Whether it is the challenge involved in keeping track of the deadlines for relatively new and complex licensing requirements or other relatively new compliance and secondary market issues that have complicated the business, Inlanta Mortgage, Waukesha, Wis., has been working to help its slowly expanding number of branches shoulder the burden. In return, the company’s executives said it has been able to bolster its conservatively underwritten loan volume and add talent.
Among other things, the company has a licensing department that helps branches deal with the process. “We can help keep it organized for every originator,” said Joe Ramis, branch recruitment director. “That’s probably the biggest thing we’ve done to help every individual.”
“It is a bit confusing because it is different for everyone,” Ramis said of the licensing requirements. But with proper organization, they can be managed relatively efficiently, he added.
Despite the costs and complications of licensing and other challenges during the downturn, Inlanta has been and continues to be determined to focus on the opportunities that can also be found and steadily grow its branch network to the extent it deems practical.
The company generally develops its branches through partner arrangements but also has done some small acquisitions and has some retail branches. Over the summer, for example, it purchased the assets and hired the retail branch employees of American Foundations MortgageBanc Inc., Brookfield, Wis., through a strategic agreement with undisclosed terms. By doing this the company was able to further solidify its Midwest presence and add two top executives to its upper echelon, one of whom was known for founding a top-10 Milwaukee lender, Inlanta chief operating officer Jean Badciong told ON.
The company has both partner and retail offices that are structured similarly, Ramis said. The majority of branches have been more interested in partnering opportunities. When asked whether there is any potential channel conflict, he said, “There is no overlap.” Ramis added that the company keeps in constant communication with all its offices to keep them informed and support them as well as to ensure compliance.
The company has and may continue to add a few traditional retail branches here and there through acquisitions when it is a good fit for both companies concerned, Badciong said.
AFMB, for example, has one retail branch in Wisconsin and two in Illinois that will be rebranded as a result of the deal, she said. There were plans at the time of this writing to consolidate two Illinois branches in one location. AFMB had close to 40 employees in total, all of which Inlanta hired. Nicholas DelTorto, president of AFMB and also founder of top-10 Milwaukee lender Amerihome Mortgage Co. LLC, has become executive vice president at Inlanta and AFMB chief operating officer John L. Watry has been named chief financial officer.
The acquisition provided the former AFMB employees with Federal Housing Administration delegated underwriting/direct endorsement and warehouse capacity they had lacked, Badciong said.
She said the transition has been relatively smooth given similarities in the two companies’ origination and secondary market technologies as well as their conservative Midwest lending cultures. But even when there have been differences in automation, such as disparate origination systems, the company has been able to help those coming on board adapt quickly, she added.
When asked how much overall growth Inlanta is targeting in the branch area, Ramis echoed a company motto, saying the company continues to move at a “crawl, walk, run” pace in terms of trying not to grow too fast and be selective so that its additions match the company’s conservative, Midwest lending culture. Badciong said Inlanta generally tries to pace itself so that it averages a maximum of about two new partner offices a month and does not grow too fast.
To give Origination News an idea of how the company usually expands, Ramis recounted how it came to do business in Kentucky. The Indianapolis office had a Realtor relationship in Kentucky and wanted to help with clients’ financing needs there, but the company needed a corporate license in that state in order to do so. So it got one. “That’s fairly typical,” Ramis said.
Some companies have been less interested in expanding into states requiring a physical branch office exist but Inlanta will do this. This is something Missouri, for example, has made mandatory within the past year, Ramis noted. Missouri is one of about a dozen states the company was licensed in at press time. Just prior to the acquisition of AFMB assets,
Inlanta had 26 offices and was expecting another two to four to be added in the next 60 days, Ramis said. Among the most recently added were Kentucky and Arizona. In addition to Missouri, the other states the company was licensed in were Florida, Iowa, Illinois, Indiana, Kansas, Michigan, Minnesota, North Dakota and Wisconsin.
While the company is “always looking to expand,” it has to be “with the right people for the right opportunity, because it is expensive,” Ramis said.
As Badciong noted in an interview earlier this year, licensing in particular has been costly, but it has not been something the company has let deter it.
When asked how the company approaches a market with a degree of distress like Florida’s, Ramis said that while states like that one and Arizona have their challenges, “there are still people there and they’re doing business.
“Those are good people they’ve made it through some tough times,” he added. “Those states will come back.”
Inlanta’s partner branches generally receive a small base salary with the majority of income based on the profits from their office. Branch managers have the freedom to manage their profit and loss.
The company looks for “good, common-sense underwriting” and wants originators that will “get a complete picture for our underwriters,” Ramis said.
It emphasizes strong turn times, underwriting and funding. The company strives for a 50/50 purchase/refinance mix, dependent on market conditions. It offers conforming, FHA, VA, 203(k) and rural loans from the recently revived USDA program as well as jumbo and reverse loans.
