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Firm With 800 LOs Closes Only 40 Loans Monthly

Firm With 800 LOs Closes Only 40 Loans MonthlyWSB added 200 originators in 2007

April 2, 2008 (revised 5:45 p.m.)


Reverse mortgage activity is fueling hiring at a California-based mortgage company, which said it has grown to 800 loan officers nationally and is headed higher. But the growth is deceiving — as the company is closing fewer than 50 reverse loans monthly.

Home Equity Conversion Mortgages insured by the Federal Housing Administration have kept WSB Mortgage Services Inc. busy. WSB added more than 100 loan offices last year and expects to add at least that many this year, said Vice President Riley Bangerter.

The Fair Oaks, California-based company, which has been originating reverse mortgages for the past six years, had 600 loan officers early last year and now has some 800, he told

WSB and its loan officers originate FHA HECMs for eight of the top national HECM lenders and also originates proprietary reverse mortgages for five other reverse mortgage lenders, including Financial Freedom and Vertical Lend.

Its e-mail recruitment letters describes itself as “one of the largest [reverse mortgage] originators in the country.”

WSB is currently licensed to do FHA business in 21 states and has physical offices in seven of those states — Arizona, Oregon, Florida, Texas, Connecticut and Pennsylvania, in addition to California, according to Bangerter. There are no immediate plans to open additional offices, he said.

“We only open the offices that we need to open for our FHA coverage,” Bangerter explained.

Although it does not have offices in Washington and Colorado, he said these are also “big states” for WSB’s reverse origination activity.

WSB has been seeking loan originators “to join our growing reverse company” through e-mails that promise weekly payouts, 45 percent commissions to loan officers, 30-day loan processing times, a six-week coaching program, and turn-key lead generation, with free weekly training.

“There’s no limit as to how many we’re looking for,” said Bangerter. “The sky’s the limit.”

Pointing to the growth potential in the reverse mortgage business, he added, “We’re never going to be fully staffed.”

But even with 800 loan officers, the company is only closing about 30 to 40 reverse mortgages a month — though they are shooting for 100 units monthly.

WSB’s reverse mortgage business had slowed during the last half of last year because of “the turmoil in the market,” Bangerter admitted, but is now turning around.

When asked why so many originators are closing so few loans — one mortgage for every 20 loan officers per month — he seemed dismissive.

“It’s the 90-10 rule — 10 percent of the people are doing 90 percent of the work, Bangerter explained. “Just because you’re a loan officer doesn’t mean you’re writing business.”

He added that they also do regular, conventional FHA mortgages, “but it’s nowhere near our reverse business, only two to five a month.”

But he expects that business to also improve.

“FHA is the place to go to right now because of what’s going on in the mortgage industry and the mishaps with subprime and all that,” Bangerter pointed out.

Last year, a total of 132,252 HECM loans were originated nationally, up from 85,639 in calendar 2006, according to figures from the National Reverse Mortgage Lenders Association, which reports that a record monthly volume of 10,913 was established this past February.

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