Citadel Servicing Corporation returned to origination in July, bringing in new leaders as part of its strategy to remain best-in-class. HousingWire spoke to Doug Perry, Citadel’s new managing director of Wholesale and Retail Sales, about his plans for Citadel and the current state of non-QM lending.
HousingWire: Tell us a bit about your background and your plans for Citadel Servicing as its new managing director of Wholesale and Retail Sales.
Doug Perry: I bring decades of experience to the table, having worked for a number of organizations, including Countrywide Home Loans, Indymac Bank and PennyMac. My most recent position was vice president of sales at 5 Arch Funding.
The strong foundation at Citadel Servicing is such an ideal situation to build on – growing the people, processes and technology that will fuel the next stage of market leadership. I am driving content and vision to the growth of the company with a keen eye to instituting best-in-class operating methodologies and a focus on exceeding customer expectations. The team here is not content to rest on their laurels; we are critical thinkers with a constant improvement mindset, which makes this opportunity a really good fit for me.
HW: What does the demand for non-QM lending look like now following the sector’s pause earlier this year?
DP: The events following the outbreak of COVID-19 rapidly led to a liquidity crisis across the mortgage industry, something seasoned veterans never thought they would witness again after the collapse of the housing market in 2008. But just like during the housing crisis, business practices will improve, whether that’s securing the balance sheet of the company or making the origination process more efficient for our brokers and consumers.
Unlike prior significant economic events over the last couple of decades, real estate fundamentals have remained sound, which provides a strong foundation to re-start lending in segments that were hard hit at the start of the COVID-19 crisis. The strong fundamentals will drive non-QM lenders and their capital partners to re-enter the space. Even though the sector paused for a short period, the demand for non-QM programs is stronger than ever.
HW: How is Citadel Servicing adapting to customer demand and other post-pause changes?
DP: At its core, non-QM lending is serving what has historically been an underserved borrower base post the financial crisis in 2008. Underlying demand for non-QM lending products remains strong.
Citadel Servicing has a strong corporate culture of service and that is one of the key drivers in our decision-making process. Things move quickly in the mortgage business and that is especially true now as we navigate the COVID-19 pandemic. The deep experience of the senior management team at Citadel Servicing allows us to react quickly to changing market conditions, which enables us to meet customer demand while also exceeding their expectations.
HW: How do you think an increase in Non-QM lending could impact the housing market?
DP: The impact will be profoundly positive in many ways. Housing demand in the purchase segment is very strong, which is a great underlying fundamental considering some of the weaker areas in the economy.
On the refinance side, we see strong demand in both rate-and-term refinances as well as cash-out refinances, especially with borrowers looking to tap into equity to do home improvements. Housing is such a vital part of the economy, assisting borrowers who did not have options just a couple of months ago will be a big boost to the housing market.
HW: Based on your experience in the sector and the current environment, what do you think the future of non-QM looks like?
DP: I think the outlook is very positive. Underlying housing fundamentals are strong and the attention to detail on credit standards and underwriting will allow the strong competitors to thrive. Deep relationships in both the primary and secondary markets are critical to long term success.
Overall, I am optimistic about the non-QM segment as a whole and the ability of Citadel Servicing to remain a leader in the space. We are providing programs and services to a sector that are often understated or overlooked.
