Two National Mortgage Cos. Enter Twin Cities

First Option Mortgage opened an office this week in Edina, only a couple of months after MetLife Home Loans expanded to Minnesota.

Amid a rocky mortgage industry, two national companies have entered the Twin Cities, both claiming that the area offers favorable market conditions.

Atlanta-based First Option Mortgage, LLC, on Monday became a new player in the Twin Cities. The company, which has 11 offices nationally and is a licensed lender in 36 states, opened its first Minnesota office in Edina.

“The Twin Cities area is one of the most desirable markets for any business,” Josh Fitzwater-regional vice president who oversees sales at First Option's offices-said in a Wednesday phone interview.

Fitzwater points to the metro area's high percentage of home ownership, impressive credit scores, and unemployment rate that remains well below the national average.

He said that the Edina office is still in the “ramp-up phase,” with a staff of six but plans to increase to 12 employees.

Whether the company will open additional Minnesota locations “largely depends on our success and how quickly we have success,” Fitzwater said, adding that the company is open to expansion.

Another factor that drew the company to the state: Peter Aurich, who will serve as branch president for the Edina location, is originally from Minnesota.

According to Fitzwater, Minnesota is an attractive market, but it has seen a steep decline in mortgage lenders-from 4,500 licensed lenders in 2007 to only 600 at the end of 2010.

“It's really a tough time to compete,” he said, but the company is relying on its track record, an established business model, and an “aggressive marketing and branding strategy” to quickly gain market share in the state.

MetLife Home Loans, a division of MetLife Bank, N.A., also recently entered the local market by opening its first Minnesota office in Bloomington in November.

Sales manager Denny Bennett said Wednesday that the office currently employs seven people, but it hopes to hire two to three loan officers per month in 2011.

Bennett also said that a favorable market drew his company to the area. “Minnesota is one of the top markets in the country in terms of size and stability,” he said, adding that the company is a relative newcomer to the industry-meaning that it “has the advantage of not having the bad debt on our books that many competitors have.”

The company plans to expand in Minnesota with additional offices in the greater Minneapolis and Rochester metro areas, although specific plans and timelines are not yet solidified.

First Option lends just under $1 billion annually, a volume that it maintained through the mortgage crisis, according to Fitzwater.

MetLife Home Loans started in 2008, when MetLife Bank-a wholly owned subsidiary of insurance provider MetLife-acquired First Horizon Home Loans. It has more than 180 offices across the country with roughly 1,500 sales associates. As of September 30, the company serviced $117 billion in home loans.