Making non-agency pricing and availability simple

by Ryan Smith06 Nov 2018

As the non-agency space expands, originators who’ve previously focused exclusively on traditional loans need to expand their toolbox. But the non-QM space comes with its own rules and complexities, which can make it a daunting space for some originators. That’s where a pricing engine like LoanNex comes in.

“LoanNex is a non-agency-focused pricing and availability engine that’s specifically configured to make the complex non-agency process accessible to loan officers and consumers,” said LoanNex co-founder and principal Ken Niemann. “If a loan originator goes to LoanNex, they can go through a very familiar legacy-type pricing-engine process – but it allows the user to do a secondary and tertiary level of screening to dig into the requirements that are so prevalent in the non-agency space.”

LoanNex started building its pricing and availability engine in 2014, Niemann said. Within the last year, the rapid growth of the non-agency space has kept the company busy.

“In 2017, we started to grow fairly quickly,” Niemann said. Obviously, the growth in interest rates has created a need for different products – especially for disenfranchised borrowers. Prior to the rise in interest rates, those customers were overlooked by the mortgage industry.”

But with rates on the rise, the non-agency space is becoming vital for originators, Niemann said.

“There was no need to do (non-agency loans) before; there was plenty of volume,” he said. “The need is there today. it’s glaringly obvious that lenders who don’t fill out their product mix are not only losing business – they’re losing loan officers to other lenders, and they won’t be able to service their referral partners. Everyone needs to have this product in their arsenal.”

LoanNex supports originators in the non-agency space by providing a pricing and availability engine that feels familiar.

“The types of non-agency loan – and the complexity of the loans – are growing,” Niemann said. “In an industry that’s been focused on agency loans, that complexity is very hard to handle at point of sale. We take a complex product and make the process easier.

“In the last 10 years, due to regulation, the mortgage business went from a sort of craft business to a very automated, technology-based business,” he said. “The fundamental problem in this space prior to 2017 was fear of regulation. The primary problem these days is getting originators used to technology.”

That’s why LoanNex was designed to look and feel like a traditional pricing engine.

“We had to create a solution in the non-agency world that mirrored that solution,” Niemann said. “Originators like the way our workflow is laid out. It takes them down a path without having to learn a new process or redo their entire workflow.”

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