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. Last Updated: 07/27/2016

Mortgage Maverick Finds Home

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Not long after pursuing a job opening published in a Virginia financial newspaper, James Cook was lecturing Siberian bankers in felt boots about housing mortgages. Seven years later, the president of DeltaCredit mortgage program can lay claim to being part of the team that invented the Russian word for mortgage: ipoteka.

"As many problems as Russia has, this is one area where they have a tremendous advantage over anyone else," Cook said. "If people start to realize they have an incredible amount of property wealth that can be tapped into, you’re going to really see things taking off."

Both the federal and municipal governments have been trying for years, with intermittent successes, to create a long-term mortgage system that would give a jolt to a potentially hot real estate market, as apartments worth billions of dollars fell into private hands a decade ago. And with high demand for housing and millions of square meters being added to the market every year, there is a great need for available financing.

There are complaints that adequate legislation does not exist to protect the lender in case of nonpayment. Prime Minister Mikhail Kasyanov said in London last month that current legislation was not solid enough for the creation of a reliable mortgage system.

"Here a creditor knows in the worst of cases he can avail himself of that mortgage, but this system is not working," Kasyanov said.

DeltaCredit — which has a 100-percent payment rate from its borrowers — experimentally dipped into the uncharted waters just before the 1998 meltdown. Despite the unfortunate timing, business picked up steam this past summer and has since disbursed more than $12 million in loans with its partner banks. And this fall it joined up with real estate and construction companies to reach more customers.

Unlike most Russian banks, DeltaCredit enjoys a steady stream of foreign finance, as it is one arm of The US-Russia Investment Fund, a private investment firm established by the U.S. Congress in 1995 with $440 million in available capital.

"I think it was really the right thing to do," Cook, 36, said of the fund’s decision to set up a mortgage program. "Russia is sort of the victim of a lot of training and a lot of technical assistance, but not enough financing really to put it into practice."

Mortgages seem to flow through Cook’s veins. When the Virginia native was 18, he began spending his vacations from college — where he studied financing and public relations — working for a mortgage bank. At 20, he organized an advertising campaign for a credit union. The first year of the campaign attracted some 20,000 new customers, so the bank made him its marketing manager.

Cook left Virginia in 1994 after being selected to help set up a mortgage lending system here under a USAID contract. "When I got here I said, ‘Is there a plan, you know, for me to follow?’ And they said, ‘No, Just go out and do it. Just do it.’"

Joined by Elena Klepikova, now vice president of DeltaCredit, he spent his first two years traveling the country conducting seminars for bankers and other professionals interested in home financing. Cook found that there was not even a word for mortgage in the Russian language, and together with some colleagues adopted ipoteka from the Greek word for mortgages.

But transplanting an "American ideal" to a country with a thin banking infrastructure was not ever his intention. "We had to really transform [the mortgage program] so it’s truly a Russian product," Cook said.

At the beginning, during strategy pow-wows with Klepikova and others, he would say how this thing or that thing was done in the United States, and they would envision how it could be done in Russia.

"It’s like a puzzle. It’s like playing a game. I always told them that business is like being master of the game," he said. "You have to figure out how to solve the problem and how to get ahead of your opponent."

And for the first time in his life, he is his own customer. Cook hopes to get a loan approval next week from DeltaCredit to finance the purchase of a former communal apartment near the Kremlin. During the application process he learned of a few of unnecessary requirements, such as needing a spravka to prove that he’s not insane and having to show an actual college diploma. Those items have now been deleted from DeltaCredit’s list of requirements.

"I think I’ll probably stay in Russia for a while because I think that this is kind of what was meant to be. It’s not too often in life that you have the opportunity to really build something."

Build they will. And buy, with monthly downpayment and interest.