Wholesale & AMC’s – good fit? Top 5 ways to a successful relationship!

The relationship between wholesale lenders and national AMCs rely on 5 primary factors. Each factor is vitally important to the wholesaler for compliance management and growth in this market. 

1.       Communication

For the wholesale/AMC relationship to work properly it comes down to the basics. The cornerstone to every relationship is communication, and in this business relationship, nothing is more important. Unlike a community bank or credit union, the wholesale client is not just one client. When you work with a wholesale lender you are actually working with hundreds of independent mortgage brokers, across the entire country. You must be able to properly communicate with the wholesale staff (underwriters, account managers, etc.) as well as the broker staff (owners, processors, etc.).  And of course, the number one concern above all else: keeping all parties fully compliant.

2.       Coverage

A wholesale lender with a national or large regional footprint needs to work with an AMC that mirrors that coverage in Appraisers.  Although they may have started with a smaller local or regional AMC and that may have worked for a while, a proper growth strategy will need to include a solid relationship with a true nationwide Appraisal Management Company.  A true national AMC has proper appraiser coverage to handle broker requests in every county along with registration certifications in each state.

3.       Systems

The successful wholesale/AMC relationship depends on the Appraisal Management Company having the systems in place to handle volume and proper assignment of orders and delivery of reports. The wholesale model is completely different from the bank, credit union or direct lender model.  The aforementioned business models typically have the orders come from a centralized location or even from the net branch system with multiple branches placing orders with multiple users from each branch. The wholesale model requires a whole new way of thinking and it requires the AMC to have the right systems in place to handle multiple orders coming in from independent brokerage firms.  Each firm having different structures, different needs and different personalities. The AMC must be knowledgeable in this space and must provide convenient avenues for the diverse brokerage population to efficiently order, monitor and retrieve appraisal reports.

4.       Technology

Due to the complexity of the wholesale model, the Appraisal Management Company must have the best technology in place.  A centralized cloud based portal that is convenient, user friendly, reliable and secure is the optimal solution for large wholesale lenders.  The appraisal management company staff must be trained on service and expectations for this particular client type to ensure satisfaction in the relationship with the individual brokers. The AMC should have a dedicated specific landing page allowing the wholesale brokers to have easy access along with reporting and alerting functions available to all parties.  This will allow for up to the minute updates on appraisal requests 24 hours a day.

5.       Compliance

2014 is the year of implementation as far as compliance is concerned.  It’s more important now, than eve, for wholesale lenders to partner with Appraisal Management Companies that are not only fully compliant but who also routinely test and monitor their systems to ensure they remain that way. Lenders are responsible for their third party relationships.  Working with a high quality AMC allows the wholesale lender to offer this as an additional selling point to their broker base. With so much competition for third party origination’s and with rates becoming more and more flat, wholesale lenders need to expand upon their offerings to the brokers. It is no longer adequate to rely on quick turn times to win the broker’s business. Today’s brokers are becoming increasingly aware of the pending regulatory pressures and are feeling the CFPB heat first hand. They are looking to partner with wholesale lenders that have these same values and who will help them to remain compliant.  Having the right AMC relationship makes that possible.The relationship between wholesale lenders and national AMCs rely on 5 primary factors. Each factor is vitally important to the wholesaler for compliance management and growth in this market.