Loan originators took notes on working with real estate investors and collected other insider tips during the final Non-QM Town Hall of the 2024 season.
Moderated by American Business Media Head of Outreach and Engagement Andrew Berman, Wednesday’s panel featured Deephaven Mortgage Senior Vice President of Client Development Shelly Griffin, EVP of Production for Angel Oak Mortgage Solutions Tom Hutchens, and Aaron Samples, chief revenue officer of Logan Finance Corporation.
Panelists had a candid discussion about helping RE investors of all experience levels, building up to this faction representing 30-50% of their companies’ business.
“The name of the game for real estate investors is speed,” Griffin said. “You don’t want to go into a room full of investors empty-handed, not understanding what the product really looks like or your options.”
She added that LOs should identify an account executive they can trust to help them navigate through challenging files and troubleshoot issues.
Angel Oak has crafted specific loan products that cater to this customer base, Hutchens told the group, adding, “A lot of the tools we use to qualify these investors just get tighter as property values get higher. When we talk about DSCR loans these borrowers are qualifying based on their credit and cash flow to the property. Investors are having a lot of luck in this market and I think that’s going to continue on,” he went on to point out.
Also known as a cash flow investor loan, DSCR loans don’t require proof of income, tax returns, or other financial documents that typically qualify borrowers.
DSCR – or debt service coverage ratio – is calculated by dividing a borrower’s monthly rental income on a property by principal, interest, property taxes, homeowners insurance, and association dues.
“They’re not as rate-sensitive,” Griffin said of investors. “I think they’re more sensitive to speed to finish; they want these things turned quickly.”
RE investors have grown to comprise more than half of Deephaven’s business, Griffin shared.
“A lot of times you’re getting multiple units through one investor. Where we spend a lot of time is education on BPL – business product lending – keeping that information in front of our customer base.”
Samples estimated that RE investors are 35-50% of the customer base at Logan Finance, and growing.
“As we look at overall statistics across the market we continue to see that segment of the market is trending higher,” Samples said. “It’s just really a great segment for that repeat business.”
He urged LOs jumping into this space to “know your client, know your business, understand the property, the transaction, and be able to give it a good narrative.”
“The more you know about the story and what your client is trying to accomplish – how you can fulfill their needs – if you can get that in the beginning it’s going to be a better experience for the client and it’s going to go faster.”
The panel went on to discuss gathering leads and contacts by attending investor gatherings in the regions they serve and working with real estate partners – many of whom happen to be investors themselves.
“There is no better way to market yourself than by providing products and programs that your real estate partners need,” Hutchens said.
While Wednesday was the final Non-QM Town Hall of Summer 2024, insights gained from the series have led to countless deals, LOs on the call shared.
Berman thanked all for their participation. Look for Non-QM-focused news and insights at nationalmortgageprofessional.com throughout the year.
