Home Again

Remember Honolulu Mortgage? It's baaack...well, sort of.

July, 2002

Last Christmas Eve, three former Bank of Hawaii employees gave themselves a present. Ron Schmid, Thomas Zimmerman and Gayle Ishima formed Hawaii HomeLoans Inc., a new mortgage banking company that’s already making a big splash. About a month after it opened for business on April 1, 2002, Hawaii HomeLoans had funded more than $3 million and had more than $25 million in mortgages in the pipeline.

Schmid is the chairman of the board of Hawaii HomeLoans. Zimmerman is the president and a director. Ishima serves as vice president, secretary, treasurer and a director. All three held management positions at Bank of Hawaii. Before Schmid retired in 2000, he was the executive vice president of the retail division. Zimmerman left late last year his post as senior vice president and manager of residential loan origination. Ishima quit her job as senior vice president and manager of Bank of Hawaii’s residential lending division.

In January 1999 (when the three still worked there), Bank of Hawaii published a press release about setting a local record in mortgage lending. It said: “Bank of Hawaii has been the state’s market-share leader in residential lending for the past three years. The $1.06 billion figure represents a 99 percent increase in dollar volume from the previous year. Bankoh now funds approximately 18 percent of the residential transactions in Hawaii, more than the second and third highest residential funders combined.” In March 1999, when Bank of Hawaii announced Ishima’s promotion, she was credited with being “instrumental in helping Bankoh set an all-time record for mortgage lending in 1998.”

Yet, the three new top executives of Hawaii HomeLoans insist that their exclusive focus on mortgage lending is going to help this new company carve out the market that’s been dominated by the behemoth bank. “You sit there and you think about doing business on your own, and we decided at one point that was going to be better than being at the bank,” says Ishima.

Zimmerman says, “We’ve all been in mortgage banking in Hawaii for a quite a long period of time. I think it started based on the three of us pretty much agreeing that there was room in this market for another full-service mortgage banker that was locally owned and operated and the decisions were made here and the loans were serviced here. That really hasn’t been available in this market since Honolulu Mortgage was purchased and then subsequently closed.”

Adds Schmid: “We’re not going to try to sit down and talk to you about CDs or safety deposit boxes or something else.”

Another big focus for the startup has been technology. All loan officers have wireless laptops and use a Web-based loan origination system created by PCLender.com Inc., a Hawaii company. “So, if you go out to buy a home, whether it’s in Hawaii Kai or Kapolei, the loan officer who is wireless can get you approved instantly over the PC without having to worry about taking all your paperwork, coming back to an office, plugging in, etcetera,” says Zimmerman.

It’s another reunion for Schmid and Zimmerman, who have worked together for more than a decade and were together at Honolulu Mortgage Co. before each moved to Bank of Hawaii. Zimmerman says a little less than half of Hawaii HomeLoans’ staff has come from Bank of Hawaii, and all but one of the senior managers he identified worked there last. Fully staffed, Hawaii HomeLoans’ roster will number about 90 statewide and, at press time, the company was in the process of procuring space on Maui.

“We’ve started off as a relatively small company, starting from scratch. We believe that within the first two or three years of operation we’d like to be among the top four real estate lenders in the market, looking at about a 15 percent share of the mortgage lending market,” says Schmid.

That market was enormous last year, about $11 billion, but interest rates were low and there was a lot of refinancing done. Zimmerman estimates that in 2003, the real estate lending pie will be between $5 billion to $7 billion, and he’d like to see Hawaii HomeLoans write at least $500 million in mortgages that year.

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