Unprecedented Times Call For Unparalleled Advice
Articles by: Richey May, May 15, 2020
The current COVID-19 pandemic and the market impacts that continue to evolve have stressed mortgage originators and servicers business models in ways that we’ve not seen even during the financial crisis of 2007. The social and economic impacts of COVID-19 will take months if not years to work through and may forever change the way real estate transactions are financed. Everything is impacted from the fundamentals of obtaining appraisals and VOEs to liquidity impacts of margin calls, specialty loan products and drastic reductions in SRPs.
In times like this it is imperative that you consider all options when reformulating your forward looking business model.
- If you don’t currently have GSE or GNMA tickets should you obtain them?
- Should you begin to retain servicing?
- How should you adjust product mix?
- How do you model cashflow impacts of expected servicing advances?
- Are you focused on financial and operational performance metrics using technology?
- Should you consider consolidation with a larger company?
At Richey May & Co. we know the mortgage business and are ready to help you with these tough decisions during the COVID-19 pandemic and the market impacts. We are currently assisting clients with establishing sub-servicer relationships, developing policies and procedures for retention of MSRs, applying for GSE licensing and rethinking their TPO strategies. We also provide M&A support services to IMBs looking to partner with high performing and well capitalized companies. There are uniquely qualified buyers seeking production platform acquisitions as well as MSRs that are paying highly competitive market valuations. If you would like to discuss any of these services or other challenges that are facing, contact us.
For more insight on the impacts of COVID-19, view our other COVID-19 resources. We will continue to monitor the market changes and provide insights that impact your business.