Anyone build their own loans to sell?

[Matt Maluchnik]

I'm speaking with a local mortgage lender...and it's basically a small business that packages loans..then sells them to a larger entity that buys them.

As someone who's started a couple companies...I thought to myself...well why don't I just get who they are selling to and package my own loans as I do my own deals...cut out the middle man and save a few thousand dollars on broker fees ect.

Anyone else currently do this?  Did I simplify this too much?  I'm assuming it's just finding the criteria this BUYER has, then filling out the proper information to sell to them.  I close myself using Cash from my new 'mortgage company', but immediately resell the loan to one of these companies.

[Bill Gulley]

Yep, it's about that simple, except you don't get a brokerage license, capital requirements, bonded, state registration, vetted with title insurance, accepted as an originator by the mortgage banker/wholesaler out of a cereal box. Probably going to jail if you don't follow the business requirements, being in violation of a string of federal finance laws that govern origination and brokerage of mortgages. 

It's a bit of a catch 22 as well. You can't learn the business in a few months. Before any wholesaler will buy from you, you'll need to  show expertise and experience, just having notes or money doesn't open the door. 

Go work for a broker, in about 5 years and a few million in originations, you can meet the legal requirements and go into business. 

It will be cheaper to just pay your broker! :)