Mason-McDuffie Mortgage Corp. Combines Old and New in Lending

Company Finds Success in Adhering to the More Stringent Lending Standards of Previous Decades

"What's old is new again" could be the theme at Mason-McDuffie Mortgage Corp., which opened a Hacienda office, its twentieth, in October 2009. The Mason-McDuffie brand has roots in a Bay Area real estate agency established in 1887. The current company, a mortgage bank, represents the third iteration of the name.

Since new ownership revived the firm in 2005, it has been steadily expanding through acquisitions and careful recruiting of loan officers. The original group of nine employees in two offices, in Colorado and San Ramon, has grown to more than 250 employees spread out among 21 branches in six states: California, Colorado, Indiana, Hawaii, Arizona, and Oklahoma.

It is an obvious success story, and a gratifying one in light of the industry's difficulties. One of the factors behind the success is the company's insistence on adhering to the more stringent lending standards of previous decades. Financing criteria have come full circle, points out Todd Brebner, who manages Mason-McDuffie's Pleasanton branch. In contrast to the frenzied days of subprime loans, borrowers once again must offer up pay stubs, bank statements, tax records, and a stack of paperwork in order to qualify for a mortgage.

"In a way we've gone back to the old school, when lending was a lot tighter," Brebner comments. During the housing bubble, "buyers who had a good credit score didn't have to provide documentation, but now they do. They might be reluctant, but that's one reason why we had the meltdown-because so many borrowers weren't qualified."

Another sign of more rigorous practices is the return of government-insured loans, which Brebner predicts will be "a big player" going forward. "FHA loans have been coming back into play over the last year," he explains, pointing out that the conforming loan limit has been raised to almost $730,000. This type of loan has been a real boon to California's first-time buyers, who are only required to come up with a 3.5 percent down payment.

Innovation mixes in with the traditional in the form of new mortgage options. A popular niche Brebner mentions is the new FHA 203(k) rehabilitation loan, which folds in funding to bring a distressed property back up to FHA standards for health and safety. Close oversight prevents fraud or waste. "The work must be done by qualified contractors. Once it is completed, an inspector is sent out to make sure everything has been done properly. We hold classes once a month in our office here to help prospective buyers understand how to comply," Brebner comments.

Homebuyer tax credits are also fueling the market, he notes. Looking to boost the state economy, at the end of March Governor Schwarzenegger signed a bill that re-established and extended the $10,000 homebuyer tax credit. The $8,000 federal tax credit, although close to expiring (property must be in contract by April 30 and closed by June 30; consult your tax professional), is also propelling sales.

With approximately $760 million in 2009 revenue, Mason-McDuffie has smoothly combined a blend of old and new practices in mortgage lending. For more information on the company and its products, visit www.masonmcduffiemortgage.com.

Photo: Ann Hufford, senior loan processor, and Todd Brebner, area manager of Mason-McDuffie Mortgage.

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