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Wholesaler Sees Opportunity in BofA Exit

Mortgage News

A California-based wholesale lender is taking advantage of Bank of America Corp.’s departure from the wholesale lending business and offering to provide mortgage brokers with continued access to the bank’s loan programs.

On Tuesday, Mortgage Daily broke the news that Bank of America Home Loans would exit wholesale lending.

In a statement, BofA said it would re-direct its resources to its retail and correspondent channels.

Yesterday, wholesaler Paramount Residential Mortgage Group Inc. said the move is a boon for its mortgage broker customers.

Paul Rozo, president and chief executive officer of the Corona, Calif.-based company, explained in the statement that his company is a correspondent lender and will benefit from the increased focus on correspondent lending by BofA.

“This reallocation of fulfillment services will now provide more horsepower to correspondent lenders, like PRMG, which in turn will help us better support our broker customers,” Rozo said. “In this rapidly changing regulatory and business environment, we want to let you know that we stand behind, and will remain committed to you and to the Wholesale business channel we serve.”

Rozo acknowledged the “vital role” mortgage brokers play in the lending industry and noted that they raise the level of competition.

Earlier this year, PRMG said it would spend $100,000 on continuing education for its broker clients.

Since May, PRMG hired Tricia Bailey as its corporate operations manager, recruited Paul Lucido as national marketing director and brought on Phil Deol as chief strategy officer.

PRMG lost its Federal Housing Administration approval in January 2009 for one year because it failed to meet the U.S. Department of Housing and Urban Development’s requirements for annual re-certification of approval. (After this story was published, PRMG National Marketing Director Paul A. Lucido clarified that “PRMG is fact an approved FHA lender” and that the 2009 action was its own voluntarily choice to give up its Title I approval for second-trust deeds because it never intended to utilize the “risky and low-margin product.” read attorney letter about PRMG’s Title I approval)

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