How LoanDepot’s Anthony Hsieh went from cashier to mortgage billionaire – Orange County Register
By Lisa Lee and Davide Scigliuzzo | Bloomberg
When Lake Forest-based LoanDepot debuted on the New York Stock Exchange earlier this year, Anthony Hsieh became a rarity among the ultra-rich: an Asian-American multibillionaire.
For the 56-year-old, it was the culmination of a decades-long quest to tackle the hyper-competitive mortgage industry. It also gave him new impetus to be more visible and inspire others, drawing on some of his own struggles as an immigrant to the United States from Taiwan.
“I have a unique opportunity,” Hsieh said. “With my success, I managed to cross and gain respect from non-Asians, which gives Asians a lot of pride. “
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His perch at the top is a far cry from a Sunday afternoon 42 years earlier when a masked man broke into his family’s liquor store in Long Beach, pointed a gun at his head and asked him to empty the cash register.
Those frantic minutes spent fearful for his life taught Hsieh one of the most important lessons of his career. He credits the experience for helping him cope with the discrimination and hostility he would later encounter as an Asian American in the financial industry, and which ultimately helped him become one of the largest mortgage lenders in the United States.
“You learn very early on how to protect yourself and how to survive,” said Hsieh, who is said to face two more armed robberies while working behind the family cash register. “I wouldn’t trade it for anything.”
Her parents settled in California after moving from Taiwan in the early 1970s with Hsieh and her two sisters, giving up a comfortable life so they could raise their children in the United States. shop.
Because they did not speak English, Hsieh helped with all of the family’s major financial decisions, from buying cars and appliances to taking out a mortgage.
“I have been protecting my parents since I was eight,” he said. “I became their advisor, I became their loan officer, I became their translator. “
It was that upbringing, he says, that instilled in him the resilience and determination to take on some of Wall Street’s biggest banks in one of finance’s toughest corners.
Hsieh’s fortune is now around $ 2 billion, according to the Bloomberg Billionaires Index. He is one of the few East Asian Americans to have turned the American companies they founded into multi-billion dollar companies, alongside Eric Yuan of Zoom Video Communications Inc. and Jensen Huang of Nvidia Corp.
Unlike many billionaires who made their fortunes in Silicon Valley after graduating from elite American universities, Hsieh attended Cal State Fullerton and was quite removed from the upper echelons of the tech world.
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Indeed, his leap into finance was largely by chance.
His parents had hoped he would become a doctor, but knowing their son was afraid of blood, they were willing to settle for a dentist. Instead, Hsieh took the advice of one of his baseball teammates and applied for a loan officer position with a small mortgage lender. He was hired locally.
After only four years in the business, Hsieh realized that the business had more potential than its owners could see. So he approached them with an offer to buy the entire company. Once at the helm, he ditched typewriters and fax machines, aggressively expanded online, and renamed the company LoansDirect.com.
“I just felt like I could do better,” Hsieh said. “I didn’t know what my skills were, I just felt confident, I felt competitive. I had a great work ethic.
It was the start of a series of businesses that would make Hsieh one of the most successful entrepreneurs in the hyper-competitive mortgage industry. After selling LoansDirect.com to E * Trade Financial Corp. in 2001, he created HomeLoanCenter.com, the first online platform to offer a full line of mortgage products in all 50 states. By the time he sold it to LendingTree in 2004, the company had 800 employees.
But it is from LoanDepot that Hsieh has collected most of his fortune. The company recorded its best year on record in 2020 as the Federal Reserve cut interest rates to near zero in response to the coronavirus outbreak, making mortgages one of the biggest winners in the pandemic .
LoanDepot’s digital approach has made it one of the fastest growing home loan providers in the United States With over $ 100 billion in originations, it was the seventh largest mortgage originator in the country in 2020 and the second largest to go direct to consumers.
In February, the company finalized a long-awaited initial public offering. While the listing only brought in about $ 62 million in proceeds – a fraction of the original target amount – an additional $ 200 million was distributed to shareholders, including Hsieh and his co-investors, via a dividend funded by the debt about a month later.
The question is whether such rapid growth can be sustained.
LoanDepot shares have fallen by more than half from their peak shortly after listing. The outlook for mortgages, meanwhile, has weakened, with just 35% of consumers believing now is the right time to buy a home, according to Fannie Mae, and rising inflation risks could weaken sentiment even further. given a possible price appreciation and interest rate hikes. Housing starts slowed, as did sales of existing homes and refinances.
Hsieh has now turned his attention to millennials, many of whom are buying their first homes. While most are used to doing business online, this familiarity doesn’t necessarily translate into a better understanding of interest rates or closing costs.
“They are very savvy when it comes to using digital tools, but that doesn’t make them financially literate,” he said.