RPM Mortgage

RPM Mortgage is an independently owned and operated mortgage lender and broker based in Alamo, California whose roots in the Bay Area stem back to 1986. RPM Mortgage is owned by Rob and Tracey Hirt. The company has over 70 branches in Arizona, California, Colorado, Nevada, Oregon, and Washington with over 800 loan agents and employees. In 2015, they were fined $20 million for illegally steering consumers to costlier mortgages.[1]

RPM Mortgage, Inc.
TypeIncorporated
IndustryMortgage
FounderRobert Hirt, CEO
Tracey Hirt, President
Headquarters
Alamo, CA
,
United States
OwnerRobert Hirt, CEO
Tracey Hirt, President
Number of employees
800+[1]
WebsiteRPM Mortgage, Inc.

RPM Mortgage is a retail only lender and a direct seller and servicer of Fannie Mae loans. In 2010 RPM closed over $4.55 billion in originations with $1.3 billion of the originations being service-retained.[2] In 2013, the company provided $5.9 billion in funding in the form of residential mortgages.[1]

RPM offers various loan programs such as Conventional Purchases, Refinances, CalSTRS, Fannie Mae DU Refi Plus, Fannie Mae Home Path, Streamline Refinances, and Jumbo loans. RPM is a direct lender with full-eagle approval from the department of Housing and Urban Development (HUD) with the following lenders: Fannie Mae, GMAC, Chase, Bank of America and US Bank. RPM is an Equal Opportunity Lender

Ratings and reviews

It is accredited by BBB.[3]

History

The company has been rooted in the Bay Area since 1986. In 1991, Rob and Tracey Hirt invested in a small, start-up mortgage company– Residential Pacific Mortgage. In 1996, Rob was awarded the ownership rights to re-acquire Residential Pacific Mortgage, which eventually became RPM Mortgage.[4] Rob has led RPM to become one of the top 15 private, retail mortgage lenders in the U.S. according to the Scotsman Guide 2015 rankings. Since its first evaluation from Standard & Poor's in 2012, RPM remains the only privately owned U.S residential mortgage originator to consistently receive above average ratings across all eight key areas S&P analyzes.[5][6]

In 2011, the company was sued by the Federal Deposit Insurance Corporation for "breach of contract, negligence and negligent hiring/supervision". They later settled out of court for $550,000.[1]

On 4 June 2015, The Consumer Financial Protection Bureau filed a complaint in federal district court against RPM Mortgage and its CEO, Erwin Robert Hirt, for illegally paying bonuses and higher commissions to loan originators to incentivize them to steer consumers into costlier mortgages, illegally profiting tens of millions of dollars from 2011 to 2013. They were fined $20 million including $18 million as redress to consumers with an additional $2 million as a civil penalty, half of which is to be paid by CEO Robert Hirt.[1]

"RPM rewarded its loan officers for steering consumers into mortgages with higher interest rates," said CFPB Director Richard Cordray in a press release. "Today we are putting an end to RPM’s unlawful practices and holding Robert Hirt personally responsible for his involvement in them."[7]

After RPM was fined, the Mortgage Bankers Association (MBA) President David Stevens defended RPM, stating that the MBA repeatedly sought clarification from the Federal Reserve, which issued the loan officer compensation rule in 2010 under the Dodd-Frank act, and later from the CFPB, which took over its enforcement.

"The rule has long been a subject of industry confusion because of its broad and prescriptive reach into the smallest details of lender compensation plans and the lack of clear guidance on how to comply", Stevens said.[8]

References
  1. Gafni, Matthias (8 June 2015). "Alamo: RPM Mortgage fined $20 million over loan scheme". Contra Costa Times. Retrieved 10 June 2015.
  2. "Diablo Financial Profiles". Diablo Magazine. Retrieved 1 April 2011.
  3. "BBB Reliability Report for RPM Mortgage". Better Business Bureau. Retrieved 1 April 2011.
  4. Inc., RPM Mortgage (23 August 2016). "RPM Mortgage, Inc. | Our History". rpm-mtg.com. Retrieved 9 January 2017.
  5. "Top Retail Volume: Scotsman Guide's Top Mortgage Lenders 2015 - Scotsman Guide". www.scotsmanguide.com. Retrieved 9 January 2017.
  6. "Standard & Poor's RatingDirect" (PDF).
  7. "CFPB orders RPM Mortgage to pay $19M for steering consumers to costlier mortgages". 4 June 2015.
  8. "Trade group defends RPM Mortgage in steering case - Scotsman Guide". www.scotsmanguide.com. Retrieved 9 January 2017.
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