For important risk and disclaimer information, Click Here.
|
vgarg@castleplacement.com
|
|
(917) 733-5414
|
Overview
AnnieMac Home Mortgage (“Company”) is seeking $30-50MM capital to pursue strategic growth opportunities
Founded in 2010, AnnieMac is a NJ based independent mortgage bank (IMB) providing residential mortgage loan origination, servicing, support, and value to clients, partners, and the community
Since 2011, AnnieMac has funded over $32BB in mortgage loans
Well-capitalized and with a talented management team, AnnieMac is pursuing growth both organically and inorganically to increase market share and achieve greater economies of scale
Inorganic growth strategy will include acquisition of strategic assets, high producers, and branch acquisitions.
Opportunity
Over the past two years, elevated interest rates and limited home inventory has caused mortgage origination volumes to drop by over 60% nationally
Mortgage companies which were under-capitalized or lacked the right management skills necessary to traverse these challenging conditions, are available at valuations not seen since the Great Financial Crisis of 2008/09
This has created a generational opportunity to rapidly grow market share through opportunistic acquisitions of deeply discounted companies and related assets
AnnieMac has identified several such large and midsized acquisitions targets with additional quality regional opportunities in pipeline. Some of these can be engaged immediately
Strategy
Target for acquisition, a select subset of mortgage banks and companies with strong loan origination capabilities
Target regional sales teams that are producing the right mix of product at the necessary net margins
Execute on a growing queue of already identified big and small targets, that are ready and willing to onboard
Goal is to become a Top 20 mortgage originator and servicer by end of 2025
Specific Risks
Interest Rate Risk: Mortgage industry is sensitive to prevailing interest rates and could be adversely impacted depending on other market variables
Default Risk: Higher interest rates may negatively impact economic conditions leading to declines in home values, higher mortgage payment delinquencies and/or defaults leading to losses for the firm
Prepayment Risk: Borrowers could repay their loans faster than anticipated, thus reducing future expected interest payments
Liquidity Risk: The firm funds long-term mortgages with short-term funds, making them vulnerable to liquidity risks
Economic Risk: Global economic and financial changes, geopolitical tensions, or natural calamities that could impact interest rates, real estate prices, or housing demand
Reputational Risk: Consumers could refrain from doing business with the firm as a result of public allegation concerning data breaches, privacy violations, fraudulent acts, or breaches of statutory/regulatory requirements
Retention Risk: Key sales staff may drive significant percentages of loan originations. Key sales staff attrition may result in losses for the firm
Legal/Regulatory Risk: New laws and/or regulations, or changes to existing laws and/or regulations, can increase operational costs, or change the competitive landscape in the residential mortgage market
Private securities are speculative, illiquid, and carry a high degree of risk – including the loss of the entire investment