Editorial
Front Page - Friday, February 26, 2010
Loan officer working hard to revive the American Dream
David Laprad
Paul Smith is a mortgage loan officer at Northwest Georgia Bank in Ooltewah.
- David Laprad
Paul Smith is a mortgage loan officer who doesn’t like to say no. That doesn’t make his employer, Northwest Georgia Bank, nervous, nor does it guarantee every applicant a yes. Rather, Smith uses his skills with money and people to give loan candidates he turns down hope for a different answer down the road.
From appraisers to underwriters, and from credit bureaus to title companies, it takes a lot of people to put together a loan. But Smith, who works at the bank’s Ooltewah branch, is the public face of the process, the one who meets the young couple dreaming of purchasing a home and the elderly widow on the verge of being on the streets. And that means he must sometimes deliver bad news, even when every bone in his body is crying out to help.
“A gentleman who was on disability from a work injury brought his wife and little boy to see me,” he says. “They had a balloon mortgage with another bank that was coming due, and the bank didn’t want to renew it. As I sat there, with this nice family, there was nothing I could do. That was a devastating day for me.”
Smith says the people who are about to lose their home are his toughest cases. Running a close second are the applicants who are not yet in a position to own a home but might be thinking otherwise when they come to see him. During his handful of years as a mortgage loan officer, however, he’s developed the ability to help a candidate look beyond his disappointment to the steps he needs to take to get an affirmative response.
“I’m not good at saying no, but I am good at showing people what they need to do to get a yes,” Smith says. “I always go through their credit report with them and explain what I’m seeing. That way, they leave with some education, if not a house.”
Some people appreciate the guidance Smith provides, while others are too frustrated or embarrassed to listen. But it’s the best Smith can do in an industry that has tightened its grip on its money in the wake of the mortgage crisis. “There are no gray lines anymore,” he says. “This has become a black and white industry because of what we’ve been through.”
While working as a mortgage loan officer at Countrywide Home Loans in the months leading up to the crash, Smith “saw the writing on the wall” and jumped ship to work for Northwest Georgia. “In my job, I have to set aside my needs, put myself in the shoes of my customer and do what’s best for him,” Smith says, making a veiled criticism of his former employer.
Northwest Georgia is a good fit for Smith, though, as his values and the company’s approach to doing business snapped together like two pieces of a puzzle. “I have to spend time getting to know the person sitting in front of me,” he says. “That doesn’t mean I have to live with him for a week; it means I need to be a good listener and get a feel for how his job is going, what he can afford and the other issues that might impact his ability to repay a loan. I have to make sure I’m putting him in the right product.”
Smith’s last statement might seem out of sync for an industry that not too long ago employed mortgage originators who were all too eager to put people in dicey subprime loans. But Smith likes to make sure his customers are prepared to buy a home. “If I meet an individual who needs to do a bit of work first, I’ll sit down with him and map out a strategy that will make him a better candidate and perhaps get him a better rate,” he says.
Smith says a mortgage loan officer must also be a good organizer to keep a loan moving in the right direction, although he doesn’t comment on his skills in this space. His office and manner of dress, however, speak volumes. For starters, Smith’s work space is as neat as a pin. His adding machine is pushed to the far left side of his desk, while his laptop occupies another surface entirely, leaving nothing but a clean surface between Smith and his customers.
With no distractions or obstacles between him and his client, Smith is front and center, so he makes sure he looks like a pro. On this day, his smartly pressed suit projects sincere professionalism and respect for the people on the other side of his desk, as does the way he leans forward on his elbows while listening to and answering questions.
Smith’s appearance is not a facade; rather, it hints at the nature of the man around which it’s wrapped. A fiscal conservative, Smith was working as a financial administrator for a large Catholic church in Minneapolis, Minn., when he and his wife decided to move. Although Minneapolis had been their home for 25 years, Smith’s wife missed their three children, who had grown up, scattered and started families of their own. Smith agreed to move to the Chattanooga area, where one of their daughters lived, on the provision that they do it debt free. “We moved here on savings, which helped us get started,” he says.
His conservative instincts are still serving him well today, during a dry period in his industry, as the choices he made in the past are allowing him to continue working in a position about which he feels proud.
Looking ahead, Smith is cautiously optimistic about the mortgage market. The inventory is becoming more manageable, home values are low and interest rates are remarkable, he says, making this a good time for people to buy. “I just quoted somebody 5.25 percent on a 30-year loan, with 3.5 percent down,” he says. “I believe this is going to be a year of slight improvements.”
When Smith isn’t working, he’s serving as the secretary of the Chattanooga Mortgage Bankers Association and on the financial board of St. Stephen’s Church in East Brainerd, where he and his wife are members. He also enjoys working out at The Rush Fitness Complex.
When he’s in his office, though, he’s focused on helping the people who step through his door have a better story to tell than the one he described earlier.
“A gentleman in his ‘50s, who had worked a number of years for a railroad, had two heart attacks. He lost everything while on disability, including his home. Not only that, his wife had left him and he was living with a friend. He wanted to buy a little place, though, so his granddaughter could stay with him once in a while. I had to say, ‘Not today.’
“To help him restore his credit, we arranged for him to have a secure credit card. I checked with him every month to make sure he made his payments and keeping his balance low relative to his line of credit. It took him nine months to get his credit score where it needed to be for us to approve him for a loan, but he made it, and now he’s starting over.
“There’s hope if you’re willing to make sacrifices and discipline yourself.”
Home ownership is one of the fundamental elements of the American Dream. The troubled economy has cast a dark cloud over that vision, however, leading people to expect the worst when applying for a mortgage. With the country slowly turning around, though, and mortgage originators like Smith working with people to make home ownership a reality again, the prospects of applicants are improving. Before long, the only time Smith will have to say no is when a person asks if he’s going to turn them down.
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