A mortgage banker tends to control the loan in Australia because homebuyers will go to mortgage lenders for pre-approval loans prior to purchasing a home. “[Real estate agents] might be able refer a few [homebuyers to lenders] but most people usually start looking at their finances before they look at property,” said Michael Herring, director of finance and administration at Axcess Consulting Group Pty Ltd., Geelong, Australia.

Real estate agents can receive leads, Herring said, but it is not difficult to receive approval from banks for mortgage loans based on the Australian market’s fluidity. “It’s not too hard to get approval in principle from the number of banks without trying too hard. The [mortgage] brokers make it even easier so it is hard for the real estate agents to convince people to go to a particular person,” Herring said. “The lenders at the end of the day are the real controllers of the market. If a new product comes out, they will distribute it quickly to the broker network that will try and get it out there for them. Obviously, it ties into commission.”

Major lenders and banks enter into arrangements with mortgage brokers to sell their mortgage products on the lender’s behalf, similar to the U.S. model. The mortgage broker has more products to sell. “We have four major banks, six minor banks and 160 credit unions over here,” Herring said. “All of them can go to a [mortgage] broker and the broker can choose which product to sell to an individual.”

But the mortgage broker market has no more than 50 percent of loan originations compared with nearly two-thirds of originations in the U.S., Herring said. “There is still a very strong relationship between the lender and the client,” he said. “The lenders will advertise on television like the brokers.”

Australia’s securitization market is not as strong as in the U.S. and lenders mostly hold mortgage loans in portfolio. Australia New Zealand Bank Ltd. went against the country’s trend in the past year. The bank wanted to cut broker fees and go back to a branch banking style. Herring said mortgage brokers 15 to 20 years ago were met with skepticism but today’s mortgage brokers have a better reputation. “They have done more work as an industry so that they are actually looking more credible and people will use them for consumer lending,” Herring said.

Lenders, like brokers, will also advertise on their Web sites and draw traffic to it. “The lenders will have their ‘honeymoon’ products. It means instead of a standard rate for the first 12 months, it is a discounted rate,” Herring said.

Australia only had adjustable rate mortgages (ARMs) during the mid 1990s when interest rates soared to 19 percent in the early 1990s. “The market started to become more sophisticated to protect itself and fixed rate is one way to hedge,” Herring said. With 2.7 percent inflation now in Australia, mortgage interest rates are at 6.5 percent to 7 percent. The country is also slowing in the activity of buying and selling property.

“It’s now starting to slow down in the residential space which is therefore flowing into the mortgage space,” Herring said. “They are not getting the high turnovers that they had before.”
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A Connecticut native, Chuck has been reporting since 1992 and has covered local government, education, police and criminal courts for newspapers throughout Connecticut and the metro-Boston area, as well as a near-year long stint covering health care and human resources for a Rockville, Md.-based business-to-business publisher.

Mavent Inc., Irvine, Calif., announced the addition of Michael Benoit as executive vice president and chief legal officer. Benoit will lead the company’s contract management efforts and assist in the management of the Mavent Legal Network, a group of more than 40 law firms nationwide that assist the company in maintaining and interpreting regulatory law.

Before joining Mavent, Benoit worked for eight years with Linthicum, Md.-based Hudson Cook LLP, a financial services law firm. Prior to that, Benoit was with Cleveland, Ohio-based Benesch, Friedlander, Coplan & Aronoff LLP, an entrepreneurial law firm focused on middle market and emerging growth companies.

Richard Riccobono, deputy director at the Office of Thrift Supervision, will serve as OTS acting director. Riccobono has been with OTS since its inception in 1989 and has served as the OTS deputy director since May 1998. He replaces OTS Director James Gilleran, who retired last month.

Prior to joining OTS, Riccobono served at the Federal Home Loan Banks of Boston and Atlanta in executive supervisory roles, and was with the accounting firm of Deloitte & Touche. On April 26, the White House announced its intention to nominate current Federal Deposit Insurance Corp. Vice Chairman John Reich to fill a statutory term as permanent OTS director.

Commercial Texas LLC, Austin, Texas, announced that Bracton Baker Bledsoe, formerly with PacTrust L.P., has been named vice president of financial services and will be leading the firm’s efforts in commercial real estate investment sales.

Bledsoe previously pursued acquisition and development opportunities, and managed operations for office, retail and industrial assets in the Austin and Dallas markets for the PAC/SIB portfolio of properties in Texas with PacTrust and its local general partner Means Knaus. Prior to PacTrust, Bledsoe worked with the Trammell Crow Co., and with the Bank One corporate services division.

Wholesale Lending Online, San Francisco, announced the addition of Greg DePriest as regional sales manager. He is responsible for maintaining broker relationships and the development of WLO’s Midwestern market, which includes Kansas, Missouri, Oklahoma, Nebraska, Iowa and Illinois.

Prior to joining WLO, DePriest was regional vice president with First Magnus, during which time he created three wholesales offices in Kansas, Missouri and Illinois. He also worked as vice president for Countrywide, where he was honored for building the highest producing wholesale office in Countrywide’s history. He has been the recipient of the KAMB President’s Award and the MAMB Affiliate of the Year, in addition to several notable achievements with Countrywide and First Magnus.

RBC Mortgage, Houston, announced it opened a new satellite branch office in Coos Bay, Ore. Susan Karolyi will serve as a loan officer in that location. Karolyi joined RBC Mortgage in 2004 with more than 20 years of experience in the banking and lending industry.

The Chicago Federal Home Loan Bank announced that Thomas Goldstein, chairman and CEO of ABN AMRO Mortgage Group Inc. and senior executive vice president of LaSalle Bank Corp., Chicago, its parent company, has been appointed to the Chicago FHLB’s Board of Directors. Goldstein assumes the term, which expires at the end of this year, of Scott Heitmann, who retired earlier this month from the Board and from his position as vice chairman of LaSalle Bank Corp.

Goldstein joined LaSalle Bank in July 1998 as a group senior vice president in the finance division. In 1999, he was named head of the finance division, in 2001, became executive vice president, in 2002, was named chief financial officer, and in 2003, was elected senior executive vice president. In 2004, Goldstein was named chairman of the ABN AMRO Global Management Reporting Committee and in February 2005, he was named to his current position as Chairman and CEO of ABN AMRO Mortgage Group, Inc. Prior to joining LaSalle Bank, Goldstein was with Morgan Stanley Dean Witter for 10 years, where he held positions in treasury, investor relations and financial operations.

Colonial National Mortgage Corp., Columbus, appointed Mitch Daniels as branch manager of its new Columbus office. The company also added loan officers Debbie McCloud, Erin Bishop, Mike McCarty, Connie Kennard and Vicki Ballenger.

ABM AMRO Mortgage Group’s Sunrise, Fla., office announced that Chris Dalton will serve as an account executive. Prior to joining ABM AMRO, Dalton served as branch manager of First Ohio Lending Inc.’s Boynton Beach, Fla. office.

Triad Guaranty Inc., Winston-Salem, N.C., hired Eric Dana as senior vice president and CFO, with responsibility for all financial matters pertaining to the company.

Dana was previously with The Bankers Bank in Atlanta, and also worked with Lighthouse Financial Services, First Union Corp., and KPMG Peat Marwick.

LandAmerica Financial Group, Richmond, Va., named Scott Smith as vice president of LandAmerica 1031 Exchange Services, based in Denver. He comes to LandAmerica from a major title insurance company in St. Louis.

Fairway Independent Mortgage Corp., Sun Prairie, Wis., announced its expansion into the Boston area with an office in Brookline, Mass. Amy Tierce, recently appointed president of Fairway New England, will run the branch with Deana Auman as vice president.
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CREF is the largest annual gathering of commercial real estate finance professionals and provides endless opportunities for building new relationships and connecting with industry experts.

Network with colleagues and attend educational sessions led by industry experts. This convention helps ensure your future success, discover new products and services, learn about new technology and business practices and exchange ideas with industry leaders. Register today to ensure housing early.

Click here to download registration form or call (800) 793-6222, Monday-Friday, 9:00 a.m.-5:00 p.m. EDT.

To visit the CREF/Multifamily Housing Convention Web site, go to http://events.mortgagebankers.org/cref2006/default.html.
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The Washington office of NorthMarq Capital, Inc. arranged first trust financing of $2.5 million for Terrapin Station in the center of College Park, Md., home to the University of Maryland. T-Mobile and Moe’s Southwest Grill are the main tenants in the 12,931 square-foot retail property.

NorthMarq, through its relationship with ING Investment Management, St. Cloud, Minn., arranged a 20-year term with a 20-year amortization for the borrower, Terrapin Main Street LLC. “The lender recognized the low loan-to-cost/value with excellent sponsorship and location, resulting in a low fixed rate self-liquidating loan,” said Matthew Kohlhoss, vice president of NorthMarq in Washington.

NorthMarq arranged first mortgage financing of $14.7 million for Concordia Shopping Center in Monroe Township, N.J. Ernest DesRochers, senior vice president and managing director, and Charles Cotsalas, vice president, in the Greater Westchester N.Y./Conn. office of NorthMarq, teamed up for Concordia Holdings LLC to finance the $14.7 million, 10-year deal with a 30-year amortization schedule.

“The property is in the midst of a major expansion and [NorthMarq’s correspondent] Archon Financial [headquartered in Dallas] was able to structure the transaction to accommodate the borrower’s immediate and longer tem financing needs.” DesRochers said.

In the Bethesda office of NorthMarq, Joseph Burke, executive vice president and senior managing director, arranged first mortgage financing for Hunt Valley Professional Center, located in Hunt Valley, Md. The 37,800 square-foot office building is home to tenants that include Coldwell Banker and Richcroft, Inc. and GSA. NorthMarq arranged financing for the borrower, Bavar Properties, through its correspondent relationship with Woodmen of the World, Omaha, Neb. The loan amount was not disclosed.
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Network with lenders and gain knowledge of how they make these programs work. The conference will feature key updates on the following issues:

• Government housing and specialty product programs
• Credit and appraisal policies
• Endorsement and complianceissues

Speakers include Keith Pedigo, director of the Loan Guaranty Service at the VA; Russell Davis, administrator of the Rural Housing Service; and an official from the Federal Housing Administration to be determined.

Breakout sessions on June 2 examine Credit Policy/Underwriting; Selling Government Housing Finance Products; Getting Your Loans Endorsed or Guaranteed; FHA and VA Appraisal Issues; and a discussion with FHA’s Homeownership Center Directors, featuring panelists Ron Bailey of the Denver Homeownership Center; Joe Bates of the Santa Ana Homeownership Center; Charles Gardner of the Atlanta Homeownership Center and Engram Lloyd of the Philadelphia Homeownership Center. Tim Doyle, a director with MBA’s Government Affairs office, will moderate this session.

On June 3, breakout sessions discuss Managing Audits and Avoiding Indemnifications; Using Neighborhood Watch/Avoiding Credit Watch; and Specialty Product Sessions on Renovation Lending, Reverse Mortgages (HECMs) and Section 502 Guaranteed Housing Products.

The conference takes place at the Capital Hilton, 16th & K Streets, Washington, D.C. 20036. Program registrants are responsible for making their own hotel reservations by calling 1-800-HILTONS or 202/393-1000. Conference room rates start at $169 for single or double per night. MBA has also arranged airfare and car rental discounts.

For more information, go to the Conference Web Site at http://events.mortgagebankers.org/fha2005/default.html.
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“The relationship between originators and secondary market purchasers, between mortgage bankers and the GSEs, is at a critical juncture,” Lowrie said. “And the forces involved are Industry growth, global capital flows, shifting risk structure, changes in technology, legislative action, and media scrutiny.”

“MBA has a role to play in each of those areas,” Lowrie continued. “It could get ugly. Or we can seize this moment to create an even more efficient, open, safe and inclusive system that will push the record homeownership rate in this country even higher.”

With homeownership rates hovering at a near-record 69 percent, and growth projections over the next 15 years at “astounding” levels—nearly 60 million new homes needed—Lowrie said the need for a strong secondary market is more critical than ever.

“Outstanding mortgage debt, compounding at about 8 percent, will grow from $8 trillion to nearly $22 trillion by 2020. We reached today's historically high home ownership rate thanks to Fannie Mae and Freddie Mac helping to ensure a stable secondary market, thanks to FHA's service to low and moderate-income families, and thanks to mortgage lenders who have expanded the number and type of products available to consumers,” Lowrie said.

But the growth in the types of mortgages also means increased risk, Lowrie said. While the GSEs have bought nearly half of all the senior pieces of sub-prime private label issuances last year, and have cooperated in formation and adoption of standards created by the Mortgage Industry Standards Maintenance Organization (MISMO), Fannie Mae and Freddie Mac also became a larger part of discussion on the regulatory front.

Freddie Mac has largely recovered from its financial problems from 2002, but Fannie Mae remains embroiled in controversy stemming from its financial statements dating back several years. The GSEs’ problems have led to increased scrutiny on Capitol Hill and introduction of bills that would restructure the GSEs’ regulatory structure.

MBA supports reform that would clearly establish a “bright line” between the primary and secondary markets. In committee is Senate bill S. 190, which will clarify how the GSEs can stick to their original mission, most notably through the appointment and empowerment of a regulator and a clear distinction between the primary and secondary markets, Lowrie said. On the House side, the H.R. 1461 seeks to accomplish the same things, albeit in some different ways. 

“All of us—MBA, the GSEs and Congress—share the same objective: safe and sound practices secured through effective oversight, by a strong regulator. MBA supports a GSE regulator with real enforcement authority. A clear definition of where origination ends—and the secondary market begins—would go a long way in clearing up current uncertainty,” Lowrie said.

No one disagrees that origination is not part of what the GSEs should do, yet no one has ever defined origination for regulatory purposes, Lowrie said. “Our position is clear, and has been clear: the secondary market begins after a loan is closed and funded; that is the ‘bright line.’ It is a simple ruling that can bring enormous clarity,” she said.

Lowrie said MBA and the GSEs are in agreement that the GSEs’ affordable housing goals should support their mission to serve low- and moderate-income buyers and renters. “The goals should also be realistic, and not so aggressive that they have unintended market consequences,” she said.
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