EP 528 – What Can Be Gained From FICO World With Merrill Chandler

Foreign this is the no Closer show where you get the latest developments in distressed note investing and learn the secrets of how you can control millions of dollars worth of property for pennies on the dollar. Get educated and entertained by someone who has closed thousands of deals and lives to support you in achieving the same. Now, here's your host, CEO of We Close notes, Scott Carson. Good morning, good afternoon, good evening, everybody. Welcome to this episode of the Note Closer Show. As always, Scott Carson, your host and excited to be here with you. Thank you as always for listening to our listeners on different podcasts, YouTube across our AM FM radio stations across the country, Note Nation. We are here to serve and as always, we are excited to have our guest, Meryl Chandler from Credit Sense and got a big, big shout out to Credit Sense for being a sponsor of the podcast. But Meryl, you and I spent some time together recently, a few weeks ago in Orlando. You've got some big things going on with what you're traveling and adventure going to and all the things you're implementing. So good morning to you guys out there in Salt Lake City, I think is where you're at today. Is that right, Meryl?

Today I'm in Salt Lake City. Don't ask me on Saturday because it'll be somewhere else. But I'm glad to be back. It's always fun. Your listeners are tearing through my podcast. We're just getting these. When I do one of your podcasts, I get this spike in my podcast. So thank you, thank you, thank you. Keep listening to him because he's the leader of the pack and I'm just here to help you guys become effable.

There you go. We had a great time in Orlando. You've got some great things. You've got Rock and Rollin. But why don't we first talk about you've got the granddaddy of them all, the big event of the year that you love going to because it helps you implement and tweak what you guys do so well to help your clients and those that are interested in helping to optimize their, you know, the fundability factors or the fundability numbers and help your students really take their credit scores to a whole different level to get lines of credit, to get approved for bank loans and cheap financing because interest rates are low. But let's talk about this upcoming event to FICO World that you're going to in a couple weeks.

Oh, so excited. They do it every 18 months and so they call it FICO 16. It was 2016. Then 18 months later FICO 18 and now we're going to be in New York City. FICO World 19. Now, I got to tell you, the very first one we went to was in Washington D.C. fICO 16. And that's where I met Will Lensing of the story that I tell both my podcast and all of yours. By the way, you rank higher on your podcast show for Credit Sense or for Rufable than I do. So this man is the man. I'm just sit at his feet and say, teach me how to get my word out to people. Which we just spent a few minutes this morning doing. So thank you again. But FICO 16, it was in Washington D.C. they rented out the Smithsonian Institution Museum of Natural History, all the wings, the animal wing, the marine wing. It was crazy. They rented the entire thing out to have their kind of gala party. So these guys are no joke. It's flat through and through. So I have a great agenda and just want to invite all your listeners to go to Credit Sense. And if you're already a member of the funding hackers community, you'll be able to find it there. But at Credit Sense, go like the page so you get notifications. We're going every single day. We're going to be talking about what we're learning at FICO World. It is eight hours a day, one hour segment. So I have there eight classes times four days where all of the FICO gurus, all of what I affectionately call the credit gods, right, the funding gods, all come down from Mount Olympus and meet with us and teach what's going on. And so there's. I am thrilled we've been planning on this since we walked out of the Last one, right. 18 months ago. But we are ready to go. And I've already got some great news about the I'm going to be doing podcasts, Facebook lives, so. You got it. Go like Credit Sense Pace you can get these notifications. These Facebook lives are going to be us debriefing every class that we come out of. Jessica, my business manager and referral partner liaison, will be there with me. Two classes, some will do together, some we're splitting up. Like everybody does at a note show, right? Where you go and learn all the different things. Yeah, sure. No camps. Gotta split. The husbands and wives, right? Even though Jess and I aren't married. But we are ready. I've never been this ready for a FICO World conference. And so, yeah, thank you for asking.

No, we're really excited about the next month's episode with you where you're Gonna come and share a lot of the aha or the nuggets in the Cliff Notes version of FICO world. If there is a Cliff Notes with the energetic Merrill Chandler there for you.

Right? Absolutely. No, this one is the prep. I'm telling you what we're going after. We'll tell you what the results are our next show.

Now, one of the things that we talked about briefly in Orlando, and you shared this on the previous episode, too, that you're working. FICO's got their 40 points and they're using AI. You know, how the gamification, how the game works. You can go in and tweak things so that you know how to use those systems to benefit you. Or when you've got a ding or bad derogatory thing or something like that, you can adjust the other dials, I guess you could say the credit dials, to help overcome that. Right. So you've got an app that you've been working on too, and you're steps ahead of really where everybody is else Is that. You want to talk about that briefly?

Yeah. Thank you. All right, so Scott's referring to what we call the FICO 40. Now, the FICO 40 is an estimate because each bureau, one uses 39, one uses 42 metrics. So we call it the FICO 40 because it's average across all three bureaus. These are the behavior metrics that are being measured over the course of 3, 6, 12, and 24 months to determine your fundability. Right. We had what we call our black box, and we met program developers so that we can create an app both on the desktop and handheld on your phone, so that we can do the principles of the basics, the principles of fundability. And this app is what we call a rules engine. And this rules engine says, if you have 17 open credit cards, what do you do? If you have two open credit cards, what do you do?

It's the rules.

And think of it as a target, Right? Concentric circles down to the bullseye. Well, there's what we call a fundability path, an optimization path. If fundability is the bullseye in the middle, then we have an optimization path wherever you're starting out to bring all of those in. That's what we do with our students at the bootcamp. That's what we do with our full service coaching clients so we can coach them unlimited support to get them to that bullseye. Well, we want to move that technology that we use over. It's probably 12 to 18 month process, but we're committed to making it more of a available to people so that they can first our clients. That's kind of our beta group. Right. To make sure all the bells and whistles and all the jots, all the dial twisting that you were talking about. But think of it as an optimization path, to use your metaphor, Scott, an optimization path. Let's say there's 10 silos with 10 points each. Well, the idea is you're fundable at let's say 80. So our objective is even if you have a couple derogatory accounts that bring your account, your paid as agreed silo is a little lower. All we have to do is make sure that the other silos are hitting on eights and nines in order to compensate for the threes and fours that you might have in any one category. Quality of your profile, length of credit, too much available credit, not enough credit. Every silo has a certain value. But all fundability means is that you hit that 80 points aggregate across all those one through 10 silos. That makes sense.

Totally makes sense. I'm imagining a credit fulcrum on a, you know, one of these, what do you call these things? You know, as kids used to love to jump on if it's low here, you adjust this back in here or move the fulcrum over so that these things come in and it comes into balance and play for you, right?

Absolutely. And fundability is perfect balance. Right. But the rules engine is one of the very things. We're being assigned a platform development manager at FICO who is going to coach us and consultant, be our consultant on how to implement our rules into the software so that we can gather the data, create AI and make fundability faster, faster, faster, faster. So that's one of our meetings that we have scheduled at FICO is with our platform development manager. How to take the software on the handheld or the desktop is only how it's presented to the world. The actual AI engine. Yeah, that's fico. So that's on our thing. And we want access to FICO scores instead of just the marketing. The FICO FACO scores. Right. Instead of just the marketing scores. We're going to see what we can negotiate about. How do we get the data from like if you choose on your app, you want a car, that's your next purchase optimized for getting the vehicle. Then we want to be able to use the FICO auto score as the regular update so that we can get know when you become fundable as it relates to your score. Remember, generally speaking, scores do not create approval. They Create the rates and the terms and the limits and loan amounts that you get. The approval comes from the lender. And so another meeting we have is with the. We met with them in 2016, but we met with the woman who is in charge of the. She was the liaison between FICO development teams and lender underwriting development. So we're having a deeper dive there than we had the first time. So, yeah, the software is huge. But again, now we're out of my area expertise. I know what works for our clients. But translating that into a rules engine and then getting that into software, I gotta have. Yeah, those are geniuses in other areas, but mine is developing that rules engine that. Right.

So one thing I like to ask is this will be the third or fourth time you've attended.

This will be our third.

Third time. And you said you're really the only kind of company like what you're doing that shows up to FICO World. Is that correct?

So far, we've been the only consumer facing organization at fico. Everybody around us, they are the underwriting teams and the programmers and coders of the Fortune 500 companies and all 5,000 lending institutions in the United States.

Nice.

Then there's me and Jessica. Now, I do have to tell you the story. Fico 16. I don't know if I shared this one with you, but Fico 16, Brad was in a course and then Hannah and I were in a separate course and we thought, all right, this is like FICO for beginners, right? So we go sit down in our. We go sit down and everybody's pulling out their computers. Maybe I should share my screen. But just the names of these courses. Sometimes I don't even understand what they're actually. I mean, the depth of them. So Hannah are sitting in this course and everybody's got the computers up. So we pull ours up and they're like, okay, guys, we're going to do a dummy click and connect for your API system from your lending software to our FICO development engine. So let's go. And Hannah and I are looking at each other going, wtfmf. I don't understand the word they. Just the sentence they just spoke, but I heard API. So I think we're programming in this course. And the first break, we just faked it. We just. Yeah, yeah. Unfortunately, I learned this for the FICO 16. I learned it for 18. And this one coming up. I do not sit at the front of the room because I don't want people over my shoulders going, this guy is an idiot. I Want to keep my ignorance to myself when I'm standing among titans. But anyway, we're on the front row trying to create the impression that we knew what we were doing when there were six rows behind us of programmers looking over our shoulders, not knowing a damn thing. It was insane. At the break, we didn't come back. Yeah, we didn't come back. Oh, you got.

Yeah, I went to fico world.com real fast or fico.com in the FICO world event. I just pulled up the schedule here, so. So it was easier, like defining the new possible decision management platforms. A disrupted world Consumer Contributed data Ultra FICO Equifax and FICO Fighting Synthetic Identity Fraud and Auto Finance tech stories from the front line. An endless. I was looking, I was like, yeah, you're right, I wouldn't know.

Yeah, here we go. Best one. FICO research xNN explainable latent features and that's. Yes, I'm going to that one. I have no clue. And if you read the small print, it doesn't help. It does not explain more. But the thing is what I'm able to glean because I connect dots, there's. I'm there to learn as much as I can. But these meetings are the ones because I'm already. Whatever we call on the inside. Right. They said, we'd like to have you meet with the appropriate team members that you'd like to answer questions, etc. Give us an idea of the scope of those. I sent them a big old email saying here's the questions, here's the scope and I would like a podcast with Will Lansing If I can, 15 to 20 minutes on the future implementation. No, excuse me. The thousand foot view of FICO's fraud prevention strategies and how those benefit borrowers. Right. I want a man himself to say we're here to support borrowers and fraud prevention is how we do it. Ethan Dornhelm, who's the chief scientist of the fico, I want to meet with him on the future implementation of FICO reason codes beyond the current 40 plus or minus. Right. The FICO 150 we've talked about. I want to know what they're casting forward on that because we're already optimizing for the vast majority of those 150. And then one that I already got confirmed. FICO business. He is the SBA Small Business association liaison with fico because they use sbss, the small Business Scoring service. We're talking about the schedule of rollout among financial institutions. I know they've been taking over the market space. But I want to know kind of what we can count on over the next two to three years. So I've already got one scheduled, I got two more on deck and I'm going to get some ad hoc ones, I promise. I'm going after MyFico.com's president so that we can talk about how they're serving people. So I go, even if I can't understand every word that's coming out of their mouths at the classes. And I go to have these meetings and find out so we can serve our students, our clients, your listeners. I want people to know that there are possibilities that they've never even dreamed of. So.

You'Re not at all excited to be going, which is great. I know you got that coming up. And then you've also going to be up in Ohio, New Louisville, Mason, Ohio, near Cincinnati for the Orea, big event area that they put on there every year.

Yep, the orea, the Ohio Real Estate Investors association, our biggest event of the year. And we're going to be there. I think we're going to have last year we had 300 people in my presentation. We're going to try and beat that. But the funny great story, Mason, Ohio. And if any of your listeners, I'm going to give you an email address. If any of your listeners have another place in the country that make the Bismarck Dunkin Donut. The only place I've ever found the Bismarck Dunkin Donut, cream filled maple bar and chocolate bar is in the Great Wolf Lodge, Dunkin Donuts on site. I've looked everywhere. That's some bs. I don't know why, but it's the Bismarck and I'm looking for it. And so any of your listeners who have it, you can just send to inforeditsense.com fire me an email telling me that your city has it. And if I'm in your city, trust me, I'll invite you for one.

That's good stuff. Now you're also going to be out in San Diego the first weekend or the 7th, 8th and 9th of November as well at Magnify you Wealth with our buddy Aaron Young, a listener.

And you're going to be at Orea. Come to the booth. Let's talk. If you're going to be at Aaron Young's Magnify youy Wealth, let's talk. I'm also going to Pitbull Monday and Tuesday, which is in Phoenix, Arizona. Right. And so this is my busiest season. The fall is always my busiest event and presentation season. But I'm gone for the next two weeks straight. I leave Sunday, don't get back until the following two Sundays later, after FICO World and Aaron Young ends on Saturday and I'm back On Sunday, literally 15 days on the road.

And that's a beautiful thing because it's a busy time of year because there are bigger events in November and October as people start prepping for 2020. And that's the big thing, that you've got something else that you're working on, something that you're boosting. Is that correct? Or the.

So one of the things that we're. That's super hot right now is what's called the FICO Boost. And FICO Boost, they actually you scrolled through one of those topics. But FICO Boost is where they're bringing in other data to create to round out your credit score. This is for people who do not currently have access to credit because they don't have a car, don't have a house, but they faithfully pay their utilities, cell phones, etc. Now, it is not a heavy implementation. It's not going to get you business lines of credit. Just having the boost data, things like that. You have to be a professional borrower. And that's what we teach at the boot camp. That's what my podcasts are all about, how to become a professional borrower. But I will be doing. We have on our schedule for this fall a podcast does a deep dive into FICO Boost because what they're doing is just trying to be inclusive, right? And so they're actually getting merchants to report credit profile data or payment history to be added to the 24 month look back period. So if you're paying your cell bill, you're paying rent, you're paying. They've even engaged their outfits out there that if you're paying your rent, you pay a service, but you pay your rent to the service and they pay it. They report your rent payments on time to fico. So they're trying to be more inclusive for borrowers so that people can get a car or get a home, get a mortgage. But do know that there are limitations to that booth. But anyway, there's classes on it that we're taking. But that's also one of the subject matter experts that I'm looking to meet with is what is the crossover point? What is the am I going to get a $10,000 credit card or am I going to get a $30,000 credit card using Boost data, those types of things so we can add them to Our rules engine in house and then optimize our clients for that. Because we can take brand new clients, the children of real estate investors, the note buyers, right? Those. The children who are starting to build. We can start with boost level stuff and start upgrading. When they get higher and higher, their fundability gets higher and higher. So that's one of the big projects we're working on, is how do we expand our base so that it's not just real estate investors, entrepreneurs, business owners, but how do we get folks who are just starting out college students, how do we get single moms, Right? How do we optimize? And how do we offer a product that makes them an intelligent, powerful borrower and stay within their $2,000 a month budget? Right? I don't have that product yet. And I want to make sure that we're not leaving anybody behind in the fundability world. One of my avatars is the single mom that's low income who's fighting to make ends meet. I want her to have the tools necessary to become fundable as she grows and grows and. And a path, a fundability path for her. That's one of our 2020 expansion markets that we're working on. But I gotta get the details so we can optimize for folks that right now we're leaving behind. And no borrower left behind. That, no joke, that's what I'm all about, right?

One of the two things that we were implementing too, and I put this out there just because crossover, is that for those of you that are existing clients of Credit Sense, there's. But also we've got some crossover with clients of Laughlin Associates that if you've signed up for the court bail protection with Laughlin, they'll report it to the credit bureaus for your entity or your name, so your business for your business. So you can start building business credit that Merrill can then use to help go get your lines of credit. And then also, maybe people didn't know this. We talked about this a while back, but Madison Management, which is our big servicing company, I talked to Shantay Duffy over there and asked her about, hey, who do you report to? She's what we want to report to TransUnion on the mortgage stuff. I said, oh, and then I reached out to Merrill, this is a couple weeks ago, I said, listen, if I technically take a property owner, finance it to my entity or owner, my entity owner finances a property to me because I don't have any mortgage on my credit, and have them both go where it's Just automatically withdrawn on an asset. It doesn't matter what it is for.

The most part, as long as they're reporting in your name to your SoC, doesn't matter.

It's a beautiful thing to boost your fundability factors as long as it's on time and reported there. But you can set it up on automatic to take care of things. So those are. I only bring that tied in because I know a lot of people out there looking at things or stressing about bills or stressing about financing. They're wanting to do some big things in the new year. And if you start putting those things together the next 60, 70 days before the year out, you can start off 2020 in a whole different pattern. And Meryl's team can do an amazing job with those extra lines of credit that are reporting on your behalf to really make 2020 a great fundability thing. Especially with the credit rates, beings and interest rates being so low across the board right now.

Yeah, it's very favorable for borrowers and borrowing. Right. So one thing I do want to follow up on that conversation is what can we do to get that outfit reporting to all three bureaus? Because when they only report to one, it creates a range differential. And we need that mortgage, we need that rent or that leasing, we need that on all three because that's a high ticket item. Right. Those are 50,000, 100,000, $300,000 properties we want. Those are highly contributable. How do we find the right outfit or how do we get them to report to all three? Because it doesn't cost to be a subscriber, cost to pull credit. So how do we do that? And maybe you can hook me up with that individual. I'm happy to make that call.

That's an easy thing. It'll be an email in your inbox in two weeks because you've got enough stuff going on. Right.

Send me that. Well, that actually as soon as you can, because I'll, I can make that call on traveling right now.

What else have you got going on? Have we covered everything? You have the app, you're going to Fico World.

Oh, I don't know if they're gonna answer it because I'm the only who uses this metaphor and they certainly don't use this metaphor. Everybody that I have a podcast interview with, I'm going to ask them. So if Fico World is the Olympus of the credit and funding gods, which deity do you most relate to? Oh, I am going to ask that question right now. I'm going to tell If I get the opportunity to meet with the CEO, Will Lansing, I love 15 minutes. I hope they can make that happen. But if I can get Will Lansing, I'm just going to tell him he's Zeus. I'm just saying, Hey, I tell my students, my audience, my podcast listeners, that you are the Zeus of the credit and funding world, the predictive analytics world, and we can go from there, but I haven't got anything else. Oh, one last thing. We're talking huge. So we talked about. FICO Falcon is fraud detection software. My intention. They have not scheduled this one yet, but my intention is how deep dive into what are the data points that they're collecting? What's the relationship with the application score? Just kind of get under the hood instead of going, yeah, this is a great Hemi 450 engine. I want to actually start taking this thing apart and seeing how deep they'll go. I have an NDA with them, but I would love to find out how deep this rabbit hole goes with FICO Falcon. Because if I believe I have come up with a way to bulletproof a pcid, a personal credit identity using the FICO Falcon, but I haven't bounced it off of them yet. So that's a huge opportunity for me as well. So I'm making a note here.

Now, most people may not know this, but you also. You've launched your own podcast, though, too.

Yes, it's on all the platforms currently. It's called Are youe Effable? F with an asterisk? A B, L, E, R U F Able. We're working. That's been the placeholder because we've been. We needed to get the podcast out, but we didn't do any survey. We didn't, you know, we didn't talk to our audience. I always, I believe in ask campaigns. Right. Just say what strikes your fancy. So that's the last thing on our. On my book, my book release, we have the publisher in play. They're doing the. What is it? ISPN number and Library of Congress stuff. All that's getting done. So I know it's real now. Right. So words on a page is not a book, an ISNP or whatever that, you know, your registration with the Library of Congress, that means you're actually legit. Yep. I've written a book, so. So go to getfundable.com and that's. Oh, that's another announcement is the funding hackers is all in play. But getfundable.com we finally. We bought getfundable.com I don't know if it's forwarding yet to funding Hackers, so I don't know if that's a thing.

It is forwarding. It is forwarding. It's just pulling up right now for you.

Yes. So funding hackers is our community, but because we want to build that brand. But that brand is the community. Right. Of becoming a funding and knowing the inside secrets. Right. It's kind of like the insiders, but get fundable. We finally got it purchased. We had to buy that baby, but it was worth it because we want to identify that's our command to ourselves and to everybody in our lives. Get fundable. Get fundable, damn it. So. Oh, getfundabledammit.com I need to get that one too. But get fundable is our rallying cry. Funding Hackers is the community of people who are on board and just going for it. Right. You have to have watched the Gone to the Boot camp and be a member. A subscribed member is 29 bucks a month to be a part of the Funding Hacker group. So some of our branding has changed. We didn't want to. People told me, I always want to wait until it's Perfect. People say 90% now today is better than 100% two weeks or a month or whatever from now. So there are some branding movements and evolution to get us all in line. We didn't want to do anything until we could purchase that URL, but it's done and it's forwarded and we're killing it.

Yeah. And you've got 30 episodes already out there. So a great way to binge and you've got some great topics on there.

30 episodes?

Yep, 30. So got a lot out there for you to binge and really learn a lot and be educated on what Meryl's experience is team experience there for you. So just really great stuff out there. Listen, like I said, I've been binging it.

Really love it.

The energy obviously comes through. Do your size, do everybody, do a favor, go over, check it out, listen to it bribe. Leave a couple five star reviews right now.

Yes. Subscribe, listen, subscribe to the podcast. Go to Credit Sense Facebook page. Facebook Credit Sense. One word and like it so that you can stay on board with the play by play, moment by moment. FYCO World. It's happening on August. What's the date? August 5th. FICO is November 4th through the 7th. 4th through the 7th. So make sure you're just tune in and figure all that out. And then, yeah, there's the Facebook Page. And the next one is. The next one is. Our next boot camp is November 16th and 17th. It will be. We're not holding it. We're doing it in our studio in Salt Lake City. So it'll be simulcast nationwide. Register for that so that you can. That's the fastest way to learn the principles of fundability, how to stop stepping on the funding landmines that are crushing the soul of your credit applications. And we will be back from fico. So that's going to be a rager of a boot camp because I'm going to be back from FICO and I'll rework my deck. I'll. The presentation is going to take on subtly or a hugely different tone. I will be coming down from the mountain of the credit gods and you'll.

Be delivering the credit ecstasy to your listeners and attendees November 16th and 17th. They're live online.

To understand that reference, go to my podcast and listen to the origin story. You're gonna love it.

Yes, Good stuff. Definitely good stuff there.

That's it for me, Scott, you're my superhero.

Well, you are doing an amazing job. And rock and rollin out there. Just absolutely. Guys, I think if you're listening to this episode and this is the first time you've heard him, you probably got your ears blown back and your hair going there. Take the opportunity to go check it out. Maybe check out some of the previous episodes with Marilla. We've got. He's got. This is your, what, ninth, tenth time to be on the podcast at least. I mean, that's not counting note camps and other things that we've done with you as well. So important guys to take advantage of the thing to learn. Live stream, listen to what Meryl's doing and sharing if you're in those other areas, like we said, San Diego, check out Magnify youy Wealth if you're gonna be in.

I'd love to shake your hand, meet you, find out kind of what's in your way, what the landmines are you're stepping on, and how we can at least keep you in one piece when you go visit with a lender and get approved instead of denied. That's our end game here.

Good stuff, man. Well, hey, do yourself a favor. Make sure you get plenty of rest, hydrate plenty of emergency or vitamin C while traveling, brother. We don't want you to get sick and you've got a busy stretch ahead of you. We look forward to having you on in a couple weeks. We'll schedule that for probably later in November just so it gives an opportunity to go through because you got a lot of things that are going on. So looking forward to it, man. Looking forward to hearing from all the good stuff you got going on and getting updated on all the new nuggets when it comes to being fundable here in the next couple weeks.

Yeah. Excited. Excited. Thank you again Scott. This is awesome.

Thanks Merrill. I appreciate it. Everybody once again, go out check out Are youe Fable podcast. You can also look for it and get a link to it and listen to it directly@fundinghackers.com Great place to binge, Great way to learn and listen. And going straight to fundinghackers.com youm'll see the most current episode at the bottom of the website where you listen to it. Bribe. Like I said, go on over to itunes too and leave a five star review for Merrill and his amazing team of funding experts to help you take your business to the next level. So guys go out take advantage of I know we're coming when you listen to this, either it's in November or December or later on that take the opportunity to plan out and Prepare to make 2020 great. The last time you want to do is be looking at your life at the end of 2020 and because hindsight is always great. So make it get some pre sight versus hindsight in your business life. And so we will see you guys later go out make some happen and we will see you all at the top. Everybody but.