Only days after acquiring Argent Mortgage, Citi has already launched a new website and plans to “begin making loans” on September 17th.
According to the Citi website, mortgage brokers who were previously approved with Argent Mortgage are now Citi Residential Lending approved, and previous status their with the company will not change.
The company will also offer valued-added services such a national sweepstakes to generate qualified leads, a “Mortgage University” offering continuing education, and a suite of professional marketing tools.
Citi will use Loan Genius as its online loan origination system, Argent’s previous online submission and approval tool.
I took a look at the broker application form, which states that, “Citi Residential does not make loans that may adversely affect the consumer in the future such as loans with balloon payments or negative amortization.”
So it looks like option-arms are definitely out, not that anyone wants one anyways.
The agreement also says, “Citi Residential Lending does not originate loans defined as “high cost”, but allows “total broker compensation to 5% of the loan amount” which in many cases can be quite high (yield spread premium).
Start argument here.
Regardless, Citi looks to take advantage of Argent’s proven platform, though it plans to make some changes to mitigate risk and avoid being just another “subprime shop”.
Update: I’ve already been told by one broker that his application was declined because Citi wants a pledge of at least 3-4 deals a month.