When Bank of America said it was exiting the wholesale channel in early October, all looked bleak for loan brokers, which depend on such firms. After all, if the nation's No. 3 ranked table funder is getting out, that's not a good sign, or so went the conventional thinking.
But now that refinancings are humming along, it appears that more firms are eyeing the sector, including nonbanks and depositories alike.
And the latest entrant to the business is an "oldie but goodie"—Impac Mortgage Holding of Irvine, Calif., a once-high-flying alt-A lender that crashed during the subprime meltdown, was delisted, but somehow avoided bankruptcy.
According to rate sheets supplied by loan brokers to National Mortgage News, Impac is now up and running with a wholesale program and has named Steven Curry its national sales director. (Prior to its delisting, Impac was a correspondent and wholesale lender with very little retail.)
Although Curry declined to be interviewed, brokers in California are cheering its return.
According to the rate sheet, Impac will originate Fannie Mae loans with FICOs as low as 620, but only if the LTV is 90% or better.
Meanwhile, according to preliminary survey figures compiled by NMN, overall origination volumes were strong in the third quarter but wholesale production slipped by about 12%.
A sample of wholesale lenders shows that some table funders had production gains of 45% with others slipping by that much. (See table in this issue.)
The largest decliner in wholesale, so far, appears to be MetLife Home Loans of Irving, Texas, which table funded $1.8 billion in the third quarter compared to $3.2 billion in the same period a year earlier.
Michael Foote, a loan broker who operates in Southern California, said he isn't seeing much evidence of new entrants to wholesale, though he did notice that Impac is back. "I think it's safe to say that firms that are still wholesaling are doing more of it," he said. "But there's not many new players that I can see."
According to NMN, wholesale lending accounts about 11% of all loan originations in the U.S., compared to 30% three years ago.
The National Association of Mortgage Brokers, which at its peak had about 25,000 members, is down to 5,000, and has just three full-timers left running the trade organization. In 2007 it had 15.
NAMB CEO Roy DeLoach is stepping down as a full-timer at the trade group, but will remain as its chief (outside) lobbyist on real estate finance issues.
DeLoach—whose chief task at NAMB was government relations—told NMN that he has accepted a position with a Washington lobbying firm started by a former aide to Sen. Tim Johnson, D-S.D. "NAMB will be one of my clients," he said.
