Meet the Experts: Creating Regulations with Peter Carroll

By Saumi Shokraee Housing Policy, Real Estate

Pete Carroll

Meet the Experts is an interview series featuring some of the brilliant minds of CoreLogic. In this edition, I spoke with Peter Carroll, a public policy and industry relations executive at CoreLogic. Carroll oversees the industry and public-sector engagement programs and drives strategic enterprise initiatives. He also expands opportunities for the company’s thought leadership, brand awareness, insights and solutions in Washington, D.C., across the Federal Housing Agencies and other stakeholders.

Saumi Shokraee: Hi, Peter! Thanks for joining me. Let’s start with where you grew up and what interested you as a child?

Peter Carroll: I grew up in Providence, Rhode Island, near the Brown University campus. Lacrosse was a big passion of mine as a kid, and I have wonderful memories of living and working at the beach with friends in this little town called Narragansett during the summer, the best time of the year in Rhode Island.

SS: What did you study in college?

PC: I studied international relations with an emphasis on economics. My father’s family lived in England, Ireland and Scotland, and through them, I became enamored with Europe and wanted to know more about the region — and the rest of the world.

SS: What was it like interning for John Chafee, the late senator for Rhode Island, in the 90s after graduating from Connecticut College?

PC: For me, John Chafee personified honor and integrity in lawmaking. He was a war hero on the front line at Guadalcanal in the South Pacific during World War II, led a platoon during the Korean War and became the Secretary of the Navy. However, I would have never known these things had I not worked for him. He never once mentioned it. Senator Chafee was a person of tremendous character, and an incredible collaborator in the Senate. Working for him gave me early exposure to good leadership.

SS: What did you do after that experience?

PC: After the internship, I moved to London for a year to work for my aunt’s strategy consulting business. I focused on quantifying and forecasting music markets by analyzing the preferences of listeners all over the world. Later, I moved back to the United States and worked in management consulting, including housing finance when it was booming in the late 90s. From there, I eventually developed an interest in the housing finance space.

SS: Could you tell me about Overture?

PC: I co-founded Overture in my mid-to-late 20s after my consulting days were over. The company focused on automated underwriting systems and credit risk management. It was a “fintech” company before the phrase existed. We would create automated decision and workflow engines and use cloud computing to connect to lenders, and point-of-sale and origination systems, via an application programming interface (API). Part of our business model was persuading real estate aggregators to create shopping channels on their front-end sites. The company was successful until 2008, when the financial crisis led to challenges the business didn’t overcome, which was a very difficult experience for me.

SS: Was the financial crisis what motivated you to work with the Consumer Financial Protection Bureau (CFPB) a few years later?

PC: After the crisis, I knew I wanted to be part of the solution in helping the country recover. I wanted to help regulators create rules that would prevent this from happening again. Through the Treasury Department, I connected with then-professor Elizabeth Warren’s team at the CFPB, which had been newly authorized after the Dodd–Frank Wall Street Reform and Consumer Protection Act passed in 2010. I was tasked with leading the Office of Mortgage Markets. I had the privilege of working under now-Senator Warren during my first six months, and even worked briefly with current House representative Katie Porter.

SS: What fascinated you about creating regulations?

PC: I wanted to infuse a new mindset and culture around public policy. Regulations should be thought of as a product. And like with any product, you have to figure out what market you are addressing, what problem you are solving and how your solution is going to have an impact.

It is never right on the first try, so product developers must constantly improve the product and ensure it meets the market’s need. When created thoughtfully, regulations can help markets operate on level playing fields and flourish without the unduly stifling of industry innovation and creativity. It’s a delicate balance.

One of the major pieces of regulation we created was the Qualified Mortgage Rule, or QM rule, which effectively divided the line between liquid mass mortgage markets and smaller niche markets. The regulation accomplished this by attaching legal liability to certain products, which contributed to reducing how often they were used. It was a very politically charged topic, so a colleague and I had to testify before the House Financial Services Committee at Capitol Hill and defend our decisions. We aimed to address a number of the complex products that created problems in the 2008 crisis, such as those that had minimum payment teaser rates, and present a solution.

We used a back-to-basics approach that emphasized fixed-rate and fully-amortizing adjustable rate mortgages with protections built into mortgage products to ensure they were not predatory. These rules positioned the mortgage economy to grow in a safer way.

SS: What’s it like working with CoreLogic?

PC: CoreLogic, in my mind, has always been the gold standard for housing analytics. When I was at CFPB, Wells Fargo, Quicken Loans and management consulting firms, CoreLogic was always our source for information about property or loans. Since I joined the team, I have been amazed by the capabilities we’ve assembled — from hazard risk models in the insurance space to technology for real estate agents and brokers.

It’s wonderful to be able to engage on policy issues that have the potential to positively impact our clients, and the products we deliver to them. We are truly connecting the entire property ecosystem.

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