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Reinventing mortgage due diligence

David Cooper's Story

My friend and former employee, David Cooper, was featured with his service dog, Parnelli (named for race car driver Parnelli Jones), on a National Geographic Wild documentary series “Blue Collar Dogs” this week.

David lost his sight when he was 17, in a warm-up run for a ski race on Aspen Mountain. I first met him in June 2001, when he applied for a summer internship with my first company, Murrayhill. I was impressed by David’s desire to learn the mortgage industry and hired him, thinking he would eventually make a good analyst on our credit risk management team.

On Jobs, and I Don't Mean Employment

Steve Jobs is taking another medical leave of absence from his day-to-day duties as CEO of Apple this week, and I am deeply moved by it.

The vision and principle Jobs poured into Apple helped inspire me to start my own company.

Due Diligence Firms as Experts

Should due diligence firms be viewed as experts on mortgage securitizations, in much the same way accounting firms are viewed as experts on audited financial statements?  Some in our industry say no.  I say yes.  Here's why.

Allonhill Academy

About six weeks ago, I ran into Colorado State Senator Chris Romer at a charity function.  He asked me how things were going, and I did what I do best: I left off the sugar-coating and told him how I really felt.

Hyper Growth at the Hill

Up until last Thursday, when we've wanted to get together as a company for a meeting or for training, we've had to use makeshift space in our offices.  Our offices were opportunistically leased from a company that had too much space in the bad market of 2009.  We took it furnished and finished, and it was much nicer than we probably would have been willing to spend money on.  But it was the back office space of the prior tenant, so it didn't come with some of the basics you expect in an office, like a reception area or conference rooms.

RMBS Fallout: Were Investors Duped?

One positive outcome from the Financial Crisis Inquiry Commission so far is the increased attention to the mortgage due diligence process for residential mortgage-backed securities.

My Changing View on Mortgage Fraud

Since the start of the mortgage crisis, I've maintained my position that everyone who participated in the market was in some way guilty of bringing it down.  Originators made fraudulent loans; investors bought pools they knew were too risky; diligence firms didn't disclose what they knew; rating agencies didn't understand the collateral; issuers were willing to securitize anything; and borrowers lied and cheated to get a loan for houses they couldn't afford.

I'm not known for sugar-coating.

We Love This Place

Allonhill is five times bigger today than it was a year ago.  Nearly all of that growth has taken place since January 1.  Believe me; we know what it means to experience growing pains.  Most of those experiences are what you would expect: lots of people working late into the night, people wearing multiple hats, everyone coming together to proof our results before we send them off to a client, proposals printed overnight at Kinko's, running late to every meeting, and the palpable sigh of relief that runs through the entire place when we bring in another client, and deliver ano


If they weren't the root cause of the subprime mortgage crisis, NINJA loans certainly fueled the flames.

NINJAs are No Income, No Job, no Asset loans. As the names imply, these loans were given to people based on income they claimed to make with no requirement that borrowers back up their assertions with pay stubs or tax returns. A credit score was often enough documentation to get a borrower qualified.

Bear Stearns

Bloomberg reported today that Ralph Cioffi and Matthew Tannin, former hedge fund managers for Bear Stearns, had been found not guilty of misleading investors in the funds they managed. Their investors lost $1.6 billion.