CEO's dream to service both non-standard and standard loans was years in the making
When Eloise Schmitz (pictured) first met Ken Niemann, her business partner and fellow co-founder of LoanNEX, they were both in seventh grade.
When they decided to launch the B2B mortgage technology platform company together many years later, it was after a lot of head scratching about the state of the private sector.
It happened when Schmitz was about to step down as CFO of Charter Communications - a Fortune 500 company – when she made a realization after having raised more than $75 billion of funding during her 12 years at the firm.
“As I left, it was shocking to me that the private sector had been reduced to less than 5% of the market after the housing sector collapse,” she said.
Both she and Niemann believed they could do a lot more for the beleaguered sector and “spent a few years trying to figure out how we wanted to play and where we wanted to play”.
When they finally launched LoanNEX’s first service in 2016, they had two main objectives – to gain access to private capital and to provide simplified tools on a modern platform for loan officers.
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“Being able to understand and navigate all these different products and programs can be really intimidating and complex. As long as you have tools that make it as easy to navigate the non-standard products as the standard ones, you have the confidence to sell them, and you are therefore an expert to your borrowers - that was our vision,” she said.
LoanNEX has since become established as an innovative web-based pricing platform that supports both non-standard and standard loans, and is currently available to more than 3,500 mortgage originators, processing in excess of 10,000 loans a month through more than 30 investor partners.
Among the roster of clients are S G Capital, Sprout Lending and Newfi Lending, to name but three.
The bulk of LoanNEX’s business is the non-agency mortgage market, and in fact non-QM lending takes up about 80% of the total, according to Schmitz.
“The agency part of the marketplace has an enormous amount of standardization, where it falls off is for that non-agency side, that’s where LoanNEX really can make a difference - it’s giving a loan officer the tools to navigate easily, whether it’s a jumbo product or an investor product or a self-employed borrower,” Schmitz explained.
“We’re not limited to non-QM, but because we focused on delivering that service it’s one of the strongest non-QM platforms around.”
Read more: Non-QM and automation – a marriage made by tech
In a significant move last week, LoanNEX announced that its platform was now integrated with ICE Mortgage Technology’s Encompass TPO Connect, described as “a fully-configurable web-based portal” intended to provide wholesale brokers with even greater loan options, while maximizing speed and loan profitability.
Looking into the future, Schmitz believes her company and platform will adapt well to market shifts, particularly as refinance loans are expected to lag well behind purchases in the coming months.
“The purchase market is going to be 75% of volume in 2022. That’s what’s projected up from the first half of 2021, when it was 25%. That’s a huge shift. That means you have to be able to serve the unique needs of a home purchaser, which are different than the repetitive side of that refi market, so extending those tools is super important to making them successful,” she said.
“The origination side is moving very, very quickly. A lot of our clients are starting to talk with us about not only implementing us as their non-QM resource, but also to add other agency products and have a full service, retail pricing engine for all their products. Same thing for brokers,” she revealed.
After more than 26 years’ experience in corporate finance, including a successful banking career in corporate and commercial banking, Schmitz has reached a new high at LoanNEX, although she was quick to dismiss her achievements from the context of her gender.
“There is nothing that keeps women from pursuing their vision and their opportunities,” she said. “(Gender) doesn’t matter, and I don’t really think the industry cares. I just don’t think we’ve seen enough women maybe taking the chance…it’s something that anybody can do.”
Many at best, perhaps, but not just anybody, one would argue.
