What’s it like working under the same roof?
Working as an in-house lender with a real estate brokerage sounds like an ideal path to guaranteed business. After all, most originators spend a large part of their time courting, communicating with, and reaching out to realtors anyway, wouldn’t it make sense to just have to walk across the hall than drive across town for some face time?
Being on-site, an in-house lender also has some potential advantages to the borrower, such as always being available to answer inquiries as well as fast turnaround times.
As with many things, however, it’s not always so black and white.
Julee Felsman, vice president of mortgage lending at Guaranteed Rate, got in with a real estate company early in her career, and spent the next two decades 20 years of her career as their in-house loan officer. She said it gave her a unique insight into the realtor perspective, and has helped her when connecting with realtor partners to this day.
“I was raised by realtors. They are my people, that’s my perspective on real estate tractions and the priorities in a real estate transaction, and who’s important and whose role is what really were formed by hanging out with realtors all the time,” Felsman said.
She got the job with the real estate company because she had taken on a niche product, renovation loans, in order to build a name for herself. Being a specialist for a particular type of loan product gives realtors a reason to reach out for help or questions about that particular product, and if the product is particularly popular in a given area, it can be a reason for realtors to want the in-house lender on hand.
Although there’s clearly potential for built-in business and partnerships, the benefits vary greatly depending on the realtors themselves, as Eric Rotner discovered.
Rotner is currently the vice president of mortgage lending and Commerce Mortgage, and worked in-house with RE/MAX Accord for a few years. He also got a lot of exposure to real estate agents, but they didn’t all want to work with him. In fact, he said, many of the agents keep an in-house lender at arm’s length.
“The effectiveness of the in-house lending relationship, my experience has shown me, has to do with the buy-in of management and also the degree of respect that the agents within the office have for management as a whole. A lot of agents tend to view the in-house lender as someone who is not capable of generating relationships on their own, and feel that they’re sort of a secondary resource,” Rotner said. “The most successful in house lending relationships that I’ve seen have been at more boutique agencies that tend to have agents who have a much closer relationship with their owners and managers and also a higher degree of trust with their owners and managers. Those are the ones that I’ve seen lenders really be able to get a high capture rate and develop loyal relationships with,” he said.
Some real estate companies can—and do—think of the lending arm as a secondary concern. It can more sense for the company to focus on the real estate side of the business, which means that the person in the lending seat may not have their priorities or needs addressed. Again, that depends on the real estate brokerage, and something an originator should keep in mind when looking for this type of arrangement.
Similar to Felsman, Rotner’s experience as an in-house lender paid off even after he had left the office.
“One of the more surprising experiences was that when I left, I was contacted by five or six agents who never gave me the time of day while I was there, and those are all agents that I work with to this day. They just didn’t want to work with me while I was in-house.”
The real estate and mortgage industries can sometimes feel like parallel roads with a wide median in between: both heading in the same direction, but not always connected. Working as an in-house lender can give an originator valuable knowledge that they can then use to make the experience more seamless for the borrower, and negating some of the ‘us versus them’ mentality that undermines the process.
“There’s a subtle mindset that if you’re working for a realtor who trusts you and who trusts your competence and views you as a colleague and a fellow professional and a collaborator in the collective, the project that we’re all working on together of getting this client into their home, then . . . everybody’s just a teammate with a role,” Felsman said. “I would say even the client has to do their part, we all have to collaborate to make this transaction happen. And thinking about things that way is probably the biggest foundational takeaway that I got.”
