Two companies that share similar names are heading in different directions in the mortgage business – HomeStreet Bank is moving away from mortgage lending, while Homebridge Financial Services is diving in.
Earlier this year, HomeStreet, a community bank and mortgage lender that operates bank branches and standalone home loan centers, announced plans to sell off much of its entire retail mortgage operation, which includes 72 home loan centers in five states, and nearly all of the mortgage servicing rights associated with loans originated in those retail outlets.
Later, the bank found its buyers, agreeing to sell a sizable piece of its mortgage origination business to Homebridge, while New Residential Mortgage and PennyMac are buying more than 70% of HomeStreet’s MSR portfolio.
And now, Homebridge has closed on the first part of that acquisition, setting up the company to become one of the country’s largest lenders.
Homebridge announced this week that it has acquired HomeStreet’s mortgage loan production branches and fulfillment functions in Washington, Oregon, and Idaho, including processing, underwriting and funding, and hired the related personnel.
HomeStreet previously had 72 home loan centers: 37 in Washington, 16 in California, six in Hawaii, five in Idaho, and eight in Oregon.
According to Homebridge, phase two of the acquisition includes the locations in California and Hawaii. The company expects that part of the deal to be completed later this month.
In a release, Homebridge stated that The acquisition of HomeStreet’s loan centers and personnel increases the company’s footprint to 241 retail branches throughout the country and takes its personnel count to 2,344 employees.
According to the company, as a result of these additions, Homebridge will now be “among the top 10 privately owned, independent mortgage lenders in the country based on volume.”
Beyond its retails loan outlets, Homebridge also operates two wholesale divisions, REMN Wholesale and HomeBridge Wholesale.
“With Homebridge’s focus on customer satisfaction and a culture of growth and collaboration, we see the HomeStreet Mortgage team as a seamless fit,” said Peter Norden, CEO of Homebridge. “We look forward to the opportunity to incorporate the HomeStreet Mortgage team into our leading retail mortgage platform.”
According to a recent filing with the Securities and Exchange Commission, Homebridge is paying $5.9 million for the pieces of HomeStreet’s mortgage origination business. But the filing notes that the purchase price may be reduced by up to $2 million for “reimbursement by HomeStreet of certain transaction expenses incurred by Homebridge, as well as the assumption of certain home loan center and fulfillment office lease obligations.”
Additionally, if Homebridge reaches a “certain level” of mortgage originations in the 12 months after the completion of the sale, it will be required to pay an additional $1 million to HomeStreet.
Rose Marie David, executive vice president and director of mortgage lending at HomeStreet, said the company’s mortgage team is “excited” to be joining Homebridge. After both phases of the closing are completed, David will be joining Homebridge as the executive vice president, divisional manager of the former HomeStreet mortgage team.
“We feel a deep alignment with the Homebridge vision and overall sense of purpose,” David said. “We look forward to the opportunity to carry on our legacy as part of the Homebridge family.”
