Leader in a changing industry

Tom "Chum" Balk has served as the president of the Mortgage Bankers Association of Georgia since May, having gradually climbed the group's leadership ladder after joining about 15 years ago.

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Jackie Ricciardi/Staff

Tom "Chum" Balk is the president of the Mortgage Bankers Association of Georgia, which works with and educates lenders across the state.

Back | Next

Jackie Ricciardi/Staff

Tom "Chum" Balk is the president of the Mortgage Bankers Association of Georgia, which works with and educates lenders across the state.

He is the vice president for mortgage lending at Georgia Bank & Trust in Augusta. Balk recently spoke with The Augusta Chronicle about his role with the association and the changing mortgage industry.

Q: What does the recently passed financial-overhaul legislation mean for the mortgage industry?

A: There are pieces of that legislation that are being diced or pulled out and dissected from a mortgage perspective. We're getting recommendations, but not final rules.

(The rules) are numerous. The summary was 800-odd something pages. At this point it's almost daily notices from our regulators saying, "This is how we understand this change" or "This is how we think we're going to offer guidance, but wait until we do." The whole industry is just sitting back and waiting for guidance from their particular regulators.

Our organization is also actively involved in the national dialogue to share our concerns and make sure there is a really healthy law in place.

Q: How does Augusta's housing market stack up against others in the state?

A : Certain areas were harder hit than others. The Atlanta metro area was probably the hardest hit in Georgia.

Augusta has always been recession-proof to some degree because of the medical community, the military and nuclear industry. Those three have always sort of bolstered Augusta's economy in a positive way.

Q: How has the mortgage industry changed and been portrayed since the financial crisis, particularly when it comes to subprime mortgages?

A : The credit markets themselves tightened. Fannie (Mae) and Freddie (Mac) tightened up on underwriting guidelines based on analysis they did. A lot of people talk about subprime lenders.

It's not fair to lump people into categories because of the profession they're in. Some people did make bad loans. Our job is to counsel people into making a decision based on all of the product offerings and let them decide which is best for them. There were some lenders out there that pushed people into products for various reasons that could have resulted in bad mortgages. Unfortunately, that made it tougher for some consumers to get mortgages. That seems to be loosening up a little.

Q: What is the result of tighter lending standards?

A : Today there are not as many products to choose from. There used to be a wide variety that included no-income-verification and no-documentation loans. Those just went away. I don't ever think it's good to have fewer choices. If it's managed the correct way and used as a tool for counseling and applied to the correct borrower, then you don't have a problem. It's when that product is mismanaged or misdirected toward a buyer who shouldn't have it that you get into problems.

Q: What does it take for a person to get a mortgage now?

A : The two biggest factors are down payment and credit score. There are different products for people with smaller down payments or depending on their credit scores. You have to sit down with the customer and assess what they have and where they are. Most of them are scared to death because they have no idea what it takes to qualify for a mortgage or even a refinancing transaction. They don't know if they qualify because of all the industry and regulatory changes. Despite those concerns, people are getting loans every day. There has never been a better time to buy real estate and get loans because the real estate is so affordable and the interest rates are so low.

Q: What does the Mortgage Bankers Association of Georgia do?

A : We are here to serve our mortgage-lending members throughout the state. We have a lobbyist on staff who is very active every day and monitors all of the legislative policy. We also provide tons of education to our lender members and even to folks who aren't members for different purposes.

Q: What are your responsibilities as president?

A : Each of our (Georgia) cvchapters -- Columbus, Augusta, Savannah, Macon/Warner-Robbins, Valdosta, Athens and Atlanta -- runs independently and has their own officers. They like for the president to come in and install them and do a state of the union. ... The president also runs the monthly board meetings that are held mostly in Atlanta.

Q: What are your goals for the association?

A : One of my goals is to try to visit all of the chapters and to promote membership to boost unity and to help get the message out. I want us to work together as one big team to help facilitate the American dream to as many borrowers as we can and to do it in the most ethical, professional way.