Lykken on Lending

There are a lot of educational resources to learn from when it comes to the lending industry. You can read up on books or listen to podcasts about the state of the markets. But most importantly, you can attend the right conferences. But what happens if you can’t attend? Don’t worry because the guest today, Kevin Peranio, has you covered. Join David Lykken as he talks to Kevin about the market and why he creates educational video content. Kevin is the Chief Lending Officer at PRMG, Inc. His main goal with PRMG is to enhance the overall customer experience. Learn more about the market today and whether or not interest rates will rise or drop. Discover what conferences to attend in the lending business. And find out how Kevin is bringing value into the lending industry by uploading his own personal, educational videos. Start learning and check out a few today on LinkedIn!

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Making The World Of Lending A Better Place Through Educational Videos With Kevin Peranio

I am so delighted to have one of my good friends on the show. I can say so many things. He’s an influencer and become a little bit of a celebrity as a result of doing videos. We’re going to get into talking about videos, what’s going on in the markets and Kevin Peranio. KP is a guy that works in the secondary markets and the capital markets area. We’re going to find out what his perspective is on the markets and where it’s going.

We’re going to talk a little bit about the market direction. What does he listen to? Who does he listen to? That’s always interesting. We’re going to talk about the videos that he does. He’s doing them so successfully and talks about a conference strategy. We’re going to cover a lot of territory in this interview. Kevin, thank you so much for joining me. It’s good to have you back.

Thank you. I’m glad we connected in Atlanta up there at Total Expert’s Accelerate and jump back on this. It’s always a pleasure. You’re one of my favorites. A lot of people might not know but I started in the business in Austin in 2001. I’ve known about you for my entire career. I love the consistency and the content you put out. It’s something that I need to do as well.

You do a great job with the videos but first of all, I want to start with what you see going on in the markets. What are your thoughts as it relates to where you expect interest rates to go? Are they heading up or down and why?

I feel a contrarian view here. I don’t think they’ll get worse than they were on June 13, 2022. The 350 tenure was 348, technically. It was a rapid mortgage rate increase in a short amount of time. Inflation was running hot. What’s interesting is with the latest CPI and PPI reads that have come out, it’s not running as hot. They are maybe saying, “Inflation’s peaked potentially,” but they got to keep the foot on the gas because if they ease up, supply chain issues and housing could roll back again. It’s not like the housing supply got any better. We take our focus off of inflation and start watching the actions to crush the map. That demand destruction will slow growth. Slowing growth is not going to get the year higher and growth mode for the economy going.

We had two negative GDP quarters in a row. Maybe we’re in a session or not. When I got in the business in 2001, there were two negative quarters in a row and that was it. Now you got to wait for some Bureau of Economic review, board or national to make up something and twelve months later, it tells us where we were a year ago. The thing that would make rates get higher would be growing and strengthening the economy.

We’re starting to see a few cracks in the labor market with job claims. In our industry, we’re seeing layoffs occurring and some lenders shutting down entire channels or lenders shutting down. We’re in that canary in the coal mine industry. The most contrasting thing I can say to answer your question short is the worst is over on the highest rates but it’s not unreasonable to say we might retest that mark potentially. I don’t think we get much worse than what we saw in June 2022. That’s my story and I’m sticking to it.

You do it very well. We were talking about that and how you repeat this. We’re not going to dwell a lot on that because there’s so much I want to cover. You do such an amazing job in so many areas of this industry. I want to cover a lot of those. One of those things is your videos but you have a unique perspective and you do communicate those well.

On the journey of finding where things are going, you watch all the components that go into this. You look at the fundamentals and the momentum part of the market. You’re seeing all this happen but you’re also listening to people. When you look at all the various factors that go into interest rates, you know those and study those as well as anybody but you also pay attention to different voices out there, those that you respect. Who are some of those and why?

I’ll start with 1 or 2 that a lot of are reading. My dear friend, Barry Habib, has got a great mind. When I started the business in 2001, we were in Austin, Texas as a Wholesale Account Executive. We were all subscribing to the Mortgage Market Guide. We were getting updates from Barry. I was already into candlestick charting. I’d studied that. I had a girlfriend in college. Her name was Dusty. Her father, Dr. Morris, wrote seven books on candlestick charting in the mid to late ‘90s. I was fascinated by it.

Dr. Morris is out there. I’ve always loved trading and have been an active trader. Barry speaks that language. He’s done macro stuff. He knows a lot of people like Art Cashin, Peter Boockvar and Ivy Zelman. Vis-a-vis his connections, I get to hear some great minds that are outside of our industry. One more that’s inside our industry who I respect is Logan Mohtashami. He’s fantastic. I moved to Orange County from Fort Lauderdale. He’s an Orange County guy. He lives in Orange County. I was following his content online on Twitter and Instagram. Clayton’s no dummy over there.

I see this content. Honestly, it’s pretty much the only other content I ingest. The Trade Rags IMF is great. Rod Chrisman and Robbie Chrisman’s Capital Markets section is fantastic. Chris Wayland got good stuff and Paul Henman. They’re all great. These are names that I love to read. If there’s anything unique that I can add that the audience might take in, I have been on this quest for financial freedom.

I look at all these analysts, stock traders, institutional investors and people who ran hedge funds and then decided to go have their private services. I’ve been a subscriber for The Motley Fool since college. At first, when email marketing was the thing and you get the same as Motley Fool, you’re like, “How am I going to trust my money and investments with such a dumb name?”

When you get a chance to read the Gartner, it is like a ribbon joke like, “These guys are fools.” Their analysis is top-notch. I subscribed to every one of the sub-services you play. You can pay a subscription fee for all of their information. It’s called Motley Fool 1. Stansberry Research is fantastic. I pay for all of their subscriptions. Every single thing in there is their alliance. I’ve got Brownstone, Louis Navellier’s Platinum Growth Club and Empire Trading. I could go on and on. I read so much stuff outside the industry. It helps me triangulate business and the markets and watch the flow of money because what we do in our business, we buy and sell money.

It’s not like the American Dream, the part that makes us feel good when we take a picture of someone we helped get a house. I love that part too but I can also love buying and selling money. There’s a saying that I made up many years ago and feel free to steal. “The secondary market is cold, heartless and unforgiving.” “You have to understand how to navigate it because it will crush the hopes and dreams of that American Dream.” That’s where I get my information. I put it on my mind and prism. I go to battle and fight every day with my back against the gates of hell of democracy like you and me, trying to survive through this crazy place.

There is a lot of information and a lot to digest. Some of it you can’t read every single day. For someone who’s saying, “I had to go to a couple of sources,” Barry’s excellent. I love Barry and his desire to teach. That is so good. Look at someone like Barry who wants to give. What’s hard to do is to help people sort through. He does a lot of work. How do you sort through the noise of it all?

He’s an inspiration and a dear friend. Why I created the content on LinkedIn is to give my perspective and give back for free. All you got to do is tune into LinkedIn. I don’t really use it. I don’t monetize it or recruit. I haven’t had people hit me up in the messages and send them elsewhere like, “You work for loanDepot as a loan officer. I know Alec Hanson and Brian Covey. Why don’t you give them a call? The grass is greener when you water.” I don’t use this to recruit. I had a guy from another company say, “You should use it to recruit.” I go, “As soon as you start to do that, it loses its luster.”

Maybe if I can help people in our community, grow and maybe from a broader audience, teach financial literacy, help put people in more homes and maybe help people achieve the financial freedom that I’m seeking as well maybe on this journey together, maybe I’ve put all this stuff. KP talks dollars and cents. It’s something I put out there. I’ve been recutting up my LinkedIn content. Maybe someday I’ll make a podcast out of it or even a TV show. I got time but I got to learn some more. I’m a giver and a humble servant working more of a servant than humble but I’m working on both every day.

Before we leave the markets, I’d like to get your perspective on the announcement of Wells Fargo to exit the correspondence space. How do you take that?

My first take is that they are a bank that is highly regulated and coming out from being under the microscope. Some rogue employees open checking accounts and credit cards. Some employees hurt the brand. “Wells Fargo sucks.” You have tens of thousands of employees that work for you and you can do everything. If a couple of high networks wealth creators or some group in Los Angeles are opening checking accounts, then the whole brand is awful. That is not right but that’s human nature. Everyone keys in on mistakes and you got to roll with it overwhelmingly as a successful company.

They’re not exiting retail. That’s the correspondence side of it. It’s interesting. One thing is you’re a trader. You sell loans off. For those that rely on one investor, this is a good lesson. You do not rely on one primary source. You’ve got to have all the tools and investors in your toolkit to be able to make sure you can consistently provide liquidity to your company. I want to get over and talk about your videos. You do them so well. You’ve already given some insights as to why you do them but how did you get started doing the videos? What launched you into doing this?

I have met the company for many years. We’re founded by two gentlemen, Paul Rozo and Robert Holliday. We have built by originators for originators. These guys originated loans. I brought a great team with me that had been with me at First Magnus, then I had my company in South Florida, called NorthStar Lending. I found a home for my team. I met Paul and Robert. I liked the way that they operated. They went through the crash as a small to medium-sized company, which was fortuitous. They put up their money, paid their debts, didn’t hightail it and ran.

They were stand-up people trying to pay off. 2008 was a reset. If you were a bank, you didn’t get bailed out by the government. You pretty much got crushed unless you were medium. If you’re a builder, you got nothing. That’s why they’re sitting on their hands. Why would they overbuild the government that helped them out? I don’t blame them. That’s why there are only 2 builders that have a 53% market share of single-family residential construction. Getting back to being over here, this company and what we do here as servant leaders and trying to grow this private platform is as an owner, we were invisible. Social media has been taking off. I’m pretty good at it.

To me, it’s a PR game you play a little bit. I try to be authentic. The best way to play the game is to be yourself. Sometimes being yourself isn’t popular and that’s okay. As long as you’re steadfast, resolved and you’ve got integrity with what you say online, overall, people can agree to disagree. What I found was some of the larger lenders out there were getting more visible. Pyramid G was getting lost in the shuffle. Here’s this great story that we’ve been building since 2001. We’ve had wholesale and retail from the beginning, both working together and reading each other.

Educational Videos: The secondary market is cold, heartless, and unforgiving. You have to understand how to navigate it because it will absolutely crush the hopes of your American dream.

There are times when one feeds the other. When the pandemic hit in 2020, every wholesale lender was crushed and raised its margins. Their margins in wholesale were tripled in retail. Capacity hits the industry and it will again. It will go in cycles over and over, wholesale, floods, they’re high churn and high refi. When you get a refi boom, those lenders that have wholesale channels and correspondent channels, especially non del corp, raised their margins. We turned to our retail channel and kept them loaded because they’re us. We don’t treat them like they’re captive or they are a group to play with.

We respected them and had lower margins for them. That balance that we have between the channels is a story that works for us for our size. We’re a privately owned yet capitalized like a bank company. That story was not being told. We have a traditional marketing team. We talk about it on the cover of print magazines and we go to trade shows. That’s great for that audience.

What about the younger generation who’s all over social media? We’re invisible to them. I figured I might as well do 1 or 2 videos a week. It was funny as it started and you’ll appreciate this. I’m on the road 50% of the year. I had this childhood dream. I want to be a newscaster or something like that. When I say live from Krone California, I’m not actually live. I’m filming live on location from a place.

It was the first thing that caught me. I caught one of the first videos you did. I heard you on the podcast a while back when you started doing it. It was one of the first ones you were holding a selfie stick on a walk. It was authentic and a great stream of thought. You can realize that you’re walking and carry on a good conversation with who knows who’s watching. You’re talking about the fundamentals. It was so well done.

I go, “I don’t know who this guy is but I’m going to get him on my show. This guy’s going to be good. He keeps us up.” You have been. I looked at this and you go to conferences where I want to go next. People go, “KP, I watch your videos and everything else.” It’s great that you’re doing it selfishly to provide information like Barry does and provide help people sort through the markets.

On location.

It’s the one that you did when you’re walking by the geese and you go, “I better watch out.”

I’m a normal guy. When I’m on video, walking and talking, don’t ask me to also chew gum at the same time. I could foster it sometimes. I can’t get the words that I’m not. A lot of our audiences reading that are terrified to do video and look at it like it’s public speaking but you can edit video. That’s the best part. We all make mistakes. It’s okay. You got to roll with it. I’m trying to provide value for those that maybe weren’t there at the trade show or the conference. Maybe I could provide some insights for the audience, not to mention people like the scenery every now and then. That was the original inspiration.

You’ve done it so well. That was funny with the geese and you were walking and trying to avoid stepping in the stuff that droppings. It was everywhere. I’ll never forget when Alec Hanson had me on. I love him and what he does over at loanDepot and beyond. I either had one too many cups of coffee and some sugar somewhere in there. I was as hyper as a Chihuahua. I listened to that interview and went like, “I sound like I’m barking away.” There are things you’re going to do out there. You go, “I wish I could’ve done that.” 

Small trivia. I have a lot of respect for Alec. His social content is amazing. I’d been following him for a little bit since I’d moved to California. He moved in three houses down on my street. His young son and daughter come over and they play with four kids. He and his wife, Erica, are fantastic people. They are good human beings. He’s as authentic as it gets. He’s also a giver.

That’s a common denominator. If you’re going to be doing videos, it should not be about you or your company. It should be about giving out. That’s the ones where you look at that. The byproduct will be, it will draw attention to you and you will get well known. If you’re doing it for the right why, which goes to this whole Simon Sinek thing, it’s spot on.

Let’s go to one of my favorite things to watch you. I love going to conferences. I’ve been in the industry for many years. I’ve been going a long time. I don’t last as long as you do but it is a joy to watch you work these conferences. We’re about ready to head into the MBA. We’re going to be heading out to Nashville.

You can drop some money in that town. There’s no town doubt about it. It is a fun town. That’s where we were at the Total Expert’s Conference together. We were walking around. I admire how you work the crowd and the conference. I want to have you share some tips with our readers that are going to be attending any conference. First of all, what conferences do you go to and why? There are some that you do go to or don’t go to. Give us insight into what conferences you choose to attend and some that you choose to avoid.

I try and touch all of them at least once and see what it’s about. I’ve done a lot of that being based out of California. There are some that I can empower other leaders at PRMG to go to. I don’t have to be there. I’m not having FOMO. I have to let go at some point. Anything Mortgage Bankers Association-related, I’m all in on that. They are true advocates on behalf of not just all bankers but independent mortgage bankers. They’re an absolute voice, Rob Broeksmit, Pete Mills and the entire team. I can go down the whole list. They’re amazing. They work hard.

They’re in DC, which is a whole different animal. They’re working that network and lobbying on behalf of a high level. The Inflation Reduction Act came out. Productions took out of that. Their language is in the bill like a cap on 1031 exchanges or not being able to net interest income, also the 15% cap on corporate taxes and a lot of things that they were able to help avoid. There was a lot that they got done. We are huge fans. We are members of the MBA. We give back to the MBA. We want to make sure that we attend all MBA events.

In addition to that, I love tech. Technology is extremely deflationary. It compresses time, reduces friction and gives us more ability to be more human and build relationships. Any show that has to do with technology is very interesting to me. I love The Mortgage Collaborative, Lenders One as well and some peer groups. They get to go here in addition to the IMB MBA session. For tips and tricks, there’s one thing that I’ve always lived by. I could get into my science on sleep and caffeine intake. I’m on three hours of sleep.

Educational Videos: Attend any event or conference that is Mortgage Bankers Association-related. They are absolutely true advocates of not just all bankers but independent mortgage bankers.

You must not sleep at these things. You go all night long and then you’re at a breakfast meeting at 7:00 in the morning. It’s amazing.

You got to power through it. I’ve conditioned my brain to not sleep Monday through Thursday and try to catch up on a Friday, Saturday or Sunday. We’re a people business. Everyone gets the same tech eventually when else has and then copycat it. People build tech but it’s tech to enable mortgages in real estate lending and housing. People ultimately end up copycatting it. The more commoditized these technology things become, the more it’s about relationships and people. One thing that I’ve always lived by when it comes to people is the way I interact with other human beings.

It doesn’t matter where I am. Work, life, trade show or a homeless person, it doesn’t matter where it is. People, in general, appreciate being recognized. I make it a point. If I see someone and I’m in their presence, I look them in the eye. They know that I know that I see them and we see each other. We acknowledge our existence, nothing like a smile or, “How are you doing?” and handshake. COVID is officially over. “Thank you for your time and the time spent,” then you move on.

That is goodwill to live by. Imagine walking by everybody not making eye contact and ignoring them. They’re like, “Who’s Mr. Big shot over there? He can’t even stop and talk to me.” That’s why everyone’s always disappointed when they meet their celebrities because celebrities move on and don’t want to talk to you. You’re like, “I waited my whole life to meet you. You run right by me. I hate you.” I don’t want to be that guy.

You’re becoming a bit of a celebrity with the videos you’re doing and the success. A lot of people struggle with the preparation part. When you’re looking at a conference agenda, how do you prepare to get the maximum benefit out of a conference?

I do look at the agenda. I see who is speaking and if there’s anything new in there. High-profile figures, especially from DC, are giving information out. I love listening to Dr. Sandra Thompson. She’s amazing. I’m hearing anything from FHA. We’ve got a great ship and housing policy to help more people get into homes. Who doesn’t want that? I love hearing her speak and anyone else.

Rob Broeksmit, President of MBA, is super tied in and has a lot of conversations behind the scenes. He’s calling treasury during the pandemic, telling them to buy mortgage-backed securities because we are having liquidity seize up. A week later, calling them and saying, “You’re buying too much.” Saving the industry. I love hearing him speak. Look for new content, players, vendors and partners.

It’s a balance of attending some of the events but you’re also planning meetings because there are many meetings we could have. How do you run that balance?

I’m not very good at dinners. Anyone that invites me to a dinner knows that I’m going to show up late and leave a little bit early because I’ll stack 2 and sometimes 3 dinners. To sit down for three hours, when everyone’s come together, I try and get that not rude.

You got to as much as three dinners a night.

Get there perhaps in a light meal and go to the next one, try and catch them on a dessert and then maybe do the active dinner drink on the last one. That was usually what I do. Three is very rare. I do try and stack them up in the same thing with the happy hours and the mix of mingles. I try and bounce from place to place and press the flesh, touch bodies, shake hands, have some fun and get some tidbits. If they can’t get it done in five minutes to tell me what they want to say, they’re not an effective communicator. I can get that everywhere I go.

I watched you at Total Expert’s Accelerate 2022. You were talking about how you stayed out 3:00 and 4:00 in the morning and then we’re up going strong. We were at breakfast together the next morning. It was amazing. What are some of your walkaway goals from a conference? Let’s wrap it up with this. We go to conferences and have a strategy but when you leave, you say, “I’ve had a successful conference.” When was it?

I’ll use Total Expert’s Accelerate that you and I were last together at. I’m looking for innovation. They’re our premier CRM partner. We’ve been on them for a few years. We migrated 1,000 loan officers over there. They are fantastic at integrating other technology. We’re constantly trying to build it and make it better. I met with their CEO, Joe Welu and the rest of their team. They’re fantastic over there. That was great, super impactful and effective. Our partnership liaison there with Jon Hill. He’s a great connector and a good dude but then I’m looking for new stuff. I’m touching base with our good friends from Sales Boomerang and other different places.

This one gentleman came up to me, Steve Doumar. I’ll give you an example. This is how the network effect is powerful. He lives in South Florida where I lived for thirteen years before I moved here. He has this company called Whisp. He comes up to me and goes, “I’ve been watching your content. I want to meet you and talk to you about what we’re building. Jonathan Breed and some other people that you know told me to come to meet you and talk to you.” We changed our phones. He pulls out this phone. He’s got this QR code that I scan and it pre-fills like a text message and says, “To get more information on Whisp, press send.”

I hit send and then there’s this whole webpage. He had already pre-programmed with PRMG, my name, my website and a QR code for me. I’m a little slow when I do sleep three hours a night and have some cocktails. I was so in the uptake but I started to get it. Here I have the only mobile call to action. This guy came and showed it to me. He goes, “I want you to talk about it and help me talk about it.” I was like, “I don’t pedal wears unless I believe in them.” People send me trinkets and a t-shirt.

The Chicago store of TravisMathew sent me the dadbod bat. They’re like, “You are fancy, your dadbod.” That’s one of my hashtags. I leave that on my desk. I get people who are like, “Let me plug my thing.” I don’t even plug anything on LinkedIn but this guy was captured and converted any hat. I opted in TCPA compliant, giving us information, drops my cell phone and email address in a heartbeat inside his CRM.

Educational Videos: When everyone in the business has the same tech, human interaction becomes more important. People appreciate being recognized, so don’t be afraid to acknowledge each other’s existence.

It was a call to action. Imagine that every way you see it. It was cool. I put money into it, invested and believe in it. I’m not here to sell it. That’s not why we’re on the show. You brought that up and said what my goal is. My goal is to find stuff I believe in. I put my heart and soul into it and make this lending industry a better place for everybody. That’s what I’m trying to do.

You do these conferences well and the videos awesomely. You’re so accurate on the markets. I’m honored to call you a friend and have you on the show. Thanks so much for taking the time and for being here and sharing all these various aspects of what you do and do so well.

I look up to you so much. I appreciate you having me on your show. Thank you.

Important Links

• Kevin Peranio
• Total Expert’s Accelerate
• LinkedIn – Kevin Peranio
• The Mortgage Collaborative
• Lenders One
• Total Expert Podcast: Tales from The Trenches episode clips

About Kevin Peranio

The Chief Lending Officer for PRMG (Paramount Residential Mortgage Group), Kevin Peranio oversees every facet of PRMG’s loan process, with a focus on customer satisfaction and quality control. Prior to this role, Mr. Peranio served as a Regional Manager at First Magnus Financial from 2001 to 2007, and then as the Chief Operating Officer at North Star Lending from 2007 to 2010.  Mr. Peranio received a Bachelor’s of Science in Advertising Business from the University of Texas at Austin.