Four years ago, Dean Harrington knew it was time for a new business model.
As a direct-mail, inside-loan origination company, East Providence, R.I.-based Shamrock Financial Corp. was heavily focused on home refinances.
But in 2007, the market changed dramatically.
“It was like going into Home Depot and all the wood had been taken out of the store,” recalled Harrington, Shamrock’s co-founder and chief executive officer.
“The subprime mortgage meltdown hit full force, leveling many large, national non-conforming lenders and returning us to a more traditional underwriting set of standards,” he explained. “This meant that refinancing people with lesser credit scores, limited income or undocumented income was basically over. Eventually, we knew equity would dry up and really whack the refinance industry, so we began re-positioning into the purchase business.”
Harrington refocused on the Rhode Island market, and built a network of local real estate agents, attorneys and accountants to refer homebuyers to Shamrock.
The company also stepped up its consumer financial education marketing efforts. Harrington launched Cardi’s Furniture/Shamrock Financial Seminar Series, began airing a “Real Estate Today” program on Rhode Island radio station WPRO and jumped into social media.
“We began to educate and motivate anywhere we could,” he said.
His efforts paid off.
Rhode Island, which used to account for 10 percent to 20 percent of Shamrock’s business, now supplies 70 percent. And in four years, Shamrock Financial has become one of the three largest volume mortgage lenders in Rhode Island.
‘Have To Become Larger’
With about $250 million a year in loans, Shamrock is small compared with other independent mortgage bankers. But Harrington is determined to grow the business.
“We have to become larger,” he said. “To survive in what we’re going to go through over the next five years, our eventual goal is to become a depository (bank) or at least sell direct to Fannie, Freddie and Ginnie Mae.”
One possibility to increase Shamrock’s net worth is by bringing in investors, according to Harrington, who is currently the sole owner.
“It’s a challenge,” he said. “We run on the skinny. I’m the sole owner.”
Harrington added, however, that the company has been prudent financially.
“We socked it away,” he commented. “You can be profitable enough where you can attract investors, to make that next jump.”
With its headquarters in East Providence, Shamrock financial has additional locations throughout southern New England, with branch locations and partnerships with local real estate agents.
Harrington has been steering Shamrock Financial to new growth levels since he co-founded it in 1989 as a mortgage brokerage. He bought out his partner in 1996, and in 2001 transitioned the firm to an independent mortgage bank.
A consumer finance professional since 1984, Harrington is an original member of the Community Mortgage Lenders of America, a member of Lenders One Mortgage Banking Co-Operative and a director of the Rhode Island Mortgage Bankers Association.
A native Rhode Islander, Harrington and his wife, Trish, have four children, ages 5 to 22, and are active in civic, church and youth organizations. Harrington blogs at DeansDeskToday.com, and can be found on both Twitter and Facebook.
