Several people have asked me to comment on the differences between mortgage brokers and mortgage bankers and levy an opinion on which I believe to be the better business model. I am, of course, weighing in on what I believe the best model to deliver service and a solid loan to a consumer, and will ignore owner-related issues such as profit margins as they do not relate to the overall customer experience. This is not meant to be a deep introspection of the two models; rather, consider it a survey of some of the important differences between the two and their implications on customers interacting with each.
If you’re wondering why I may be able to speak to this argument with any rigor it is due to the fact that the company I own has operated under both the mortgage broker and mortgage banker business models. As the champion of our switch from brokering to banking, and the change agent involved in the transition, I have a first hand knowledge of all aspects of the differences between the two models. With this understanding I believe I can candidly discuss the pros and cons of both models; and what the implications of each are for the customer.

For those of you with limited time or attention, I’ll share my conclusion with you here. With anything complicated the answer is “it depends,” and here is the distillation of the below: if you are unconcerned about loan-product selection and you are a very vanilla-type borrower then I would suggest choosing the mortgage banker. If you are concerned about a wide selection or you have a difficult financial or credit history I would suggest choosing the mortgage broker. With one caveat, I would always suggest the mortgage broker over the small mortgage bank.

The Broker Argument
The broker argument is often surmised as follows. The broker has a wide range of bank partners and loan options, making it easy for brokers to find and place the best loan for a customer in terms of price, rate and terms of the loan. The argument continues, not incidentally, that people with difficult-to-document situations can be served by this wide network of lending partners. Brokers will also excitedly share with you the discount you receive by receiving “wholesale” rates that are below the market that banks offer. The reasoning is that because the broker is responsible for overhead they receive a reduced rate from the bank – which they are graciously passing on to you, the customer.

An Argument against Brokers
Often, you’ll hear someone who works for a bank or a mortgage banker tell you that working with a mortgage broker is bad news with the following pitch. A broker is an independent third party, with zero decision-making ability; they don’t approve your loan and have to wait in line with all other mortgage brokers while they wait for a decision from the underwriting department. Further, when you have a middleman you pay for that extra party involved. They have expenses that they need to cover by fees charged up front on a loan; which means higher upfront charges to you.

The Banker Argument
The banker argument sounds a bit like this. By working with a direct lender you have eliminated and expensive middleman who has zero decision-making ability. You have decided to come straight to the source; and because we lend our own money we are able to make underwriting decisions, gain special exceptions, and process your loan much faster at a much lower cost to you. Everything is done in-house, there is no waiting inline, no false promises – I can give you a fully underwritten approval from right down the hall. A mortgage broker can’t really tell you what you’re approved for until they hear back from the bank, which can be weeks. Why put yourself through that when I can tell you right now whether you’re approved or not? And remember, we are a financial institution, a direct lender, not just a fly-by-night broker who you are not sure is going to be there tomorrow.

An Argument against Bankers
Often, when a broker is competing against a banker they’ll use some derivative of the following argument. Mortgage bankers are exceptionally limited in the products that they are able to offer. They make their money by producing volume in limited product categories; in addition they don’t have the opportunity to shop for the true best deal for you. You only get to choose from what they offer, and depending on their specialty, those rates and programs could be far from the market value. You also don’t see how much money they truly make on your loan. They could be making thousands of dollars in additional hidden profit by giving you a higher interest rate than you deserve. Further, many small mortgage banks are nothing more than brokers on steroids. Since they sell your loan immediately they don’t always have ultimate control like they say they do. Finally, your loan will be sold immediately. This means that you may be confused about whom to make your payment to, and will have to deal with the headaches of your lender changing almost as soon as the ink dries on your loan documents.

Common Misconceptions about Brokers
With anything confusing people attempt to simplify the story to make it easier to understand. We are far better at remembering and making sense out of stories than we are at remembering and processing lists of facts and figures. That’s why people tell stories and don’t rattle off bulleted lists. The problem with the way we process information and remember stories however; is that we tend to over-simplify to make the story cleaner and easier to tell and remember. For most things the result is negligible, and the simplification suits us well; for others this tendency can be damaging. Such is the case in a complex comparison between brokers and bankers. By distilling to simple comparisons we fall victims to the lack of focus on key distinctions and facts.

Here are some common misconceptions about brokers, and a humble rebuttal.

Brokers don’t have to be licensed
This is patently wrong (mostly, depending on the state). Brokers are governed by state licensing institutions and therefore require licenses to operate. Federally chartered banks are not subject to state licensing requirements and therefore do not need to have their employees licensed under the state regulations in the jurisdictions where they operate. The efficacy of licensing is a debate for another time; but suffice to say, according to (most) state laws brokers of residential home loans need a license.

Brokers have no decision making power
This is wrong as well. While this myth is most likely perpetuated from the past, brokers have many of the same tools as the mortgage banks in terms of underwriting and qualifying a borrower for a home loan, on the spot. Brokers have access to the same Automated Underwriting Systems (AUS) that most mortgage bankers do. This allows brokers to obtain instant approvals in-house with out needing to ship the file off to the bank for approval. Once an AUS approve is obtained, the bank simply verifies the documentation supports the information uploaded in to the AUS; they do not re-underwrite the loan, and they do not review the decision (except as noted).

This means that an approval from a broker is as solid as the one from the bank. In fact, the mortgage bank is going to do the exact same thing. Where this myth holds is in the offices of the “old school” brokers who refuse to run files through AUS prior to submitting files to the bank. By avoiding this recent technological advance the broker is putting you in line with others; and then truly has no decision making ability. Some times, if you are a subprime borrower or have a unique lending circumstance, brokers may not be able to issue an AUS approval, and then your file will need a complete underwrite at the bank your loan is destined.

Brokers are financially unstable
Bankers love to portray all mortgage brokers as fly-by-night operations that don’t have the capitalization or the stability to be a direct lender. This is certainly true in some cases. Some people who obtain a brokers license choose to practice their craft on a part-time basis, others are truly the fly-by-night variety, in the industry for a quick buck and then gone the moment things get tough; however, there are some brokers that are well established, have a longer track record of success than a mortgage banker, are better capitalized and have made a choice to stay a broker.

Brokers are a rip-off
There seems to be an American quality that drives us to “eliminate the middle man,” perhaps it’s been the successful marketing over the years of direct-to-consumer efforts of other industries. We love Costco, we love discount “wholesalers” we loathe paying markups and dealing with middlemen. In the case of mortgage brokers some are certainly rip-offs. The fact remains however that anyone issuing credit to you in the form of a home loan can rip you off. Bankers can certainly charge excessive fees with the best of under-handed brokers. Loan officers at banks and loan officers in a brokerage all have varying moral compasses and the institution they work for has little to do with their current direction.

Here are some common misconceptions about mortgage bankers; again with a rebuttal:

Bankers charge more on loans – you just don’t know it
Some brokers argue that because mortgage bankers are not required by law (like brokers are) to disclose the compensation paid to them for selling premium interest rates, bankers are able to dupe the customer in to a higher interest rate to reap additional hidden profit. While it is true that bankers do not need to disclose that hidden profit (known as yield spread premium, see link for in-depth explanation) most are unable to maximize that hidden profit because to do so would price them out of the competitive interest rate market. Hidden profit cannot be made unless there are higher interest rates charged to the customer. Unless the customer is blindly accepting the rate on good faith, they should be able to quickly surmise that the rate offered is way out of line with even a superficial comparison shopping effort.

This competitive environment often limits this ability to hide profit from customers from turning in to a “rip off.”

Bankers are limited to only one of two programs
I’ve heard the silly argument that bankers are bad for consumers because they only offer say, product A or B, and if product A or B isn’t ideal for the customer the mortgage banker still steers them in to one regardless better options “out there.” While bankers do customarily have fewer bank relationships than brokers, this does not necessarily mean they are more limited in the mortgage products they can offer. Take for instance a mortgage banker that sells to Countrywide. This banker may have in excess of 150 different loan products running the full spectrum of financing options.

Additionally, mortgage bankers may be allowed (based on the business rules established in the institution) to take loans that don’t “fit” their banking guidelines through the broker channel and act in a limited broker capacity; that is they can farm your loan out if it doesn’t fit internal guidelines. As I said, their ability to do that is really dependent upon the institution they work for.

Bankers have better rates
Some people mistakenly believe that bankers have lower rates than brokers. It probably stems from the “eliminate the middleman” pitch that we discussed above. This myth is just that, a myth. Rates are based upon the rate available to the bank for the particular loan program PLUS the markup charged by the banker to cover their expenses and add to the bottom line. This markup is hidden from you, the borrower, and often from the employees – definitely the sales team. Brokers must disclose all rate markups. This doesn’t imply that banker rates are higher than broker rates, but it does suggest that regardless of business model their will be fluctuations based on decisions made at each individual business.

Some pros and cons of working with a broker

Pros

• Low overhead can lead to lower rates
• Wide range of products from diverse lending sources
• Can source many different financing options
• Must disclose all compensation associated with loan

Cons

• Necessary middleman
• Sometimes limited decision making ability
• Can be ephemeral, lower barrier to entry for business owners

Some pros and cons of working with a mortgage banker

Pros

• On-site decision making ability, more control over the process
• Better rates for larger banks (volume discounting)

Cons

• Don’t disclose yield spread premium profit
• May charge additional fees to support overhead (underwriting, etc.)
• May not have true decision making ability

Why I don’t like small mortgage banks
I said earlier that if you had to choose between a broker and a small mortgage banker to always go with the broker. Here’s why I believe that.

Decision Making Ability
To make a decision on a loan you need an underwriter to sign off on the loan and a funder to coordinate the funding by ensuring the final documents are in place that make the loan “sellable.” When those two positions are properly performing their job functions you have in-house decision making ability on loan approval and funding. The problem with small mortgage banks is that they may not have underwriting and funding in-house. This takes the decision making ability right back out of the hands of the small mortgage bank; making them no better than a mortgage broker on steroids.

Small mortgage banks may not have underwriting and funding in-house due to the high expense associated with the positions. Underwriters are not cheap, and while funders are relatively inexpensive it is a fixed cost that some smaller operations choose to not incur. So if you are working with a small mortgage bank they may have a contract underwriter or a part-time underwriter or use an underwriting service to approve the loans they plan on writing. This invalidates their argument of having centrally-based decision making ability because they are sending their loan files off to another source outside of their organization for someone else to underwrite and make the decision. This is exactly what brokers do.

To exacerbate that problem, smaller mortgage banks often require prior approval from either their warehouse line or end investor (the bank ultimately buying the loan) or both. This means that not only does the small mortgage bank have to underwrite the loan (by sending it out?) but they also need to receive approval from their warehouse credit facility to lend the money and they may even need the investor’s prior approval to buy the loan before they are willing or able to fund the loan.

So hopefully you can see the added complexity that can bog down your loan when you use a small mortgage bank. Instead of one approval, they may need up to 3 approvals before your loan is truly approved and ready to go. Most of these problems are alleviated when you use a larger mortgage banker who has in-house, delegated underwriting authority. The question to ask when someone tells you they are a direct lender is “Do you have in-house underwriting?” and “Do you have delegated approval authority from your investor?” If the answers are yes to both of these questions then you are in pretty good shape; if not the service provider is going through extra hoops to approve your loan for funding.

Costs
As I mentioned above underwriters and funders are not cheap, and they are fixed costs for a mortgage bank; costs that aren’t there for mortgage brokers. There are other costs for mortgage bankers that are not associated with brokers – warehouse interest fees, document preparation fees, fees associated with the loan sale and transfer, and of course the added salaries of the people involved in the process.

These costs need to be recouped by small mortgage banks, and they often do it either by adding hidden profit in to the loans in the form of inflated interest rates, or by charging additional fees on the closing statement to recoup the costs of mortgage banking business. For a smaller mortgage bank that doesn’t do a lot of volume the need to recoup costs may be much higher on a per loan basis than a larger mortgage bank. Again these costs are non-existent for a mortgage broker.

You can see that a large mortgage banker, who operates on volume and therefore only needs to recoup a small portion of expenses on each funded loan; and a mortgage broker who doesn’t have the associated costs with their business model, may be less expensive than the smaller mortgage bank.

Higher Interest Rates
Continuing with the above, the need to recoup costs while profiting in a higher-overhead environment can often times manifest itself in interest rate mark ups. That is, the mortgage banker is not required to disclose yield spread premium profit on each loan. They therefore are able to mark up the rates offered to them by investors in secret, before delivering them to the sales staff so that there is a fixed profit margin on each interest rate quoted. This is often profit for the house and not known by the sales staff. In order to achieve this profit though there needs to be a spread between the interest rate offered by the investor and the interest rate charged to the customer by the mortgage banker. This can be anywhere from a few percentage points to a quarter or half-again higher interest rate.

This is exacerbated in smaller institutions because of the pressure to increase margins on each unit funded because of the overhead expense associated with banking. Larger institutions can make smaller profit on each individual unit; relying on volume to make up the difference.

In Conclusion
The banker/broker argument is a bit overblown. It is often used as a sales tool and the benefits of each are usually espoused the strongest based on the company’s current business model. Bankers push banking and brokers push brokering. As both a banker and a broker (a small banker, btw) I think that both models are efficient and have pros and cons that offset one another and are often overblown. I think that consumers, real estate professionals and other interacting with the lending community should not base their decisions on the business model chosen by the financing source (broker or banker) but rather on the individual merits of the people and institution. Regardless of model, I would look for people that tell the full story and look out for the best interests of the borrower as tantamount to any of the concerns above. Bankers and brokers both can be excellent sources of financing and lousy sources of financing. It’s up to the borrower to and business partner to choose their financing source based on service, honesty, integrity and follow through; more so than rate, cost or business model.

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I have recieved now more than a few requests to share a bit more about my background with respect to how I ended up where I am now than i reveal on my About page. It is a task that I have not been too excited about as it feels self-indulgent and overly revealing at the same time. I am sure that many of you will skip these posts (and yes there is more than one) and feel free to do so, those of you interested in where this is all coming from - enjoy.

There are four parts to this thing and I’ll be rolling them out over the next week or so. It is definitely an unfinished piece. Particularly the parts about my indoctrination in to the industry and any in-depth conversation of where I learned what I share here; but its a modest start and one that I hope puts some perspective me - the person who writes Blown Mortgage every day.

– Morgan

Part 1

A lot of people ask me about my background and how and why I am in mortgages. Most people want to know why someone in the mortgage industry has a web site like Blown Mortgage. I guess its a little weird having a site that is primarily focused on the negative aspects of the industry in which I work. So with out further ado, for those of you that care about who is writing this blog please enjoy this autobiographical article that should shed some light on who I am and why I write Blown Mortgage.

The Early Years 1976 - 1998

We’ll breeze through the formative years as it can get a bit cumbersome and is primarily rooted in good-old suburban America. I was born on January 25, 1976 to Paul and Diane Brown. The first born, I am the older of two sons for my mom and dad. My brother, Graeme Brown was born a mere 23 months later in December; and to this day laments that as a December baby his birthday is always neglected. I grew up in Avon, Connecticut. Avon is a small, typical East-coast town nestled away in idyllic Connecticut suburbia. Ideal, anyway, for a relatively stress-free upbringing. Avon, and the surrounding towns Farmington, Simsbury and others are towns insulated from the difficulties of “real life.” A peaceful bubble where neighbors leave their doors unlocked at night, kids play in the street, and the most exciting thing happening in town was the occasional volunteer fire drill.

I spent the majority of my days playing baseball or whatever sport was in season with my younger (more athletically gifted) brother in between being a very serious over-achiever in the classroom. During high-school I was on our conference-winning varsity baseball team. I managed to earn an All-Conference Academic Team nod for my baseball/academic feats; though I imagine it was more for the grades than the baseball. I was also on about a million after-school clubs including Model United Nations, Tutoring in the City, Young Republicans, Computer Club – you name it, I was probably on it. I spent too much time growing up stressed out about things I couldn’t control; politics and my parents divorce are two that consumed the majority of my time.

Growing up in Avon in retrospect was a true blessing. Living presently in California, and meeting so many California kids who were born and raised in the OC, I am so thankful to have the peaceful, bucolic setting of Avon for my youth. The dangers of drugs, alcohol, violence were all absent from my childhood and for each day I live I am thankful for not having to deal with any of that growing up.

When it was time to go to college my high-school mentors and advisors thought I’d do what every other sensible east coast graduating senior does by attending one of the myriad well-regarded liberal arts colleges in the North East. I would have none of it. I wanted out. The catty in-fighting, the cliques, being around the same 500 people for the last 18 years was just the fuel I needed to blast-off for greener pastures. I didn’t make my parents too happy with my college requirements which are repeated here in total. They were 1. Some place warm, 2. some place far away, 3. Some place big. That was it – I wanted a fresh start somewhere warm and potentially prosperous.

After looking at schools such as University of Miami, Florida, University of California San Diego and Santa Barbara, University of South Carolina and Pepperdine; I settled on the University of California at Santa Barbara. I was the only one from my school attending (duh) and I couldn’t have been happier. I chose Santa Barbara because of the idyllic setting. I don’t know if any of you have been to the campus; but it is one of the most beautiful settings in the world (based on my limited travels). The day that I went to visit the campus was a beautiful Santa Barbara fall day. I remember it exactly today – 10 years later – as the day I was there. It was late-afternoon; a light, cool ocean breeze swept over the campus and kissed my face. I stood, with my Dad, in one of our painfully few bonding moments, looking out over the cobalt blue of the Pacific, soaking in the salted air and feeling the warmth of the sun and possibility on my skin. It was perfection defined for a sheltered kid from Connecticut; and I still equate it with the feeling of endless possibility to this very day.

My Dad and I walked around the campus on a group tour that (minus any other visitors) ended up being a private escort around the grounds. I was hooked immediately; and I believe my dad knew before I even told him – that this was my spot.

The College Years

College in Santa Barbara is a delicate balance of enjoyment and responsibility; and I handled the juggling acts better at times than others. Ironically, the further I progressed in my education the more clumsily I managed that tension. I was a Marine Biology major; intent on fulfilling a childhood dream of swimming with Shamu at Sea World as a world-renowned expert in the field of marine mammals. It wasn’t until my junior year of college that I was told the cold facts of marine biology; mainly being that 99% of ocean life is plankton - hence requiring 99% of the study and research – and that there isn’t much money to be made studying the microscopic shrimp. Disillusioned is a good word, bored of the subject is probably more accurate, and I chose the fastest path out of the major which was a quick jump over to Zoology. Literally one class separates the majors at UCSB.

Through my first year and a half I mastered the balance of fun and class with the same skill and gusto that got me through high-school as a stressed-out, ultra-conservative, type-A personality headed for a heart attack at 22. I was Dean’s List with a 4.0 average my freshman year (spring quarter no less) and enrolled by selection in to the Honor’s Program. I began struggling with the balance between social and academic pursuits upon my acceptance in to the Beta Theta Pi fraternity during my sophomore year.

Joining a fraternity, while a definite impediment to one’s academic drive (I quickly lost my honor’s status and was never to see the Dean’s List again), has been one of my most personally satisfying and successful decisions I’ve made to date (with the notable exceptions of my marriage and birth of my son). It was in my fraternity that I first got the idea that it was OK to slow down a bit. That the race was rather a myth; and that there wasn’t anywhere to get in any particular hurry. Right or wrong, I unwound, distressed and started to come in to my own as a person with a point of view (not a very impassioned one, mind you). My mom continues to say to this day that Santa Barbara made me who I am now.

But back to why it got me where I am today. In Santa Barbara and in the fraternity specifically I became very involved in organizing events. It was something that I loved to do. The promotion, the marketing, the outreach – these were all things that lit my fire. I loved marketing an upcoming fraternity event; the kegger, the beach clean up, the softball tournament, whatever it was I loved promoting it and seeing the success as people streamed through the proverbial gates. It was my first taste of marketing, and while I was propping my eyelids open reading marine biology texts, I was enthralled with marketing. It was the first taste of the path I would eventually choose.

My senior year I was able, with the help of a very good friend, to put together the fraternity’s single largest charitable event in the history of the chapter. I organized and promoted a softball tournament that involved more than 3,000 Greek-affiliated students from 6 different universities over a weekend long sequence of events, games and the requisite parties. It was a massive 3-month undertaking which involved recruiting sponsors such as Red Bull and other name-brands, as well as encouraging teams to road trip it to Santa Barbara from as far away as Phoenix. It was a huge success on all levels, and sparked an annual tradition for Beta at Santa Barbara which is planning its 10th Annual Greek Softball Tournament. It was a great achievement that was even sweeter after my failed attempt junior year to rally the same event with a disastrous outcome (no one showed, literally).

For my efforts with the softball tournament I was awarded the University Award of Distinction; one of 50 of a graduating class of 4,500 to receive the honor, which is awarded for improving the quality of life on campus and in the community. It was a great moment. At that point I should have known that my passion was organizing, promoting and marketing. But I didn’t.

Stay tuned for part 2.

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Filed under: Newspapers, Marketing and advertising

I’m not sure why a good scent would make you want to go see a movie, but apparently some ad executives are willing to bet that it will.

According to The New York Times, The Los Angeles Times will be running an ad for the upcoming Mr. Magorium’s Emporium, complete with a scented ink that will remind the sniffer of frosted cake. Pretty cool. It will cost the studio about $55,000 to add the frosted cake-scent to to the ads.

It’s easy to see why the newspapers would be pushing this kind of thing: If they can convince advertisers that scratch and sniff is the way to attract consumers then — and only then — will they have found a way to preserve their relevance as they lose revenue to the internet and other media outlets.

It just might work. People will show the ad to their friends because it’s something new and different. The extra $55,000 has already generated a story in The New York Times business section. I doubt that scratch and sniff is the wave of the future (I thought it went the way of the hula hoop around 4th grade or so) but creative marketing strategies like this are the newspaper industry’s only hope of remaining (or becoming) relevant.

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Filed under: Internet, Mutual funds, Personal finance

Marketwatch’s Chuck Jaffe recently conducted an interview with the greatest friend the individual investor has ever had: John Bogle.

Bogle banged the drum for the cause he has made famous: Active investing generally leads to poor returns, and the best thing an investor can do is buy index funds and rely on the long-term returns generated by businesses to create long-term portfolio success.

Jaffe asked Bogle for his reaction to the numerous market gurus who have suggested that the future returns of the market will be lower than in the past. Bogle explained that lower dividend yields and slower earnings growth will lead to an average annual return of around 7%, more than 2% less than the historical yield of the market. What should investors do about that? They just have to save more money, according to Mr. Bogle.

Bogle remains a big supporter of traditional index funds, and isn’t too impressed with ETFs or hybrid funds. As he said in a recent column, “Mama, what have they done to my song?”

All of his books are terrific, but an absolute must-read is his tome on corporate governance, The Battle For the Soul of Capitalism.

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Filed under: Google (GOOG), Apple Inc (AAPL), General Electric (GE), AT and T (T), small business

Most young companies dream of getting their first heavyweight customer — a huge player, central to their industry, like Google Inc. (NASDAQ: GOOG), or better yet, a General Electric (NYSE: GE).

Snaring such a customer can change an entrepreneur’s fortunes overnight. Of course. But how do you gain the attention and trust of a large and important company? It’s certainly tough — but there are some strategies to help out.

First of all, make sure you are in a niche that large companies don’t consider core to their business, advises Steve Waldis, who is the CEO and founder of Synchronoss Technologies (NASDAQ: SNCR). The company develops software for the telecom industry and even powers the activation for Apple’s (NASDAQ: AAPL) iPhone. This was the result of a deep customer relationship with AT&T (NYSE: T).

According to Steve: “We developed a solution focused on the order management process that is a critical and often very complex process but not core to our customers’ business. Our customers can now focus on marketing and building out world class networks, and we can focus on connecting the two. Basically, smaller companies need to constantly differentiate and continually provide added value to larger organizations by focusing on their niche while maintaining a superior level of customer service.”

Chris Cabrera, the founder and CEO of Xactly Corporation (which develops sales software), also knows how to snag big-time customers.

He says that big companies often see working with small companies as a risk. They wonder, will your company be around tomorrow? Can you scale your solution?

To deal with the pushback, a small firm may want to try using new technologies, such as on-demand software. With this, a customer does not have to pay large up-front fees. Instead, there is a monthly or quarterly subscription payment.

Indeed, flexibility in pricing may be what it ultimately takes to get a large company to give you a try. You should consider other things, such as delayed payment terms, pilots, trials, escrows, and even money-back guarantees.

Another way to mitigate the risk is to highlight your expertise. In other words, hire top people who are experts in their fields.

Something else: it’s critical to show your commitment and that you’ll provide strong support. “Giving out your cell phone number can really drive the message home,” said Cabrera.

He also recommends sharing your product road map. “One thing large customers understand is that their size and complexity often makes their needs unique,” said Cabrera. “Embrace such challenges and let these customers engage in helping to shape your future product direction.”

Finally, you might want to partner with a larger company — to get the halo-effect from their credibility. But there are risks. “Partnering is always a good idea so long as you can secure that your brand identity is preserved and that you can protect your IP and financial viability,” said Michael Gregoire, the CEO of Taleo Corp. (NASDAQ: TLEO).

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements.

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So, we’ve been hooked on the screen cast thing around here lately. First it was the podcasts, then the 30-second news clips (starring yours truly as a talking head) and now we’re on to the screen casts. In this video I cover some of the rudimentary top-level actions that got us in to this mortgage and credit mess. Not deep economic theory, not really anything deep - just a cursory look at the problems articulated by yours truly.

View the video here.

While this clip is geared for the Realtors out there, consumers will surely find the overview of the problem valuable.

One note of disclosure. This presentation is not mine, not the words, not the slides. You see, lots of mortgage people pay for prepackaged information that comes to them at different intervals. There are many services that provide this type of information. We get to use it as our own as part of advisor-based marketing. Lots of people use it, most don’t say that they didn’t come up with it. Personally, I find most of it disingenuous and therefore don’t use it. It’s usually too salesy. However; I thought this piece was worthy of passing on, but not worthy of passing off as my own.

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