From the start, Evan Einhorn was intentional about his growth.
He founded Modern Home Lending, an Arizona-based mortgage shop, in May of 2018 with a single processor by his side. Just a year and a half later, he’s now expanded his team to seven people across the areas of sales, operations, admin, and marketing.
Einhorn stepped into the professional world at 18 years old as a Realtor. A few years later, he moved to the mortgage industry and became a loan officer, moving through four different retail lenders during his first year in the business. Eventually, however, he found a sweet spot and spent the next few years growing his business.
Eventually, though, Einhorn took the plunge to become a mortgage broker primarily because he was finding it increasingly difficult to compete with brokers in his market in terms of pricing. He remembers one deal in particular where, even if he could’ve waived his commission, it wouldn’t be enough to win the business.
“I always knew the pricing was there. I guess I didn't realize how good it was until I had a friend try to recruit me to their mortgage brokerage. I basically needed to make sure that service was there,” Einhorn said. “I needed to bust all those myths: you lose control of underwriting and underwriting turn times, you can't close on time, etc., all the little parts of the process that you always hear are not so great on the brokerage side. I needed to physically see.”
What he saw, he liked. He was also swayed by the increased amount of down payment assistance available, which was important to his realtor and client base. And his base has not been disappointed.
In 2017, which was his last full year as a retail originator, his personal volume was just over $14 million, with almost 80 units. In 2019, he’s closed more than $50 million and more than doubled the number of transactions. Part of that is due to the rate drop, he acknowledges, but he says that the move to the broker channel has been the primary driver of his growth. Despite being relatively new to the business, Einhorn gets almost all of his business from past client referrals. Even though his real estate partners remain a great base, his business is increasingly moving toward working directly with the borrower from start to finish instead of going through a referral partner.
Most of his clients don’t know the difference between being a broker or a retail loan originator, and honestly, Einhorn doesn’t think most of them have a preference or even care—unless someone explains the difference to them. When a past client refers two people to Einhorn and he secures them a mortgage with two different lenders but both referrals have a great experience, it goes a long way toward client retention. Einhorn has also had several deals that were rejected by multiple lenders, but his team was able to continue working until they found a lender that would approve it. Having the ability to keep working a file is really important to business, Einhorn said, because those are the clients that end up being champions for an originator and their business.
“Not only do I get business partner referrals, but I get more customers that refer me and my company because we tell them what we're doing. We tell them the value add, that we're literally here shopping for your best mortgage,” Einhorn said. “I truly believe we are the best place to get a loan. That doesn't necessarily mean we need to be the cheapest, but we still need to be offer good value. There's no reason to be way higher on rate if there's no value add to the consumer.”
Einhorn estimates that in a typical year, 90% of his business is purchase, although that’s dropped to about 60% this year based on favorable conditions for refi activity. No one knows for certain how long that refi business is going to keep rolling in, and Einhorn’s focus for 2020 isn’t specially on one type of business or the other. Rather than setting goals based on numbers, his goal is based on people.
“If it makes sense for clients to refinance then we're going to reach out, but my goal is to personally help at least 150 families as far as purchases go, and honestly if refinances stay, the same will be close to 300. But my focus is really helping people get into homes.”
Sounds like potential homeowners in the Southwest are lucky to have Einhorn on their side.