Wholesalers across the country have been busy rolling out new conventional, government and commercial mortgage programs. Even correspondent lenders are stepping up their offerings. Two firms hope to fill the void left by departing reverse wholesale lenders.
An Aug. 11 news release from Reverse Mortgage Solutions Inc. indicated that the Spring, Texas-based company has launched a third-party origination channel. Ralph Rosynek was recruited to head up the new business, while Garrett Kolb was hired to oversee originations in the West and Jamie Longe was brought on to oversee the Midwest.
The expansion into wholesale lending follows RMS’ March entry into retail reverse mortgage originations.
RMS Chief Executive Officer Bob Yeary said in a telephone interview that its broker approval process might be considered “laborious,” but “we want to make sure we know who we’re dealing with.” He indicated that they are licensed in 33 states, and around 20 wholesale clients have been approved so far. Four people currently handle mortgage broker sales at the company.
“We realize to build a quality book it’s going to take a little time to get to know those customers, and get them to know how we operate,” he explained.
Yeary noted that the company issues about $120 million a month in Ginnie Mae HMBS. They have been buying business from correspondent customers for two years.
Earlier this year, Value Financial Mortgage Services Inc. said that the despite the exit of reverse mortgage wholesalers like Bank of America, Financial Freedom and Wells Fargo — it is “embracing” third-party originators.
“We have been in this niche since 1994,” the Miami-based firm proclaimed. “We were the first to embrace the broker industry through our use of the HECM Advisor program.”
Also earlier this year, Manhattan Beach, Calif.-based Kinecta Federal Credit Union said it added Federal Housing Administration programs. The launch followed a trial period in the Midwest.
TMS Funding parent Total Mortgage Services LLC said in August that it added The Guaranteed Rural Housing Loan Program offered through the Department of Agriculture’s Rural Housing Service to its menu of programs. The product targets low- and moderate-income borrowers who live in communities where the population doesn’t exceed between 10,000 and 20,000 depending on the proximity to metropolitan statistical areas.
USDA mortgage don’t require any down payments, while closing costs can come from any sources including gifts, according to Milford, Conn.-based Total. The loans don’t require mortgage insurance premiums.
TMS has posted guidelines for the offering at www.tmsfunding.com.
In May TMS announced the addition five new account executives. Robert Lukowksi Jr. was hired to service the Illinois market, while Craig Castronovo will handle mortgage brokers in the New York area and Matthew Neeley will originate third-party loans in Connecticut. In addition, Scott Beckwith is the new account executive for Atlanta, and Tracey Ibsen joined the company to handle New York and New Jersey.
A month earlier, TMS said it added six account executives for Florida, Maryland, New York, the Northeast and Virginia.
Earlier this week, TMS announced plans to recruit another two dozen or so wholesale account executives with mortgage brokers in 21 states.
Impac Mortgage recently said that it had partnered with eMagic to provide a secure, Web-based portal for access to Fannie Mae’s Desktop Underwriter. Broker customers of the wholesaler will reportedly have the ability to reduce costs.
Alternative Mortgage Express has been marketing itself as a manufactured housing loan expert. The company said it started doing such financing in 1988. Among a variety of loan programs offered in 10 states are home-only chattel loans.
Addison, Texas-based Schmidt Mortgage recently announced its approval to lend in Alabama, Georgia, and Connecticut — bringing to 29 the number of states in which it is approved. Approval in another 10 states is pending, and the 61-year-old privately held firm plans on eventually lending in all 50 states.
Schmidt offers residential and commercial programs.
Also in commercial arena, South End Capital Corp. in July announced the launch of a correspondent lending program. Clients maintain contact with prospective borrowers, while the Boston-based lender handles the underwriting, third-party reports and closing.
Pricing premiums up to 2 percent are available through the program, and another 2 percent can be charged in origination fees.
South End Founder and Managing Director Noah Grayson highlighted in the news release how the program enables brokers to act as lenders while gaining access to “top-flight servicing and new compensation streams.” It also helps correspondents in marketing to mortgage brokers.
