HomeBanc announces new compensation plan for originators
By MortgageDaily.com staff
12/14/2005

Bypassing overtime issues arising over originators who don't earn the minimum required compensation, a national lender plans to pay its mortgage loan officers a base salary.

HomeBanc Mortgage Corp. recently announced it will implement a compensation plan in January that includes a base salary plus commission. The company says it's new compensation plan is rare given that most originators are paid on a 100-percent-commission plan based on loan originations.

With the new plan, the Atlanta-based lender reportedly intends to increase its pool of talent, particularly with new college graduates. The plan will apply to new originators that engage in HomeBanc's nine-week sales development training program, while those already with the company can opt into the new base-salary-plus-commission.

However, employees under the new compensation plan will have performance goals that will impact their continued employment at the company.

Right now, "there is a large pool of very talented people who for one reason or another will not consider a 100% commission job," said Chairman and Chief Executive Patrick S. Flood in the statement. "We believe this new plan should change that and should increase our opportunities to recruit top people into our field who can help us build HomeBanc and become our next generation of leaders."

The base salary will be based on the qualifications of each individual hired and will serve as a non-recoverable draw against commissions, according to HomeBanc -- which placed 20th in FORTUNE magazine's 100 Best Companies to Work For. At the time, HomeBanc had a staff of more than 1,200 -- with underwriters holding the most common job at an average annual salary of $60,600.

"Our goal with this plan is to create a situation where top people can come to HomeBanc and have the security of some amount of steady income while they build their mortgage banking business with us," Flood said.

The move will help the company avoid costly lawsuits like those filed by loan originators against Residential Finance Corp., Bank of America and Countrywide.

HomeBanc said it is currently hiring mortgage bankers for positions in Georgia, Florida and North Carolina.

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