Freedom Mortgage has experienced impressive growth since May 2014, when Stanley Middleman led the privately held, full-service lender through four acquisitions and grew its employee base by 86%.
The Mount Laurel, New Jersey-based company has gained valuable market share with branches spanning nine different states, adding into its fold BluFi Lending, Continental Home Loans, First Mortgage Corp. and Aurora Mortgage.
“We went from no participation in the traditional retail space to becoming a significant player in that space,” Middleman said. “Those originations will put us on a path in 2016 where we hope to be able to originate close to $5 billion in that traditional retail space.”
He expects there will be more consolidation in the industry and will continue to strategically consider companies that are a good fit with Freedom’s business.
“We certainly have to digest and consolidate all those things we’ve been involved in, but if there are opportunities along those lines we will take advantage of that,” he said.
When Middleman founded the company in 1990, he said he saw tremendous opportunity as the industry was coming off an era of high-interest rates. He built the company, one loan at a time, with just a handful of employees. Employee count has grown from 1,875 employees in July 2014 to 3,500 year over year.
In the last few years, BASEL III reform measures have opened up market share to nonbank entities, leveling the playing field for companies like Freedom Mortgage.
“It’s part of market share redistribution that has led to a large part of our growth,” he said. “A lot of the hard work that has been going on for the last few years has really paid off as more and more market share is available and the ability to compete with banks has improved.”
The company also has seen gains from pulling its servicing in house in July 2014. Since that time, Freedom’s servicing team boarded over 145,000 loan accounts worth over $33.5 billion. By mid-2016, Middleman expects to bring all 300,000 loans it services, worth more than $70 billion, in house.
It operates four regional call centers in Florida, California, New York and Arizona.
Middleman is a well-known speaker on panels for the national and local mortgage bank associations, information management network forums and other conferences. He serves as a member of the Housing Policy Executive Council (HPEC), an affiliate of the Financial Services Roundtable, and is frequently quoted in interviews with Bloomberg, The Wall Street Journal and industry trades.
Earlier this year, he launched a new initiative for the company called the Freedom Mortgage First Flyers program. This college recruitment and mortgage training program was launched with its first round of recruits hired in January. There are 96 First Flyers in the program, including 10 licensed loan officers and seven in a sales associate rotation prepping to be loan officers.
Freedom Mortgage is one of the largest producers of government-backed loans in the U.S. Middleman said one of his biggest challenges is managing regulatory risk and working hard to be compliant and the premier lending partner with the government.
“We have a big team dedicated to regulatory compliance and keeping up with technology is a consuming event,” he said. “The customer expects much more than he ever did before. We as service providers and pathways to homeownership need to make the customer experience a better one without creating additional risk to people who invest in those loans.”
He added: “Our industry needs to be disrupted by technology and we’re working hard to be disputers, not disrupted.”