One of Puerto Rico’s largest reverse mortgage lenders is expanding into the United States and plans to carve out a “niche” targeting the Hispanic population.
With seven branches and 80 employees, Money House is the second largest reverse mortgage lender in Puerto Rico with 26.5% of the market according to Reverse Market Insight. The company wants to build on its success and sees now as the perfect opportunity.
“[With the exits of Bank of America and Wells Fargo] there is a huge opportunity for a company like us,” said David Levis, CEO of Money House during an interview with RMD. “We want to take our way of doing business in Puerto Rico and transfer it to the U.S.”
While many lenders in the U.S. are moving toward a call center based approach to originating reverse mortgages, Levis wants to bring it back to the “kitchen table” and sees a great opportunity to cater to Hispanics as well.
“We want to recruit great people and be known as the mortgage lender for Hispanics in the states,” he says.
According to figures from the U.S. Census Bureau, there were 44.3 million Hispanics in the country in 2006. Those numbers are expected to grow significantly in the coming years, reaching an estimated 59.7 million by 2020.
Money House is looking to start in about 10 states that have the biggest impact in the Hispanic communities he says. While Levis says the company is targeting the Hispanic population, he is looking to bring reverse mortgage education to entire families in person, no matter the ethnic background.
“In Puerto Rico, the education process is always face to face, at our company it’s 100%,” he says. “[While the Hispanic niche] is something we’re excited about, it’s not the only market we plan on marketing to. That would be our niche, but we’re going to do reverse mortgages for everyone.”
Whether the company’s approach will work in the states isn’t guaranteed and Levis knows it. “I think it depends on the market, but we have to go out there and see what happens.”
With plans to make the move in the second quarter of 2012, Money House needs to get licensed and it’s looking into making an acquisition to speed up the process. According to Levis, the company is already looking at a range of companies, but it continues to look for the right opportunity.
As far as the type of company it would like to acquire, “We’re trying to bring on quality personnel that make the best decision for borrowers and Money House in the U.S.,” he says.
Levis estimates he could spend over $1 million expanding should they decide to make an acquisition.
