Charbonneau & Associates is working on two mortgage-related acquisition deals, a sign that certain lenders are looking for a strong capital partner in anticipation of tighter net worth requirements.
“I’m so busy right now,” said Charbonneau managing director Larry Charbonneau, adding that a key requirement for buyers is that an acquisition target have its Government National Mortgage Association approvals.
“If you have your FHA approvals, you’re ready to go,” he said. “GNMA is key to all of these deals.”
Although he could not identify the firms he’s working with, the M&A advisory veteran said one deal involves a “large” publicly traded bank that is ready to buy. (C&A is based in Spring, Texas.)
In late 2009 the Department of Housing and Urban Development issued a rule that requires FHA lenders to increase their net worth requirements to $2.5 million over three years. Charbonneau said firms that can’t meet the threshold are busy hunting for partners.
Because of its low downpayment programs, FHA loans (which feed GNMA bonds) have become the product of choice for many first time homebuyers as Fannie Mae and Freddie Mac tighten up their downpayment requirements.
