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Do something you actually want to do. I don't know why people interview for jobs that they don't want, or can't articulate why they want them. When I interviewed, I was just honest.
The honest answer is that you want to make a bunch of money. I know brokers who are killing it right now. That is all assuming you are in a good shop of course.
Textbook answers: - Fast paced, deal focused environment - Exposure to different asset classes and financing structures - Entrepreneurial 'eat what you kill' attitude
I think about being a broker all time. Much more money. However, when the market corrects your pay dries up and lowest on the pole is first to get cut. Then you’re out in a bad market, poor because you blew all your money, and no one wants to hire you because you have the stigma of being 'a broker'.
It's not brokering, its originating and lending their own money.
Generally, the term 'mortgage banker' refers to a mortgage broker. Couldn't tell from your post.
My impression of mortgage banking is a specialized lender that lends out their capital for only mortgages, doesn't take deposits like a bank, and then sells the mortgage. Do you like real estate? Not sure if you're talking about residential or commercial mortgage banking, but if it's commercial, I can see it being very interesting. It's debt investing. You'll get to underwrite loans and analyze properties, perform market analyses, etc. If you want a career in real estate, it's experience underwriting real estate, so it would probably be a good role. What are your career goals?
Side note: Was analyzing a deal today and read the background on the borrower. He is currently a mortgage banker, he has been at REITs, banks, mortgage banking shops, etc. He is also currently a pretty successful investor. Not saying mortgage banking is what made him a successful investor, but you utilize similar skills in evaluating deals. One you're putting your capital at risk via debt and the other via equity (usually),
Mortgage banking isn't a job that has "exit options"--it's a career in itself. It is the exit option, so to speak. I've got a lot of family and friend (and, loosely, even some business) connections to this industry. The most likely scenario is that you will attempt to originate for less than 6 months and quickly drop out when you realize you can't make any money at it (it takes a unique person who can succeed in this business). If you make $30,000 in year one you're lucky. In this market you might feast off of the refinance boom and make $60,000 in your first year; however, when the refinances dry up you'll realize that you spent no time developing your purchase money business and be forced to resign as you'll have virtually no business.
Based on my observations, about 2/3 of originators will drop out of the business within 5 years. Of the remaining 1/3, about 20% of the originators will do 80% of the business. This means that between 5-10% of originators from day 1 will find a lucrative career. If you happen to be one of those 5-10% you've got yourself a pretty amazing career.
Some possible answers in an interview may include:
1) The challenge 2) The thrill of the chase and exhilaration of victory 3) Working closely with people 4) Autonomy and intellectual independence 5) Entrepreneurial nature of the business 6) Genuine intellectual interest in the industry (mortgage bonds, secondary market, regulatory environment, the economics of the business, large impact on the U.S. economy, the politics of the industry, real estate, etc.)
It's DEFINITELY not a job that you go into lightly. If you're not 110%, balls to the wall committed then don't waste your time. The majority of people who are totally committed will not be able to make it.
If you're not commission-only, then you can expect a salary of about $30,000. That's the business model. If you pay excellent commissions then it is harder to compete on price. If you pay crappy wages then you can afford to compete on price. Don't think for a second that an entry-level loan officer is going to get paid a $50 or $60,000/year salary.
Ok, well, that's not mortgage banking. If that's what he means then he's using improper terminology, or at the very least terminology that is not commonly used. CMBS origination is called "origination" in everyday lingo.
With regard to the link you posted, you'd be surprised how little they are paid as many of these types consider compensation the contacts and mentorship of their boss, as well as potential bonuses.
Just last week I grabbed a beer with a friend who is joining one of the more reputable brokerage firms (think JLL) where he'll be arranging debt. He explicitly described the pay structure as "investment bank" style. He will have a base salary and it's definitely not commission-only. And he's not even in NY.
Yes, I personally know a few mortgage bankers very well who work on commission-only and really have to hustle, but they do not work at, say, Eastdil.
I'm sorry, but you simply don't have a clue what you're talking about. Nobody refers to commercial lending as "mortgage banking". I know this because I have family members who, well, own a mortgage bank. That doesn't mean that it isn't "mortgage banking", but colloquially "mortgage banking" is known as single family origination. If you're originating commercial loans there would be other commonly used terms, like "commercial originator" or "multifamily originator" or "commercial lending/lender"--nobody generically refers to commercial lending as "mortgage banking". That's just common industry knowledge and that you would push this forward as reasonable demonstrates your breathtaking ignorance of real estate at large. Why don't you leave this discussion for people who know what they're talking about, ok?
The role you're talking about I was offered as one of several offers out of college in the Mid-Atlantic. I know what the goddamn pay structure is since I was offered the position and have friends that currently work the position--and not with Marcus & Millichap but with firms like Cassidy Turley and Cushman & Wakefield. Guys can expect higher base salaries with several years of related work experience, but without related work experience you're in the $30,000 range with some quarterly bonuses, absolutely.
By the way, "arranging debt" at Jones Lang Lasalle is not even remotely in the ballpark of being called "mortgage banking". That's like me haughtily saying to you, "BTW, I had a beer with a guy who works at Eastdil's real estate investment banking group and he gets paid Wall Street type money, so HA, mortgage banking analysts do get paid big bucks." At this point you've completely conflated industries and positions and are just talking out of your ass. I mean, it's breathtaking--truly breathtaking at this point.
Just remember the old adage--it's better to be thought a fool than to open your mouth and confirm it.
Prospie I think knows what hes talking about because I already told him the details in a PM.
potato potahto: JLL, northmarq, marcus & millichap, HFF, eastdil, cushman, cbre, cassidy turley etc etc are all just brokers who find you a loan and take a fee at closing. If you think arranging debt at JLL is somehow vastly different, that's fine but some would argue that it's the same thing at the end of the day. But back to the point, you were talking about being an entry-level loan officer and making potentially $0. I mean single-family, you think he was talking about single-family? The OP was talking about an analyst job on the debt side where one would hope he gets paid a little better than a janitor or waiter.
I know you know what you're talking about, but for someone right out of college, you can't blame him for describing the process of underwriting potential loans on individual properties as mortgage banking.
Exactly. My idea's always been: Mortgage Banking = Capital Brokerage (not necessarily just secured debt; as well as advisory) = Capital Markets/Capital Group (at national brokerage houses - JLL, CBRE, etc.) = Real Estate Investment Banking (at some smaller shops, though some like to reserve "REIB" for traditional investment banks who more customarily are advising real estate and lodging corporations, not so much asset level transactions)
It's all the same and i prefer to use the title: capital brokerage, or to the extent a significant component of the service provided is advisory and deal structuring as well as private placements and structured financings in some cases: real estate investment banking - as much as it may bother traditionalist investment bankers (i.e. REIT, REOC, Hotel Corp. advisors)
Here's some more examples: The Carlton Group Cushman Wakefield Sonneblick Goldman Newmark Grubb Knight Frank George Smith Partners Rockwood Real Estate Advisors Latitdue Managment (formerly Legg Mason) etc.
It's not potato potahto. What you're describing at JLL is not mortgage banking. In fact, there are strict regulations about what can even be called a mortgage bank. The mortgage bank my family members own can't legally be called a "mortgage bank"--it has to be called a "mortgage lender" in legal paperwork and advertisements and websites. "Arranging debt" isn't even in the ballpark of "mortgage banking".
Unless you also define real estate investment banking as "mortgage banking" you are so far off base that it's not even funny.
Because you like making a turd look like a Ho-Ho?
Either way you define it, mortgage banking sucks.
What the difference then? Not sarcastic, I'd seriously like to know.
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