Even though Ed Solter was a Realtor before he became a mortgage originator, his former profession is not among his leading sources of referral business.
Surprisingly, his No. 1 referral source is an architectural firm. “Hardly anyone ever calls on them,” and with this particular firm it is a long-term relationship, going back 20 years.
Architects typically don’t ask their clients how much they make and this one firm realized there was an issue with over-designing houses; bids would be sought on a house and people couldn’t afford it. There were redesign costs, etc., “everybody was mad at everybody.
“So I was visiting with this architect and he goes, ‘Ed, can you help me with this problem?’ And I go, ‘You bet I can.’”
The architect would introduce his clients to Solter and he would qualify them for a loan. “Nobody calls on architectural firms like that, nobody. And it seems like a very logical thing,” he continued.
He was also teaching the architect’s clients how construction loans work and how they interface with a permanent mortgage loan.
Solter started in the mortgage business in Austin, Texas, around 1989. Prior to that he had worked in real estate sales, but he found it frustrating for a few reasons. There were some buyers who acted illogically when it came to deciding on a property; they would find a reason not to make a bid.
Solter decided he would enjoy being on the analytical end of the transaction and sell mortgages rather than real estate.
At first, Solter was a mortgage broker with his own company in Austin, Presidential Mortgage, for 18 years. Approximately four years ago, as the bust started taking hold on the market and on the broker industry in particular, he joined up with Fairway Independent Mortgage Corp. and is now a producing manager.
“It was kind of scary in 2008, with what happened with Lehman, all the issues in our industry, all the mortgage companies that were closing. We just needed a big brother and at the time, Fairway really looked like a good answer. And it turned it was a very good answer for us,” Solter said.
Solter ranked 127th on the updated 2012 Origination News Top 200 producer list with volume of $76 million, and Fairway was one of several companies with multiple originators on that list. Among those from Fairway, he ranked fourth.
He had heard from a headhunter who felt Fairway would be a perfect cultural match in terms of the way both parties did business.
In the Austin market, the median sales prices in the area of $220,000. Therefore it is not much of a market for government loan products, Solter said. So the Austin branch does a lot of conforming loans as well as jumbo mortgages.
It does business with the upper-end Realtors (“people think of us as an upper end branch,” he said) so it doesn’t see a lot of government loans.
During the national bust of the last few years, prices went flat with a little bit of pull back in the Austin market, he noted, but now prices “are way, way above those levels.” Like many markets, there is now a shortage of inventory, exacerbated by the fact that there are 150 people per day moving to the market. Austin’s stability is helped by the fact it is both the state capital and home to the University of Texas; there are also a lot of hi-tech employers in the city as well.
Doing jumbo loans the past few years has been frustrating at times, but Fairway has some good relationships with many outlets for the product and as a result he has seen very good service from buyers.
“That is why we do a lot of jumbos here. We feel comfortable and confident in selling jumbo money. Many of our competitors don’t feel comfortable and they don’t go and chase those loans. With Fairway I feel we have a good mix of investors” where he is confident to be able to offer a jumbo loan and have it close in 30 days.
In fact, one jumbo loan he was able to close in as quickly as two weeks and helps to make this product a competitive advantage for him in the Austin market.
He added he does not normally do this as a rule. “Normally I wouldn’t tell my momma I could get her loan done in two weeks—but at Fairway, when push comes to shove, it can be done.”
Besides the architectural firm, other leading sources of business for Solter include financial planners and accountants. He has done the loans for the principals of these firms, so it makes it easy for them to refer their clients’ to him.
The changing rate environment means that extended locks will be in vogue on the permanent loan and Solter said he is “brushing up” on that aspect of the business. He does not do the one-time construction-to-permanent product.
He does get Realtor referrals as well, but only a select few—about a group of 20 which he called the “Super Bowl” of real estate salespeople.
Those are “real loyal Realtors who will sell one or two deals at minimum each month,” so that core group gives Solter a lot of business.
“We went to the upper-end Realtors that we knew were successful and they weren’t starving for their next commission,” he continued, adding this group trusts in him to get their loan closed (rather than continually calling him). It is a relationship and Solter said he knows if he “drops the ball,” those Realtors would go elsewhere.
These are relationships that allow Solter to do a lot more volume “because I am not getting tackled with questions and trying to get status and where there files are at every point along the way. Processors are busy and we’re all busy. It is Realtors that trust in us and know us and know we deliver what we say,” he said.