Friday Funding takes a look at the mortgage lending operations at origination firms. In this edition, Bela Donine, a managing director at HomeBridge discusses correspondent growth with HousingWire.
HousingWire: Who is your target customer and why are they a good fit for your business model?
Bela Donine: Our target customers are community banks, credit unions, national builders and independent mortgage bankers. We are a non-depository so we can 100% guarantee that we will not be soliciting the community banks’ customer or credit union members. HomeBridge is about quality and all these channels produce quality business, which fits in very well with our business model.
How does lending fit into your overall business strategy? In other words, what other lending divisions do you have, i.e. warehouse, wholesale, ect.?
We are a diversified mortgage lender, along with the correspondent channel, our parent company — Real Estate Mortgage Network, has a very viable wholesale channel and retail channel. Founded in 1989 and headquartered in Edison, N.J., REMN serves the lending needs of homebuyers and home owners, real estate professionals and builders across the country.
What do you see as the greatest challenge(s) your clients face today?
Our sellers are seeking to find a partner that caters to building a relationship which brings value added to their business. HomeBridge is all about creating synergies with our sellers and setting clear expectations up-front.
What made your firm decide to ramp up its correspondent division?
Past experience in the value of a correspondent platform as a diversification strategy, and the correspondent platform is a model for aggregating which allows to ramp up the servicing portfolio, which is one of the primary focuses of the enterprise.
How broad of a market do you serve today and what does the next 12 months look like from an expansion standpoint?
The HomeBridge correspondent channel is conducting business on a nationwide basis and we are nimble enough to quickly make the necessary adjustments to move in tandem with market conditions.
There have been a lot of new entrants into the correspondent market over the last 12 months, what is going to be the key that helps your firm rise above the rest?
- Customer service; our sellers can pick up the phone and talk to a live person.
- We are not a pass-through investor.
- We service our loans within the U.S.
- Ease of file delivery based on our proprietary technology.
- We do not solicit our sellers customer and/or members.
- We listen to our sellers and can customize solutions which benefit their internal operations.
With the increased competition in the correspondent arena, what do you think is the single most common mistake you see other correspondents making?
The recurring theme appears to be the lack of customer service. We are a nimble organization; we are the size that allows entrepreneurial behavior and we are very well capitalized to compete with first-tier banks.
Tell us about the team you are building and who sits at the core of the operation?
Our sales and operations teams are seasoned mortgage veterans with deep industry expertise that value our sellers by acting quickly and decisively. Both sales and operations are focused on anticipating seller needs, exceeding the expectations of our sellers and committed to developing a strong working relationship.
Correspondent lenders are paying a high premium for loans. What do you see happening to spreads over the next 12 months? How will rising rates impact your business?
Market volatility is a wild card and can be very unpredictable. Our enterprise in all channels has always focused on the purchase market, which will not be as affected by the rising interest rates.
Finally, with all the new compliance and regulation rules coming out, how will new compliance rules impact your business? What are you doing to stay on top of compliance, i.e. technology, new software, ect.?
Our enterprise recognizes the importance of being on top of all the compliance regulations. We follow the federal register and the CFPB updates as they become available. We also maintain in-house and outside legal compliance support and training for all channels.