Mortgage lender and servicer OCMBC has acquired HomeStar Financial Corp., marking a significant expansion across the country.
The acquisition formally closed on Aug. 29, OCMBC announced Thursday. The terms of the deal were not disclosed.
“Their extensive experience in servicing and their commitment to providing outstanding customer service align perfectly with our values at OCMBC,” Serene Vernon, president of OCMBC, said in a statement.
Founded in 2001, California-headquartered OCMBC originates in the wholesale, retail and correspondent channels. It is licensed in 48 states and the District of Columbia.
OCMBC, doing business as LOANStream Mortgage, posted $3.56 billion in wholesale volume in 2023, making it the fifth-largest wholesale lender in the country, according to Scotsman Guide. OCMBC also originated $2.1 billion in volume in nonqualified mortgage (non-QM) volume, placing No. 2 on Scotsman Guide’s list of the country’s largest non-QM lenders.
HomeStar — founded in 2002 as a local mortgage bank in Georgia — offers conventional, government and jumbo purchase loans, as well as refinances, reverse mortgages and a doctor/medical professional mortgage program.
HousingWire previously reported HomeStar’s decision to suspend its retail operations by the end of 2023 due to mortgage volatility and extreme margin compression.
Mortgage data platform Modex showed that HomeStar posted an origination volume of $2.45 billion in 2022, but it fell victim to higher interest rates, leading it to cease its retail operations last year.
“As we head into a period of historically seasonal lows, for protection, with no end in sight for the margin compression or realistic prospects of lower rates, I have decided not to incur further financial risk over the coming months,” Wes Hunt, founder and CEO of HomeStar, said in October 2023.
The mortgage industry continues to consolidate as higher interest rates and low profit margins are making it difficult for smaller lenders to survive.
According to the Stratmor Group, a mortgage advisory firm, more than 100 mergers and acquisitions have taken place since 2021, with 80% of the deals involving large independent mortgage banks acquiring smaller IMBs.
