Wholesale Mortgage Lenders Jump into the Mortgage Net Branch Game

February 8, 2010

The overhaul of the mortgage industry by the government has changed the business models of many companies. Wholesale mortgage lenders fearful of their ability to survive in the near future are trying to become retail mortgage net branch companies over night by turning customers into employees.

Can they do it?  Most will not be able to succeed. Wholesale mortgage lenders lack the experience to operate a retail mortgage branch company. They are not accustomed to licensing originators.  Accounting and payroll departments are not in place, most do not offer the ability to also “broker” mortgage loans but require all loans to be “banked”. When you lose the choice to broker a mortgage loan, the mortgage banking company has no competition and you have no alternative, no plan B for your loan. Turn times can slow down, pricing can worsen, your employer – the mortgage banking company – does not have to compete for your business. Not only do you suffer, but so do your borrowers.

A true retail mortgage branch company offers BOTH mortgage banking and mortgage brokering, and lets you make the decision each and every time on how you want to close your loan. This type of arrangement puts you in control and requires your employer, the mortgage branch company, to be competitive with their mortgage banking.

Not too long ago wholesale mortgage lender account executives served as the sales representatives for the wholesale mortgage lender to develop new mortgage broker relationships and maintain existing ones. Today, many account executives are being faced with new a job description – Keep your mortgage broker customers AND go find some loan officers to work for us. This presents a conflict of interest, the account executive must manage loan officers who are now employees of the wholesale mortgage lender, and they must continue to manage their mortgage broker customer base. The mortgage broker is in direct competition for the same borrower as the loan officer of the wholesale lender.

What if you had the ability to bank mortgage loans with multiple lenders and broker mortgage loans when you wanted? Could you really have both? Contact us today and find out why we are the industry leader in mortgage retail branch opportunities. Southwest Funding is truly you net branch alternative.

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