SOURCE: Primary Residential Mortgage, Inc.

September 07, 2007 19:12 ET

PRMI Expands in Midst of Shrinking Mortgage Market

SALT LAKE CITY, UT--(Marketwire - September 7, 2007) - Since late 2006, over 140 U.S. lenders have closed their doors for business. As the liquidity crisis continues to create challenges for many mortgage lenders, Primary Residential Mortgage, Inc. (PRMI) has been rapidly expanding its operations. With over 40,000 mortgage professionals losing jobs since the beginning of the year, PRMI has responded with aggressive recruiting. Distribution of new branch applications has increased 98%, from 279 in August 2006 to 554 in August 2007, and the company has announced plans to add over 35 employees to the Business Development Team at their corporate offices.

"PRMI's business model has insulated the company from current market challenges," says David Zitting, CEO and President of PRMI. "First, PRMI made the decision years ago to distance itself from the sub-prime market. While we offer loans that fit every type of borrower, our core strength has been in traditional prime products. And second, while many lenders have been caught without investors for their loans, PRMI utilizes a model whereby all of our loans have a guaranteed investor -- before the loans are funded. These have proved to be wise decisions and have allowed us to be in the strong position we are today."

PRMI sells all loans via best efforts flow execution (each loan is committed up-front prior to funding) and to date there have been only two units slated for re-direct. This execution model has allowed all other loan volume to execute normally. Other companies have suffered as a consequence of selling loans via sophisticated secondary market models that create significant issues with mortgages held for sell that are ultimately not purchased by investors.

In addition, PRMI strictly follows the specific investor guidelines and has only booked loans on its warehouse lines that are properly approved and committed for sell. This gives PRMI the ability to fit any loans with issues into other investors. The company has taken the additional step of sequestering all product sells that do not fit standard agency product to a select group of investors.

"I am watching the markets and PRMI's potential risks closely," says Zitting. "As of today there are zero issues that would cause PRMI to fail. We are in direct contact with our investors, banks, and warehouse facilities to ensure we are conducting business in ways that they are comfortable with. To date they have assured us that we are in excellent shape."


Headquartered in Salt Lake City, Utah, Primary Residential Mortgage, Inc. (PRMI) was founded by David Zitting, Jeff Zitting, and Steve Chapman in 1998. Since its inception, PRMI has evolved from a four-person business to a nationwide multi-billion dollar operation with 800 employees working in approximately 200 Branches in 47 states. Branches operate under the PRMI brand or as DBAs as part of the Divisional Joint Venture and Consortium Partner programs. Serving all segments of the market, PRMI is a privately held, debt-free company that focuses primarily on traditional loan products.

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