Hard winds of change create turbulent waters. For law firms in the mortgage lending and servicing industry, the recent past has been a demanding era of intensive, costly regulation and auditing requirements—and an ongoing series of high-velocity legal battles from borrowers and their advocates.
Law practices have faced a painstaking array of new challenges to stay on course, assume the financial burdens of reconfiguration, and to staff up, train, and integrate a new way of doing business—and of being measured and evaluated on the job.
To thrive in the aftermath of the near-meltdown in the U.S. financial and mortgage universe, firms needed to be both sure footed yet nimble, too. They needed their eyes wide open to the new realities.
One law firm that navigated these rough waters—and found itself expanding instead of contracting—is headquartered just outside Chicago, the Windy City.
From Surviving to Thriving
Twenty miles from the hustle, bustle, and high-octane firms based in the kinetic center of Chicago is a default mortgage services firm long known for its quiet, high-IQ excellence.
Codilis & Associates, P.C. weathered the regulatory onslaught and then thrived after it.
“We were light on our feet, receptive to change, and not fearful of more scrutiny,” said Ernie Codilis, Founder and Head of the law firm. “The wave of more regulations led to many firms downsizing or even getting out of the business altogether.”
But while the increasing regulatory burden has been difficult, it’s not one his firm shied away from, according to Codilis.
“It certainly was a giant challenge,” Codilis said, “but we embraced the transition, and it has paid off.”
Codilis is by no means alone in its accomplishments, but it is a valuable case study in consistency, cohesion, and spending money to stay on top of the curves.
“First and foremost, a lot of firms just couldn’t handle the increased costs of compliance,” said Berton “B.J.” Maley, VP and Managing Bankruptcy Attorney at Codilis. “They were just prohibitive.”
Maley has been with Codilis for 24 years. “Yes, some of our success at evolving was because we are a big and experienced firm on very sound footing,” he said.
But an equal contributor was the firm’s tight internal auditing systems already in place.
“We were ready,” Codilis said. “We’ve always been open to industry changes. In fact, we’ve embraced them.”
Greg Moody is the Managing Attorney at Codilis. He’s been with the firm since 1991.
“I think some other firms made mistakes, either by moving too fast or not recognizing it was a changing landscape,” Moody said.
Codilis echoed his sentiment.
“We’ve worked very hard to build a strong foundation for this business,” he said. “A law firm that does that is usually a stable, well-regarded, and financially healthy law firm.”
Codilis at its Core
Headquarters for Codilis is Burr Ridge, Illinois, a city populated by just 11,000 residents, give or take. It’s a serene suburb surrounded by ever-crowded freeways—a cozy community where one of the favorite area breakfast spots sits adjacent to a bowling alley.
Codilis occupies two buildings in Burr Ridge: one contemporary, creative, and cool, and the other more old school through and through. The nearly 500-person family of firms operates in five states and is the largest default servicing firm in the Land of Lincoln.
Codilis is a long-view firm to its bones, with a mission to build slowly, be the best at the craft, engender loyalty and low turnover, focus on facts and fairness, and speak the truth clearly, calmly, and kindly to clients and its mortgage customers.
The result: a rare record of growth and a deep reservoir of respect. The 40-year anniversary for Codilis fast approaches, and you don’t get there taking many wrong turns.
“My mom and dad were all about doing the right thing,” Codilis said. “I am so lucky to have had them, so I’ve wanted to practice what they preached in my life as a father to my children, and with my co-workers at the firm.”
Humility, not hubris. People, not just profits. A clear conscience, not a cloudy one. That’s classic Codilis.
A major portion of the firm’s business, of course, is tied to foreclosures and loss mitigation, and Codilis has subscribed since day one to the belief that there is almost always a solution short of someone losing their home.
The firm’s lawyers don’t forget that on the other end of most mortgages gone bad is a family whose fortunes have gone awry—and people are hurting.
“When we deal with our clients’ customers,” Codilis said, “We listen, we are compassionate, and we communicate.”
Moody joined the firm when Codilis had only four lawyers. He said, “There is no such thing as a ‘one-size-fits-all’ approach here. It’s not our style, by choice.”
Moody said the firm persistently seeks a mitigation strategy and solution that’s a win-win for all parties. Admittedly, lots of borrowers often don’t see it that way.
“We give them as many options as we can,” Moody said. “We don’t surprise them. We want them involved, not intimidated.”
Codilis seeks to demystify the foreclosure process and reduce the borrower’s anxiety and fear levels.
Ernie Codilis added, “No one wins when there is a foreclosure and a family has to leave. Banks and servicing companies don’t want that to happen. They’d rather get the borrower into an arrangement where they can save their house.”
Moody agreed. “We listen, and we are problem solvers, not problem creators.”
There’s been another kind of shift in the last two or three years that favors firms with a track record of fair play.
“In the wake of the mortgage crisis,” Moody said, “many judges—who on a daily basis were being exposed to negative media coverage of the mortgage industry—were sympathetic to the plight of the borrowers who appeared before them.”
But the courts are now adding balance back into the process.
“Judges saw clearly that many firms do try to work with consumers and make countless arrangements short of foreclosure,” Moody said.
“Maybe it’s just the pendulum naturally swinging back,” Moody said.
Lessons in Longevity
The resonance of reputation energizes Ernie Codilis. His name is well known in the Burr Ridge community. One reason: his childhood home, where Codilis’s parents still reside, is a mere two miles away from the firm’s office.
For Codilis, a trip to the local hardware store is like traveling down memory lane. If his firm went off the ethical rails, he would see it in the faces of his friends and acquaintances.
“We strive to defy the common perception of those who think we work in a cold-hearted business,” Codilis said. “I don’t hire heartless people. In fact, I look for the opposite.”
He believes the key to the firm’s success and standing is longevity among his lawyers and staff.
“I am most proud of that,” Codilis said. “I don’t know that I have too many special skills, but I read people well. I can spend time with folks we interview and sense their character and likelihood of thriving in our environment.”
The numbers bear him out. The lack of turnover is the envy of any employer.
Over 150 of the employees at Codilis have worked there for more than 10 years. About 55 of these employees have more than 15 years tenure. Incredibly, eight have more than 25 years.
“You don’t get numbers like that unless you hire a lot of the right people in the first place,” Moody said.
Coming Back for More
VP and Managing Foreclosure Attorney Robb Rappe has worked for Codilis twice, the first time in 1989 as a young lawyer learning the ropes and stretching his legal limbs.
In 1993, Rappe went out on his own, working from home. He says he did “the typing, the printing, the legal work, everything. I loved it.”
That is, until he fell in love, got married, and a family was forthcoming. Time would not be as plentiful. Rappe’s one-man operation joined forces with a larger firm he’d worked with closely for several years.
His focus sharpened as his horizons expanded. In 2010, Codilis came calling, wanting him back in a leadership role.
These days, Rappe is an expert analyst at the firm who, while doing his day-to-day duties, stays on top of legal trends in the mortgage servicing industry.
He is regularly called on by lobbyists and legislators. He’s helped draft legislation and provided comment on proposed laws or regulations that directly affect the sector.
“So often,” Rappe said, “They just don’t make sense. My advice and insight is independent, not paid for. I just call them as I see them.”
Kelli Snowgren Garcia, who works in marketing for the firm out of Dallas, underlines that point.
“I frequently meet with clients,” she said, “and at a recent visit, the client said we have our ‘hands on the steering wheel’ regarding ever-changing case laws and legislation, which keeps them in the loop on potential threats, and out of harm’s way.”
Rappe is also fine-tuned on the habits and practices within the stable of defense attorneys who often represent homeowners when the bank, servicer, or law firm begins an action toward foreclosure. Foreclosure appeals are rampant these days.
“Those lawyers are committed and competitive, too,” Rappe said.
Codilis and like-minded law firms have to be on their toes in these battles that show no signs of abating. It’s now the nature of the beast.
Greg Moody often reminds himself, “How fortunate I am to be in a place that operates with confidence in its people and their professional judgments.”
Codilis lawyers deeply value the freedom to forge ahead and explore what interests them. They believe it’s another relatively rare trait in their industry.
The Managing Attorney for Codilis & Stawiarski, P.C., the firm’s Houston-based practice, is Lisa Cockrell.
About the firm’s emphasis on workplace satisfaction, she said, “There is a culture that they feel comfortable in, and which allows them to excel. Leadership is about making others better and making sure that impact lasts.”
Ernie Codilis knows a lot of lawyers in his industry work in environments seen as negative, with little apparent enjoyment. “We are optimists,” he said. “We are positive in outlook. That’s how we tackle challenges, too. It’s a cooperative, can-do spirit.”
Mike Sullivan is the Director of Marketing and Client Relations. He believes one of the foundations of the firm is Ernie Codilis’s naturally inclusive nature.
“To this day,” Sullivan said, “he engages his A-team, if you will, upon every learning opportunity via proactive versus reactive management methods. That, in turn, has provided everyone the chance to enhance their own success.”
In addition to foreclosure work, Codilis’s practice encompasses the full spectrum of other loss mitigation services, along with bankruptcy, REO, title, litigation, and building/housing court services.
For the 100-plus regional and national clients handled by Codilis offices in Illinois, Texas, Indiana, Missouri, and Wisconsin, it’s a start-to-finish firm.
“We assist clients in navigation, execution, compliance, and appropriate outcomes,” Codilis said.
The firm also focuses on preparing clients for the inevitable detours, large and small.
“When the mortgage crisis impacted law firms in our line of work,” Moody said, “the media painted a negative picture of the mortgage industry and wrongfully created the belief that they were in the business of exploiting their customers.”
The criticism of the banking, mortgage servicing, and ancillary fields was vociferous. And there were some bad actors out there.
New rules and additional audits were pervasive, happening in the hallways of law firms week after week. Furthermore, clients were also required to come in and do their own reviews of the work their firms performed.
B.J. Maley said, “I have personally been involved in hundreds of audits on-site. It’s taxing, but it’s the norm now.”
After the smoke cleared from the crisis, the firm even asked for its own audit by another law firm.
Moody attributes the continued success of the firm to the policies and procedures they already had in place before the crisis. He said that “at Codilis, we stayed strong because the audits showed we had been doing business the way it is supposed to be done. We had checks, balances, and policies in place that protected clients and their customers.”
Clients got to see the firm in action on its home turf.
“I really disliked being painted with the same brush as those who took advantage of people,” Ernie Codilis said. “And I was so happy we were viewed as a firm that was on sound, responsible footing. I always knew we were.”
On the Cutting Edge
In its approach, the firm has also always been on the forefront of technology. Codilis was considerably ahead of many competitors when it developed its own sophisticated proprietary case management system.
The legal field, Codilis said, is somewhat notorious for often being five or more years behind in adopting available new technology.
“I have always been open to technology,” Codilis said. “It is a strong selling point. We try things others don’t. And if you don’t try, you can’t succeed.”
In recent years, a young lawyer came on board with strong interest and savvy in new technologies. In a compact time frame considering the life of the firm, the IT staff at Codilis leaped to 12 people.
That lawyer, now 33, is Adam Codilis. Yes, son followed father into the field. Adam began doing some office work for Codilis as a teenager in 2000 and then periodically worked during summers while in college.
“I have pretty much worked in every department and have done every job here, both nonlegal and legal,” the younger Codilis said.
Adam joined the firm as an attorney in 2009 and has risen to become a VP of the Illinois firm. In part, his current responsibilities can be traced to keen curiosity on what technology can do to make the firm’s product better.
He and the IT division are now “hard at work looking into how we can design solutions using ‘AI,’ or artificial intelligence.”
Just as its self-made technology put Codilis in a lofty position with regard to case management, Adam Codilis said, “AI is the next wave, and it’s coming right at us. I want us to seize the opportunities in data science, and continue to differentiate ourselves that way.”
When Adam signed on with Codilis, he knew the going wouldn’t always be easy—he’s got the founder’s name, after all. There would certainly be more watchful eyes on him, more judging.
“My dad just told me, ‘Adam, you’re going to have work harder than anyone here. Get used to it,” he said.
Adam Codilis continued . “My father said I should just keep my head down and don’t get distracted from solid performance. Things have been smooth, and I give a great deal of credit to my co-workers for accepting me.”
Adam is also an advancing tech entrepreneur in ventures outside the firm. He is now involved in a startup business that has been getting some Silicon Valley expertise and funding.
One of these external ventures—which will be focused at first on the legal field—is about to enter the market. He is also working on artificial intelligence products in the legal field, which he plans to bring to the market in the near future.
When he was younger, looking at his professional opportunities in law and outside of it, Adam was drawn to the generosity and gratitude that have always been in abundant supply in the corridors of Codilis.
“My father always told me that everyone needs to be recognized and treated the same,” Adam Codilis said. “We’d be driving somewhere and come across the guy cleaning the parking lots or a homeless person huddled up in the cold. He’d remind us that we were no better than those folks and the importance of helping others where and when we can.”
Without a doubt, Adam said, “Ernie Codilis wears his emotions on his sleeve.”
The firm has been a sustained major supporter of The Mercy Home for Boys & Girls in Chicago. Mercy is a safe haven and recovery zone for children who’ve been abused, neglected, and poorly parented. Its mantra is in the words of a child: “Mercy Sees Me.”
Adam has served on the junior board at the Mercy Home for the last five years.
The firm also supports, among other charitable endeavors: St. Jude Medical Center; the Family Shelter Service, which promotes healing from domestic abuse out of Wheaton, Illinois; and City of Refuge Ministries.
“Kids need love, support, guidance, and safe surroundings,” Ernie Codilis said. “We do what we can to help. I see community service and charitable giving as obligations for us.”
“I never imagined Codilis would get this big,” the firm’s founder said. “We could have been much bigger, much faster. Sure, we’d have more money in our pockets, but would we maintain the quality of our work?”
So, Ernie Codilis said, “We’re the size we need to be to meet the standards we set for ourselves.”
The modest expansion is another way to keep jobs available for staff whose positions might have to be eliminated.
That’s not surprising. According to Cockrell, “Ernie has always shown the human side to problem-solving. He has continuously been the living and breathing spirit for our attorneys. He leads by example.”
From the Start
Not long out of law school, serendipity struck Ernie Codilis. One day as a fledgling solo practitioner, he contacted a sizable servicer run by a man named Gary Janeway.
“Well, what do you know,” Codilis said. “Gary responded and said, ‘I’ll give you a small piece of work, and we’ll see how you do.’”
It happened to be in the default servicing sector. Ernie Codilis sunk his teeth into the project, lean as it was, and he impressed. He got more work from Janeway.
“I could pay the bills,” Codilis said, “though barely. Somehow, I scraped by.”
Janeway’s work and mentoring gave Codilis the incentive to keep at it, as he aimed to be a reliable but shrewd small-town lawyer with his own shingle.
“You never know what’s possible until someone believes in you,” he said.
Ernie Codilis has principles—and he has fun. He’s among the legions who are captivated by the Chicago Cubs, holding season tickets, of course. He never tires of giving out giant tins of gourmet popcorn with the Codilis logo on the lid.
He is amusing and easily amused. Co-workers tease him, and he teases back.
Like his parents, Ernie Codilis also lives but a few miles from the firm’s first offices in Burr Ridge. He still regularly takes his mom and dad to local family favorites, including the Country Cup, known as “The Cup,” where they have gone for over 50 years.
There, Ernie Codilis is not the eminent owner of an esteemed law firm. He’s just a guy eating breakfast with his family, like everyone else.
Maybe that scene is a word to the wise in an industry where tranquil isn’t a typical adjective.
Modesty and humility doesn’t slow successit might very well power it.
“In what can be a dog-eat-dog world, I want us to be decent and self-effacing,” Ernie Codilis said. “It’s a strength, and it works.”