Can mortgage brokers do good and do well? These three hope to make it

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A second-floor office suite above Nanobrew in Cleveland’s Ohio City neighborhood isn’t where you might expect to find a mortgage brokerage startup. However, this works well for Social Mortgage owners, both for lunch and for public contact.

Gusty Molnar, a real estate developer who cut his teeth as a mortgage banker at what is now Rocket Mortgage and is a co-founder of Social Mortgage, said: “If you want to ride a bike to get a mortgage, it’s is the perfect place. “

Molnar and fellow co-founders Brian Lewis and Michael Hudson say the minority-owned company emphasizes social in its name to show it puts community emphasis and has aim to help young buyers and under-represented minorities to get into overcrowded selling. housing market.

“During COVID-19, we decided this was a way to pay it off, help people get mortgages and help the community the same way Dan Gilbert did with Rocket Mortgage.” , Molnar said.

One thing is clear is that Social Mortgage is participating in a resurgence in mortgage brokerage business.

Less regulated mortgage brokerages bore some of the blame for contributing to bad mortgages, waves of foreclosures and the financial collapse of 2007-08. Federal and state laws have been significantly tightened on mortgage brokers, who register and research loans for applicants that other lenders fund, as well as internal bank loan officers.

The booming housing market and loan refinances in a low interest rate environment have reinvigorated lending activity since the Great Recession.

Kevin Allard, superintendent of the Ohio Financial Institutions Division, wrote in an email that new loans from state-approved non-bank mortgage lenders now exceed bank-sourced mortgages.

“In Ohio, we saw a 42% increase in the number of approved principals from June 30, 2020 to June 30, 2021,” Allard wrote.

So, Social Mortgage needs a story and a strategy to stand out and stand out in an industry focused on relationships and dedication to customer service.

To achieve its goals, Social Mortgage plans to work with major employers to organize courses to help employees learn how to buy their first home, advise potential clients on ways to improve their credit rating, and build credit. duty to inform clients about the down payment. assistance programs and other programs offered by local and neighborhood development companies.

The three, all of Cleveland State University alumni, worked together in 2008 at the Cleveland office of Quicken Loans, now known as Rocket Mortgage, where they became a group of friends.

Hudson returned to Cleveland last spring from a position in Detroit as regional vice president at Rocket to become a managing partner of the startup brokerage firm. He recalled that as a novice mortgage banker in 2008, as the housing collapse hampered lending prospects, he befriended Molnar and Lewis who taught him the ropes.

“This experience,” said Hudson, “has shown me the value of the business that you keep. They showed me that I could get away with it. It has given me, as a person caring to help others as a son of a finance is the cornerstone of a busy life. Starting a business in our own backyard is a way for us as Clevelanders to help other Clevelanders, not just with a loan, ”but by hiring and providing jobs as they arise. concern grows.

Lewis, who is black and a majority owner of the company, said he felt, growing up in Cleveland, Euclid and Cleveland Heights, that he was looking out on banking.

Today, he operates from a conclusion and a mission of his extensive banking experience.

“Financial literacy is something we can improve in the African American community, and we want to help as many underserved people as possible,” Lewis said.

Besides Rocket, Lewis rose through the ranks among several local banks, working as a cashier, bank manager and wealth management lender.

Hudson said potential home buyers in Cleveland face a particularly tough market as they are beaten to closure by hordes of local and outside investors making cash offers.

“But there are programs to help people with a low down payment buy a home,” said Hudson. “Millennials are under-represented in homeownership because of various factors such as student debt that keep you from starting to build equity.”

Molnar said he and his partners plan to go the extra mile to help prospects, noting that he has personally called listing agents to assure them that a prospect can qualify with the right lender.

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