Mortgage loan officers are still smarting over the Federal Reserve's new compensation rules, but if anyone's celebrating it's the folks whose job is to actually hire loan officers and their wholesale counterparts, account executives.
"It's a fun time to be recruiting," said Lisa Schreiber, executive vice president in charge of wholesale lending for TMS Funding in Milford, Conn. "There are so many good account executives out there right now — with 20, 25 years of experience."
Schreiber's job is to hire experienced account executives whose job is to gather product from loan brokers. Lately TMS has had the pick of the lot because of the Fed's loan officer rule and a slowdown in industrywide originations and wholesale lending.
When volumes fall account executives lose their jobs, which results in a buyer's market for senior sales executives. Earlier this month TMS issued a press release touting its hiring of six new account executives. These sales managers' former employers are a who's who of wholesale lending: AmTrust, Bank of America, Chase, Countrywide, U.S. Bank and Wachovia, to name a few. Even more telling is the number of years the six account executives have been in the business: 30, 28, 20, 20, 19 and 16.
The lesson here may be that only the very experienced should apply.
Paul Hindman, managing director of the recruiting firm Management Advisors International, said lenders are assessing their hiring needs like never before. With volumes likely to decline this year, it's all about evaluating and hiring the very best loan officer, Hindman said. "Companies can no longer afford to hire just the warm body … the right hire is critical," he said.
Those bodies better have good ties to Realtors, because the market this year will be driven by home purchases rather than refinancings, said Bill Dallas, chairman and CEO of Skyline Financial in Agoura Hills, Calif.
"Oh, my God, the resumes I've seen," said Dallas, who has headed both prime and subprime shops. "Right now there's a lot of LOs out there looking for homes," he said.
Skyline's origination volume is about what it was this time a year ago. The company employs about 135 loan officers, but its mix of production has shifted from 25% purchase money loans in the fourth quarter to 65% in the first quarter. "The purchase business is the environment we've wanted," Dallas said. "We think we can compete better against the big banks."
There has always been a perception that nonbank lenders are more adept at gathering purchase money loans than most of the nation's megabanks, with Wells Fargo being a notable exception. Wells has always cultivated strong ties to Realtors and home builders, though builders are not big players these days because the new-home market is depressed. (Wells, according to figures compiled by National Mortgage News, is the perennial market leader in retail home finance.)
But banks, especially publicly traded ones that answer to shareholders, are quick to cut staff in a downturn, creating an opportunity for nonbank players. (Wells is cutting 1,900 mortgage workers, though it claims very few of those are loan officers.)
One company scooping up talent from depositories is the privately held Mortgage Master of Walpole, Mass. "We're picking up LOs from both bankers and brokers," said Paul Anastos, its chief operating officer.
Although Mortgage Master has been hiring for the past two months, it's uncertain about what it may do the next two months. Last year Mortgage Master funded $6 billion in loans and was one of the largest retail lenders in all of New England. When asked about what it may fund this year, CEO Leif Thomson was noncommittal. "We'll gain market share. That's all I can say right now," he said.
