Our History — A Window Into The Future
Just as a mortgage underwriter assesses a loan applicant’s financial history to predict the likelihood of future loan performance, an understanding of a company’s history can provide a sense of what its future may hold. Early struggles and effective adaptation to challenges and a changing environment forge the essential character of a company and those who lead it. Today, Homestead Funding Corp. is the dominant independent mortgage banker in our primary marketplace. Encouraging a supportive corporate culture underpinned by mutual respect, cooperation and service to our community, we have been recognized by our staff as one of the Great Places to Work in the New York Capital District.
Homestead can trace its roots back to United Mortgage Services, a registered NYS Mortgage Broker based in Niskayuna, NY. This nascent mortgage company was the creation of Mike Rutherford, Homestead’s founder and Chief Executive Officer. The company started with six loan originators supported by an office manager and a loan processor. Counted among this original mix of employees was Vince O’Neill, who is now Homestead’s Vice-President in charge of secondary marketing. It was the spring of 1988. The Savings & Loan crisis was making headlines and the economic recession of 1990 to 1991 was looming unseen just over the horizon. This crisis had caused a serious slowdown in both the finance industry and the real estate market. It was a challenging time for veteran participants in the mortgage lending industry, even more so for a tiny startup operating on a shoe string budget.
These early years tested the resolve and resourcefulness of Mike and his young management team. In late 1988 United Mortgage Services merged with Builder’s Funding Corp., a struggling NYS licensed mortgage banker owned by a consortium of local home builders. Mike recognized the growth opportunity provided by the mortgage banking license held by Builder’s Funding. He successfully blended the talented staff of both companies and quickly reversed the declining fortunes that had plagued Builder’s Funding. The newly merged operation, with a staff of twenty employees, was renamed United Builder’s Funding Corp. Joining Mike as a result of the merger was Homestead’s current Chief Operating Officer, Anthony Felitte; our Vice-President of Quality Control and Licensing, Jacqueline Varrone; and Dawn Keyrouze, our Loan Settlement and Delivery Manager. Jacqueline also manages our regulatory compliance activities. At Homestead, we expect all employees to observe a high standard of ethical behavior, which begins with understanding and complying with consumer protection laws.
Following three years of uninterrupted sales growth and profitability, in 1991, Mike and his staff were abruptly confronted with a new crisis - one that struck a lot closer to home. A difference of management philosophy resulted in a falling out with the builders who owned and controlled United Builder’s Funding Corp. Events unfolded quickly. Mike responded decisively and immediately focused his attention upon negotiations with the owner’s of Homestead Financial Services, a NYS licensed mortgage banker with a small loan origination office in Albany, NY. The owner’s of this operation had been searching for a management group that could reinvigorate their company. The timing was right and within a period of less than two weeks virtually the entire staff from United Builder’s Funding followed Mike to Homestead Financial Services. Having weathered this unexpected storm, the office quickly settled in and got back to business as usual. Among the new employees who joined Mike’s team at this time was Jane Borbee, who is now Homestead’s Vice-President of Operations; and Ed Moriarty, our Vice-President of Sales. The key people destined to become the management team that would lead Homestead to two decades of continued success were now in place.
Over the next few years, Homestead Financial Services prospered in the Albany market. As 1994 approached, Mike realized a longstanding goal by securing his own NYS mortgage banking license. Having enjoyed a good relationship with the owners of Homestead Financial, Mike invited them to invest in his new company. They became minority owners. Now master of his own destiny, Mike incorporated Homestead Funding Corp. in February 1994. On January 1, 1995 Homestead Funding opened for business and an exciting new chapter in the company’s story began. That year, Homestead Funding, which had grown to forty employees, originated 160 million dollars in residential mortgage loans.
By May 1998 Homestead Funding Corp. had continued its strong expansion pattern and on the day we moved to our current main office at 8 Airline Drive in Albany, NY there were over one-hundred mortgage professionals calling Homestead home. Jeff Mason, our current Human Resources Director, had also joined the growing Homestead management team. In July of the same year, a savings bank that Homestead had enjoyed a mutually beneficial business relationship with, Hudson City Savings Institution, went public and formed Hudson River Bancorp. Seeking to use a portion of the funds raised with its stock offering for investment in complementary businesses, Hudson River executives saw the advantage of investing in a secure and well managed business they already had a great relationship with. Hudson purchased a minority interest in Homestead, providing us with the capital infusion needed to leverage larger warehouse lines and continue the steady growth track the company had been on.
August 2000 saw Homestead expand its geographic footprint when several former loan origination offices of Republic Bancorp., located in New York and Connecticut, joined our team. Another Republic Bancorp office in Massachusetts came onboard shortly thereafter.
From 2000 to 2005 Homestead Funding Corp. enjoyed increasing loan volume. We invested in new technology, expanded our IT department, launched an in-house marketing department and hired a full-time professional trainer to support our growing network of loan originators. In January 2005, First Niagara Financial Group, parent company of First Niagara Bank, purchased Hudson River Bancorp and with it the minority interest in Homestead Funding Corp. The easy credit environment that fueled the refinance and housing construction boom during these years was followed by what many consider to be the worst financial crisis since the Great Depression of the 1930’s. The fallout for the residential mortgage lending industry was immense resulting in the collapse of several large national and regional financial institutions. Many smaller lenders were also forced to close their doors due to an inability to obtain the short-term financing needed to fund their operations. In an environment where only the strong would survive, Homestead proved itself equal to the task.
Over the years Homestead Funding Corp. has successfully adapted to changing circumstances and emerging challenges. A loyal and stable workforce led by management that recognizes and rewards the effort and achievements of our people; that instills an expectation of high ethical behavior; and that chooses to invest wisely in technology and training has made this achievement possible. With offices in Connecticut, Delaware, Massachusetts, Maryland, Pennsylvania and Virginia and seventeen locations throughout Upstate New York, Homestead now employs approximately two-hundred and eighty of the best people in our industry. We have originated billions of dollars in residential mortgage loans and offer experience serving the unique needs of a diverse market place in multiple states. We have over two decades of company history that provide every reason to view our future with confidence and optimism.