Florida Mortgage Lender Interview: State of the Market Discussed
Joe Nunziata is the CEO and co-founder of FBC Mortgage LLC. The Florida mortgage lender recently talked with the Orlando Business Journal about the state of his industry…
OBJ: What effect is the slowing residential market having on the mortgage industry?
Nunziata: The less people who buy homes, the less [Florida mortgages] we get to do. Our volume has definitely been affected. People are afraid to commit to purchasing homes right now. Our business was growing exponentially, in a good way, and now we’ve kind of flattened out. Industrywide, it’s slowed down an awful lot.
OBJ: Are you being affected by more mortgage loan defaults due to people overextending themselves when the housing market was booming a year or so ago?
Nunziata: Yes. These people bought homes they potentially could afford. But once they start making late mortgage payments, that greatly affects their credit score. The problem is these people then try to refinance Florida mortgages, and we can’t help them.
OBJ: What are some common mistakes people make when it comes to mortgages?
Nunziata: One of the big ones is trying to obtain a mortgage from an Internet Florida mortgage company. Most are based outside of Florida and don’t adhere to state laws.
People think they’re getting one deal, and when it comes to closing, the deal is totally different from what they expected. I think people should shop around, but also ask their references - friends, Realtors - for referrals. Referral is the best way in this business to find a mortgage company that’s really good.
Customers should never be afraid to ask their loan officer about a product guideline. It’s very important that they’re comfortable with the program they’re getting into.
OBJ: What’s your take on the subprime meltdown that seems to be taking place, and has that affected FBC?
Nunziata: We were never heavy into the true subprime market. When I started in 1988, subprime was when someone put down a lot of equity, and they had bad credit or judgments, and it was an equity-based loan.
By 2004 and 2005, subprime companies were doing 100 percent loans with no down payment for people with low, low credit scores and putting them into two-year adjustment periods. People with less-than-perfect credit didn’t pay their other bills and then didn’t make their mortgage payments.
Literally, in 2005 and 2006, if you could sign your name on a piece of paper, you could get a Florida mortgage loan. It’s definitely tightened up the underwriting guidelines. It’s taken away a channel of business, not that it was very big, but it was still an outlet to sell loans into.
