 – p / 925.790.2601 – f

Contact: Jason GilbertE-mail: [email protected]

Website: www.armaninollp.comProduct/Service: Accounting

Bolour Associates8383 Wilshire Boulevard, Suite 920

Beverly Hills, CA 90211323.677.0550 – p / 323.677.0522 – f

Contact: Elliot ShirwoE-mail: [email protected]: www.bolourassociates.com

Product/Service: Real Estate Investment / Finance Development

BuildZig1211 Embarcadero Way, Suite D

Oakland, CA 94606800.380.0180 – p / 866.703.5150 – f

Contact: John BohannonE-mail: [email protected]

Website: www.buildzig.comProduct/Service: Real Estate Development /

Funds Control

Del Toro Loan Servicing2300 Boswell Road, Suite 215

Chula Vista, CA 91914619.474.5400 – p / 877.826.7834 – f

Contact: Drew LouisE-mail: [email protected]

Website: www.deltoroloanservicing.comProduct/Service: Loan Servicing / Foreclosure /

Loan Docs

IRA Services Trust Company 1160 Industrial Road, Suite 1

San Carlos, CA 94070650.593.2221 – p / 650.591.2168 – f

Contact: Belinda SavageE-mail: [email protected]: www.iraservices.com

Product/Service: IRA Custodial Services

LendingHome201 Post Street, Floor 12San Francisco, CA 94105

858.945.1393 – pContact: Josh Stech

E-mail: [email protected]: www.lendinghome.comProduct/Service: N / O / O Loans

Mortgage+Care Loan Servicing29222 Rancho Viejo Road, Suite 209

San Juan Capistrano, CA 92675800.481.2708 – p / 650.745.7088 – f

Contact: Bob SpierE-mail: [email protected]

Website: www.mortcare.comProduct/Service: Loan Software

Olympia Financial16633 Ventura Boulevard

Encino, CA 91436818.885.8585 – p / 818.788.8471 – f

Contact: Jeff AronsonE-mail: [email protected]

Website: www.olympiafin.comProduct/Service: Lender

Thank You to Our Spring Exhibitors



Peak Corporate Network5900 Canoga Avenue, Suite 400

Woodland Hills, CA 91367818.591.3300 – p / 818.591.2990 – f

Contact: Mike UrbanE-mail: [email protected]: www.peakcorp.com

Product/Service: Loan Servicing / Foreclosure Services

Polycomp3000 Lava Ridge Court, Suite 130

Roseville, CA 95661916.773.3480 – p / 916.773.3484 – f

Contact: Stacy SheetzE-mail: [email protected]: www.polycomp.net

Product/Service: Self-Directed IRA

Private Mortgage Fund, LLC23586 Calabasas Road, Suite 100

Calabasas, CA 91302818.702.2551 – p / 818.222.1793 – f

Contact: Randy Van DueckE-mail: [email protected]: www.pmfundllc.com

Product/Service: Hard Money Fund

Ross Diversified Insurance Services2922 East Chapman Avenue, Suite 203

Orange, CA 92869714.633.7677 – p / 714.633.7788 – f

Contact: Mel BabtkisE-mail: [email protected]: www.rossdiv.com

Product/Service: Insurance Products

SBS Trust Deed Network31194 La Baya Drive, Suite 106

Westlake Village, CA 91362818.991.4600 – p / 818.874.9500 – f

Contact: Mitch WilletE-mail: [email protected]: www.sbstrustdeed.com

Product/Service: Foreclosure Services / REO

Spiegel Accountancy Corp.2033 North Main Street, Suite 365

Walnut Creek, CA 94596925.977.4000 – p / 925.977.4015 – f

Contact: Jeff SpiegelE-mail: [email protected]

Website: www.spiegelcorp.comProduct/Service: CPA

Thank You to Our Spring Exhibitors

Total Lender Solutions, Inc.6540 Lusk Boulevard, Suite C238

San Diego, CA 92121866.535.3736 – p / 858.630.5570 – f

Contact: Randy NewmanE-mail: [email protected]

Website: www.totallendersolutions.comProduct/Service: Foreclosure / Default Services

PLM Lender Services, Inc.46 North Second Street

Campbell, CA 95008408.370.4030 – p / 408.370.5484 – f

Contact: Elizabeth KnightE-mail: [email protected]

Website: www.plmweb.comProduct/Service: Loan Servicing / Foreclosure /

Loan Doc Drawing

PENSCO Trust Company595 Market Street, 4th Floor

San Francisco, CA 94105415.395.5729 – p

Contact: Mike HoweE-mail: [email protected]

Website: www.pensco.comProduct/Service: Self-Directed IRA



Thank You 2014-15 PAC Contributors!$2,000 – $6,800

Anchor Loans, Inc.Calabasas

Equity Funding Resource, Inc.

Sherman Oaks

Southwest MortgageGranada Hills

$1,000 – $1,999

Adleson, Hess & Kelly, a P.C.Campbell

Budget Mortgage Corp.Los Angeles

Creative Realty Marketing & Mortgage

Bakersfield

Fidelity Mortgage Lenders, Inc.Los Angeles

Geraci Law FirmIrvine

Herzer Financial Services, Inc.Redwood City

Lantern Financial Corp.Sherman Oaks

PLM Lender Services, Inc.Campbell

Roza Real Estate Loans Inc.San Francisco

$500 – $999

BaySierra Financial, Inc.Santa Rosa

FCI Lender Services, Inc.Anaheim Hills

Law Office of Benjamin R. Levinson, APC

Campbell

Law Office of Peter N. BrewerPalo Alto

MAI Financial Services, Inc.Toluca Lake

MOR FinancialLos Angeles

Mortgage Securities Inc.Encinitas

National Equity Funding, Inc.Irvine

Redwood Mortgage Corp.San Mateo

Total Lender Solutions, Inc.San Diego

$200 – $499

A.S.K. Investments, Inc.Stanton

Abundance RealtyMilpitas

All California FundingStudio City

Allstar Financial Services, Inc.Woodland Hills

Applied Business SoftwareLong Beach

Bolour AssociatesBeverly Hills

California Home LoansSan Jose

California Western Financial Investments, Inc.

Los Alamitos

Cal-Pac Capital AdvisorsNewport Beach

Cirius CapitalSan Jose

Cushman Rexrode Capital CorporationOakland

David A. Duner, CPAIrvine

Del Toro Loan Servicing, Inc.Chula Vista

Diamond PotransDiamond Bar

Equity Bridge CapitalSan Francisco

Equity Funding Source, Inc.Los Angeles


Standard Mortgage Financial Services Inc.

Riverside

Stonecrest FinancialSan Jose

Trilion CapitalSan Diego

Wachter Investments, Inc.Burlingame

$1,000 – $1,999 continued

Woodland Hills Mortgage CorpWoodland Hills

Woody Financial Realty Corp.Long Beach

$500 – $999 continued



Thank You 2014-15 PAC Contributors!Athas Capital Group

Calabasas Hills

Available Home Loans, Inc.San Bernardino

BayMark Financial Inc.San Mateo

Baypoint Mortgage Inc.,Granada Hills

Best AllianceVan Nuys

Blackburne & BrownSacramento

Buchalter Nemer, A Professional Law Corporation

Los Angeles

Cal-West Home Loans, IncSan Carlos

Capital Benefit, Inc.Newport Beach

Cascade Capital ServicesBuellton

Chuck Birkett TsoongPasadena

Commercial Mortgage CorporationSan Mateo

Cournale & Co.San Francisco

Crawford Investment CompanySan Bernardino

Creative Capital Group, Inc.Seal Beach

Custom Financial Services Inc.Torrance

Dark Horse DevelopmentOakland

Datacom Investment Co.Trabuco Canyon

DFI Funding, Inc.Emeryville

DMA Corp.Cathedral City

Doss LawSilverado

Duane Gomer SeminarsMission Viejo

E.F. Foley & Co., Inc.San Jose

Elmer F. Karpe, Inc.Bakersfield

F.E. Forbes Company Inc.Berkeley

FJM Capital, Inc.San Rafael

Hanson Bridgett LLPSan Francisco

Hensel Financial, Inc.Carlsbad

Kirby & McGuinn, A P.C.San Diego

Mid Valley Services, Inc.Fresno

Monterey Bay Resources, Inc.Soquel

Mortgage Vintage, Inc.Newport Beach

Mortgage+Care LOAN SERVICING SOFTSan Juan Capistrano

Note Servicing CenterChowchilla

Olympia Mortgage & Investment Co., Inc.Grass Valley

Pacific Capital Loans, LLCCalabasas

Pacific Private MoneyNovato

Pacific West Mortgage Fund, LLCTorrance

Private Financial, Inc.Sherman Oaks

Private Mortgage Fund, LLCCalabasas

Redwood Trust Deed Services, Inc.Santa Rosa

ReProp FinancialEureka

Residential First MortgageIrvine

Ross Diversified Insurance Services, Inc.Orange


S.B.S. Trust Deed NetworkWestlake Village

Salas FinancialSan Diego

Selzer Home LoansUkiah

SFR Ventures, IncWalnut Creek

Showcase Investments, Inc.Glendale

Socotra CapitalSacramento

Sonoma Equity Lending, Inc.Petaluma

Spiegel Accountancy Corp.Walnut Creek

Sterling Pacific Lending, Inc.Watsonville

Sunset MortgageMission Viejo

The Argus GroupWoodland Hills

The Helvetica GroupCarlsbad

Unitrust Mortgage, Inc.San Diego

Val-Chris Investments, Inc.Irvine

Watsonville MortgageWatsonville

Windvest CorporationSan Diego



$20 – $199

A-1 Loans & InvestmentsSanta Rosa

Action Funding, Inc.Woodland Hills

Agricultural FinanceHayward

Alliance PortfolioAliso Viejo




Thank You 2014-15 PAC Contributors!Peak Corporate Network

Woodland Hills

Pelorus Equity GroupLaguna Hills

Pfeifer & De La Mora, LLPOrange

PMB Capital, Inc.Calabasas

Premier Money Source, Inc.Corona Del Mar

PrideCo Capital Management, LLCNewport Beach

Private Capital InvestmentsAlamo

PROPELIANBeverly Hills

Provident TitleGlendale

R.C. Temme CorpWoodland Hills

Real Estate Lending Group, Inc.San Jose

Realty Capital Lending GroupDowney

Roebuck & CompanyAlameda

Royalty Mortgage CompanyRancho Cucamonga

SDC Capital FundingTarzana

Security Financial ServicesSan Francisco

Sequoian Investments, IncSan Diego

Sterling Pacific Financial, Inc..Santa Rosa

Streit LendingVan Nuys

The Evergreen AdvantageSanta Monica

The Money BrokersSacramento

The Nikols CompanyNewport Beach

The Norris GroupRiverside

The Three WisemenEl Segundo

Twin Pier CapitolSanta Monica

$20 – $199 continuedV.I.P. Trust Deed Company

Montrose

Valley Mortgage Investments, Inc.Bakersfield

Value Point Capital, Inc.Laguna Niguel

Westside Capital Management, LLCLos Angeles

Yale Street MortgagePasadena

Zinc Financial, Inc.Clovis

$20 – $199 continuedEquity Mortgage & Investments

Modesto

Equity Wave LendingIrvine

Excel FinancialSan Jose

Gasbarro Investments, Inc.Calabasas

Golden West Foreclosure Service, Inc.Redwood City

Granite Funding Inc.Rancho Cordova

Hamilton Ridge Asset ManagementSan Jose

Harmon Financial CorporationModesto

Helvetica GroupCalsbad

I.R., Inc. dba Investors RealtyBakersfield

IRA Services Trust CompanySan Carlos

JMJ Financial GroupGarden Grove

La Mesa Fund ControlLa Mesa

Lending Bee, IncNorth Hollywood

LendingHome CorporationSan Francisco

McCormick & CoSanta Rosa

Methven & Associates PCBerkeley

Mortgage Lender Services, Inc.Folsom

N A Nationwide MortgageMission Viejo

Olympia Financial Mortgage Inc.Encino

OnPoint Services, Inc.San Diego

Pacific Horizon Financial, Inc.San Diego

Pacific Loanworks, Inc.Covina

Park West Financial, Inc.Los Angeles

Partner EquitySan Francisco


PAC Announcements:

• Thursday Cocktail Party – Apple iPad WInner: Sandy MacDougall

• Friday Luncheon – Apple Watch

Winner: San Cohn, National Equity Funding

• Friday Luncheon – Apple iPad

Winner: Shafiq Taymuree, Stonecrest Financial



A s a securities attorney I have had many discussions over the years with mortgage fund managers

regarding the use of leverage to enhance the yield of a mortgage fund. These conversations tended to include the usual warnings about the perils of leverage and the need to clearly disclose the additional risks leverage entails in their offering documents. Then, right around 2009 and 2010, the topic ceased to come up. Apparently, lenders that previously made leverage loans to private mortgage funds were off somewhere licking their financial crisis wounds. As we move into the second half of 2015, however, the fog of the financial crisis has all but lifted and leverage lenders have once again appeared that are willing to lend to private mortgage funds.

A New Leverage Warning

Now, one might think that the return of leverage lenders would prompt me to dust off my usual leverage warnings and to once again focus upon the dire consequences of leverage and failing to fully disclose the additional risks leverage entails. That,

A New Leverage Risk to Consider – the Added Costs of Legal Opinions

however, is not the case ... not today anyway. While all these warnings continue to be true (and how quickly we forget), today I warn not of a risk of nondisclosure or of a potential risk faced by investors in leveraged funds. Today, I bring a warning to the fund manager standing in the unfamiliar shoes of a borrower. Don’t ignore a legal opinion requirement in the term sheet for your leverage loan until it’s too late.

It is an issue I have seen now on more than one occasion and it relates to the structuring of leverage loans by certain lenders as if the loans were part of a much larger asset backed securitization transaction (“ABS transaction”) by requiring: (i) that the borrower be a special purpose, bankruptcy remote entity (“SPE”); and (ii) that the borrower deliver legal opinions usually reserved for ABS transactions as a condition to closing the loan. The use of an SPE itself involves issues that a mortgage fund manager must consider; however, in my experience, it is the opinion requirement that is more easily overlooked or underappreciated by fund managers when assessing the costs and benefits of obtaining these type of loans.

Legal Opinion Requirements

A discussion of the purpose and scope of the various types of legal opinions is beyond the scope of this article; however, given the audience, it might be helpful to think of a legal opinion as similar to an estoppel certificate. Just as a tenant estoppel certificate is relied upon by a lender to preclude the tenant from later arguing about issues pertaining to the status of the lease, a legal opinion allows the recipient to rely on the opinion of borrower’s counsel as to issues related to the borrower and the loan transaction. By obtaining a legal opinion with respect to such matters the lender, rating agency or other recipient of the opinion is ostensibly precluding the borrower from raising these issues in the future.

Legal opinions are nothing new and certain types of legal opinions are very common. In large loan (and other) transactions borrower’s counsel is often called upon to issue opinions for the benefit of the lender


byBrad Rogerson

Hanson Bridgett, LLP


on certain issues related to the transaction. Generally, these include (i) a “due formation” or “ due authorization” opinions, confirming that the borrower parties have been duly organized and are authorized to enter into the transaction documents; and (ii) an

“enforceability” opinion, establishing (among other things) that the transaction documents are enforceable against the borrower parties under the laws of the state governing such documents. In ABS Transactions, however, one or more additional opinions related to the SPE structure of the transaction are required. Generally referred to as “non-consolidation” opinions and “true sale” opinions (if applicable), these additional opinions, in essence, confirm that the SPE used in the transaction will not be legally affected by the bankruptcy or insolvency of any parent or affiliate of the SPE.

In ABS transactions, due formation, enforceability, non-consolidation and true sale opinions are required by the rating agencies the lender has engaged to rate the asset backed securities being issued in connection with the subsequent ABS transaction. Leverage loans to private

mortgage funds, on the other hand, have traditionally not involved the use of an SPE or required these types of legal opinions. This is because they were usually not considered large enough loan transactions and they were not generally collateralized by the lenders in further ABS transactions.

Recently, however, certain lenders have begun to require the use of SPEs and the issuance of ABS type legal opinions in connection with credit lines being marketed to private mortgage funds. This appears to be true even in cases where the lender is not contemplating engaging in an ABS transaction with respect to the loan and the loan amount is far less than the traditional amount required to warrant costs associated with this structure.

Legal Opinion Considerations

There are two primary questions a mortgage fund manager should immediately consider when assessing loan terms that require the borrower to deliver any legal opinion as a condition of the loan. First, the manager must determine exactly what type of

opinions are being required by the lender and identify the legal counsel that will issue the required opinions. The manager may simply assume that the fund’s usual attorney will give whatever legal opinions are required; however, the fund’s usual attorney may not be willing or able to give one or more of the opinions on the fund’s behalf. For example, if an enforceability opinion is required with respect to loan documents that are governed by the laws of another state, the fund’s attorney may be precluded from giving the required opinion. In that event, the fund may be required to engage local counsel solely for the purpose of issuing such an opinion. Moreover, non-consolidation opinions and true sale opinions relate primarily to bankruptcy and insolvency matters and attorneys or law firms without experience in these areas of law may be unwilling to give these types of opinions as a matter of policy. Again, if that is the case, the fund may be required to engage separate counsel for the sole purpose of issuing the required opinion.

The New Leverage – continued from page 22



The New Leverage – continued from page 23

The second issue is, of course, the cost of obtaining the required legal opinions. Legal fees for the various types of legal opinions that may be required vary widely from state to state, firm to firm, and attorney to attorney. So, even if counsel is located that is willing and able to issue the required opinion, the amount of legal fees charged for such opinion should be clearly stated and understood. Many attorneys and law firms view legal opinions as tantamount to issuing an insurance policy for the transaction. If this type of firm has no other involvement in the transaction, the legal fees required just to conduct the adequate due diligence for the opinion can exceed tens of thousands of dollars. If several types of opinions are being issued and more than one issuing attorney is involved, the costs of delivering the opinions alone can reach $50,000 to $75,000 or more very quickly. Depending on the circumstances, however, it may be possible to locate attorneys willing to issue one or more of the required opinions for far less because they either specialize in issuing the required opinion or don’t regard the risks of opinion practice as being so great. If the opinion requirements aren’t identified and

addressed early enough, however, locating and engaging these types of attorneys becomes much more difficult.

Assessments to be Made Prior to Commitment

Given the foregoing, it is important for any fund manager seeking to obtain fund financing to be aware of the issues and costs associated with a legal opinion requirement. Loan terms requiring the use of an SPE should alert the manager that legal opinions may be required; however, other loan structures may also require the delivery of some type of legal opinion. General language in a term sheet referring to the delivery of “customary” or “usual” legal opinions should be immediately clarified with the lender and the specific types of opinions being required should be determined. If one or more opinions can not be eliminated through negotiations with the lender, a clear assessment of who will provide each opinion, and the cost of each opinion, should be made. Most importantly, this assessment should be made prior to execution of the term sheet for the loan or

otherwise obligating the fund with respect to the loan. Failure to identify the issue until after the fund becomes obligated on the loan may prove a costly mistake.

Brad Rogerson (Hanson Bridgett LLP) represents clients in a wide range of real estate finance and business transactions, including debt and equity f inancing, complex workouts, mortgage lending and investment, public and private securities offerings and real estate purchase and sale transactions. Brad devotes a portion of his practice to private mortgage lending and investment and has considerable experience representing California real estate brokers, investment advisors, finance lenders, mortgage funds and other private lenders in connection with licensing requirements, regulatory compliance, audits and enforcement procedures brought by the California Department of Real Estate, the California Department of Corporations and other regulatory agencies. He also represents CMA as its Securities Counsel. He can be reached at (415) 995-5898 or [email protected].


Sixteen months have now passed since the effective date of the CFPB’s rule on loan originator compensation

(the “CFPB Rule”)1 and, given its lack of clarity, it continues to pose significant compliance challenges for the mortgage industry. The earlier Federal Reserve rule on loan originator compensation (the

“Fed Rule”)2 was equally opaque, and one would have hoped that the Bureau, when drafting its Rule, might have offered some definitive guidance on “real life” scenarios that affect the mortgage industry daily. Unfortunately, it didn’t. As a result, many aspects of the CFPB Rule remain a struggle for the mortgage industry, including whether a loan originator’s compensation on a consumer-paid transaction must be the same as it would have been in an equivalent “creditor-paid” transaction with that lender.

While some well-intentioned lenders and mortgage brokers have concluded that consumer-paid compensation may vary from loan to loan, others have

byG. Bradley Hargrave

Medlin & Hargrave

Consumer-Paid Transactions Under the CFPB Rule on Loan Originator Compensation

analyzed the CFPB Rule and arrived at the opposite conclusion. And still others have decided to permit compensation variances between “consumer-paid” and

“creditor -paid” transactions for a particular loan originator – at times within narrowly stated ranges, provided the consumer-paid compensation is less than it would have been on a creditor-paid transaction with that same lender. The reason for this array of interpretations is understandable

– the CFPB Rule fails to provide definitive guidance on this issue, thus leaving mortgage industry participants with no choice but to make difficult judgment calls based on their interpretation of the CFPB Rule and their tolerance for regulatory and civil liability risk.

When tackling this particular “judgment call,” it is helpful to take note of a few basic tenets of both Rules, and the differences between the two. The “core” of each is the prohibition on the payment of compensation to a loan originator3 that is based on a “term” of a transaction, or

a “proxy for a term,” in connection with the origination of a consumer credit transaction secured by a dwelling (a

“Covered Loan”).4 In order to avoid a violation of this prohibition, most lenders pay their loan originators a commission calculated by multiplying a fixed, pre-determined percentage against the principal amount funded on all Covered Loans originated by that loan originator over an appreciable period of time. In addition, the CFPB Rule continues the Fed Rule’s prohibition on “dual compensation,” thus a loan originator who receives compensation directly from a consumer may not receive compensation from any other person, including the creditor, in connection with a Covered Loan.5 Further, the CFPB Rule continues the Fed Rule’s requirement that a creditor and a loan originator may not agree to set the loan originator’s compensation at a certain level and then subsequently lower it in selective cases.6 And finally, the CFPB Rule continues



Loan Originator Compensation – continued from page 25

to permit periodic changes to a loan originator’s compensation, but warns that such changes should occur infrequently, and must not result in compensation which is based on a loan’s terms.7

Despite this commonality between the two Rules, they are not identical, and the CFPB Rule made an important change with respect to consumer-paid compensation. The Fed Rule provided that the prohibition against basing compensation on the term of a Covered Loan did not apply to a consumer-paid transaction. The CFPB Rule, however, expressly deleted that consumer-paid exemption, and thus all of the prohibitions applicable to creditor-paid transactions now apply with equal weight to consumer-paid transactions.8 In short, consumer-paid Covered Loans are now treated identically to creditor-paid Covered Loans, and thus are subject to the basic tenets and prohibitions discussed above.

So what does this all mean? Importantly, the CFPB Rule does not state that consumer-paid transactions may not vary from loan-to-loan. But the fact that a particular practice is not expressly prohibited by a regulation does not necessarily mean that it is permitted. Moreover, officials of the CFPB have indicated, albeit informally, that the Bureau did not intend to eliminate consumer-paid compensation when it made this change, and that it understands that consumer-paid compensation often results in lower compensation to the loan originator – which could imply that the Bureau permits variances in consumer-paid compensation or, that it permits such variances if the compensation paid to the loan originator is less than the loan originator would have made on a creditor-paid transaction. Unfortunately, the CFPB has not said this either – at least not in a manner upon which the mortgage industry may reasonably rely (such as in the Official Interpretation to Regulation Z). This all leads, of course, to legitimate industry confusion, which in turn leads to a range of business practices with respect to this issue. And when lenders then factor in the potential Fair Lending concerns associated with loan originator

compensation practices that include these sorts of compensation variances, the compliance waters get muddier still.

The vast majority of mortgage industry participants are good actors who want what’s best for their clients and who desire to comply with the statutes, regulations and rules that govern the mortgage industry. As such, they deserve, as a matter of fundamental fairness and due process, to know the “rules of the road.” In this regard, the Bureau needs to do better – considerably better – when it comes to rule-making and guidance, but until such time as it does, difficult issues such as this one will remain a hard fact of life in the mortgage industry.

Brad Hargrave is a Shareholder of Medlin & Hargrave, P.C. His practice is devoted to the representation of mortgage bankers, depository institutions and loan originator

organizations. Brad can contacted at [email protected] and his firms’ website is located at www.mhlawcorp.com.

Endnotes1 12 CFR §1026.36

2 75 Federal Register, 58509, 58513 (2010)

3 The term “loan originator,” includes a loan originator organization, such as a mortgage broker entity. See, 12 CFR §1026.36(a) for the full definition.

4 12 CFR §1026.36(d)(1). Each of the terms in quotes is a defined term in Regulation Z.

5 12 CFR §1026.36(d)(2)

6 12 CFR Part 1026, Supplement I, 1026.36(d)(1)-5.

7 12 CFR Part 1026, Supplement 1, 1026.36(d)(1)-6.

8 12 CFR §1026.36(d)(2). In addition, in making this change, the CFPB also corrected the

“36(d)(2)” problem in the Fed Rule that prohibited a loan originator organization, or mortgage broker, from compensating its loan originator on a consumer-paid transaction.




Get to Know Your CMA Board Members

As part of our effort to better connect the CMA membership with the Board of Directors, Points of Interest is continuing our series entitled “Get to Know Your CMA Board Members.” The series profiles three randomly-selected Board members per issue. The profiles will be fairly uniform and focus on the Board Member’s

history and current responsibilities within CMA, how the organization has benefited the Board Member’s business and a little bit about the Board Member’s professional and personal life. We are also including contact information for each Board Member should CMA members want to reach out, which is encouraged!

We hope that this series will foster an increased understanding of the Board members’ various roles within the organization as well as increased dialogue between the membership and the Board. As always, please do not hesitate to reach out to us with feedback on this series or ideas for other series that you would like to see in Points of Interest.

— The Editors

continued on page 29 continued on page 29 continued on page 29

— Chuck Hershson —

How long have you been on the CMA Board of Directors?

I’ve been on the board of CMA and its preceding organizations for about 40 years, past president of CMA, MAC and CIMBA.

Are you currently, or have you previously been, a member of any Board subcommittees?

I’ve served as Treasurer, Chair of the Membership Committee, and others over the years.

How long have you been a CMA Member, and what convinced you to join the organization?

I’ve been a member since the beginning. I joined for the education, networking and collegiality.

— Odell Murry —


I have proudly served on the Board of Directors since 2010; two years as treasurer, one year as vice president, and most recently, two years as president.


As president, I have been an ex officio member of all committees. When serving as the Treasurer, I also served on the Executive Committee, the Nominating Committee, and Summer Seminar Committee. I also served as chairman of the Finance Committee, where I was responsible for overseeing budget preparation, monthly reports, and annual audits.

— Michelle Rodriguez —


Almost 1 year.


I’ve been chair of the Dodd-Frank Committee for many years, and I’ve been on the Ethics Committee, an ad-hoc committee on BRE audits, and a committee on foreclosure registry ordinances.


I’ve been a member for 4 or 5 years, I believe. I joined because I believe in


How has CMA changed since you joined?

It has grown and it has enabled us to be more proactive in the legislature.

Tell us about your business? Is it set up as a broker or a lender? How long has it been around? How can our members learn more about it?

We are broker/lenders. Been in business for over 40 years.

Look at our website or call me.

Please provide a brief bio on yourself

Charles “Chuck” Hershson, president of Fidelity Mortgage Lenders, Inc., founded the company in 1971 after graduating from the University of Southern California (B.S. Real Estate and Finance) and working for several years as a licensed real estate broker.

A leading member of the California real estate community, Chuck has served as president of the California Mortgage Association, president of the Mortgage Association of California and president of the California Independent Mortgage Brokers Association. He has also been a member of the Real Estate Finance Advisory Committee appointed by the Commissioner of the California Department of Real Estate.

In addition, Chuck is active in many community organizations, including serving on the board of the Cancer Support Community, the Guardians, The Jewish Home for the Aging, and Friends of the Hebrew University. He’s also a supporter of the Real Estate and Construction Division of the Jewish Federation and is a member of the Board of Governors of Cedars-Sinai Hospital.

An automobile enthusiast, he enjoys a nice ride, some travel and reading adventure fiction.

How has CMA benefitted your business?


Chuck Hershson Odell Murry Michelle Rodriguez

continued on page 30 continued on page 30


I have been a CMA member for fourteen years. In the late 80s, I was a managing partner of The Emeryville Business Center. In 1989, shortly after the 6.9 magnitude earthquake in San Francisco, I learned that the institutional second mortgage on EBC would not be refinanced by the current lender. At the time, there were no other institutional lenders willing to finance industrial properties, so I looked for a professional private mortgage broker who would do the loan at a time when most commercial property values were plummeting due to the earthquake. We were eventually able to get a second mortgage from Bob Cushman, then president of Embarcadero Mortgage Corporation. After becoming a borrower, I became interested in learning more about the private mortgage business, and joined CMA in 2001.


Over the years, CMA has adapted to the needs of the industry. Today, CMA is going through a revolutionary change and is positioning itself for future industry changes. The private money industry has evolved to a more professional and sophisticated business with added legitimacy, which requires membership in an organization such as CMA to stay current and on top of legislative and regulatory changes.

What would you like to see change about CMA going forward?

First, I envision CMA expanding its borders to – as a first step – include members from the eleven western states. The Las Vegas meeting could then be geared more toward a national audience to reach members outside of California. Second, CMA should expand technology, marketing, and membership committee budgets to better meet the needs of future growth. Third, the quarterly Points of Interest magazine should be expanded

the importance of CMA’s mission of education and advocacy for our industry.


The level of sophistication has grown, and the number of gray hairs among the members has also increased.

What would you like to see change about CMA going forward?

I would like CMA to be more appealing to young businesspeople, businesswomen and businesspeople of color. The organization as a whole, and each member individually, would benefit from the diversity of perspectives and ideas, and potential new sources of business. We don’t need a formal campaign to get this started. All CMA members can reach out to their fellow members at our seminars & in their communities to ensure that all feel welcome in our organization, and all obtain the benefit of networking with industry leaders.


We have several companies. Woodland Hills Mortgage Corp has been around for about 20 years, and is a direct private mortgage lender. We are one of the few private mortgage lenders in the state doing consumer loans these days. R.C. Temme Corp. has been around since 1976, and is a loan servicer and trust deed brokerage. We also have a foreclosure trustee, Sentry Reconveyance Corp. To learn more, go to www.woodlandhillsmtg.com and www.rctemme.com.

Please provide a brief bio on yourself.

I grew up in a small town in Central Wisconsin, and went to law school and got my masters of business administration in Saint Paul, Minnesota. I worked in-house for a title company for many years, and also worked for a large legal publisher before moving to California. I am currently General Counsel & Chief Compliance Officer for Woodland Hills


Education on new legislation and member referrals.

How can CMA members contact you if they want to reach out?

We are in the CMA directory.

What is one fun fact the membership might like to know about you?

I’m learning how to fly-fish and practice casting in my pool.

Chuck Hershson

Odell Murry

Michelle Rodriguez

beyond California to reach readers in neighboring states. Last, CMA should incorporate a video aspect into its educational and webinar programs, and develop a library of digital programs for the members.


MAI Financial Services was established in 1989 as a mortgage brokerage firm specializing in the origination of institutional loans for retail, office, industrial, and residential real estate. After joining CMA in 2001 we added private commercial mortgages to our list of loan products. Members can learn more about MAI Financial at www.maifunding.com.

Please provide a brief bio on yourself.

My many years of real estate experience include ownership, management, and financing of various commercial, industrial, and residential properties. As the founder and president of MAI Financial Services, Inc., I hold a California Real Estate Broker License, and my firm is licensed as a California Finance Lender. I am or have been a member of the Mortgage Bankers Association, Association of Realtors, California Receives Forum, Military Officers

Mortgage Corp and R.C. Temme Corp., and their affiliates. I’m married, with 3 furry, four-legged children. In my free time (haha), I like to ride my bicycle, garden, play the piano, and read – mostly science fiction, mysteries, and classical literature.

How has CMA benefitted your business?

CMA has provided the education I need to create and tighten my policies & procedures to not only comply with laws and regulations, but to avoid lawsuits and make more profit. CMA has advocated for our industry in Sacramento and in Washington, to make the needs of our industry known to lawmakers, has stopped bad laws, changed other bills to make them less harmful to our industry, and helped introduce bills that are beneficial to our industry. Lastly, CMA allows me to network with industry colleagues and professionals, to find out what is happening with their businesses, discover best practices, learn from the mistakes of others, and find new sources of business.


My phone number is 818-206-2325, and my e-mail is [email protected].


I was inspired to learn to play the ukulele after meeting CMA board member Joffrey Long’s father, Gerry Long, who literally wrote the book on learning the ukulele.

Association of America and the board of directors of Vallejo General Hospital. I am a contributing author for several financial trade publications, and I also serve as Chairman of the National Advisory Board at the University of Massachusetts W.E.B. Du Bois Center. Previously I spent several years in the retail industry as an executive with national/international companies, and I was commissioned as a U.S. Army officer. I’ve traveled most of the world, and climbed to the summit of Mount Kilimanjaro.

How has CMA benefitted your business?It ’s been a pleasure to serve CMA and to work with such outstanding professionals. Membership in CMA has not only created great business relationships, but I have also made many great friends for life. My business has benefitted by me staying abreast of current regulations that directly affect my business and the industry. I can’t see how anyone can participate in this industry today without attending all four seminars each year.


Interested CMA members can email me at [email protected], or call at (866) MAI-FUND.


I have survived both a major hurricane and a tsunami, for which I am grateful. In 1997 during a Baja California camping and fishing expedition, Hurricane Nora struck my campground in the middle of the night, destroying our camp, leaving me exposed to the elements. A few short years later, in 2004 while vacationing in Penang Island, Malaysia, I found myself in the middle of the 9.1 magnitude earthquake and tsunami which killed 230,000 people in 14 countries.

Odell Murry


Mortgage Industry Information, Opinions & Tips

What are Your Chances of Being Audited

O ne of the questions I always get from Brokers is “What is the chance I’ll be chosen for a CalBRE

audit?” Generally they have been in the business for many years and have never gotten the dreaded call that the Bureau wants to schedule an audit. Or, they have never been the unhappy recipient of a call or letter from a Special Investigator (formerly called Deputy Commissioner) asking about a specific file or scheduling an Office Survey.

Lately my question back to them has been “Are you doing fee-based property management activities or do you have a broker-controlled escrow?” If the answer is “yes” to either of those business types, I respond that they should expect the call sooner rather than later. The Bureau’s goal is to audit as many of these types of companies as they can, and for very good reason. In 2014, out of only 612 audits performed by the CalBRE statewide, 75% were property management firms, 11% were mortgage brokers, 5% were broker-controlled escrow and 5% fell into the “other” category. The total trust fund shortage was a staggering $6.4 million, of which $5.6 million was from property management broker trust accounts. Imagine what those numbers would look

like if the Bureau could audit EVERY trust account maintained by brokers! In the next two years, the Bureau intends to continue to concentrate on property managers and ramp up the audits on broker-controlled escrows.

filing on time can trigger an audit. Note that the Business Activity Report (RE-881) is now required for all brokers engaging in mortgage loan activities, not just threshold brokers. This report is filed on-line only and accessible under FORMS on the CalBRE website.

The main things that will increase your chances of getting called for any audit are: 1) Consumer Complaint; 2) Competitor Complaint; 3) Past Employee or Past Licensee Complaint; or 4) Late Filing of Required Reports. Lately the CalBRE is closely monitoring the answers to the questions on the license renewal applications and audits have been triggered when the answers raise red flags. I know of one company that recently went through a CalBRE audit due to the Broker answering “YES” on the renewal to the question regarding property management activities. In actuality, the Broker managed some of his own rentals, but did no property management under his license. Due to the fact that he indicated that he engaged in property management, his company was audited. Read and answer those questions very carefully!


If the answer is “no” to these types of activities, I then ask if they are doing loans and if they are threshold and/or multi-lender brokers. Depending on the answer, I ask them if they are filing ALL of their reports on time (the Business Activity Report, Escrow Activity Report, quarterly trust account report and annual trust account report). Not filing at all or not


A Word to the Wise

In the last few months I have either witnessed or been made aware of losses to Broker trust accounts either from outside hackers going directly into the bank account or from outright embezzlement by employees. Talk to your bank to see what safeguards you can put in place to minimize the risk of non-authorized withdrawals through bogus checks or wires. Ask about “positive pay” for both checks and wires. Religiously reconcile your account to the penny every month. And, whatever you do, make sure you get a background check on anyone you employ who has access to any monies, trust funds or otherwise. The person doesn’t even need to be a signer on the account to perpetrate the fraud – simply having the routing numbers, they can use an ACH transfer to take funds. I cannot tell you how many brokers are victimized by employees who had previously served time for fraud and embezzlement! A background check and credit report should be a mandatory employment requirement for any accounting personnel.

Pam Strickland is a compliance consultant specializing in helping CalBRE brokers prepare for and survive an audit. www.pamstrickland.com.

Strickland – continued from page 31


From the President – continued from page 2

■ The Finance Committee, chaired by Treasurer Mark Forbes, along with our CPA Tricia Schrum and outside auditor Pamela Mainini have brought us audited annual financial reports, which are available for member inspection. The Finance Committee has also been diligent in providing our organization with annual budgets and business planning that have resulted in CMA’s solid financial position. I would like to thank the Finance Committee and the Board of Directors for their keen insight in keeping CMA financially strong and on solid footing during the worst financial crisis since the Great Depression. We weathered the storm.

■ Our Legislative Committee, chaired by George Eckert, continues each year with a solid performance, working with both Mike Arnold and Mike Belote, reviewing the important legislative issues that face our industry. They monitor between 50 and 70 bills annually that may affect our industry. Our organization is so fortunate to have the exceptional talent and extensive and in-depth experience like we do in both Mike Arnold and Mike Belote.

■ We have our Logistics Committee Co-Chairs Phil Ruble and Jeff Spiegel, along with our Meeting Planner, Jen Gross, to thank for all the new hotel facilities that we have been experiencing lately. I would like to thank this group for all their hard work in locating, negotiating and securing these fine facilities for us and maintaining the high standards that CMA is known for.

■ Our Marketing Committee, chaired by Steve Belleville, was developed to work independently and in conjunction and cooperation with other committees as it relates to branding and marketing CMA and the events and activities sponsored by CMA. This committee has done a great job introducing video to help market our upcoming seminars, and linking CMA to social media sites such as Facebook, LinkedIn and YouTube. A

special thanks to Beau Eckstein for his part in assisting this committee.

■ The Member Benefits Committee, chaired by Pam Sosa, is one of our newest committees which is designed to improve existing member benefits and to develop new CMA benefits for our members.

■ A streamlined version of CMA’s Points of Interest magazine – ePoints – was distributed beyond the membership to professionals and the general industry. To ensure this rollout went smoothly, we formed a joint committee. This rollout was made possible by Points of Interest Editor Steve Pollack, the Technology Committee, chaired by David Herzer, the Marketing Committee, our Executive Director Lexi Howard and the CAMS management team. I would also like to thank Steve Leidner for his role in helping us to turn this idea into a reality.

■ Steve Anderson, our Membership Committee chair, worked with John Graziano to create the threshold broker membership recruitment program. The Membership Committee also started a successful mentor program, which helps our new members to get acquainted with CMA.

■ Our PAC Committee, chaired by Rich Wachter, worked to substantially increase our PAC contributions, which now regularly exceed $10,000 per seminar. Also, special thanks go out to our largest contributors, Steve Pollack, Anchor Loans Inc.; Robert Box, Equity Funding Resource Inc.; Chuck Hershson, Fidelity Mortgage Lenders Inc.; and Joffrey Long, Southwest Mortgage.

■ We all admire the brilliance of Glenn Goldan and greatly appreciate the tremendous contributions he has made to CMA. Glenn chairs the Pool Manager’s Group and provides first-class education and training in this area.

■ The Summer Seminar Committee, chaired by Pam Sosa, introduced the popular Speed Networking session and has brought us training on other timely topics. This seminar has turned into a big success under Pam’s leadership.

■ Brad Rogerson was selected as CMA’s new securities attorney.

■ Our Technology Committee Chairman Dave Herzer created eBinder, an electronic version of the physical seminar binder, making it easier for members to access materials from CMA seminars. A website was also created so members can access all the seminar materials online.

■ We hosted a successful Sixtieth Anniversary Celebration. With the help of Gordon Getz, Steve Leidner and many others, we turned this milestone into a year to remember; the achievements this organization and the previous organizations have made down through the years have been tremendous. Steve Leidner has been a sterling example of a dedicated CMA member. He has worked behind the scenes of many successful projects, never seeking credit, but yet playing an instrumental role.

■ Our organization is professionally managed by California Advocates Management Services led by Jennifer Blevins. I would like to thank Jennifer, Executive Director Lexi Howard, CPA Tricia Schrum, Webmaster Michael Cochran, Graphics Designer John Berkowitz, Stephanie Schoen, Jen Gross, Isis Humphrey, Teresa Excinia, and the many other CAMS personnel who have assisted us over the past couple of years.

■ Finally, a big thank you to Uncle Chuck, who was always there to help should the need arise. Whether it was making a sizable contribution when we were short of funds for a particular project, maximizing his contributions to the PAC,



or providing his country club facility for a fund raiser, Chuck Hershson was always there to help.

While we have had many successes, we have had many challenges as well.

One of our biggest challenges was just surviving through the Great Recession and the massive barrage of legislative and regulatory changes. Although some of this occurred on my watch, I would like to thank our past president, John Graziano, and the prior leadership team, our attorneys and lobbyists for doing a yeoman’s job of charting our course through the maze of changes.

However, there are other big challenges facing this organization. We need more talented individuals to step up to the plate and volunteer their services to the organization. Volunteers are the glue that holds a successful organization such as CMA together. Volunteering to work

on a committee is the training ground for future CMA leaders. This industry may not exist today had it not been for the tireless efforts of several individuals who saw the importance of volunteering their time to achieve important industry goals. The future of this industry will depend on the same type of effort.

There are many new operators who have entered the private money real estate lending business in recent years in California who are not receiving the valuable and necessary training that only an organization such as CMA offers. CMA is the largest private mortgage trade association in the country with roots going back over sixty-one years. CMA and its previous organizations created and professionalized the industry in California, and California set the stage for private mortgage lending across the country. Everyone out there in this business should be a member of CMA.

With all the new legislation and regulations that have taken place over the past several years, our business has significantly changed from what it was a decade ago.

Through all of this, we have persevered. Despite our challenges, you have taken care of each other, as well as the organization, and you have succeeded.

As you continue under new leadership, remember that our challenges are not over. There will always be tough times and hurdles to overcome. Do not be discouraged, but rather persist in your dedication to this organization and to each other. Together, we will continue to make industry improvements and create an environment where we can thrive.

In closing, I would like to say that my term as president has been extremely rewarding. I have faith that our new leadership will continue to build on our recent successes. Many thanks to you all!

From the President – continued from page 33

MEMBERSHIP APPLICATION

Mission Statement

The California Mortgage Association is committed to providing legislative advocacy, legal resources and education programs for our members to enhance their professionalism. We believe that the public good is served when professionals serve the public.

Regular Member

Any reputable individual, sole proprietorship, corporation or partnership primarily engaged in the business of arranging trust deed loans and/or selling, collecting/servicing trust deed loans in the state of California.

Affiliate Member

Any reputable individual, s o l e p r o p r i e t o r s h i p , corporation or partnership having interest in the above-cited objectives. Affiliates share all privileges of Regular Members, except that of voting.

Mail Application with Payment to:

2520 Venture Oaks Way, Suite 150

Sacramento, CA 95833

If paying by credit card, you may fax to:(916) 924-7323

Questions?Call (916) 239-4080

or visitwww.californiamortgageassociation.com

Power of Membership

Name ________________________________________________ License # (if applicable): _____________________________

Company: ________________________________________________________________________________________________

Address: _________________________________________________________________________________________________

City: __________________________________________________________ State: _____________ Zip +4: _______________

Phone: ______________________________________________ Fax: ________________________________________________

E-Mail: ___________________________________________________________________________________________________

Annual Gross Closing: $ ______________________ Referred by: ________________________________________________

I hereby make application for membership in the California Mortgage Association and pledge myself, if accepted, to abide by the requirements of their By-Laws and Code of Ethics as they are now and as they may be amended. Applicant acknowledges that the use of the Association logo is exclusive to members only, and applicant agrees to cease utilizing the logo upon termination of membership. By becoming a member, applicant authorizes CMA to send information on products and services by phone, fax or e-mail under U.S.C. 47 sec. 227. Applicant certifies that the foregoing information and annual gross closings are correct.

Signature (required) ___________________________________________________

I would be interested in participating in the following focus group:

■ Commercial: For those members whose interest is commercial finance. While we meet as a whole, we have organized into two chapters – Northern and Southern California. Select the location where you do the most lending. ■ Northern CA ■ Southern CA

■ Securities: For those members who are using "non-DRE" methods of raising capital for your loan investments or would like to learn more about securities like pools and permits.

■ Consumer: For those members who are arranging owner-occupied 1-4 unit loans, want to stay up-to-date on the laws and invent new possibilities in this lending arena.

DUES PAYMENT OPTIONS: Dues are based on your annual gross closings. Please select one: ■ Regular Member — ($1 million and above per year): $125/month

■ Affiliate Member — Billed Annually: $500/year

■ Educational Member — (Open to non-threshold and sales individuals. Non-voting privileges): $75/month

MAKE CHECKS PAYABLE TO: CALIFORNIA MORTGAGE ASSOCIATION

Credit Card Authorization: ■ VISA ■ MasterCard

Card Number: ________________________________________ 3-4 Digit CVV: __________ Expiration: _______________

Amount to Charge: $________________ Cardholder's Name: __________________________________________________

Carholder's Signature: ____________________________________________________________________________________

Billing Address (if different): ________________________________________________________________________________

City: __________________________________________________________ State: _____________ Zip +4: _______________

CMA offers a convenient automatic payment plan for your membership. Dues will be charged to your credit card on the 1st of each month. The first month's payment or annual dues payment is required to activate your CMA Membership. By signing below you authorize the California Mortgage Association to initiate credit card charge(s) to remain in full effect until written notification from you is received by CMA, in accordance with the terms and conditions contained herein.

Monthly Payment: $ ________________ Signature: _______________________________________ Date: ______________

Contributions or gifts (including membership dues) to CMA are not tax deductible as charitable contributions. Pursuant to the Federal Reconciliation Act of 1993, association members may not deduct as ordinary and necessary business expenses, that portion of association dues dedicated to direct lobbying activities. Based upon the calculation required by law, 6% of the dues payment only should be traated as non-deductible by CMA members. Check with your tax advisor for tax credt/deduction information.


BENEFITS OF MEMBERSHIP

WELCOME NEW MEMBERSThe California Mortgage Association welcomes the following members who are new to the association:

CMA is one of the fastest growing statewide associations and we thank all our members for their support! You

are encouraged to share with your nonmember colleagues all of the membership benefits and reasons you belong to the association. Encourage them to join – applications can be found on the CMA Web site – www.californiamortgageassociation.com, or by calling the headquarters office at (916) 239-4080.

Please remember to share information about the Focus Groups that are provided to members only. Additional information can be found on the CMA website. There are many exciting educational programs being planned and the Summer Educational Seminar in San Diego in July, 2015 is the next program being offered.

Thank you again for all of your support and contributions to CMA and the private loan industry!

Jeffrey JosephCoastline Lending Group

12100 Wilshire Boulevard, Suite 800Los Angeles, CA 90025

(310) [email protected]

Regular Member

Bradley LaddusawMOR FinancialP.O. Box 811487

Los Angeles, CA 90071(213) 284-1005

[email protected] Member

Kevin HeslinChurch Capital Corporation

302 East 14th StreetSan Leandro, CA 94577


Regular Member

Peggy CramerPENSCO Trust Company

595 Market, 4th FloorSan Francisco, CA 94105


Affilliate Member

Brad RustPivotal Capital Group II, LLC111 Corporate Drive, Suite 270

Ladera Ranch, CA 92694(949) 535-1533

[email protected] Member

FIRST-CLASSU.S. POSTAGE

PAIDSACRAMENTO CA

Permit #1876

California Mortgage Association2520 Venture Oaks Way

Suite 150Sacramento, CA 95833

Date post:	27-May-2020
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