BILL CALDERARA – ‘A good market’

Two out-of-state mortgage companies are making moves into Connecticut, even as the housing market takes a tumble across the country.

Residential Pacific Mortgage, which is based in the San Francisco Bay Area, will open a branch in Norwalk, and New York-based Trump Mortgage has become licensed in Connecticut.

The slowing of the real estate market has prompted many national mortgage companies to expand to try to increase originations, according to Kim Neilson, senior vice president of New Britain-based McCue Mortgage.

“It’s a difficult challenge right now, especially on the retail side,” she said.

The hardest part of breaking into Connecticut’s market for out-of-staters is a lack of referral sources, she said.

“It’s difficult to [get referrals from] the Realtors,” Neilson said.

Large companies tend to recruit experienced loan officers from other companies in the state.

“You really need loan officers in the state who have relationships in the state,” Neilson said.

Residential Pacific Mortgage is not opening a traditional branch in Connecticut, according to the public relations agency representing the company. But more information was not available by press time.

According to a prepared statement, RPM signed a partnership agreement with Residential Finance Solutions branch owners David Leonard and James Welsh as part of the company’s ongoing expansion. The deal incorporates RFS’s two offices into RPM’s community net-branch system.

“The net-branch system is designed to empower branch owners and loan agents by providing innovative mortgage tools, training and strategies, while RPM benefits from the offices’ established presence in the community,” according to the statement. “RPM’s net-branch system is made up of more than 25 branches, mostly located in California and Nevada. In 2006, with 18 loan agents, the former RFS branches are expected to close more than $65 million in home loans.”

The deal also will create an RPM office in South Carolina.

“David and James have years of experience in delivering superior mortgage advice and unbeatable customer service,” said Robert Hirt, chief executive officer of RPM, in a prepared statement. “Now, as part of the RPM family, both offices will have the tools needed to offer the best loan education, successful loan and referral programs, and expeditious closing processes for their clients.”

Bill Calderara, president of the Connecticut Mortgage Bankers Association and senior vice president of Fairfield County Bank Corp., said he was not surprised that the two companies are making inroads into Connecticut.

“Everyone else is already here,” he noted. “It’s a good market.”

A Lot of Stability

Connecticut has been attractive to mortgage companies for years. Fairfield County is very affluent, but the rest of the state holds a good mix of incomes, Calderara said.

The state has stagnant population growth and the mortgage market is mostly made up of re-sales, but there is also a lot of stability. Home values seem stable, and the average loan balance is high, meaning mortgage companies can reach the same volume with fewer loans, Calderara said.

It also is typically a good credit market, and Connecticut buyers tend to have large down payments.

Trump Mortgage earlier this month acquired mortgage licenses in 25 states, including Connecticut.

Most larger firms are trying to become licensed in all 50 states, and Trump Mortgage’s location in New York City made it almost a necessity to be licensed in Connecticut, Calderara said.

“To apply for a license doesn’t really mean much,” he said.

According to RPM, it is the largest privately owned mortgage bank in the East San Francisco Bay Area. In 2006, RPM is expected to close more than $3.1 billion in loans and projects – a 12 percent increase in loan volume over 2005.

The company has an in-house mortgage bank, which funds 75 percent of its loans. Additionally, RPM can underwrite for a number of major banks, including Wells Fargo, Countrywide, Citibank and Washington Mutual, allowing agents to shop around for the best rates for their clients.

“We are eager to benefit from RPM’s in-house mortgage bank and superior technology programs,” Leonard said in a prepared statement. “RPM offers an incredibly helpful and knowledgeable team that teaches branches how to be successful by developing strategic tools specific for each loan agent.”

Trump Mortgage is now licensed in Alaska, Arkansas, California, Colorado, Florida, Iowa, Georgia, Idaho, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Dakota, and Texas, as well as Connecticut.

“Trump Mortgage is growing by leaps and bounds under the direction of [President and Chief Executive Officer] E.J. Ridings,” said company Chairman Donald J. Trump in a prepared statement. “The company is expanding so rapidly that I believe Trump Mortgage will become one of the largest mortgage companies in the country in the very near future.”