Mortgage companies masquerading as broker-friendly wholesale lenders but functioning as retail lenders are now, after years of anonymity, the topic of industry conversation. They were exposed by a growing faction of mortgage brokers who dubbed themselves the nickname “BRAWL” (for “Brokers Rallying Against Whole-tail Lending”).
FIGHT introduced himself to the industry a few weeks ago, and caused a stir with coverage in many mortgage outlets. The group has been the subject of much discussion at NAMB National, a well attended conference by brokers nationwide, and has received an overwhelmingly positive response from brokers and lenders.
“There was a great sense of excitement and, quite frankly, relief when BRAWL was announced,” said Anthony Casa, president of Garden State Home Loans and founding member of BRAWL. “Mortgage brokers have known the shady tactics of entire retailers for years, but we just had no voice before. We are speaking now and urging brokers to avoid doing business with full retailers as this is setting them up for long term failure. “
BRAWL wrote an open letter to express the frustrations felt by the brokerage community over the years, most notably with the group’s creation of a petition on Change.org. Petition calls on mortgage brokers to sign their names to support the group’s rallying cry against “lenders who appear to offer both wholesale and retail services, when the truth is their wholesale divisions don’t exist.” that for one reason only: to power their retail machines ”. Almost 500 people have already signed the petition.
An excerpt from the BRAWL open letter:
Let us come to the truth about loans. Wholesalers steal from our customers, but we give them the keys to the front door. Let us pledge to partner only with genuine wholesale lenders until entire retailers end their selfish and greedy ways. Let’s work together in the best interests of our borrowers and ourselves. Let’s keep the big one true.
The group does not stop there. This time they are naming names.
“Data is available on the type of activity of each lender,” Casa said. “You can see in the fine print the names of the companies that call us every day to tell us that we are their top priority. And then you research them and see that the majority of their overall business is retail. It makes you wonder how many clients you have lost over the years when you thought they were supporting you.
The group submitted a BRAWL-approved list of wholesale lenders who wholesale the “right way” – wholesale lenders who support the broker channel and do no more than 20% of their business on the brokerage side. retail. On the flip side, they also named lenders who are known to return leads to their retail channels and permanently steal customers.
Good wholesale lenders:
- Angel Oak
- MB Financial
- Nations Direct Mortgages
- Orion mortgage
- Loans at the edge of the park
- Plaza real estate loan
- United Wholesale Mortgages
Notorious “full tail” lenders:
- The group has also compiled a list of lenders who are known to be a “full tail” lender and you can find them by going to the BRAWL site. Facebook community.
To qualify a lender as an engaged wholesaler versus a full retailer, BRAWL assesses businesses using a five-part checklist. If a wholesale lender does not do more than 20% of their business in retail and checks the following boxes, they are considered the “good guys”:
- Route all broker-generated clients through the wholesale channel to the originating broker with no time limit
- No solicitation by the retail division, under any circumstances, of clients originating from brokers via the wholesale channel
- Communicate with the broker when a previous customer orders or requests a refund
- Non-compete policy for the lender’s retail division on any registered customer through a wholesale channel that contacts the lender directly
- No solicitation of broker employees for employment opportunities with the lender
In addition to BRAWL Facebook community for wholesale brokers and lenders who are committed to helping the broker network grow, the group has created a Change.org petition to sign to show their commitment to BRAWL.
After years of quiet hindsight, mortgage brokers are talking louder these days. And at first glance, this BRAWL is just getting started.
According to BRAWL, it is ultimately up to mortgage brokers to make the decision not to use any lender on the retailer list.
If there are other lenders who want to be on the “good wholesalers” list, they can contact StopWholetailLending@gmail.com to request a letter of commitment. If mortgage brokers know of other lenders who should be on the “good wholesalers” or “large retailers” list, they can let the group know and the list will continue to be updated.