The National Association of Mortgage Brokers has created a new grant program that is designed to expand the mortgage broker channel by helping mortgage professionals open their own wholesale shops.
The new program, called KickStart, is set to launch immediately thanks to a $500,000 grant from United Wholesale Mortgage. Through the program, qualified individual originators can receive up to $10,000 to cover startup costs such as procuring office space or purchasing software technology.
The ultimate goal is to double the market share held by wholesalers, which currently stands at around 12%, according to UWM President and Chief Executive Mat Ishbia.
"The KickStart program is about strengthening the mortgage broker channel as a whole because it's the best way for consumers to get a loan," Ishbia said in a news release. "KickStart will strengthen the market by getting more loan originators where they belong, at independent mortgage companies."
To be considered for the program, applicants must have at least three years' experience in the mortgage industry. Applicants must also provide a description of their planned company, production goals and anticipated operational structure. Grant recipients are not expected to pay back the funds they receive.
Applications are reviewed by the KickStart Review Committee, which includes three representatives from NAMB, including CEO Don Frommeyer, and a representative from UWM, Vice President Anthony Lynch. Also on the committee are Lisa Lund, owner of Lund Mortgage, and Lisa Severseike, branch manager at Global State Mortgage.
Existing wholesale lenders can also get involved in the program through sponsorships, which range from $100,000 to $500,000. Those who grant $500,000 will receive a seat on the review committee like UWM.
The program should address startup concerns among prospective brokers. A survey conducted by NAMB found that while 70% of loan originators had an interest in owning their own shop, 44% viewed money as a main barrier to opening their own business. Among those respondents though, 60% said they would be more likely to make the leap if they received seed funding.
