Independent Mortgage Bankers Flex Their Muscles
PALM SPRINGS, CALIF.–The Mortgage Bankers Association’s Independent Mortgage Bankers Conference, now in its fifth year, has grown from a small gathering in Dallas (200 attendees) to more than 700 here this week.
MBA Past Chairman Bill Cosgrove, CMB, CEO of Union Home Mortgage Corp., Strongsville, Ohio, a driving force behind its creation, calls the IMB Conference a “celebration of non-bank lenders–an opportunity to mark our territory to show who we are and how we working in and with our communities.”
Cosgrove said the independent mortgage banker enters 2017 with momentum and “incredible optimism” for the future.
“We have a new Administration and a new Congress,” Cosgrove said. “Communities and households are growing; more borrowers are ready to get into the housing market; and we have new technologies to explore to reach those borrowers.”
MBA Vice Chairman Chris George, founder, president and CEO of CMG Financial, San Ramon, Calif., echoed those sentiments, saying 2017 offers IMBs the opportunity to “effectuate real change.”
“IMBs more relevant today than ever before in this atmosphere of change,” George said. “Overall market share of IMBs has essentially doubled between 2008 and 2015 to nearly 46 percent. Community banks’ share is nearly 25 percent of the market. Of IMB originations, 65 percent of that is for home purchases. We have a commanding presence in the market, but also the community at large.”
George noted IMBs serve the marketplace differently. “Largely, we are a collection of small businesses,” he said. “We operate differently from the large guys; we don’t have the same opportunity of brand. As a small business, we do things large things large businesses can’t–and not necessarily with less compliance, less structure or less policies and procedures.”
George said the strength of IMBs come from localized influence and more personal relationships. “We hire locally,” he said. “We participate in our communities, giving back in profound ways. It’s just a different vibe when there’s 50, 100 or 500 employees versus 3,000–we have the opportunity to see our business values at work. It’s personal for most of us. We live and work and play in the local communities. The couple you just helped buy their first home goes to your church or synagogue or plays softball with you.”
George called on IMBs to be “selfish” in getting their voices heard. “Our strength is our membership,” he said. “It is our diversity that makes us stranger, not our differences. They say seek out people that are better than you, different than you, braver than you.”
MBA serves as a strong resource for IMBs, with influence both outside and inside the Beltway. “When Ben Carson was nominated as HUD secretary, who do you think he called? Not Ghostbusters–but MBA,” he said. “When questions about GSE reform or FHA premium changes were being bantered about, MBA was the definitive player. The first call and the final word on lending and housing policy is MBA…Because our fingers are on the pulse of the community, we know how much the fabric of America has changed from when we first entered real estate finance.”
George said the next year–and the next decade–provide strong opportunities for IMBs. “Over the next decade, there will be 16 million new households in the United States. Millennial generation proportionally has the largest share of immigrants. These demographic changes as positive opportunities. As an industry, we can move beyond standard business practices and develop diverse management strategies with dedicated recruiting, mentoring and leadership programs. And for IMBs, we’re nimble enough to make this happen quickly. But we can only accomplish these goals together.”
George noted politically, the next four years will be the most interesting in recent memory. Let’s not confuse this with ‘revolution’–this is ‘evolution,'” he said. “It is inevitable and was coming someday; I doubt any of us thought it would be today. We all saw the pendulum swing too far. By 2006, last week you could have been a butcher and this week you are a mortgage broker; last week you were a police officer, now you are a loan officer. Either on purpose or on accident, some of these folks harmed our industry’s reputation. The thing about pendulums is, that they accentuate the extremes. Sort of where we are now.”
George emphasized that IMBs can’t get lost “chasing after the rabbit down the Alice in Wonderland hole.”
“Know there is a difference between politics and policy,” George said. “We must keep our eye on the prize, affordable access to credit for all Americans, especially low to moderate income. Transparency and certainty in the process and a balanced regulatory environment. Technology and diversity reflecting our emerging customer base. You all have heard the quote that the devil is in the details. The devil is also in the distraction today. We must remain focused.”
