Redlands, California-based mortgage lender Mountain West Financial has struck a deal to sell its retail assets to competitor ML Mortgage Corp., one of the latest M&A transactions amid a challenging landscape for home loan originators.
“We did transfer our branches and loan officers to ML Mortgage. We felt that ML was a good culture fit and would provide the least amount of disruption to the origination team,” Mountain West CEO Michael Delehanty said in an email to HousingWire.
“There are many reasons that caused us to make this difficult decision. Ultimately, we were not able to overcome the decline in the market over the last few years while continuing to originate within the business model that we had,” Delehanty added.
A spokesperson for ML Mortgage didn’t immediately reply to a request for comment.
Mountain West offers Federal Housing Administration (FHA), U.S. Department of Veterans Affairs (VA)and U.S. Department of Agriculture (USDA) loans, as well as down payment assistance programs. As of Thursday, per the Nationwide Multistate Licensing System (NMLS), it had 18 active branch locations and 86 sponsored loan officers.
In 2022, HousingWire reported that the company exited the wholesale channel due to the competitive pricing landscape. But it continued to serve retail clients throughout the western U.S.
Mountain West was founded in 1990 by president Gary Martell and chairman of the board Michael Douglas. Its management team is not joining ML Mortgage, Delehanty said.
But the company’s branches and loan officers will transition to ML Mortgage, which had nine active branches and 63 loan officers as of Thursday, according to the NMLS.
Mortgage platform Modex shows that ML Mortgage originated about $135 million in loans in 2023. Meanwhile, Delehanty said Mountain West produced $255 million. But higher mortgage rates for longer periods have strongly impacted the business.
According to Delehanty, Mountain West is “looking for a new partner with whom we can create a different opportunity.” One idea would be a ”builder that wants to add a lending arm,” he added.
Mortgage lenders have been engaging in M&A deals amid rising rates.
So far this year, CrossCountry Mortgage acquired Amcap Home Loans, Guild Mortgage struck an agreement with Academy Mortgage, and New American Funding (NAF) nabbed Draper & Kramer Mortgage Corp. Last month, CMG Financial acquired Norcom Mortgage‘s retail assets.