6 months ago
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Small-balance commercial lender Stronghill Capital shut down its nascent consumer and correspondent lending businesses late last week.
The Austin, Texas-based lender will continue offering small-balance commercial and business purpose debt service coverage ratio (DSCR) loans to its clients, CEO John Eisinger told HousingWire Monday morning. He cited a difficult market and elevated rates as reasons for shutting down correspondent and consumer lending businesses, which were added in 2022.
Eisinger confirmed that “a few” staffers were laid off as a result of the closure, but declined to specify how many. He said Stronghill is in the process of alerting clients whose loans were in the pipeline so they could transition to another lender.
The company, which is owned by asset management firm Arrowmark Partners, sells non-QM loans via brokers for clients — usually LLCs, C-corps or S-corps — to acquire residential real estate for commercial and investment purposes.
Dustin Wells, who was appointed as co-president at Stronghill Capital in 2022, told HousingWire in November 2022 that the lender projected between $400 million and $500 million in originations in the residential consumer space in 2023. Eisinger declined to say how much origination volume the now-shut down consumer businesses generated, but said it was a “small piece” of the overall business.
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