When pressed, I’m happy to tell how I came through the near economic collapse our country went through in 2008. It’s a story about getting knocked way down only to work a hard row back up. I’m certainly proud, and I certainly had a lot of help from some great people.
But none of it comes close to the story of my recent podcast interviewee, Egbert Perry.
Perry was born on the Caribbean island of Antigua, where today, the average salary is about $23,000 a year. He was one of 10 siblings raised on a chicken farm there. If you ask him about it, he’ll tell you how great it was growing up there.
“We had 365 beaches there,” he says. “And it was a real village where everyone looked after each other.”
Somehow Perry found out about a scholarship opportunity for a private high school in New York. He somehow convinced them to award him the scholarship. He went on to study civil engineering at the University of Pennsylvania, earned an MBA at Wharton School of Business with majors in finance and accounting and worked his way up to eventually becoming a chief principal at the nation’s third largest African-American owned business. He became well known around the country as a brilliant man and after the near economic collapse in 2008, was asked to sit on the board of directors for Fannie Mae.
Fannie Mae was at the epicenter of the financial crisis, which was born out of bad mortgages being bundled together and sold as good mortgages. Fannie Mae’s role is to encourage home ownership by taking significant risk off the shoulders of the banks and lenders, so they’ll be more aggressive in giving people loans. Fannie Mae, and others like it like Freddie Mac, the Federal Housing Administration and Veteran’s Affairs, basically tell banks and lenders “if you underwrite your loans according to our guidelines, we’ll pay you back for losses incurred if the borrower stops making monthly payments.”
Fannie Mae’s way of doing that is to promise to buy the loans from the bank or lender, no matter what. So in 2008, it was buying billions of dollars in bad loans. It was near the brink of collapse and was bailed out by the taxpayers. It is still owned by the federal government today. Perry was put on the board to help right that ship during the worst economic storm in recent history.
Then, five years into the job, he was asked to be chairman.
I was of course thrilled to be able to interview him and talk about his time there, and what the atmosphere was like at Fannie Mae during that crisis. I’m a mortgage banker, so clearly I wanted to know as much as he was willing to talk about it. But I also was very interested in something else he is doing today that is starting to gain traction throughout the country. Maybe it’s because of his roots, but he seems to be driven by the desire to see less affluent families live and play in the same communities as more affluent families.
I’ve seen him talk before about how less affluent families have to live in parts of town that do not have the same schools or opportunities as the more affluent parts of town. And he’d like to figure out how we can mix people with different economic backgrounds.
One roadblock is that land has become so expensive that it’s really hard for developers to build houses that sell for under $300,000 these days and still make a profit. Certainly in more affluent areas, where land values are even higher, the problem is even worse. In the interview, Perry seemed to be under the impression that more affluent people do not want to live near less affluent people and he had an argument for this:
“If you are a city planner, or if you are someone who has any say in where things get built, think of where you have to live if you don’t make a lot of money, and ask yourself if you would want someone you love living there,” he said. “I think if we make it personal, we may start thinking differently about this.”
He said the will of the people has to be there, because the only way for builders to build more affordable houses is for local municipalities to have the political will to offer incentives to builders specifically for more affordable housing.
It was a fascinating interview for me and I hope you’ll go in and have a listen. You can find it at https://businessradiox.com/podcast/north-fulton-studio/atl-developments-geoff-smith-egbert-perry-integral-group-llc.
Geoff Smith is a mortgage banker with Assurance Financial focusing on residential home loans for refinances and home purchases.
*The views and opinions expressed in this column do not necessarily reflect the views of Assurance Financial Group