Like a lot of his competitors, Patrick M. Sheehy, the newly minted chief of production at GMAC Mortgage Corp., has big aspirations -- and big expectations to fulfill.
His boss Mark Korrell comes right out and says it: "Our goal is to get in the top five."
A laudable goal certainly, and one which many of GMAC's competitors share. But many of them are banks -- such as Chase Manhattan Bank and Bank of America -- with massive portfolios to book the adjustable-rate loans that are so popular this year.
So how will Mr. Sheehy help GMAC Mortgage, currently the 14th-largest home loan servicer, scale the heights of mortgage lending?
"We want to aggressively pursue nontraditional channels of production," he says reeling off a list growth areas like telemarketing as well as affinity and relocation lending.
An effort is also underway to tap the one million employees and retirees of General Motors and its subsidiaries and related businesses.
GMAC has also made the news recently with a pilot program to sell mortgage loans to the 11 million holders of its GM Mastercard.
And there is an expanded effort to build up products that sell well in a higher interest rate environment -- such as home equity loans. Annual production of home equity loans should be $150 million in 1994, triple 1993 volume, according to Mr. Sheehy.
Unlike most mortgage banks, the Elkins Park, Pa.-based lender has something of an ace up its sleeve, in the form of support from its parent General Motors Acceptance Corp, which recently gave the mortgage company the go-ahead to portfolio some special products.
Mr. Sheehy is cagey about the exact dollar amount of the portfolio program but GMAC recently announced a $50 million commitment to originate 3% downpayment loans that would not be sold to .Fannie Mae.
"That a mortgage banker has stepped outside of the box should let people know we are serious," he says.
While trying to emulate banks in that respect, GMAC is busily working on capitalizing on its differences by going after big producing loan officers.
GMAC is working up a new compensation plan that will pay tier-one loan officers for making loans that are profitable for the company.
Mr. Sheehy is betting that some big producing loan officers whose companies have been bought by banks will jump ship in search of a more entrepreneurial atmosphere.
For instance, GMAC continues to split overages with loan officers, a practice that many banks are moving to stamp out. Overage is the practice of making loans at higher interest rates than those the company generally offers.
"That's one area where we have an advantage."
The company is also looking to, expand its 121-branch retail network.
Mr. Sheehy singles out the Southeast as a particularly attractive area.
But all the expanded production in the world won't do much for you if you are originating loans at a loss, as is most of the industry in 1994.
So, higher-ups at GMAC have set Mr. Sheehy the task of reining in costs, a tough job while expanding production.
"The industry is under tremendous cost pressure," said Mr. Korrell.
"We have to figure out how we can employ technology to bring costs in."
Mr. Sheehy, 36, comes to GMAC Mortgage from Prud-ential Home Mortgage, where he headed national sales. There he oversaw "B and C" lending, as well as the home equity and affordable housing efforts.
Before that he did a stint with GE Mortgage Insurance Co., where he was in capital markets. His first job in the industry was with the old Cameron Brown Co., now part of First Union Mortgage.
