Loan Servicing Role

Would you accept a role in loan servicing? Its a company that services commercial mortgages. Not sure if I should take this role or to keep looking because there's not much modeling or underwriting in this position since thats already done ahead before the loan is even made. I think this would be considered "back office."

I'm looking to eventually head into development in the future. Right now its kind of all I have on the table at the moment, still looking for analyst type roles.

 

I just graduated college this past December. I am nearing the end of an internship that offered experience in loan servicing and commercial mortgage banking. Its not a big company, but has good west coast coverage. Prior to this internship I didn't really have any hands on experience with real estate. Should I take it or keep looking????

 

I 've worked at two Servicers in the past. The first was as a portfolio surveillance analyst. I collected borrower financials/created OSARS and then did a lot of modeling to see how upcoming rollover/new leasing would effect the property. The second was in an internal valuations role. Obviously there is a lot of modeling/underwriting going on there just by the nature of the job.

Is it a spot at one of the national Servicers like Wells/Midland/Berkadia/HFF or is it at a small shop? If it is at one of the larger places, then it isn't a bad way to break in so that you can eventually lateral around. I know several people who worked in servicing and then made the move to AM, debt placement or origination roles later on. I personally moved from servicng to AM (debt) and from there to acquisitions (equity).

 

I'm going to assume you've been there since the beginning of this year, if thats the case, it wouldn't hurt to stick around until the end of 2016 at your 1 year mark and leverage that experience to start looking. I know young guys that started from a servicing type of roles and move into AM/Credit analyst role after.

You can always spin those experience in a favorable way for your next job. You can always network with the guys on the deal side at your firm and lateral in that way.

But if you can afford low paid internships at development/repe firms then by all means do that. There have been a few people I know that get started through that route using their family's network.

Good luck!

Array
 
Best Response

Ok - I think people here are overestimating what this role is. I assume it is commercial bank, back-office, where you're working with loan closers to process the underwriting documents, update the loan booking system, etc. Could also include some residential mortgages, auto-loans, refinances. If that's the case, read-on:

I'll be blunt - this job sucks. It's about as BO as you can get, BUT there are exit opportunities. If this is a middle market size bank at a minimum, they will most likely have a credit-analyst training program. If you can jump into that program via strong performance, networking, you can go a lot of different places. You could also work in servicing, and find your way to other areas of the bank, such as Risk or Analytics. This of course assumes, the bank is not so large that everything is formal and lateral moves are impossible.

My advice to you, if you choose to accept it, is to learn something that nobody else has. I assume that's going to be Excel, because most people in loan servicing are middle aged and barely know how a computer works. In that event, you can become a rock star on the project scene. You can build dashboards, reports, and get some traction with management if you're young and hungry. Go off the script and find ways to make the job better. If you can do that, you'll have opportunities.

The next stage would be the 'give me a boost' stage - and this is where either graduate school, or something like the CFA exam comes into play. If you can get through Level I, you'll have a great shot (and be way ahead) of most credit analysts, or you can jump into a training program, and move your way towards a commercial banking career. Analyst programs that focus on debt underwriting also can lead to careers in Real Estate, and at the extreme, distressed debt investing at a Hedge Fund.

So the short answer is hell no - you should pass on this, BUT if you dont have any other options, which sounds like the case - you can do this role for a year or two, and if you're a rock star, you can network and climb your way out of it. It may take graduate school and the CFA exam, but within a few years you may find yourself in Asset Management in a sweet role you never thought you'd get to. Trust me, I know this is all possible, because I've basically laid out my career progression.

Happy to expand on certain aspects if you'd like. I'm a CFA Level III candidate with a MSF acquired PT while working and prepping for Level I and II. I went from deep back office to front office in the span of 3 years. It can be done. And, you can always take the job and quit for another, better one if it comes along.

 

GoldenEagle2009 Its a financial intermediary that does commercial mortgage banking, so it doesn't function like a typical bank. We share relationships with banks and life companies that don't want to spend the money to have a loan servicing/cre team and therefore they outsource that work to us. As far as the description of the role, you got it pretty much spot on. Its a smaller company that doesn't have the recognition or the resources say like Wells does. So there aren't too many other opportunities to move around to there. If i took it, I think the only thing i could do, is like you said, make it better, be a superstar and show how valuable I am. However, since its a small company that does commercial mortgage banking, so it may be easy to transition to the brokerage/production side of the company.

Would it be bad to take it, but then find something else in 6 months, and leave in such a short time? And would it ever be better to keep looking rather than take this offer? I can probably afford to go without work right now, but who knows when the next job comes around though?

 

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