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The Benefits of Correspondent Lending Continue to Offer Businesses More Options

The Benefits of Correspondent Lending Continue to Offer Businesses More Options

With the housing market hot again a lot of first time home buyers are entering the market. Correspondent lending is a good way for small businesses to access this growing market.  A correspondent lender essentially helps first-time and other buyers by offering them non-qualified mortgages to purchase a home. These home buyers, who may have been turned down for a conventional mortgage, are interested in taking advantage of alternative mortgage lending.

As a result, there’s been a significant upshift in the corresponding lending sector, and in return, many current brokers and other small businesses are considering transitioning to become correspondent lenders. Because of recent changes in regulations, and a shift in modern home buyer demographics and priorities, becoming a lender is a great way to access a growing market and develop your core business.                                                    

If you are a broker or small business contemplating the transition, consider these other additional options that promote effective strategies for growth.

Closing Using Your Own Name

As a correspondent lender, you can close loans in the name of your own company. Closing loans in your company name gives lenders the ability to leverage an advantageous strategy…advertising.

Advertising as a correspondent lender allows a firm the ability to navigate directly to the population, targeting their ideal consumer base. As a result, firms can tactfully target and choose a larger market of prospective clients from the new, rising and incentivized homebuyers within that market.

Here are some key elements of advertising that can expand a firm’s options:

  • Tactical targeting – Correspondent Lenders are able to advertise to borrowers and actively differentiate themselves from brokers and the stigma of past subprime loans.
  • Simplified processes – The conventional qualified mortgage process is more complex for both borrower and lender. It is often drawn out, with more steps, more participants and subject to new types of mortgage regulations. By closing in their own name, lenders can underwrite and handle the overall workflow in-house.
  • Less labor – Since the process is simplified as compared to conventional mortgages, lenders do not have to exert more labor or jump through operational hoops. Once brokers are licensed as correspondent lenders, they can often more easily handle the loan processes themselves without additional effort or time investments.

Correspondent Lending Feeds your Core Business

Non-qualified mortgage loans tend to help borrowers and lenders more easily connect. The mutual benefit of non-qualified mortgage loans decreases the market resistance to lenders providing alternative lending options. This creates a steady and more accessible revenue stream that stimulates the growth of a lender’s core business.

  • Steadily Growing Volume of Clients – TAs the housing crisis becomes more of distant memory, the demand for homes has increased, and with there has been an increased demand for non-qualified mortgage loans. The presence of such a high volume of consumers provides lenders with more options to invest in their overall core business with security and consistency.
  • Undisclosed premium – When you’re the lender, the premium you charge stays between yourself and the investor. Lenders can assess business needs and then confidentially set the transaction rates and fees to expand their core business. For example, a lender can increase premiums for a small pool of people or have lower premiums and appeal to a larger pool of populations.

Fewer constraints – The provisions of qualified mortgages have constrained firms’ ability to feed their core business. But the benefits from non-qualified correspondent lending programs offer firms the ability remain competitive and healthy. Fewer constraints mean more autonomy and mobility to deploy and execute on previously unattainable core business goals.

  • The Moreover, it allows for the development of new revenue streams.

The plethora of benefits of non-qualified mortgages and the ability to develop new revenue streams and tap new markets allows firms to use correspondent lending as an exciting new market, one that can feed their core business and ultimately tap into the growing market.

Become a correspondent lender with Angel Oak

We are delighted to team up with non-delegated correspondents to provide additional lending options available for businesses and borrowers. Our innovative wholesale alternative mortgage lending products are among the top in the industry, providing a high level of service, speed, and mortgage financing options for your non-prime clientele.

Download our Correspondent Package:

About Angel Oak Mortgage Solutions

Angel Oak Mortgage Solutions offers non-Agency wholesale mortgage financing options and specialized low-credit wholesale alternative mortgage solutions for brokers throughout the country. We provide brokers mortgage access for low credit consumers, even after a bankruptcy, default, or delinquency. We also provide a unique application flexibility for alternative mortgage applicants when applying for home loans. The technology platform our wholesale alternative lending process is built on allows for paperless submission and the ability to track loan status with the click of a button, and our streamlined operations encourage quick response times, allowing for dependable communication and decision-making.

Angel Oak Mortgage Solutions is comprised of a team of qualified non-prime mortgage professionals who provide wholesale nonprime mortgage lending programs specifically for consumers whose circumstances may not meet standard Agency financing guidelines. With alternative lending services available to brokers in more than thirty states, Angel Oak Mortgage Solutions is proud to serve as your team of non-agency mortgage lending specialists.

Angel Oak Mortgage Solutions currently offers non-prime wholesale mortgage loans in Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Mississippi, Missouri, New Jersey, New Mexico, Nevada, North Carolina, Oklahoma, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington and Wisconsin.