Family Trust Mortgage Group, a mortgage lending and brokerage business, opened for business in this Burlington building in September.
It’s a “tough market” for real estate financing in general, Massachusetts Banking Commissioner Steven L. Antonakes says, with both refinancing and purchase volumes down. However, that isn’t stopping at least one area mortgage professional from setting up a new shop.
Massachusetts Mortgage Bankers Association Treasurer Charles Nilsen, who’s also a regional vice president for Chase Home Mortgage in Braintree, agreed that conditions are challenging for mortgage lenders and brokers.
“Most people are borrowing to buy a home as opposed to a refinance, which is driven by interest rates,” Nilsen explained, noting that today’s 30-year fixed-rate mortgages, still hovering just above 6 percent, are low – but not as low as in 2003.
In that context, most new loans today are for purchases as opposed to refinances, he said.
“It’s a flip-flop from three years ago,” which means lenders have to work harder to get new business, since interest rates alone won’t attract a borrower.
Despite the shaky economy, applications for new mortgage broker and lending company licenses are holding steady, if not rising, according to Antonakes.
When the MMBA heard that from DOB a couple of months ago “it surprised all of us,” Nilsen admitted. He said the new licensees come from a number of sources, including out-of-state businesses that want to write loans in Massachusetts and real estate firms and financial services firms seeking to form new mortgage groups. Other license applicants include people who have been in the business a long time and now want to strike out on their own.
One of the newest licensees, Bob Rocklein, fits the last category well.
“I can open now because I have the large client base that I built up,” said Rocklein, who’s spent 30 years in the mortgage business.
The 54-year-old opened Family Trust Mortgage Group, a broker and lending business, in Burlington in September. He’s worked in the financial services field since 1976, right out of college, when he took a job as a teller at WarrenFive Cents Savings Bank in Peabody (WarrenFive has since merged with Banknorth).
“They had hired a real heavy-hitter from Fannie Mae to set up their Mortgage Department. It was kind of revolutionary,” he recalled. He was recruited from within to be a part of the new endeavor.
One of Rocklein’s former colleagues at WarrenFive, Richard Callagher, now owns First Eastern Mortgage Corp. in Andover, a subsidiary of First Federal Savings Bank of Boston. “He did what I should have done 20 years ago,” Rocklein joked.
‘Customer Contact’
In the early 1980s, mortgage companies began to spring up where, before, only banks had done the loans, Rocklein recalled – and he was part of that movement, too.
“A guy that owned Commonwealth Mortgage (which has since shut its doors) called me up and asked me to go on the road” selling the new business and its product, he said. When he started there, there were a dozen or so employees. When he left a decade later, there were more than 500.
After Commonwealth, he worked at small mortgage companies in Waltham and North Andover, and later at First Call Mortgage in Andover. He learned that he liked selling as much, if not more, than management.
“I really missed the customer contact,” he said of the times when he wasn’t selling.
Rocklein said he thinks his knowledge of the mortgage industry from its early stages will work well for him and his customers – and the fact that he’s kept a good Rolodex through his career is helping his business get off to a roaring start. At Family Trust, where he both sells and manages, he and two employees are now writing a dozen loans, at about $3 million in volume, per month, he estimated.
“That’s OK for our size right now,” he said, though his mission is to grow.
“I envision a company where I could bring in another 10 to 12 people,” he said, adding that he wants to keep it “manageable.”
Massachusetts Mortgage Bankers Association Executive Director Kevin Cuff noted that a mortgage lender such as Family Trust Mortgage Group must have a larger financial network than a broker to start up its business, which, he said, “implies a financial obligation to the consumer.”
Rocklein, who’s an incoming member of MMBA’s Education Committee, said he’ll be helping to plan the trade group’s continuing education programs for loan originators and processors. That will be an important task in the months ahead, he said.
“I want to say this carefully,” he confided. “I think we’re in a position right now, because of the refinancing boom of 2002, that the sales force in mortgage origination and the leadership in the business are probably at their worst levels now, in that so many people jumped into the business [during that boom], and they weren’t properly trained.”
That, coupled with today’s slow market, might lead to some smaller companies shutting their doors this winter, he predicted.
It’s where he’s hoping his experience will help. So far, it seems to be, based on who’s showing up at his door.
“People [former customers] have their kids now coming to me for loans,” he said, and at some area businesses where he might have had one original borrower to begin with, “now I write loans for 30 or 40 different people.”
A love for what he does also doesn’t hurt. He’s so enthusiastic that sometimes, he’ll even take the unusual step of accompanying first-time-buyer clients to closings.
The slow sales right now don’t particularly deter him, Rocklein said.
“It’s pent-up demand. There are a lot of first-time buyers not buying and people not able to sell right now,” he said. “And that will turn at some point. It’s what I have learned from my 30 years in the business.”
