Is the time of the smaller mortgage banker at hand?
A lot of what has happened in the past two years may seem to favor the largest of mortgage lenders. After all, they’re the ones with the capital to work directly with the GSEs and the resources to handle the increasing costs of compliance.
Then again, it’s the flexibility and mobility of the smaller guys that may give them a fighting chance.
For example, several of the biggest banks in the industry are now doing what they have to as we retool from a re-fi to a purchase market: cutting jobs. There is a silver lining to this otherwise dark cloud, however. I like to say that there’s no explicable reason that a bumble bee can fly. Just look at it! And yet, it does. For the smaller lenders, most of whom are already “right-sized” for this market, there is suddenly a lot of talent available to them. Hopefully, those newly released “bumble bees” will be able to fly to those taking advantage of the market.
Similarly, not every warehouse or correspondent lender is shutting out the small guys with less capital. I have a new client, in fact, which is willing to float lines for super jumbo loans to the smallest of lenders. Imagine a $4 million dollar lender or bank able to originate a $5 million loan! It is possible…in fact, it’s reality.
Sure, the small guy has some challenges ahead. But there’s always opportunity in change. You just have to know where to look for it.