The government may not be out of the mortgage industry yet, nor may they ever be, but companies are already beginning to brace themselves for a day when they might not be able to rely on the government guarantee for originations.
Companies like Titan Capital Solutions, we speak to Mike Eberl for his insights.
Video transcript below:
Reporter: The government may not be out of the mortgage business yet, nor will they ever, but companies in the mortgage industry are already preparing for the day when they won’t be able to rely on a government guarantee for originations. Companies like Titan Capital Solutions, a private correspondent investor, Mike Eberl, Head of its regional correspondent sales explains that the days of Fannie and Freddie may not be over, but relying on public financing for housing will not last for ever.
Mike Eberl, Head of Regional Correspondent Sales, Titan
Mike Eberl: Of all of the news and perhaps over the last few years about Fannie Mae and Freddie Mac and you know what their long-term viability is going to be, I think more and more companies are kind of looking to the future to non-agency products.
So we happen to be after non-agency jumbos, but I think there’s going to be a swing more in that direction where more and more companies are going to be looking at non-agency products just because you know we don’t have the baggage that’s connected with a lot of that old type of lending.
Reporter: Eberl explains that originators should be looking at opportunities beyond government backed products and that it’s not very difficult to understand all the reasons why a transition to the private market is on the horizon.
Mike Eberl: We have an advantage selling portfolio products is our pricing isn’t reacting to the day to day market fluctuations that you are running into if you’re selling direct to one of the agencies. They price by the minute just about so we just don’t run into that.
Reporter: Unlike giant investors, Eberl explains that there is a lot less stress involved with doing business with a correspondent investor like Titan, because they do not have minimum production requirements.
Mike Berl: We’re kind of going after a little bit smaller market and opening those doors for a lot of companies that aren’t able to sell one investor 15 to 25 million dollars a month, you know. But they could very well originate you know 5 to 10 million dollars a month and not really be able to play on that, that arena and that’s where Titan Capital comes in by kind of filling that gap.