As an organization that is on the comeback in the origination business, Impac Mortgage, Irvine, Calif., is looking to take advantage of opportunities in markets where others are dropping out.
For example, it is entering the reverse mortgage business on a retail basis, said company president Bill Ashmore. Production will be centered in the southwest at first.
There will be both outside sales staff and inside sales personnel working out of its headquarters in Irvine. Plans are to expand the business into the northwest then other areas on a retail basis. Eventually it will do these loans in the wholesale channel, but that is down the road he said.
Richard Johnson and Frank Curry are heading the unit up. The two men had their mortgage business in the same building as Impac, Ashmore noted. Impac approached them and looked at what they were doing. Their operation, based on its capital, was not scalable, so Impac brought the pair under its umbrella.
By being a part of Impac, it gives them scalability, better technology and access to more capital to generate business, he said.
A big part of the operation is that Impac will establish a training program for the sales staff, so that they become reverse mortgage specialists, Ashmore said. The reverse mortgage division is not being commingled with its forward mortgage originations business.
The company is actively recruiting experienced inside and outside sales staff and operations staff.
Ashmore said it is important that the reverse mortgage fits the needs of the borrowers, “so you don’t want to be putting somebody in the loan for the wrong reasons. That is why we want to be hiring high-quality loan officers.”
The company will have a “very vigilant” monitoring process in the call center on what the loan officers are saying to the borrower. It will be constantly coaching and educating them, he continued.
Initially Impac will be selling its production on a servicing-released basis to reverse mortgage correspondent purchasers. But eventually, he said, because it is a Ginnie Mae direct issuer, it will put the loans into securities, but that is down the road.
Ashmore noted that “Impac is re-emerging” as a lender and that gives it “a unique advantage.” It is looking at products that will remain strong after the refinance boom ends.
An earlier example of Impac entering a business that others are leaving was in February of this year, when it announced it was returning to the forward mortgage correspondent channel at a time many of the larger players in this segment had shuttered their operations.
So in August, it will be rolling out the Federal Housing Administration 203(k) rehab loan product. That market has also been vacated by lenders, creating a void similar to that in the reverse mortgage market, he noted.
Impac is looking to take advantage of the current market situation by doing what he termed “wider margin products,” as well as go into areas “where there is a really fragmented market share.
“If we offer the tools and have the right people in place, we think we can do a material amount of volume.”
Furthermore, the real issue is what is going to happen after the next 12 to 18 months pass, when interest rates rise again and refinance volumes subside.
“Our ability to do some of these other products is going to be important for our strategy,” Ashmore said.
