Stonewater Says It's Prime Time For Wholesale

Excerpted from an article on AmericanBanker.com:

Among the growing ranks of industry veterans assaying comebacks despite still-tumultuous conditions, the team behind StoneWater Mortgage Corp. is arguably going against a rougher grain than most by focusing on wholesale lending, one of the hardest-hit segments of the business.

"Most of what we hear on a daily basis is continuing deterioration within the mortgage industry and people continuing to lay off employees, close down branches, pull out of market segments altogether," said Karl F.W. Young, the former chief operating officer of First Magnus and StoneWater's president.

"Most people's thought is along the retail lines, which kind of helps bolster our enthusiasm for getting in now on the wholesale side," he said. "The opportunity will never be better for us to enter the market."

StoneWater plans to begin funding loans next month and ramp up quickly. "We're working real hard to pace ourselves for the first 60, 90 days or so, just because we feel there's such demand out there right now," Mr. Young said. But the company plans to have wholesale production offices in more than 30 large metropolitan areas with just under 300 sales representatives by next spring. It has targeted production of about $1 billion a month by April and hopes to "probably double that in the following 12 to 18 months," Mr. Young said.

The hiatus since the collapse of First Magnus also created space for its team to regroup, Mr. Marchetti said.

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