Embrace Home Loans partners with Ameriprise Financial following pilot

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Rhode Island-based nonbank Embrace Home Loans has formally agreed to provide mortgage financing and informational services to wealth management clients of Minneapolis-based Ameriprise Financial after an earlier test run.

Embrace will originate and close home loans in its own name for Ameriprise clients who opt to work with the mortgage company. Ameriprise's bank has the option to purchase the loans or servicing from the partnership or from other lenders. The agreement is similar to another that Embrace’s financial institutions group has, which supports mortgage operations for Boston-based Eastern Bank.

"It's a comparable affinity relationship with a different construct. We customize depending on the specific needs of institutions that come to us," said Kurt Noyce, president of Embrace's financial institutions group.

Ameriprise and Embrace had agreed to explore a partnership several months prior to the coronavirus outbreak in the United States, which has complicated many such business transactions.

"We've been able to create an extraordinary experience even under the current challenges," Noyce said.

Originally functioning as an American Express financial advisory unit, Ameriprise Financial was spun off from the credit card company in 2005.

Ameriprise Financial has almost 10,000 financial advisers and more than 2 million clients. It initially tested the partnership with a subset of those advisers.

The company converted its limited trust bank back to a federal saving bank last year, and had been looking for a way to re-enter consumer lending segments like mortgages and credit cards. It previously terminated the deposit-taking and credit-originating activities of its federal savings bank and converted it into a national trust bank in 2013, due in part to lingering impacts from the 2007-2008 housing crash.

The coronavirus has made related public and private policies around mortgages more complicated to navigate, increasing consumer interest in guidance from financial advisers in some cases.

"Whether clients are looking for a new home or refinancing their current one, securing the right mortgage is a critical piece of their financial planning," Abu Arif, president, Ameriprise Bank, said in a press release. "We're excited to combine Ameriprise’s comprehensive advice with the right lending solutions to help clients achieve their financial goals."

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Originations Nonbank Wealth management Ameriprise Financial Secondary market Eastern Bank