Need $23 Million Fast? Mortgage Queen Melissa Cohn Checks Your Credit

Location: Last year you did $1,129,126,981 in loans, which makes you the biggest mortgage broker in the country. How is that possible during such a massive economic crisis?

Melissa Cohn: Well, 2007 happened to be probably the biggest year in real estate for New York City, and I was certainly a beneficiary of that. I mean, it was the highest-grossing year for real estate in any year that’s ever been recorded. I certainly have benefited from the increase in the value of real estate in New York City.

You’ve been No. 1 in the country seven or eight times in the last ten years.

I think I’ve been No. 1, like, 10 times in the past 12 years. I was No. 2 and No. 3 for two years.

Is there anyone that you think might catch you?

No, because I’m not stopping.

The mortgage crisis has helped cause a recession. How early did you realize that your industry was so troubled, and that those troubles could spread so wildly?

I never understood why banks got so aggressive; I never understood why banks would make 100 percent mortgages to people who don’t have sufficient credit, who don’t have sufficient income, who don’t have liquidity.

So banks are the ones to blame?

I think there are really three parties to blame. First of all, the borrowers, who knew they didn’t have enough income, who still took a mortgage that they knew they didn’t qualify for; secondly, the banks for actually approving these nonqualified buyers for financing; and then you have to blame Wall Street for making the money so readily available to the banks and wanting to gobble up the mortgage securities and encouraging more and more of these loans.

But weren’t you a facilitator? Weren’t all those mortgages a reason for your success?

No. My business has been focused on helping qualified buyers get better mortgages than they can get on their own. So the answer is no.

How easy was it for you to broker a mortgage? Is it true all you needed was a heartbeat and two legs?

No, you needed a little bit more than that. But there were banks that used to do 90 to 95 percent financing with no income verification and very little documentation. For the most part, they all stopped by the end of 2007.

When you go to dinner parties, are you shier about telling people what you do for a living—or that you’re the biggest mortgage broker in the country?

Absolutely not! Because I was not part of the problem, in terms of the subprime crisis. … I pride myself on the fact that my company never did subprime loans.

You’ve never brokered a subprime mortgage?

I mean, my company has done some subprime. But there are different types of subprime borrowers. The true subprime borrower that we read about is really someone that doesn’t have any money, doesn’t have sufficient income, doesn’t have good credit. The subprime borrower that my firm has dealt with—irregularly—has been someone who either has enough income but bad credit or has better credit but not sufficient income.

Are we going to discover in a year or two that there were mortgage problems in New York, too, and even the wealthy over-borrowed?

What happens to Wall Street with all the layoffs? That’s where we may see some foreclosure risk in New York City. There are very few foreclosures in New York City. Are there more today than there were a year ago? Yes, but not at the same level as the rest of the country.

What’s the single biggest mortgage you did last year?

I did a number of loans in the Plaza, we’ve done a number of loans in 15 Central Park West. … My biggest mortgage ever is $23 million; it’s actually this year.

These multimillionaire or billionaire buyers take out very large mortgages?

Thank God! … They like to borrow; they believe they can earn more with their money invested in their funds than by keeping it in real estate.

What kind of banks do you go to?

Need $23 Million Fast? Mortgage Queen Melissa Cohn Checks Your Credit