Thu Mar 28 12:34:21 EDT 2024
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NAMFS Fraud Fest 2024 $57,000 Underfunded

Eric Miller, National Association of Mortgage Field Services (NAMFS) Executive Director, and Matt Zoldowski, NAMFS President have been out on the NAMFS Eras Tour hawking up Verisk to anyone who will listen. Problem is that the main targeted batch of folks who used to use Property Preservation Wizard and Pruvan, boots on the ground Labor, can no longer afford it. Miller and Zoldowski are both on the Verisk payroll and the Industry knows it. In all actuality, NAMFS should just change their name to the Verisk Association and be . . .

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Industry Education Needs Broader Investment and Participation

When the IAFST University set out to create simple and affordable training for the Mortgage Field Services Industry, it took a three prong approach: 1) Ensure affordability — $2.95 per module per year, at the Enterprise level; 2) Ensure that the training would protect Management from employee misclassification claims; and 3) Ensure that the training was federally credentialled with federal funding opportunities. All three items have been accomplished and that is what we will talk about, today. First and foremost, though, IAFST University is not a part of the International Association of Field Service Technicians (IAFST). It is an independent, educational arm of the IAFST Federation of Labor. The IAFST does not necessarily support the views or opinions of the IAFST University nor the Federation. This was purposefully done in order to rise above the proverbial noise and distractions of the Industry and serve the Clients — financial institutions, GSE’s and US government agencies whom actually define the products — and Labor, the actual boots on the ground, performing the work.

There are only two reasons why wages are so low in our Industry: First, greed, and second a lack of training by and through a dedicated North American Industry Classification System (NAICS). NAICS is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the US business economy. Fact of the matter is that Prime Vendors, whether NAMFS members or otherwise, have fought for nearly five decades to avoid a NAICS code for our Industry. The primary reason for this is that without a NAICS code, specific to our Industry, pricing data is unavailable and lump summed together with the generic codes used today. This, in turn, creates a false and fraudulent appearance of propriety by lumping far below minimum wage work — such as the $15 paid for interior and exterior inspections in combination with a full maid service demanded by HUD’s M&M FSM Awardee 24 Asset Management — with legal and legitimate wages under say the NAICS 561720 and 541350. Anyone telling you otherwise is an outright liar.

The legitimacy of any trade or industry is determined by the ability to measure competency by and through education. NAMFS had attempted this when it forcefully — and without proper compensation according to the owner — took over the former Stallion product. The bigger problem, though, was that it was Management focused with hundreds of dollars in billing and no ability to interconnect into the federal accreditation cycle of the Credential Transparency Description Language (CTDL). Moreover, though, NAMFS is incapable of integrating with the Registered Apprenticeship Programs with the Department of Labor (DoL) which the IAFST University is now doing.

IAFST University is connected into the CTDL as seen here. As seen, IAFST University is eligible to issue a mountain of credentials and is the only one in our Industry legally allowed to, thus far. Building on that we are capable of digitally tracking them, cradle-to-grave, and have invested in the technology to verify them as well as document outdated credentials to issue new testing or continuing education required and display these throughout all aspects of Social Media including on the LinkedIn Licensing pages.

While neither NAMFS nor the IAFST have made any concrete decisions to move forward with training, several smaller Industry firms, including a nonprofit firm, have already begun working on their own work product specific curriculum which IAFST University will begin to host. Our understanding is that the firms deploying the training and testing will marry the results to increased pricing.

The problem with anything that challenges the status quo is bubbles are burst and the central base of power shifts. As previously discussed, with pricing in our Industry far below federal minimum wage, education is not something that anyone wants to discuss. Surprisingly, though, IAFST University is now working with several facilities and property management firms outside of our Industry. Why, you might ask? Legitimate firms, working in regulated industries, have a need for affordable and robust training and testing platforms that are ready on Day One.

What many NAMFS and IAFST Prime Vendors do not seem to want out there is that when you marry a CTDL authorized training process to DoL’s RAP, the financial benefits to Management and Labor; to large and small firms, are astronomical. In addition to the both federal funds and tax credits, RAP participants have access to the following:

    1. U.S. Department of Labor: Federal Workforce Development Funds, including Workforce Innovation and Opportunity Act, Trade Adjustment Act, H1B and Women in Apprenticeship in Non-Traditional Occupations;
    2. U.S. Department of Education: Federal Student Aid Funds, Title IV Student Aid including Pell Grants and Federal Work Study;
    3. U.S. Department of Veterans Affairs: GI Bill® and Veterans Affairs Educational Assistance;
    4. U.S. Department of Agriculture: Supplemental Nutrition Assistance Program Education and Training Funds;
    5. U.S. Department of Transportation: Federal Highway Administration On-the-Job Training and Supportive Services Program; and
    6. U.S. Department of Housing and Urban Development: Financial Assistance Programs, amongst others.

Depending on state and local policy, On-the-Job-Training contracts can reimburse employers up to 75 percent of wage rates paid to participants for up to six months. Additionally, On-the-Job-Training contracts can also cover a portion of the supervision and extraordinary training costs associated with overseeing a new apprentice, equivalent to 75 percent of the apprentice’s wage rate. If these two reasons are not enough to incentivize your firm to get involved, chances are that you may be better suited to close your business and become a WalMart greeter.

The larger, untold story here is that many legitimate Industries overlap into our unregulated Industry. For example, inspections. Our Industry only covers a few types and those are specific to residential assets in some form of foreclosure. The HUD 309 inspection pertains to new mobile homes. Today, many of these assets are rolled off the line and upon final assembly, in the field, require a final inspection. They generally pay around $150 and are actually require far less time than the $8 inspections you typically see from NAMFS members. IAFST University already covers those through the MFS Inspector Apprenticeship. Or take the $1 Trillion in defaults potentially coming down, this year, in the commercial real estate sector. Every single one of these CRE assets are going to require an inspection — whether it be for pre-foreclosure purposes or the renewing of senior loans covering the assets.

Whether anyone likes it or not, our Industry is dying. There will always be a couple of nickel and dime jobs out there, in the rural setting, but the reality is with the massive conversion to a W2 setting by Mortgage Contracting Services, by and through their recent purchase of Five Brothers, the writing is on the wall. I stand by my predictions of a near completely controlled institutional environment by the end of the year, when it comes to Prime Vendors — Guardian Asset Management’s parent company, Rithm Capital; MCS’s family of firms controlled by Littlejohn & Co.; and ServiceLink, which is controlled by Black Knight. The outlier of Altisource will probably remain after the recent rebranding of nearly 30+ firms a year or so ago. No other firms have the capital to remain financially solvent. And like it or not, those firms and the hundreds of others whom are performing their own facilities and property management, all require the cookie cutter product that is the same thing, the same way, each and every day. The only way you get there is through training. To that point, those firms will eventually recognize the advantages of CTDL and DoL’s RAP versus WalMart greeters whom believe that Burger King’s model of Have It Your Way is what the Industry is really looking for.

End of an Era: Real Estate Commission Cartel Crumbles

For decades, Americans selling homes have shouldered the burden of a seemingly unshakeable 6% commission fee for real estate agents. This practice, however, has finally come to an end thanks to a landmark settlement in a class-action lawsuit against the National Association of Realtors (NAR). The settlement builds on a bitter irony I brought up nearly eight years ago on Foreclosurepedia and predicted the NAR’s ultimate demise. It has been paralleled in our Industry, both by National Association of Mortgage Field Services (NAMFS) members and Prime Vendors and their obvious price fixing, as well as that of Verisk, whom controls all property preservation — not inspections — software. In fact, when Verisk bought out both Property Preservation Wizard (PPW) and Pruvan, they hiked pricing which calculated with today’s inflation rate is in the hundreds of dollars more, per year. When drilling down, even deeper on Verisk, their placement of Matt Zoldowski, former PPW owner, as the NAMFS President shows a very clearcut sign of antitrust as defined by the Sherman Act, in my opinion as well as many others in the Industry.

The NAR, a powerful lobby group, had long enforced a system where sellers were forced to offer a set commission split between their agent and the buyer’s agent. This arrangement, deemed anti-competitive, inflated home prices and limited consumer choice.

The lawsuit, initiated by Missouri homeowners, challenged this system and emerged victorious. The settlement compels NAR to dismantle its commission structure, allowing for negotiation and potentially lower fees for home sellers. This could translate to significant savings, with estimates suggesting a reduction of up to 30% — a substantial sum considering the average US home price.

This settlement signifies a major victory for consumer rights and a potential turning point for the housing market. Here’s a breakdown of the implications:

  • Increased Competition: With the fixed commission rule abolished, competition among real estate agents is expected to rise. This could lead to the emergence of services offering discounted rates or flat fees, catering to a wider range of budgets.
  • Shifting Landscape: The role of real estate agents may evolve. Buyers might choose to forgo an agent altogether, relying solely on a representative for closing procedures. This trend mirrors the decline of travel agents as online booking platforms empowered consumers.
  • Agent Exodus: The new landscape might lead to a significant decrease in the number of real estate agents. The current abundance, with millions licensed in the US compared to a fraction in the UK with a similar population, could be trimmed. This would likely benefit consumers by weeding out less dedicated agents.
  • Weakening of NAR’s Grip: The settlement weakens the influence of NAR, which has historically lobbied against measures that could increase housing affordability. This could pave the way for policies promoting a more accessible housing market.

While the long-term effects remain to be seen, this development holds immense promise for a fairer and more competitive real estate landscape in the US. It also highlights the crucial role of private lawsuits in challenging hidden price-fixing schemes and empowering consumers.

NAR’s past president, Kenny Parcell, resigned under a cloud of sexual harassment allegations last August and his replacement, Tracy Kasper, spent about three and a half months as the NAR President before resigning after being threatened with blackmail. Sounds almost like the NAMFS Secretary, Heather Berghorst, and other NAMFS members whom have ended up in state and federal prisons over the past decade.

There was a previous settlement between the DoJ’s Antitrust Division and NAR that restricted the department from pursuing a new case against the realtor association. That is currently being challenged by the DoJ showing the vigor of the US government when it comes to how quickly the pendulum swings. Obviously, the DoJ is likely interested in taking on NAR again. This could be due to concerns about ongoing anti-competitive practices despite the recent settlement in the private lawsuit. And here we see that antitrust private lawsuits are taking center stage. The success of the Missouri lawsuit highlights the effectiveness of private action in enforcing antitrust laws. This might be a more viable path for challenging NAMFS and Verisk, going forward, in light of the current scenario.

Regulatory vigilance will be essential to prevent the formation of new monopolies like we are seeing in our Industry. Tech giants like Amazon or Google could potentially exploit the market disruption to gain dominance. We are witnessing the same thing with Littlejohn & Co. and their recent totality in purchasing with respect to MCS, GIS Field Services, and Five Brothers. Going further, though, in the NAR settlement, brokers had to subscribe to the MLS to list properties. The settlement removes this requirement. This could lead to the emergence of new platforms offering alternative listing services outside the traditional MLS system. This is nearly identical to the NAMFS requirements to utilize the Aspen Grove Solutions ABC number.

More importantly, though, the NAR settlement ensures that buyer’s agents will now be required to have written agreements with their clients before showing properties listed on the MLS. This could make it easier for buyers to understand the services they’re receiving and the associated fees. There is a similar issue in our Industry that EVERY SINGLE NAMFS Member as well as Prime Vendors refuse to disclose the pricing that they pay unless a Master Services Agreement (MSA) and Certificate of Insurance is issued naming the firm applied to. When juxtaposed, there is no doubt that the NAR’s litigation and eventual settlement will be reflected in our Industry as soon as later this year.

This settlement marks a turning point in the US housing market. By dismantling a long-standing cartel, it paves the way for a more competitive and potentially more affordable landscape for home buyers and sellers. It also will serve as the templates to sue NAMFS members and the Prime Vendors. When taking into consideration the $7 paid for inspections that pay $45 and the $35 for grass cuts that pay $525, what Labor is left in our Industry are already looking for the exit door.

Tyson Foods is Sold on Illegal Alien Labor Is NAMFS Next?

Tyson Foods is looking to hire over 40,000 illegal aliens according to reporting from Bloomberg. And with their recent partnership with Tent Partnership for Refugees, it is looking more and more like Corporate America is doubling down on the bet against legal Americans attempting to work. And if you think this is simply yet another pissed off redneck rambling about the dangers of . . .

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As Recently Hacked MCS Buys Five Brothers Labor Refusing to Come Along for the Ride

Don't say we didn't tell you --- several months ago. Five Brothers finally bowed down and sold off to Littlejohn & Co. --- err, Mortgage Contracting Services (MCS) --- in a no holes barred multi-million dollar deal which is presumed to have included goodwill, golden parachutes and the lot. These are the pesky things normally viewed on 10K and 10Q documents, but Littlejohn is a private label firm and not required to publish publicly. Here is the news you are not hearing: Five Brothers has . . .

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