IBJNews

Local mortgage firm lands $25M in private equity

Back to TopCommentsE-mailPrintBookmark and Share

Indianapolis-based Stonegate Mortgage Corp. has received funding from Long Ridge Equity Partners, a private-equity firm, to help it expand in mortgage origination and servicing, the company said Monday.

The lender will use the money partly to continue retaining mortgage-servicing rights generated by its lending, Stonegate CEO Jim Cutillo said. The company may also buy existing servicing contracts from banks and build a portfolio of so-called jumbo loans, he said. Jumbo mortgages are larger than allowed in government-supported programs, currently as much as $729,750 for single-family properties in certain areas.

The investment was $25 million, according to Whit Clay, a spokesman for Stonegate. Long Ridge sees an opportunity to profit through a firm able to acquire servicing rights because of the low interest rates and high credit quality of new loans and recent retreats from the business by several large banks, said Kevin Bhatt, a partner at the New York-based firm.

“For us, a flat overall market is actually OK because there’s more market share available,” Cutillo said.

Stonegate lends directly to consumers, as well as through brokers and correspondents. It originated about $1 billion of mortgages last year and expects volume may total about $2.5 billion this year and as much as $5 billion in 2013, according to Cutillo. It owns about $1.5 billion of servicing rights, he said.

Stonegate will appoint Richard Mirro, former chairman and CEO of North American Mortgage Corp., to its board as part of the deal. Mirro is a member of Long Ridge’s financial-services advisory board.

Stonegate was founded in 2005 and was based in Fishers before moving its headquarters last year to The Precedent office park near Keystone Avenue and East 96th Street in Indianapolis, to accommodate a planned expansion.

In December 2010, Stonegate pledged to hire 300 workers by 2015 and expects to add 100 of those by the end of this year, CEO Jim Cutillo said. With $15.4 million in revenue at the end of 2010, the firm was the second-fastest growing company in the Indianapolis area, according to IBJ statistics. Its grew revenue 491 percent from the previous three years.
 

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. I never thought I'd see the day when a Republican Mayor would lead the charge in attempting to raise every tax we have to pay. Now it's income taxes and property taxes that Ballard wants to increase. And to pay for a pre-K program? Many studies have shown that pre-K offer no long-term educational benefits whatsoever. And Ballard is pitching it as a way of fighting crime? Who is he kidding? It's about government provided day care. It's a shame that we elected a Republican who has turned out to be a huge big spending, big taxing, big borrowing liberal Democrat.

  2. Why do we blame the unions? They did not create the 11 different school districts that are the root of the problem.

  3. I was just watching an AOW race from cleveland in 1997...in addition to the 65K for the race, there were more people in boats watching that race from the lake than were IndyCar fans watching the 2014 IndyCar season finale in the Fontana grandstands. Just sayin...That's some resurgence modern IndyCar has going. Almost profitable, nobody in the grandstands and TV ratings dropping 61% at some tracks in the series. Business model..."CRAZY" as said by a NASCAR track general manager. Yup, this thing is purring like a cat! Sponsors...send them your cash, pronto!!! LOL, not a chance.

  4. I'm sure Indiana is paradise for the wealthy and affluent, but what about the rest of us? Over the last 40 years, conservatives and the business elite have run this country (and state)into the ground. The pendulum will swing back as more moderate voters get tired of Reaganomics and regressive social policies. Add to that the wave of minority voters coming up in the next 10 to 15 years and things will get better. unfortunately we have to suffer through 10 more years of gerrymandered districts and dispropionate representation.

  5. Funny thing....rich people telling poor people how bad the other rich people are wanting to cut benefits/school etc and that they should vote for those rich people that just did it. Just saying..............

ADVERTISEMENT