Thrive Mortgage acquires American Mortgage Service Company

Texas-based Independent Mortgage Bank Prosperous Mortgage signed a letter of intent to acquire the Ohio-based lender American Mortgage Services Company (AMSC).

Financial terms of the deal were not disclosed.

The acquisition will strengthen Thrive’s retail channel and bring new territory into arguably the toughest mortgage market since the early 1980s.

Thrive chief operating officer Selene Kellam, who designed the lender’s operations workflow, will serve as chief executive from 2023. Thrive co-founder Roy Jones will transition to a chairman role.

“We never had a stated goal of being the biggest mortgage lender,” Randell Gillespie, national sales manager for Thrive, said in an interview. “We are continually looking for partnership opportunities to help us lead our industry into the next generation of mortgage lending.”

The two companies generate the vast majority of their origination volume through the retail channel and plan to expand their lending offerings by combining their businesses, executives said.

Founded in 2011 in Georgetown, Texas, Thrive has originated $2.3 billion in loans in the past 12 months, 90% of which through the retail channel, according to data from the mortgage technology platform. Modex. Thrive has 60 branches and 258 active loan officers, according to the data.

The acquisition of AMSC will allow Thrive to expand into areas where a physical presence is lacking.

AMSC is significantly smaller than its Texas-based dance partner. Founded in 1975 in Cincinnati, AMSC has issued $836 million in mortgages in the past 12 months. It has 26 branches and 95 active LOs, according to data from Modex.

For AMSC, the deal provides access to Thrive’s technologies and structure in a tough market that some estimates could halve by 2023.

Neither company is in trouble or needs to execute a deal quickly, AMSC CEO Bill Case said in an interview with HousingWire. It’s just a smart deal for both parties, he said.

And while he conceded it hasn’t been a “great” year, “we haven’t had great years in the past,” Case said.

“We keep our business well capitalized. The deal is more about where we see ourselves in a year or two. We agreed that we had no tools and technology. We could get everything Thrive has, but it would take around several million, over many years.

The companies expect the transaction to close in the fourth quarter of 2022. The acquired lender will operate as “American Mortgage Service Company, powered by Thrive.”

Veritex Holdingsthe parent company of Veritex Community Bankin 2021 acquired a 49% stake in Thrive Mortgage for $53.9 million.

Veronica J. Snell