Knutson Taps Seasoned Exec For Wholesale Lending Unit

Knutson Mortgage Corp. hired a seasoned mortgage industry executive to forge alliances for its wholesale lending unit.

Terry Rowland was hired as senior vice president of Knutson's Residential Express unit, which Knutson purchased from GE Capital Mortgage in October. The unit provides a computerized lending program that gives affinity and correspondent lenders access to Knutson's loans and the secondary market.

Mr. Rowland will set up lending alliances with depositories, credit unions, corporations, realty firms, and builders, in addition to managing current accounts.

Prior to his new position, Mr. Rowland headed Countrywide Partners, with similar responsibilities, since January. Countrywide had hired him away from Norwest Mortgage, where he was chief executive at a lending arm of Norwest's joint venture with Long & Foster, a large real estate broker.

"Knutson is a step ahead of the industry in terms of figuring out how to create these kinds of strategic lending alliances," Mr. Rowland said in a statement. "Unlike other mortgage companies who provide these types of services, we create an alliance rather than a joint venture partnership."

He said the system works because it offers technology and back-office support without getting too deep into the everyday business activities of the aligned businesses.

"They're still 100% in control of their lending operations and their profits," he said.

Ray Sims, president and chief operating officer at Knutson, said he was optimistic about prospects for the lending unit. Mr. Sims joined Knutson in April 1995 from GE, where he had created Residential Express.

A mortgage industry executive who set up a similar alliance that ultimately failed at one of the top lenders, said these type of alliances are doomed to fail. The breakdown, he said, comes from real estate agents who do not refer buyers to the lender despite the alliance.

"Real estate agents think they should get all the money from the deal, and because they don't make money for the referral (to the mortgage company), they might send the customer to another lender out of spite," he said.

When Knutson acquired Residential Express, Glenn R. Wilson Jr., chief executive of Knutson, said such alliances would be part of the company's push into the national arena.

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER