Not riding refi wave pays off for young broker

While peers chased them, he was taking advantage

Not riding refi wave pays off for young broker

Early on, Russell Petty (pictured) knew he didn’t want to work for someone else. After an early entry into the mortgage industry, he launched and sold his first brokerage and now oversees a staff as owner of Charlotte, NC-based Grow Mortgage – all before the age of 30.

Even more remarkable: This, in essence, is his second career. “I was very young, I think I was 16, 17 years old, working on IT repair for insurance companies,” he told Mortgage Professional America in a recent interview. “If your home burned down or you’d flooded or something like that, I would go in and I would pull out your computers, your TVs, and I’d do data recovery and fix your television.”

He hated IT

He was not enamored with the work: “I hated that,” he said. “I did not do it for long, but I hated doing that so I ended up quitting one day. I’m pumping gas at a gas station and it pops up on my phone – I think it was Glassdoor: ‘Hey, we need an IT guy here at this mortgage company.’ I thought, ‘you know what, I’ll try this’. I called the guy and their internet was down and it was the last day of the month – little did I know one of the most important days in the mortgage industry because everything kind of closes at the end of the month. I drive over and fix their internet and, long story short, this is on a Friday. They say, hey, can you start Monday. I said, ‘OK, sure’.”

Petty spoke to MPA during the recent Hall of AIME event that took place in Naples, Fla., from Jan. 26-28. Staged by the Association of Independent Mortgage Experts, the event showcased top producers while doling out awards – including a “visionary” award to Petty.

But back to his story: “So I started on Monday and didn’t even know what a mortgage was – I wasn’t old enough to get one,” he said. “I started off with this company and they said ‘we need you to come up with a spreadsheet of what everybody made this month in commissions.’ There’s only 12 people in this office – like a one-room company, you know.

“So I made the spreadsheet and said: ‘Hey, this can’t be right, this guy made X amount of dollars this month; he must be doing something wrong’. And they said: ‘No, that’s correct.’ So it would come to pass that at the age of 17, he would have an epiphany: “I said ‘well, you know what, screw IT’,” he said with a laugh. “I want to do this now. I started learning from the owner, and I’ve been doing it ever since.”

Venturing out on his own

He would venture out on his own after a few years with the firm, launching Grow Home Loans at the age of 21. “I didn’t want to leave them high and dry, so I did IT the whole time and helped with licensing, compliance, pretty much all their systems I helped build. A few of the people who were working for me at that time are working for me now.”

He was doing compliance and originating at Grown Home Loans for about a year before selling the firm to a California hedge fund. “They didn’t end up buying the actual company itself, but they bought the technology.” Still, one of the conditions of the sale was that Petty had to agree to a one-year non-compete clause.

After that idled year, he launched Grow Mortgage. He remembers the date of the launch, as it was all 2s – Feb. 2, 2022. That year, he posted volume of around $60 million. His title of senior mortgage planner/owner belies his day-to-day work, he suggested. “I consider myself an originator,” he explained. “I don’t consider myself one of these guys that won’t originate anymore now that I own my own company. I consider myself an originator first and foremost.”

What makes him tick?

Now 27 years old, he explained his drive: “I just don’t like working for people,” he said succinctly. “I’ve always been driven to the point where I’ve wanted success but I’ve always wanted it to be something I’ve built and something that I, not necessarily control, but enjoy. I enjoy looking down the road and building that pipeline. I enjoy running my own company.”

For all his success, Petty suggested he’s not driven by profit motive: “I opened the company not to make a bunch of money off the originators who work for me. I did it because I saw a mortgage process – or envisioned a mortgage process – and couldn’t find anywhere that did that process the way I wanted it done. I thought ‘there’s a better way to do this, and I think I know what it is’. There have been bumps along the way but I think we got it pretty dialed in. Our average clear to close time from start to finish is just under 10 days on a loan. It’s very, very quick, very efficient. We’ve never had anything but a five-star review. I couldn’t get that process anywhere else because I didn’t have control.”

The period of unprecedented refi activity of the recent past wasn’t a major focus either, he explained. Even as other brokers gorged on the low-hanging fruit of refinancing, he focused on the purchase market as a better long-term strategy. Given the abrupt end to the refi boom, that approach would end up being prescient.

“You have to focus on purchases,” he said. “A lot of people lost sight especially in the last few years when rates were in the 2s and they started focusing on refinancing. Refinancing is a wave of business and then nothing – feast or famine. People always need a place to live. So while it might be a down year, it’s not nearly as down for refinance loan officers. I didn’t pivot in the least. While they were out focusing on refi, I was stealing all their real estate agents. While they were neglecting these agents and not calling them back, I was building up my pipeline for right now. Instead of focusing on the quick money of the refis, we focused on getting those real estate agents and it definitely paid off.”

AIME membership has been beneficial

Surrounded by his peers at the Naples Grande Beach Resort that served as the venue for the Hall of AIME, Petty was asked to detail some of the benefits he derives from being a member of the Association of Independent Mortgage Experts.

“How much time do you have?” he asked rhetorically. “This could take a while. When I got into this business, there were broker shops you could throw a rock and hit them, and we didn’t even know they were there. We had no voice, no camaraderie, and didn’t know the other one existed. There was no connection broker to broker. Retail, bankers, correspondents had it; brokers were left out on their own little island. It brought us all together, it gave us a voice. We’re a team working together. Instead of being just me, I have thousands and thousands of other brokers to team up with, learn from, bounce ideas off of. It’s just been phenomenal. The wholesale channel would not be where it is if it weren’t for AIME.”