What’s with all the sales in the mortgage industry?
What is going on with all these companies being sold?
In the midst of all of the busiest origination period of the year, the sales of a number of companies comes at a time when margin compression is also occurring. We’ve seen the sale of four Mortgage Lenders and one bank’s branches in just the last two weeks. Castle & Cooke Mortgage, Franklin American Mortgage, Midwest Mortgage and Peoples Home Equity Mortgage Lending. Since negotiations had to have been in process for a long time, it’s not likely compression caused these sales but it could have speeded up the process for a few of the purchases.
Two of these companies were purchased by a private equity firm or holding Company. Anyone familiar with what happened at Stonegate Mortgage after it went public probably has an opinion of what will eventually happen in the future at these companies when a good Return On Investment is expected. None of these buyers are Midwest based. How will they deal with our Midwest loan sizes, underwriting and high volume of units?
Another interesting sale was announced last week too as Wells Fargo Bank sold 52 Indiana, Michigan and Ohio locations to Flagstar Bank. They only sold the bank branches in those states and are leaving any free standing mortgage origination offices open. But, with the way they’ve handled pricing and underwriting of government loans this year, are they committed to mortgage lending in government areas in the Midwest? Time will tell.
Whether or Not
Whether or Not Margin Compression played a part in these sales, we will look at margin compression next week. Stockton Mortgage is expanding. We’re looking to grow in AL, AR, FL, GA, IN, KY, MI, MS, NC, OH, PA, SC, TN, TX & WV.
We’re looking for branch managers or good producing loan officers looking to open their own branch.
If you are a Loan Officer and looking to go to a company that can help you grow your business, Give me a call:
Rick Koenig is a lifelong Cincinnati, OH native involved with the housing industry his entire adult life. As a Mortgage Banker the past 25-years. Rick has worked as an Originator, Branch Manager, and Regional VP in the mortgage industry. Rick is currently the Director of Recruiting and Business Development for Stockton Mortgage. Rick is very active in the housing industry having served as past president of the Cincinnati Mortgage Bankers Association and the Greater Cincinnati Home Builders Association. You can contact him at 513-382-5861 or by email at rkoenig@smcapproved.com
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