It is important to understand that there are multiple channels for mortgages, and access to ALL of them is essential.
HARD MONEY: These are pools of money primarily from private investors. They focus mostly on investment properties. They also focus on equity (LTVs), over and above a borrower’s credit quality.
PORTFOLIO LENDERS: These are lenders who lend outside of the standard Fannie, Freddie and FHA guidelines. These are “stated income” loans, and/or loans above $729,750. Citi and GMAC, for example, have returned to this market. Many other lenders are now returning to this market, much to our relief.
MORTGAGE BANKERS: These are lenders who fund loans in their own name, on their own “warehouse line” (line of credit), and then sell the loans to larger investors like Wells or B of A. We (JVM Lending) have a warehouse line, and fund loans in this manner sometimes.
MORTGAGE BROKER: These are independently licensed operations that access all of the above referenced sources, depending on the needs of the borrower.
RETAIL BANKING: These are large banks like B of A and Wells that originate and fund loans in their own name. Ironically, they lack access to many of the above sources, and are more limited in what they can do.
Because of our volume and reputation, ALL of the above sources have been aggressively seeking US out for relationships. This is essential for any successful lender, as ALL of the above sources are necessary to fund the maximum amount of loans in this environment.
Last spring, we focused much more on our own mortgage banking. But in about July of last year, our Wholesale Sources suddenly became extremely competitive, so we have shifted our focus. BUT, we keep ALL of our options open, all of the time. Good luck to those who don’t.
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167