Blend’s Crystal Sumner on increasing housing access
On the latest episode of HousingWire Daily’s Women of Influence podcast miniseries, 2020 Woman of Influence Crystal Sumner, who serves as head of legal, compliance, and risk at Blend, discusses the company’s recent inititiatives to increase access to housing and financial services.
She also shares the trends and topics that she is keeping a close eye on, such as the impact of the COVID-19 pandemic on the ability to qualify for a mortgage, specifically in regard to minority homeowners. Another trend Sumner touches on is on the growing number of consumers who feel comfortable with online transactions, with 81% of Americans saying they now feel secure making financial transactions online.
Tied to that, she addresses the increased adoption of RON legislation. Sumner notes that 34 states have enacted some form of permanent remote online notarization (a number that has since increased to 38 states.)
Here is a small preview of the interview, which has been lightly edited for length and clarity:
Brena Nath: Can you talk about the latest projects that you’re working on and one that you’re passionate about?
Crystal Sumner: A couple of areas that I’ve been passionate about this year have been first, a recent announcement around Blend Impact, which Blend kind of sits in the middle of this ecosystem and really has an opportunity to make a positive difference when it comes to increasing access and equity in the housing and financial services. So this led to our recent announcement where we want to seek to bring all those various aspects of the ecosystem together to expand access.
And that kind of has three critical initiatives. The first is our Equitable Ecosystem Initiative, where we’re currently exploring areas where we can work together with both our partners and our customers to try to find areas that we can, you know, drive more accessibility, whether that’s potentially homebuyer education, or additional language support or alternative data for credit underwriting. We just have a real opportunity sitting in the middle to drive efforts there.
HousingWire’s Women of Influence podcast miniseries spotlights the significant contributions of women who are driving the U.S. housing economy forward, interviewing our honorees over the years on the impact they’re making today. Hosted by Brena Nath and produced by Alcynna Lloyd. If you have a pitch or an inquiry relating to podcasts, you can reach our team at firstname.lastname@example.org.
Below is the transcription of the interview. These transcriptions, powered by Speechpad, have been lightly edited and may contain small errors from reproduction:
Brena Nath: Hi. I’m Brena Nath, HW Plus managing editor here at HousingWire. We’re continuing our Women of Influence Spotlight Series where we’ve selected women throughout the years who’ve been nominated and awarded our Women of Influence title and asking them what they’ve been up to and seeing some of the latest initiatives and projects that they’ve been working on. So first off right now I have with me Crystal Sumner. She’s the head of legal compliance and risk at Blend. So first off, thanks for joining me, Crystal.
Crystal Sumner: Thanks so much for having me.
Brena Nath: My favorite part of these interviews as I go back, and so I’m going to read Crystal’s profile for her 2020 award that last year and then needless to say it might be an understatement a lot has happened in the last year, so I’ll let her touch on some of those things that happened since. But reading through her 2020 profile Crystal Sumner played an instrumental role in growing Blend’s customer base to more than 225 lenders, and I’m sure that number has grown since then while brokering contracts through Wells Fargo and US Bank.
She joined Blend in 2016 and immediately began working tirelessly to bring Blend’s one-tap preapproval technology to market, enabling lenders to verify consumers’ assets, income and employment with source data and reducing paperwork to provide a modern application experience for consumers. In her daily role at Blend, she exemplifies how to implement and advance consumer banking technology, ensuring the company built innovative products that simultaneously push the consumer lending industry forward while adhering to strict security and compliance standards.
So I know that was a lot. I’m sure there’s so much more that goes into your day-to-day. So I’ll let you kind of fill in the blanks there and talk about, you know, what are those latest projects that you’re passionate about, and some of the new initiatives that you’re working on?
Crystal Sumner: Yeah, I know. Thanks so much and thanks for asking. I can’t believe it’s already been almost a year and what a year it has been for Blend. You know, mostly recently we just had a successful IPO in July, which I just have to note because it was a true team effort, not just on the legal team but across the company. But really a couple of the other areas I ‘ve been passionate about this year have been, first of all, our recent announcement around Blend Impact, which Blend kind of sits in the middle of this ecosystem really has an opportunity to make a positive difference when it comes to increasing access and equity in the housing and financial services. And so this led to our recent announcement where we want to seek to bring all of those various aspects of the ecosystem together to expand access.
And that kind of has three critical initiatives. The first is our Equitable Ecosystem where we’re currently exploring areas where we can work together with both our partners and our customers to try to find areas that we can, you know, drive more accessibility, whether that’s potentially homebuyer education or additional language support or alternative data for credit underwriting, you know, we just have a real opportunity kind of sitting in this middle to drive more efforts there. We also as part of the Blend Impact are looking at Blend Givebacks where we have, you know, our employees have 24 hours of paid time to purchase, pay, and volunteer programs, and they’re also having a full dedicated day of service company-wide where we’re going to have one cause that the whole company can kind of volunteer their time towards.
And then last as part of Blend Impact, we have become part of Pledge 1% where we’re joining more than 1,500 companies and pledging 1% of our product development and employee time towards building actual kind of products that can help to support the Equitable Ecosystem. You know, we just feel that the financial services and inclusive financial services should be top of mind for everyone and it’s something that I’m really passionate about as kind of a role that I support within the company.
And the second, you probably also heard we just closed the end of Q2 the acquisition of Title365. It’s a streamlined title, escrow, and settlement service. So you kind of heard about one-tap earlier. I think at Blend we’re really looking to push the process of home buying, which is often a complex and stressful experience to be one that’s more this end to end kind of delightful experience that’s connecting all the service providers together. Actually recently just refinanced my home and having the notary and having, you know, the title company all come to your house and things not be filled out, it just felt kind of like an antiquated way of doing business, and so Blend spent a ton of time and energy evaluating title companies to make sure we partnered with the right company to kind of bring the title and escrow space into kind of this next phase.
And so partnering, you know, Blend’s engineering and talent with the Title365 deep expertise, we’re really looking to try and create, you know, an efficient and deeply integrated title and settlement. And I would say personally for me, I think one of the best parts has been the Title365 team. I have now amazing new colleagues that I get to work with and learn so much from each and every day, which is one of the things that really just always keeps driving me and makes me super excited to be at Blend.
Brena Nath: One thing that’s been cool to watch or interesting, maybe cool’s the wrong word, over the last maybe two years is just as much as we’re all in the industry, also a lot of us are homeowners and so just to hear, you know, that you just went through your process yourself, I bought my home in October of last year. I went through that closing process as well and to see it from the consumer experience, then also to your point, going in and that’s the role that you are innovating in as well and streamlining the process, this creates this cool double scenario where I mean I’m sure there’s other industries as well where you also are a participant in the same thing, but just interesting to note how you get to experience it first-hand.
Crystal Sumner: When I actually applied for my initial mortgage, I got to use Blend as like a consumer two or three times. And then the lender that didn’t have Blend and like filling out like a PDF, it was actually much harder than you thought, like that borrower education, even though I’d lived and breathed, kind of having it just a much more seamless experience was just such a better consumer experience even as someone who lives and breathes this space.
Brena Nath: And speaking of living and breathing in this area, I mean, your title obviously is head of legal compliance and risk. There are so many trends that are happening right now in that department, especially you can look at just last year alone, I mean, in the closing world we all went to stay at home orders, work from home. So as we were just talking about the closing industry drastically changing, there are I’m sure a lot more trends. So from like your seat and what you are kind of watching in the industry, what are some of the trends and the news pieces that you’re closely watching that probably our listeners should also know about?
Crystal Sumner: Yeah. Well, first I mean, you can’t ignore what’s happening with the pandemic across all fronts. But I think, you know, kind of tying onto the earlier topic of Blend Impact, I think something that I’m keeping a close pulse on and that we’re seeing kind of startling and somewhat just sad kind of since coming out is the impact the pandemic is having on Americans’ ability to qualify for mortgages, and specifically the impact that it’s having on minority borrowers. A recent report from Morgan Stanley found that for minority borrowers with the lowest credit ratings and Black and Hispanic borrowers in that middle credit tier that mortgage denial rates had increased in 2020 kind of compared with years earlier and that were further, you know, you’ve seen a lot of commentary on this but the gap between white and Black Americans with the lowest credit scores, who were denied, widened to 12% and 10% between 2019 and 2020. And so this increasing inequity in financial services is a huge focus for us at Blend and, again, that’s why we’re strengthening kind of our focus and try to make impact with the Blend Impact announcement.
I think the second, again, somewhat tied to the pandemic, is the recent report that, you know, 81% of Americans say they now feel secure making financial transactions online. And I think honestly, having not left my home for much of anything, I order my groceries and then still today it’s for the convenience but also kind of from a safety perspective having a two-year-old, this has been an acceleration of Americans really feeling comfortable transacting online. In fact, the real estate is the leading industry for digital transformation via kind of online notarization. And so this increased trust and reliance that consumers have in digital solutions means that we at Blend have an opportunity to serve that greater population in that end-to-end financial journey.
And kind of tied to that of course, you know, the remote online notarization I know the end game, many have been following this but 34 states have enacted some form of permanent remote online notarization. It really is just kind of a critical component to allow, you know, faster and more seamless closings. Again, having the notary come to my house the other day was just kind of a bizarre way to operate given how much consumers are expecting the ability to transact and still safely and securely, that’s kind of front of mind for all of us but seeing, you know, clearly the traction there of the state and then hopefully at the federal level at some point. So those are kind of the things that I’ve been kind of pulsing on and keeping top of mind and, you know, all these kind of tie into some of the working projects that I’m doing at Blend as well.
Brena Nath: I want to emphasize too one of the things you just said is the real estate industry being a leader in it and one of the questions that I’ve asked kind of throughout different interviews is kind of setting that record straight because the housing industry, I mean, there’s so many different parts of moving kind of areas with it but people sometimes, you know, like oh, it’s outdated or it’s antiquated. But sometimes actually, no, there are a few things out there where housing and real estate is paving the way and maybe on the cutting edge of technology and I wanted to emphasize that because that was one of your answers. Like actually no, this is an area where the industry’s on the cutting edge of technology.
Crystal Sumner: Well said. And I think that’s at the core of what Blend is here and trying to help do, and it’s not just us alone. There’s a whole ecosystem of partners that are helping integrate technology into the financial services industry because, you know, lenders are hungry for it and consumers kind of expect it.
Brena Nath: And you touched on your last answer, it’s something I mean we’ve been seeing in our coverage a lot right now as we’re talking all about D.C., what’s happening there. They’ve made a major push this year when it comes to minority homeownership and low income borrowers. And one of my favorite questions to ask is, you know, you’re in a room, you’re sitting in front of the top stakeholders in D.C., they are listening to what you have to say, you have a captive audience, what would you want to talk to them about?
Crystal Sumner: Yeah, interestingly enough we actually are having the discussions internally about some conversations that we’re going to be having kind of upcoming. And one of the top topics that we have is just, you know, better guidance in how can we best serve kind of limited English proficiency borrowers. The census data shows that nearly 9% of U.S. population has limited English proficiency and so, again, when you think about technology, how can we meet that subset of borrowers but also do it in a way that of course it’s always a forefront in this kind of highly regulated space that we can do it and ensure that we’re kind of meeting the regulatory obligation. So that’s something that we’re actually currently kind of discussing internally and something that would be top of mind.
But kind of following on your point, it goes beyond that. I think we should be thinking about and talking about ways to expand home ownership among people of color generally. You know, for example, the FICO scores are an outdated way of measuring creditworthiness and disproportionately affect people of color from, you know, accessing credit and purchasing a home. We also should be thinking about income more holistically. The gig income and the gig economy is discounted and we should think about should it be and should it negatively…it is negatively affecting Black borrowers. And so those are some of the things that thinking about really how can we be more thoughtful about how we should be expanding on homeownership for people of color specifically.
And I did note this earlier, though, in the news but the recent announcement between HUD and FHFA about kind of a joint memorandum of understanding about how they’re going to be kind of collaborating working together on their fair lending policy enforcement and investigatory activities. And I just think as a former regulator myself, any ways that we can kind of, you know, have efforts where the federal regulators are aligning where possible, I think just, you know, helps and create kind of, you know, consistency but also, you know, clear rules of the road for people to know how they’re operating. And so those are the things that, you know, if I was there talking to people, and again, conversations have already been prepping for that I would be highlighting.
Brena Nath: That’s a good added detail about the alignment of multiple regulators kind of coming together initiating those announcements. And to your point, and even as I guess mentioned earlier, is that has been a lot of our coverage lately is the continuation. And it was cool because I think we had a piece out at the start of the year about, “Hey, how do you create change in minority home ownership?” and it all really pointed back to what we’re seeing today. I can’t believe we’re almost at the end of the year but watching it come about full circle has been interesting to watch in coverage.
Crystal Sumner: Yeah.
Brena Nath: Well, switching topics a little bit, I know your answer to the first question really centered around Blend Impact and a lot of the impact of change that Blend is doing. And this next question is very similar to that. You are an executive sponsor of Women of Blend, which is the professional development of Blend’s female workforce and building a supportive network within the company. Can you talk about this initiative, because that’s a huge topic, I think, that goes with our Women of Influence is this idea of creating that next generation of the female workforce and helping mentor, which is another part of not only getting the talent, retaining the talent once they’re in the door? So can you share some about your passion for that around the initiative?
Crystal Sumner: Yeah, no, Women of Blend is one of the first ERGs that Blend set up and it’s been years ago now. We were early in establishing ERGs and we continue to add to them but, you know, as one of kind of the early female executives at Blend, it was something that was core to my belief that I really wanted to be a resource, you know, not just from a professional perspective but just generally kind of being available. And the women ERG is just an area in which we can really try and have the peers and mentors to new hires but also people who are just kind of thinking through those next steps. And as we know, the percentage of women generally in tech can be…has been notoriously small and even more so in fintech. So it’s critical for us to have a group where people can really connect and empower each other. And this group, amongst like having speakers come in, but it also creates a safe space where we can connect and talk to our allies and into advocate, educate, and really try to drive causative change and really just be kind of a group where people can kind of lean on each other.
I will say though, Blend has really made huge strides in diversity. Forty-five percent of our workforce at this point is made up of women or individuals who identify as trans. But I recognize like everyone else, there’s still tons of work that needs to be done. And the last thing I would say is I’ve just been super lucky that both my peers, whether it’s peers from currently at Blend or from classmates at law school, and I’ve had great mentors who I know have been critical to my success and believing in me and really pushing so I really try and strive to pay that forward and do the same for women both either in the Women at Blend but just generally throughout the company.
Brena Nath: I would probably copy and paste almost your answer there in like the broader theme of that to what my answer would be to the next question, which is what do you think it would take to get more women and more diversity into the industry? And I think a common theme that I’ve seen is to your point, you know, half of it is thanking the people who helped get you where you are today and then also mentoring the next generation, but I’m sure there’s so much more to unpack there. So ask kind of that question directly is what would it take to get more women in the industry and what would it take to get more diversity in the industry?
Crystal Sumner: I think really kind of having open and continued conversations about how…it’s really been the first place to start. Prior to us signing onto the actual podcast, we talked about the fact that work-life balance or trying to say what that concept is. That is nearly kind of impossible at this stage of the pandemic where as my dog just ran out, my child’s about to run in, like we need to just be our open and true selves and have conversations about how challenging it can be and that’s really where I try to model is really an openness about, you know, the difficulties but also the highlights of what it can be to be working in tech and that we appreciate that there’s always going to be… Sorry, I told you it was going to be… Just about the issues that are contributing to lack of diversity but how can we educate ourselves to see how we can be better. And so, frankly, where I think I’d be is I just hold myself accountable and I hold my leadership team accountable to make sure that we’re really being effective leaders and really thinking about the challenges that our employee base is having, that the challenges our industry is having, and so that we set a good example for our employees and hope they create as inclusive kind of environment as we can.
Brena Nath: I appreciate that and I know we unpacked a lot in this interview, everything from your latest initiatives at Blend all the way to how to create that impactful change, which I think is a theme of our Women of Influence. You get to see a lot of not only the role but also the impact they’re leaving just in general even in and outside of the industry when it comes to building a pathway for the future. So first off, thank you so much for joining me, Crystal, and hopefully this is not the last of our conversations.
Crystal Sumner: Thanks so much for having me.