Austin, Texas-based mortgage lender Open Mortgage has announced it will acquire the reverse origination arm formerly under 360 Mortgage Group. Sources within 360 Mortgage Group confirmed staff were notified last week that the company would be winding down its reverse mortgage originations, after entering the business earlier this year. The company did not return additional requests for comment.
360 Mortgage Group, also based in Austin, will continue to acquire and service reverse mortgage loan pools, the company said in a joint press release. Around 20 originators based across the country will move from 360 Mortgage Group to Open Mortgage, with licensing currently in process.
”360 Mortgage Group has made the decision to allow the acquisition of its origination business for reverse mortgages in order to increase its focus on wholesale, correspondent, and the servicing of both forward and reverse mortgages,” said Mark Greco, founder and CEO of 360 Mortgage Group, in a joint press release. “360 Mortgage Group’s goal remains the same; to gain market share in the multiple channels of origination as well as to continue building our servicing platform.
The move gives Open Mortgage, a growing lender both in forward and reverse mortgages, more of a presence in the reverse space, says Scott Gordon, the company’s CEO and founder.
“Open Mortgage is deeply committed to the reverse mortgage origination business and adding 360 Mortgage Group’s reverse origination business to the mix gives us critical mass,” he said in the press release. “We look forward to this acquisition, helping us create a stronger presence as a national reverse mortgage lender.”
The structure is slimier to a recent rollup of former Reverse Mortgage USA employees into American Advisors Group, which took place in early 2014.
360 Mortgage Group entered the reverse space in March, after having established a large forward platform including a strong wholesale presence. At the time of its entry, company executives said they were aiming to grow to become a top-tier lender, in part through efforts targeted at the reverse mortgage for purchase market. The company launched a retail channel in May. Since its entry, the company had closed 41 reverse mortgages, according to the latest Reverse Market Insight endorsements report.
The opportunity stands in growing the production of the originators who are joining the Open Mortgage platform, Gordon tells RMD.
“It was a great fit since 360 didn’t want to continue on the origination side, and when we talked with originators about how we can help them growth their production, they were excited about the opportunity,” Gordon says.
Written by Elizabeth Ecker