all right all right season two baby technically kind of did we just make up our own seasons because we are back and we're calling in season two episode one very special episode what's up charlie what's up yes we did just you know we're calling it season two we're calling it season two like are there actual seasons with podcasts i don't even know if that's a thing it is but you know what we eclipsed the the 10 episode mark so we figured hey let's Let's start over in season two. We
did take a little break. You know, no one likes us. We had some bails on interviews. And so things kept getting pushed back. So we do apologize for being away for a while. But this is Value Nation. Without further ado, we are here. Season two. We made it. Episode one. coming at you. We have a very special guest, and it's kind of perfect timing for everything that's going on in the business right now. Again, hey, Schwartz, again, you're outnumbered. We got another Ohio
guy coming in. Stay tuned. Everybody, we got a certified appraiser, financial guru. You see him wearing a black belt every now and again, mixing it up on the mats. And bless his heart, he's a Bengals faithful. We have Michael Kirk, our chief innovative officer. Innovative? Innovation. Innovation. Anyways, hey, round of applause. Welcome. Welcome to the show. Thank you. Thanks for having me, guys. And yeah, I am a huge Bengals fan. Hey, listen, I feel your pain. I'm a Browns
fan. We haven't gone down this path yet over a couple beers, but eventually we will. We'll talk about it. We'll have a therapy session. All right, so, Mr. Kirk, you are a little, let's give the fans a little bit about you, right?
um like to do that get a little more to know you uh you have two kids is that correct yeah i i was actually surprised it sounds like you guys have done a little bit of homework um i don't we do deep dives yeah yeah i don't really put out that i um took karate for many years so i'm not sure if i have a feeling i know who may have mentioned that to you but So anyway, yeah, two kids, both in college and one out of the house and actually the other one moving out
in August. They're going to be empty nesters here soon. Start throwing some travels and parties. Travel time. Yeah. Turn one of those bedrooms into a dojo. There you go. Are you really a black belt? How many years have you been a black belt? Yeah, I'm a second degree black belt in Shotokan karate. I can't believe I literally have kept this out of the industry for a long time. Breaking news. Thank you for that. Yeah, it's been, I actually started training when I was, I don't
know, 10. years old and all the way through, really through college and got my first degree, I think when I was six, 16. And then actually got after college, got married, started an appraisal business, got busy, kind of got away from it. And then my son wanted to take it when he was around that same, you know, nine, 10 and kind of pulled me back in. And then I went for my second degree. So it hasn't been actually that long ago, but today could kick you still probably
in the knees and it would hurt pretty bad. I'm not sure I could kick much higher right now, but it's all about. The discipline and the defense though. I mean, obviously to get to that point, you have to have a lot of discipline, body control. And I mean, it's kind of a defense first, more type skill that you learn anyways, correct? It really is. Yeah. Shotokan is actually like fighting is the last resort type of thing. And I'll tell you, it's really great for kids. I think I started
six or seven, got to yellow belt. And then I had multiple other distractions, like other sports and other activities that kind of just took away from it. But from what I do remember, yeah, you know, talking about the discipline and that kind of thing. I mean, you can use that in every day life, right? Some of the way that they teach you to just, you know, you look inside or you take a step back and you're not so reactive, right? I mean, you're not jumping down someone's
throat first. You're kind of, you're waiting it out. I'm trying to keep a level head, all those things. So, I mean, that's really awesome. I mean, you should share that. Put it out there. Makes you a little more intimidating. Gives you a little edge, too. I need a little bit of that in the appraisal business. Yeah, maybe. So you were a Cincinnati guy through and through. Went to school there. Still live there. You still cheering on your Bearcats, even when they lose
to Xavier? Yeah, I figured Xavier would come up as well. But yeah, definitely a Bearcat fan. So, yeah, I went to actually my wife and I both. attended UC. Both of our kids have attended UC. My son's actually finished. He finished up his capstone project in IT today, just a few hours ago. So he's going to be graduating here shortly, hopefully finding a job soon. So if you know anybody, let me know. But yeah, my daughter's gone on to NKU now and in business. And yeah,
things are going well. Can't complain since he's been good to us. That's great. All right, well, let's get down to To some of the nitty gritty, the juicy stuff. It's a business. Why everybody's here to listen to you and all your knowledge. So you were brought to Nationwide primarily because of your expertise in this, you know, the alternative
valuation space. So with you and Chad Carroll, who's the head of operations for the Alt Vals, you guys have, you know, stood up this entire department for us and got it up and running, you know, worked through all the kinks on the backside to make sure that it's exactly what. we're going to need to be successful for the long -term, right? So without getting too in -depth from the jump, basically these products are there to separate out the data collection
from the actual valuation process, right? And so can you give everybody just a little insight on how this works? Yeah, yeah, that's correct. So the new alternate valuation division was really built, you said the focus on... any product that falls outside the traditional space, right? So in fact, I think we're headed towards a time where traditional will kind of become the alternative valuation. It's going to take a while, right? But we're seeing that path kind of take shape,
if you will. And so most of the products that we offer separate the data collection from the valuation piece. And so what do we mean by that? Again, without going too far in the weeds, but we're sending out a professional, well -trained. This is not just a pizza delivery person, right? This is a well -trained professional, typically holds a license. a real estate license of some type that we'll go out and collect that data.
And then we allow the raiser to place the valuation on the back end on the products that need it. So that's kind of at a high level. And that's pretty much every product that we touch in our space has that bifurcation process built in. You're saying like an Uber driver couldn't moonlight as an inspector? They could, but not with us. Yeah, we are really trying to make sure, and we are making sure that we have professionals on that panel. And, you know, Chad and I have
been doing this for a long time. hear me talk about these products being around for a while, but, you know, it's in the home equity space and the REO and some of the other areas we've been, you know, China, I've been working on these for almost 20 years and other areas. So it's funny that a lot of people are talking about this being something new and it is in the first mortgage space, relatively new, but we have a lot of experience that we're able to bring to
the table. And we have a lot of folks that, you know, love doing this type of work. And so we're pretty excited about what we've built here. nationwide. So quick, quick side question on top of that. So you had said, you know, it separates the data collection from the valuation itself. And so then is there some valuations that are automated like an ABM or something along those lines as well that could be a product like this encompasses anything like that, correct? Yeah, that's correct.
So you're exactly right. So we do have ABM products in our home equity lineup, for example, where we pair that ABM with a property data collection report. Sometimes they're known as PCRs, property condition reports. We call ours PDRs. And so we pair that together. We do a reconciliation on the back end of that. But again, it's a bifurcated process. Value on one side and data collection, then we merge that together. We have our own version of our desktop appraisal that we're using
in those areas. And then it's really, if you think about it, it's that same process, no matter if we're doing one for a home equity loan or if we're putting it on one of the GSE forms, right? technology, the app that's used on the front end to collect the data. We put some guardrails around that to make sure that the data collector
is getting the information they need. If they see something that, you know, if they put down that there's some damage that prompts for a photo, it really guides them through the whole time. The nice thing about it is when the data collection process is done, when they're walking back over that threshold of the house, they hit submit, it comes back. We're actually doing a QC process of that data. before we send it over to an appraiser in the case of a desktop, for example, or hybrid.
And then when we get that back, we're going to second QC. So it's a, these products I've been, I'm kind of a nerd when it comes to these appraisal products. And I'm just going to say it now, but I've been waiting for this in the first mortgage space, because like I said, we've been using these, I've been using these as a lender. I've used them as an appraiser out in the field. I've just kind of been on all sides of this and it's.
Pretty exciting to see it kind of take shape in the first mortgage space because we know they work. We know that there's tons of portfolios out there that lenders have been holding in home equity, for example, with these products with no greater risk. And so it's just exciting to kind of see some different products coming out in this first mortgage space that has really been lagging the market when it comes to modernization.
So you had mentioned the term GSE. So as far as what could be used as just a straight alternative valuation product? and what the GSE forms, the GSE kind of program is, what's kind of the layman's terms on what those mean and what the kind of differences are there. Sure. So, you know, like I said, alternative valuations have been around
for decades in home equity. And so just to kind of level set, you know, we've had the EVMs, we've had typically each vendor has their own proprietary desktop form that they've created for the handful of vendors that have really taken over some market share in that area. And then the GSEs come along and they obviously need to standardize the process, right, as much as possible. So even though there's a little bit of a difference between the data set currently that Fannie collects versus Freddie.
it's very close to being standardized and quite frankly, will be standardized here soon. There's an initiative to make that happen. They have agreed to the same form. And so what we're seeing in the first mortgage space that's different is that Fannie and Freddie have come together with basically the same form, even though they get to it a little differently through the data
set and some of the photos and things. And so in the first mortgage space, there have been programs that have come out, for example, with Freddie. It's the ACE plus PDR. And then with Fannie Mae, we're announcing here, I think today, what everybody's been talking about, which is value acceptance plus property data. So we're pretty excited about that. And I think it's really going to continue to kind of change the industry as we move forward. Talk about a segue for you
there, Charlie. I know he just, it's a layup from there. I mean, it was like he knew what was coming. It's crazy. This guy is so, he's so dialed in. It's a lot of meditation, a lot of training at the dojo. It's the discipline. There it is. It's the discipline. So yeah, like you mentioned, you know, the big news this week is Fannie Mae announcing the value accepted and that finally going live to everybody. So, you know, lenders will be able to, they'll see a
new prompt. when they're submitting new loans for approval and know whether it's going to qualify right so can you give like a you know brief overview of what that means and you know most importantly is reiterate nationwide is approved with Fannie Mae to be able to prepare some of these For the lender partners, correct? So, yes, we're absolutely an approved AMC to provide the product, which is called value acceptance. Our portion will be value acceptance plus property data, right?
Because if it's just a regular value acceptance, there's really nothing else is needed and we can talk about that. But so it's value acceptance plus property data. And that program was really put in place. And let me back up and say. Also, the date again. You're right. April 15th is when it rolls out. I believe that's on a Sunday. That's typical to kind of start on Sunday. And then it usually will start seeing orders on that following
Monday. So it goes into place. It allows for lenders that go into DU and get, you know, they will actually go in and see that they've got an offering of a value acceptance plus property data. They'll come to an approved vendor like Nationwide, order that property data. We obviously... have built out the technology. We have the app to go out and collect the data that's needed for that. We're going to be connected to Fannie Mae through an API to send that back to them,
which is required. And then the lender will actually receive a copy of a PDF of the data that was sent to Fannie Mae. And so the nice thing about this program is that while the lender still has to make sure that the property is eligible, right? Just no different than they would if they had a 1004 for Fannie Mae. they have to make sure
it meets eligibility requirements. But Fannie has come out and said that, you know, as long as the property is in decent condition, meaning that it's not in, you know, say C6, that lender can move forward with that. And so the exciting part about that piece, just to pause on that for a second, is that, you know, there have been programs in the past where the lender is required to do a lot more. And like I said, eligibility.
check condition, the model is already built that as long as the property is not in C6, that it's pretty much like ready, ready to go. And so Even though there's a version of this where the lender could have to order a hybrid appraisal on the back end, I don't think it's going to happen. Fannie has suggested it's not going to happen very often. So this is like, if you get one of these, it's like a free pass almost. So you get the pass go with just the property data and move
forward, right? With a large percentage of these. So that's going to be a game changer for a lot of our clients. So you mentioned with what you're talking about, value acceptance basically replacing appraisal waivers? Yeah, that's exactly right. So value acceptance itself is the waiver that Fannie has been offering. And so if you looked at it on a chart, it would start with value acceptance, which would be a full waiver, if you will. Nothing
else is needed. And then there's another version where Fannie has looked at their models and said, you know what? We have enough from a credit standpoint.
We feel pretty good about. that if the models are correct about the collateral that we know what the value is as long as we know what the condition is and so we're going to send it out as a value acceptance plus property data and that information then will come back to feed back in to to the data set if you will and they can move forward with that like i said a large percentage and then there's going to be a a very smaller subset from what we understand that if
for some reason the condition is not what they think it is or there's an eligibility issue, then it could be upgraded to a hybrid appraisal. And by the way, we are absolutely able to provide those to our clients as well. So they start with the value acceptance plus property data. For some reason, it needs to get flipped to a hybrid. We can simply go back and send that. data over to the local appraiser, finish up the hybrid, and get it back to the client. So we have a seamless
operation there. We're good to go there. The clients also have the ability to go back and order a 1004, but at that point you would kind of be starting over. So I recommend that they go to a hybrid and we can facilitate that. very easily through the workflows that we have built out today. Yeah, since the inspection already took place for the PDR, and then that gets sent over to the appraiser for the hybrid desktop. That's right. And another good thing is our ops
team, like... We've been in, we've actually been involved in some of the pilots that are, you know, not so secret anymore at the beginning. It was kind of top secret stuff. The Fannie and Freddie were doing pilots with hybrid appraisals and other things. And, you know, that was the, that's been the joke recently. I've heard Freddie talk about it, that, you know, it's not, not so much a secret anymore that that had been going
on for a few years. And, and so Chad, myself and others involved in this process, we have been involved in those pilots in the past. this is new to us. We have done every piece. We've done the data collection. We've done the hybrid appraisals. And so this is kind of just kind of getting back to what we've done in the past. And so we're very excited about it. Like I said, I've been waiting for the first mortgage side
to catch up. I think that we are going to end up down the road and not too far distance where we have this value acceptance. We have the value acceptance list property data. And then we have just like that hybrid appraisal that gets ordered, not as an upgrade, but sometimes we just need a hybrid. And then we'll have the 1004 as kind of the cleanup. So I kind of see that. And then we got the desktop that fits in somewhere. Although I think once hybrid comes in, that desktop may
not be needed as much. But if there's already a floor plan out there, then obviously the desktop, that's no inspection. No inspections needed on that. So I think you're seeing really what. Again, the secondary, Martin, what home equity lenders and other folks have been doing for a long time, I think you're starting to see that full breadth of products, depending on your credit risk and, quite frankly, your collateral risk, right, as well. What do they already have in their data
set? And then what makes sense to move forward from there? Yeah, I've seen a lot of this, a lot of movement, actually, in the private money sector, too, with these kind of products, right? And it's from the standpoint of speed and efficiency. whether it's a one or two value report, these have been pretty attractive over the last couple of weeks. So it's awesome that we have them to provide. Yeah, you're right. That's a huge market.
Another area that that area and I've played in the REO space, the full space where we've built products, you know, just for those areas with special addendums, you know, obviously. Sometimes you need rent rolls, you need, sometimes you need current condition and the budget to, you know, what that's going to look like after they do those repairs. So you got the as is and as repaired with the budget. And so we put together
all those different things. And so the nice thing about this is that we're not just saying, you know, we would just say that Mike is alternate evaluation, whatever, but we're saying chief innovation officer, because I get the sandbox that. we get to build these cool tools in right and so we've built a lot of stuff already and we've already got I've already got several products kind of in the hopper that we're working on as well, including draw inspections and some other
things. So it's pretty exciting for our clients to bring a problem to us and for us to take the tools that we have and be able to help solve those problems. And that's really what is the most exciting part, I think, about this new division and the focus that we have. Yeah, I'd say so. It's pretty sweet. I mean, anybody can come to us basically and say, hey, this is what we're lending on. This is kind of what we have in mind. It kind of fits outside the standard box of what
other lenders are doing. You know, can you provide this for us? And we say, yeah, we don't have exactly what you're looking for right now, but I'm pretty sure we can tweak and build something around it. Yeah, that's huge. That's huge for us because we haven't to date. I mean, we haven't been able to really bring that kind of customization to a lot of the different lenders we've been
working with over the years. So to have that now, sure as what I've been with Nationwide for five plus years, you've been right around the same, right? I can't remember this one. Yeah, so it's been a long time coming. Like innovation in our business, like it needs to happen, you know, from inside out. So yeah, without having to outsource to, you know. Yeah, exactly. Having tons of different third -party vendors that are coming in, you know, be able to do it in -house,
have our name stamped on it. It means a lot and it's huge. Yeah, it's been fun and we're just getting started. That's the exciting part about this. you know, I ask our clients just to keep bringing those problems to us because that's what, that's what I enjoy going is working through those. And obviously we have Chad who is great on the operation side. He is, you know, he's managed probably a couple million alternative valuation products through his career, which
is just mind blowing. So there's not much he hasn't seen. So it was, it's pretty wild, but yeah, there's not really anything that us as internal folks or our external clients you know can bring to him that he hasn't already seen or dealt with right and so that's a that's a big advantage for us as well so so basically To round it out, you're saying it doesn't matter if you're a credit union, private money lender, bank with portfolio loans, first mortgage -based,
selling secondary. If you're looking to do something outside the norm of a standard 1004, 1073, we have the products to help you get it done. And if we don't have that exact product, I'm pretty sure the guru can help put one together for us. Yes, that's exactly what we're saying. We are excited to be in this space. We have so many products out there today that are... helping our clients, you know, cut costs, be more efficient, decrease return times, all while, you know, still
managing the risk, not increasing the risk. So we're very excited about that. And yes, like I said, I literally have, I think there's three different projects I'm working on right now that clients have brought something and said, this isn't working well for us today. You know, we're using traditional, we're using... somebody else to do this and this would be helpful. And we're working through those problems and figuring out a solution to those. And so that's what we're
here for. So just ask that folks reach out to their account executive and get a hold of us. And we'd love to do a demo for folks if they want to see more about our products as well. That's where I spend a lot of my time. It's just educating our clients as a subject matter expert on these products, as well as let's not forget the regulations right around using evaluations and appraisals. And so I've got a long history of making sure that we fit within the box and
the guidelines on those as well. I keep up with all the appraisal regulations, which is not something that's fun to do, but it's needed for our clients as well. Awesome. Yeah. And if any of you listeners out there, if you haven't been in contact with any of your reps or AEs, you can always reach out to sales at nationwideamc .com and that'll get rounded to the correct person. to Kirk's team or anybody else that can help get that conversation rolling and, you know, talk about demo or whatever
kind of information you may need. All right, Swiercy, want to do some rapid rush requests? Ooh, rapid rush requests. Starting you off with our standard questions, Apple or iPhone or Android. I'm an Apple guy and we're an Apple family here, the entire family. And Charlie is still the odd man out. Steady out number here. I will tell you that our technology, our app that we utilize, we'll work on both. So Charlie, you could do some data collection for us. Perfect. Ooh, a
little side hustle. With the proper training, sir. That's true. I'm not saying we would hire him. I'm just saying he has the equipment that would work. He'd be capable of doing it. All right. So Cincinnati, we got to talk about Skyline Chili. Oh. I love that place. I miss it. So tell me, are you a... Do you go three ways, four or five? Three way. Three way. And get this, a little bit of mustard in my three way now. My daughter actually works at Skyline right now through a
college job. And she turned me on. Some of her customers were asking for mustard. And you get mustard on the Coney's, right? That's standard. But I never thought about it on the three -way, and it actually adds a whole other dimension. It's not much. It's just a little dab in the spaghetti. It just adds a whole other flavor profile. So I highly encourage you to try that. I'm going to do it. I'm going to do it. I've got to provide an outsider's perspective here.
No, I've never had it. I've never had it. But, you know, like listening to sports radio and stuff here, every time the Chiefs still play the Bengals, Skyline Chili always comes up. And it's about 90 % of the people who have tried it to talk on the radio, they don't understand it. Yeah, if you're not from here, you don't get it. I mean, there's a lot of local foods like that, right? I'm sure you guys can think of others. But I find that they either love it
or hate it. Most of them hate it if they're not from here. But the ones that it's not like, oh, it was okay. Usually they're like, man, that's
really, really good. for somehow they have a taste for that but if you didn't grow up around here you're probably quite frankly not gonna not gonna like it it's a it's a different taste nobody from texas is ever gonna like um skyline chili i don't think because they think of chili it's something completely different to them when you say the word chili um and then most people are like you put it over spaghetti it just doesn't make sense right but that's kind of the same
thing here then yeah when i think chili i think big thick hearty you know full of meat beans and all kinds of stuff like it's not it couldn't be used as a sauce really you know yeah that's funny no it's it's gonna this is a fight that's gonna just keep happening the i think the thing that people get most grossed out about when they hear that they're not trying to just hear someone describing it is when you mentioned that there's some cinnamon in the recipe, right? That's what
I've heard is that cinnamon taste. Yeah, so it kind of weirds people out as well. It all goes together somehow. Oh, my gosh, it works, and it really is. All right, and last but not least, will the Cincinnati Reds finish at or above .500 this season? No. We both share the pain on that one. The Royals are pathetic. You guys can come like my guardians if you want for the season. You can just have fun beating up on us, what, like 14, 15 times this year? How many times do
you play interdivision? But you're welcome for those wins. We need them all. We need every one of them. Appreciate it. Very helpful. Appreciate it, guys. Thanks, Michael. How about that, Mike Kirk? So much information. Oh, man, he's got just – I know he's got so much more he wants to talk about. No, it was good. But it was great, yeah. It was a lot of good information. And I hope everybody listening got to enjoy that and learned a little bit and is aware that we got
it. We're ready. Nationwide. Whatever you need. We're right beside you. Right beside you. Oh, we need a banner. It's back for season two. It's back. So make sure to go like, subscribe on all of our social media channels per use. Really appreciate all the listeners out there. And if you do need some more information on the alternate evaluations, reach out to your AE rep or you can email us at sales, all of us, sales at nationwideamc .com. Value accepted. Peace.