Appraisal Demand Leads to LRES Growth

ORANGE, CA—Increased call for mortgage-appraisal services, in addition to an expanding client base, has resulted in measurable growth this year for LRES, a national provider of commercial and residential valuations and asset management for the mortgage, banking, credit union and real estate industries. The firm experienced 13% revenue growth throughout 2014 and is projected to achieve a 28% growth rate in 2015.

According to Roger Beane, CEO of LRES, “This has been a banner year for LRES, thanks to the hard work and dedication of our staff, process and product improvements and numerous technology enhancements. We have positioned the company for further growth in 2015 as a result of such increased technical innovations and corporate expansion.”

Beane tells GlobeSt.com, “There has been a distinctive uptick in purchase market activity in 2014. An increase in home buying directly correlates to an increased demand for mortgage-appraisal services, and that's where we come in. LRES can attribute a lot of this year's success to the jump of first mortgage sales and the overall healthier real estate market. We expect that trend to only continue in 2015.”

The company's growth is due in large part to the LRES 360 Program the firm implemented this year, which tracks all new appraisal orders, confirms appropriate follow-up and issues hourly checks to ensure that all deadlines are met. The program added resources to the client-relations division and a highly focused strategic plan for the first 360 hours of a new client's relationship with LRES.

The firm also introduced this year hybrid valuation products to help its clients meet evolving property-valuation requirements. These products combine accurate property values with additional information that is often overlooked but can substantially impact a property's value. New strategies such as these contributed to LRES' recognition by a local industry business publication as one of the fastest-growing mid-sized companies in Orange County.

To keep up with its external growth, LRES increased internally expanding business into 11 new states and is growing its staff to handle additional volumes. With this expansion, the company added new corporate roles including chief administrative office, manager of compliance, two EVPs and a VP of human resources, asset management and valuations, respectively.

Regarding technology enhancements, LRES DirectConnect integration hub now integrates with two loan-origination systems and five loan-service platforms. Other technology improvements include an enhanced auto-assignment process to assign the best-qualified appraiser/broker, improved vendor grading system and scorecards and enhanced automated custom client reports. LRES also implemented the utilization of third-party automated QC software to improve the quality of appraisal reports prior to line-by-line auditor review.

As GlobeSt.com reported earlier this month, during the recent third annual MBA Independent Mortgage Brokers Conference in San Diego, Andrew WeissMalik, COO of 360 Mortgage Group, said more volume doesn't necessarily mean increased profitability in an independent mortgage brokerage. Figuring out how much production you need in order to produce revenue is key for any independent mortgage brokerage that doesn't have a parent company it can go to for capital. Fowler Williams, president of Crescent Mortgage Co., added, “You can grow, but not be profitable or safe. It's hard to do all three.” And Stanley Middleman, president and CEO of Freedom Mortgage Corp., said you have to first manage risk before you make a profit, which is a quandary.