Rapidly expanding Cleveland, Ohio-based CrossCountry Mortgage (CCM) has struck a deal to acquire the smaller retail mortgage lender AmCap Home Loans and bolster its operations in Texas.
In an exclusive interview with HousingWire, Ron Leonhardt, a former mortgage broker who founded CCM in 2003, confirmed conversations with the parties started years ago, although the transaction closed on Tuesday.
Leonhardt first met Garrett Clayton, AmCap’s CEO, about a decade ago. They hit it off.
“We’ve always talked about working together. We had been talking about this off and on for probably two or three years. It just was the right time,” Leonhardt told HousingWire.
Terms of the acquisition, including financial information, were not disclosed.
In December, the National Multistate Licensing System (NMLS) showed that AmCap had more than 400 sponsored loan officers while CCM had over 4,000. As of Jan. 10, AmCap had only 43 sponsored LOs due to some having already transitioned to CCM. As a result, CCM had 4,200 in total, per NMLS.
Leonhardt said that AmCap employees will participate in a two-week training program at CCM, with the integration expected to be complete in 45 to 60 days. AmCap will become a division of CCM, and Clayton will have a leadership role within the company.
“I am very proud of what we built at AmCap over the years, but I fully recognize what got us here wasn’t going to get us to where we ultimately wanted to be as a business unit,” Clayton said in a statement.
In terms of volume, CCM claims it originated $31.6 billion in loans in 2023.
AmCap, founded in 2002, is a much smaller lender. Mortgage tech platform Modex shows that it produced about $2 billion in mortgage loans over the last 12 months that ended in November, about half conventional loans, 32% Federal Housing Administration loans and 13.5% Department of Veteran Affairs loans. In total, 78% were purchase loans.
Everything’s bigger in Texas
Although smaller, AmCap fits CCM’s goal to expand geographically through mergers and acquisitions. However, the lender’s primary strategy remains to grow organically by hiring LOs nationwide.
“Our basic strategy for growth has always been organically, getting into markets one by one. But recently, I’d say since maybe 2018, we’ve done six or seven of these [M&A deals] –LendUS was the biggest of them all,” Leonhardt said.
In April 2022, HousingWire reported that CCM acquired LendUS, which had originated $7 billion in 2021 through 350 loan officers and roughly 100 retail branches.