Analysis: Mortgage lenders dip toes into job pool

NEW YORK (Reuters) - Job seekers may want to call a mortgage lender. Not for a home loan, but for employment.

Employers slashed 8 million jobs during the latest recession and unemployment is near its highest since the early 1980s, but some in the mortgage banking industry are breaking that trend as the lowest loan rates in history spurs a refinancing boomlet.

With 30-year mortgage rates dropping nearly half a percentage point since the end of April and more than 0.60 of a percentage point from their year-ago levels to 4.57 percent, applications for home refinancing loans have spiked to their highest level in over a year.

To cope with the uptick in demand, mortgage bankers have been hiring employees.

John Walsh, president of Total Mortgage in Milford, Connecticut, said he hired eight people in May and June and is looking to hire another 5-10 employees, which would amount to a cumulative 20 percent increase in his overall staffing.

"We were having a hard time keeping up with the huge influx in refinancing activity, which warranted these positions," he said. "The resumes have been coming in like crazy.

"It is clear the job market is still tough because we have received 150 resumes to fill these positions," he said.

The hiring is in stark contrast with the massive layoffs during the housing market meltdown. Total mortgage industry employment has plummeted since the market's heyday. Employment in the industry was 480,000 in May 2005, but has fallen to 247,000 as of May of this year, according to the latest data from the Bureau of Labor Statistics.

After reaching a 2010 high of 254,000 in February, employment in May reached a fresh low and was 51.1 percent below the peak of 505,000 in February 2006. The job losses month-over-month, however, in May was only 0.3 percent, one of the smallest declines on record.

Michelle Salvatore, director of recruiting for Quicken Loans, an online mortgage lender in Livonia, Michigan, said in the last two months the company has hired an additional 75 non-banking employees in their technology, marketing and operations teams.

Quicken Loans has been hiring about 150 new employees, primarily mortgage bankers, each month since the middle of 2009.

"We will likely continue on the pace of hiring about 175 people per month, with about 100 of them mortgage bankers, for at least the next three months as we look to fill open positions," she said.

Thirty-year mortgage rates dropped to a record low of 4.57 percent in the week ended July 8, according to a survey by Freddie Mac (FMCC.OB), the second-largest U.S. mortgage finance company, the lowest level since the survey started in April 1971.

"We see the effects of low rates on hiring and profitability in the banking industry," said Paul Sorbera, president of Alliance Consulting in New York.

Reduced rates make it more profitable for companies to operate, for banks to offer cheaper financing, and companies and consumers to spend.

Consumers have reacted to low rates as well.

The Mortgage Bankers Association, in its latest survey, said its seasonally adjusted index of refinancing applications climbed 86.3 percent since the end of April and was nearly 131 percent above its year ago level.

Paul Anastos, president of Mortgage Master in Walpole, Massachusetts, said he has seen a 55 percent increase in refinancing demand over the past few weeks.

"We have actually added quite a few new operations staff over the past few months," he said. "We are continuing our search for people in most departments and branch locations."

Total Mortgage's Walsh said the influx of resumes he has received vary from college graduates to mortgage industry veterans.

"While the veterans have a lot to offer, some of them come with a lot of baggage in the aftermath of the meltdown of the industry," he said.

"Home loan refinancing demand may not stay strong, housing may stay weak, but I would rather be overstaffed than understaffed," he said.