Broker makes the leap to wholesale after a career in retail
In this down market, the best strategy is to stay positive until better times emerge. And those who survive the market downshift will be rewarded handsomely in the end.
That positive outlook is what Florida-based Andrew Cady (pictured), of Epic Mortgage Team powered by UMortgage, manifests each day, he said. Cady’s perspective comes from having been on the retail side most of his career, and just nine months after having shifted over to the wholesale channel. Despite the timing of his movement amid a challenging market, he’s remained positive.
“This is 2020 and 2021 all over again,” he said, prefacing as if to detail a sense of doom. Instead, he turns it into a positive, noting how the times are ripe for the broker model to recruit from the retail side. “They’re hurting significantly worse than we are,” he said of the retail model. “We have better margins than them. A lot of what I’m seeing is leadership missing in action on the retail side.”
He spoke to Mortgage Professional America during the annual FUSE conference staged in Las Vegas by the Association of Independent Mortgage Experts (AIME). The gathering took place Oct. 4-7.
Given what he has seen, Cady feels he’s well positioned for the future. “I feel I’m in the absolute best position than I’ve ever been, not necessarily to get a bunch of deals – because the deals aren’t as fluid as they used to be – but as for building a team and recruiting and growing your model. Hands down, this is the opportunity. When rates drop, we’ll still have a competitive edge, but it won’t be as visible as our competitive edge is today.”
Keep calm, and stay positive
It’s a battle to be sure. But the key is to keep calm and stay positive, he suggested: “You have to control your mentality and you have to control your positivity,” he said. “There’s a silver lining in everything we do and the moment you let negativity creep in, it’s like a cancer that spreads faster than positivity will. It’s a battle you always have to fight.”
And what a battlefield it is. “No, this market isn’t fun,” Cady said. “This market isn’t ideal. It’s not what we’re looking for. Home affordability is off the charts bad. But we have to stay positive. We have to see the silver lining. There’s going to be a lot less competition coming out the other side of this. Those who survive are going to be rewarded very heavily. So for me it’s all about maintaining a positive mentality and maintaining positive energy as we go through everything.”
Data suggests the number of loan originators will have been cut in half between 2022 and 2023. Is there an opportunity there for brokers to gain market share?
“Absolutely,” Cady said without hesitation. “We’re better priced. We also are really starting to dial in and streamline processes and systems. Yes, there’s going to be a big shift in the market. I wouldn’t be surprised to see the broker community exceed 50% in the coming couple of years because the movement is there – especially if we see the interest rate environment we’re in today stay higher for longer. You’re going to see companies potentially fail on the retail side because they’re losing so much money. But it’s also going to push the individual originator to seek out an opportunity to get optionality for their clients.”
Sleeping well at night
The big advantage he’s secured after his recent migration to the wholesale channel is the variety of lending options he’s been able to secure for his clients, Cady said. That dynamic also bodes well for independent brokers in general for the future, he suggested.
“I spent my entire career in retail,” he said. “I was a top-producing loan originator in the country at one company before I left. And then I built a team at my next company on the retail side that was the number one producing branch in the company last year. But I never really slept well at night because I only had one option to give them,” he said of his past clients. “I had no optionality - and having optionality is the big win we have on the wholesale side.”
Now comfortably ensconced in the wholesale channel, he suggested restful slumber has returned: “I sleep well at night knowing I shopped 22, 23 lenders for this client’s deal. And I’m giving them the absolute best they’re going to get.”
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