Picking the Right Net Branch Company

Times are tough enough in the mortgage industry without trying to go it completely alone as an independent loan originator. Hooking up with a mortgage net branch company offers many advantages to the independent mortgage company or loan originator – advantages that are tough to pass up in today's soft real estate and loan market. Choosing the right net branch company could be one of the most important decisions you'll ever make in your business, and not just in terms of the amount of profit you can make. With the increasing scrutiny focused on the mortgage and loan industry, you also need to look at the company's record of compliance with the law and the additional mortgage branch opportunities the net branch company offers. Here are just a few of the considerations you should be looking at before you make your decision on a mortgage net branch company.

Per File Fee

Check the fixed costs of each mortgage opportunity in addition to the rate sheet. Make sure that you're considering the total cost of the net branch opportunity when making your decision.

Broker or Banker?

It used to be enough to be either a broker or a banker, but these days you really need to be both in order to be in compliance with federal and most state laws. If you want access to FHA/HUD loan opportunities, you need to be working with a company that is in complete compliance with the federal rules. Anything less risks a big portion of your business, and could see you under investigation through no real fault of your own.

Licensing

Many mortgage net branch opportunities make a big deal about being licensed in all 50 states. Being able to do business across the country is obviously a nice advantage, but the number of states in which the net branch company is licensed shouldn't be your sole or even your largest consideration. If you don't typically do out of state loans, licensure across the country is nice to have, but not vital. Check to make sure that the net branch company is licensed in the states you most commonly do loans in, but don't sweat the numbers other than that.

Number of Lenders

One number you should sweat, however, is the number of lenders available to you through the net branch company. In this case, more is definitely better. The more lenders available to you through the net branch opportunity, the less likely it is that a change in a single loan product will damage your business.

FHA and VA Approval

We touched on this briefly above, but more specifically, don't even consider a company that isn't approved for both FHA and VA loans. It gives you the greatest access and opens the most opportunities for your own business. Likewise, be skeptical about any net branch company that tells you not to worry about compliance with the rules. The federal government is looking very hard at compliance across the industry these days and one of their points of interest is company-wide compliance. When discussing mortgage net branch opportunities, ask for very specific assurances about how the company as a whole handles compliance.

Software

Loan origination software is and should be one of the major selling points of any mortgage net branch. The best LOS provides the life blood for your business, so be sure to check out the net branch company's interface, front end and back end management to make sure that it meets or exceeds the industry standard.

Beyond those basics, the most important factor in choosing the right mortgage net branch opportunities is your own gut feeling. If something about the opportunity or the company feels “off,” trust your instincts. There are tons of mortgage net branch opportunities out there. Make sure you choose one that you're comfortable working with.