Regional Mortgage Lenders Grow Production Operations

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Rather than targeting national expansions as many did before the downturn, today’s growing residential lenders increasingly tend to be regional players targeting specific loan channels, areas and/or customers in their strategies.

Norcom Mortgage, for example, last month said it has entered the correspondent channel. The company is a Ginnie Mae issuer and Freddie Mac seller/servicer that is licensed to operate in a slew of states along the East Coast as well as in the state of Washington.

“We had brokers we had been dealing with that had the ability to close in their own name,” Patti White, a Norcom vice president, said when asked about the catalysts for the expansion.

She added that the company wanted to expand to target community banks and credit unions. These financial institutions might find the new TPO mortgage services attractive because, among other things, they could be useful to those that might want to boost their Community Reinvestment Act ratings, she said.

Norcom also had noted others were moving out of the channel, creating more of an opportunity to move into the space, said White.

Paul Anastos, president at Northeast-based regional residential retail lender Mortgage Master, said last month that his residential mortgage company also has been growing, albeit in the retail channel only. He said his company sets its sights specifically on higher-priced metropolitan markets that match its core competencies, rather than national expansion.

Mortgage Master aims to hire strong loan officers and provide efficiently packaged, high-quality loans, Anastos said. The company is licensed in 22 states and has been expanding its operations not only in the markets around its headquarters but also in places like in Maitland, Fla. In this way, Mortgage Master seeks to balance the advantages of economies of scale with the hyper-local nature of real estate markets. It is not yet a seller/servicer but acknowledges that it is a move that the company’s executives have been considering,

Another regional player, FBC Mortgage LLC, also has been growing and recently entered third-party origination channels through a separately operated brand due to needs it identified through an Orlando area affiliate in the community bank market.

“We’ve always been a retail mortgage banker, but in the last 12 months seen a need in the marketplace for a boutique wholesale lender,” said Rob Nunziata, president and co-CEO of both FBC Mortgage and the specialized CloseQuick TPO division. The company is licensed in 16 states, with more pending and has its main footprint in the Southeast.

Nunziata said that the company is offering both wholesale and “mini-corr,” the latter being a form of correspondent where there is a quick turnaround between closing and loan purchase. The company provides through its separate TPO brand what he describes as back-end mortgage services for community banks. The services are available on a private-label basis with the aim of allowing community bank clients to keep their brand names in front of their customers even though a third party is providing the services.