Is there financing available for investors? Part 1 of a series
By: Dennis Norman
For investors there is no lack of opportunities when it comes to real estate. The recession, record foreclosure levels and high unemployment are some of the contributing factors to why there are “deals” to be had. I keep hearing from investors though that the problem is financing. Even established investors with a good track record and existing banking relationships are finding that banks are reluctant if not flat out unwilling to loan money to investors at this point.
H. John Frank, Jr., President Paramount Mortgage Co.
To explore this issue and find out what types of financing is still available to investors I turned to someone I have known for over 20 years that is a highly respected mortgage banker, H. John Frank. John agreed to do an E-View TM to discuss financing issues for investors. John has been a great source of information and I want to be able to share everything I learned from him so I’m going to share his E-View TM in a series of posts over the next few days.
Here’s the beginning of my E-View TM with H. John Frank, the President of Paramount Mortgage Co. based in St. Louis, MO:
Q-John, can you please give me some information about your background and experience?
A-After graduating form University of Wisconsin I became a teacher for 3 years. I went to work for Gershman Investment Corp. in 1976 where I became the top producer there for nearly 10 years. In 1989 I bought into Paramount Mortgage Co. where I have become the President of the company. I have been the President of the Mortgage Bankers Association of St. Louis as well as the President of the Missouri Mortgage Bankers Association. I’m involved with the Home Builders Association as well as the St. Louis Association of Realtors.
Q-You mention the Mortgage Bankers Association, can you please explain what the MBA is and the significance to a borrower of a lender being a member?
A- The MBA is a group of mortgage bankers (not brokers) who oversee each other and abide by a set of guidelines that keep the borrower’s best interest in the forefront. The MBA teaches, informs and constantly tries to improve our members to improve the home buying experience for all, making home ownership one of the greatest goals for all who pursue it.
Q-You point out that the MBA is comprised of mortgage Bankers not Brokers. Can you please touch on the differene between a Mortgage Broker and a Mortgage Banker? Include any significance between the two to a borrower.
A- A mortgage banker originates processes and underwrites their loans. They also use their own funds at closing and service the loan for a period of time. Mortgage brokers originate and do some processing of their loans. Typically they cannot underwrite their loans and do not have any warehouse lines of credit so they must be subservient to the investor as to the closing and funding of the loan. The broker has no control of the loan (will the loan be approved, will the money be there on time, what if there is a problem at the closing table…it can’t be corrected quickly).
I’m going to stop here for today, I know; “so you’re stopping before you get to the part about availability of financing??”. Hey, I have to do something to try to get people to check back 
Seriously though, there is a lot to cover with John and I want to give him his due.
To contact John for help with your financing needs, or with questions, you can reach him by phone at (314) 372-4300, email at hjfrankjr@paramountmortgage.com or you can visit his company website at http://www.paramountmortgage.com/.
To read part 2 of this series click here
To read part 3 of this series click here
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