In this on‑site interview at LeverageCon in Dallas, Toby Potter of Global Integrity Finance talks with Marco, a representative of Velocity Mortgage Capital, about the lender’s role in the private‑money real‑estate market. Marco explains that Velocity is a nationwide, business‑purpose, 100% wholesale lender that originated as a private lender and went public five years ago. The company offers a broad product suite—including 1‑4 unit non‑owner‑occupied loans, fix‑and‑flip, short‑ and long‑term rentals, and small‑balance commercial loans covering retail, warehouse, industrial, automotive, and multifamily properties. Velocity does not impose a hard debt‑service‑coverage‑ratio (DSCR) cutoff; instead, underwriting relies on a common‑sense assessment of property value, investor experience, cash reserves, and overall risk. The conversation covers how COVID‑19 and the subsequent zero‑interest‑rate environment disrupted the industry, forcing lenders to lower rates and prompting a shift toward rate‑sensitive borrowers. Marco notes that investors now prioritize speed, relationship, and dependability over rate chasing. Both hosts discuss the current interest‑rate outlook, expressing that a move below 6% could reignite buying activity, while acknowledging a market “pause” as investors await clearer signals. On the commercial side, Velocity reports a decline in office‑building loans post‑COVID but an increase in appraisal orders and a recent uptick in activity. Finally, Marco provides contact information (info@velocitymortgage.com) and emphasizes Velocity’s extensive broker support network of about 80 seasoned account executives, positioning the firm as a one‑stop shop for real‑estate investors seeking fast, flexible capital.
Chapters
Hey everybody, Toby Potter here with Global Integrity Finance. We are here in Dallas today at the LeverageCon real estate expo. Uh, if you can spin this camera around, you'll see this place is packed. It's full. Um, we've got lenders here, We've got brokers here, we've got attorneys, valuation, appraisals, anything you need for real estate investing is here today. If you're not here, you're missing out. But right here, right now, we have the direct honor of speaking with Marco with Velocity.
Correct.
And I just listened to Marco talk on the lender's panel and heard him bring some really unique insight to what he believes and his firm believes is going on in the market with interest rates. I know that's the number one question on everybody's mind. So we're going to pick his brain here one on one because we get this distinct honor and privilege to having him right here. Marco, glad you're here, buddy.
Hey, welcome. I appreciate the invite. This is great.
You bet. So tell us about Velocity, who you are, what you do, and then we're going to get into the real stuff.
Great. No. So I'm with Velocity Mortgage Capital. We're a nationwide business purpose lender. Formerly a private lender. We went public about 5 years ago.
Oh, really?
We've been in business, this is our 21st year.
Wow.
Uh, which is obviously rare in our, our space.
Yeah. Uh, with all the volatility. Yeah.
Went through the crash.
Yeah.
Went through COVID. Um, we've taken our lumps, but we've, um, we, we have a really good foundation. Um, a really good, you know, business model and great employees that have been with us a long time. So we're a business purpose nationwide. Uh, we're 100% wholesale, meaning we only deal with mortgage brokers. We don't deal directly with the investors. And we do 1 to 4, uh, non-owner only, obviously fix and flip, short-term, long-term. And then we do small balance commercial.
Small balance commercial being, uh, retail.
Yeah, we'll do retail, uh, automotive. We'll do, uh, warehouse, industrial, mixed-use, multifamily. Okay. Our main bucket right there.
So no multi?
We multifamily. Yeah, multifamily, mixed uses in one bucket. Then we have the retail, warehouse, industrial, auto repair in another bucket.
So on the multifamily, how many units will you guys go up to?
We don't have a unit cap, we have a loan amount cap. And then obviously we have a DSCR capped as well as once we get above 750.
On the multis, do you do the NOI or how are you calculating off the NOI? Yeah, it's multiple.
Yeah, we do value NOI, obviously, then, you know, You know, take the expense out, all that. We have, we have a little formula for that.
Perfect. So you guys pretty much have a one-stop shop in that for a broker to come to you guys, whether it be fix and flip, DSER, 1 to 4, short-term, long-term, long-term.
The short-term and the fix and flip is just 1 to 4 only.
Yeah.
The long-term is only for 1 to 4 and commercial. Yeah.
As I mentioned earlier, I got the chance to listen to you guys over there in the lenders panel talking about what's going on in the market. I think this is a perfect time for you to share to our audience how you see rates and what's going on, valuations, so on and so forth.
No, great. I mean, I appreciate that. We did have a brief discussion on our panel earlier and, uh, you know, the topic is always— it amazes me sometimes, especially recently. When are the rates going down? When are the rates going down? When are the rates going down? I sometimes— I've been doing this for 30 years and I don't remember private lending space being about rates.
It never was.
It never was. It's always been about—
COVID killed us.
Yeah.
COVID killed us when, when the government dropped rates down to zero, borrowed, uh, capital market, borrow money to zero, and then we were borrowing it at, at, at 3 and then lending it at 6 and 7. It killed us because now all our clients, that's all they care about now.
Absolutely.
Yeah. So that's what happened.
Yeah. And, and when the rates went up, we started getting the consumer bar type borrowers in our space.
Yeah.
That are rate sensitive.
Yeah.
And they don't understand and wrap around their product, you know, so. You know, we deal with investors, you know, real, and a lot of real experienced real estate investors, institutional investors. Yeah. Yeah. And they're in borrowers, right?
What do I mean? People that done 10, 20, 30 deals, you know, have a good portfolio of deals.
Absolutely.
Yeah.
And they, you know, it, everyone is different, but almost everyone will tell you is speed, relationship.
Yeah.
Dependability, right? They're moving money constantly. They're, they're, they're, you know, refining this to buy this or selling this to do this. They're rehab to get a renter in. I mean, there's, there's a million different things that are going on with these investors and they need capital fast and they need smart capital, right? So we, we based off, we based that model off that and, um, we're not rate chasers and, you know, we still want to be profitable and we understand what our market is. It's a higher risk, right? We're not using income documentation to calculate, to qualify.
Yeah.
So there's, there's a premium for that. But, um, the real investors understand it and we do $200 million a month with it. So it's, there's a market.
Yeah, there's a market. Don't get me wrong, but you're absolutely right. And I'll go back to COVID killed our industry because when I started, uh, in, in 2015, I charged 12% interest rate and 4 points. I didn't care if this was your first deal or your 50th deal. It was 12 and 4. And I told people, I don't— I don't— it's not about the rate, it's about the relationship. So if you want to do business with me and use my money, then it's 12% rate, 4 points. And then— and there never was a question.
Yeah.
COVID happens. And we did— we had to compete with the RCNs and Lima Ones, all those guys. So we had to drop our fix and flip rates down to 7.5, I think was our best rate at the time. And then now we're at 11. And everybody, oh my God, that's so expensive. And I'm like, no, it's not.
No, no, it's not.
It just, it wears me out. Like you, when a rate's going to come down, when the rate's going to come down. The one thing that I see, and you can correct me if I'm wrong, what I am waiting for the rates to come down is for our industry to take back off. That everything's kind of on hold, you know. It's a, it's a, it's, it's above 6 rate right now. We believe once it gets sub-6 that now people will say there's a, it's a positive, uh, it's a positive impression in our economy. It's a positive, uh, perception. So yeah, let's go start buying real estate. That's what I see when we're asking about where the rate's gonna move.
Yeah, I do. I see the same thing as you. Um, you know, obviously with recent announcements and, and things that have happened, there is a sense of, oops, let's wait to see what happens next. Right.
So everybody's on hold.
You know, our outlook is we're, we try to stay ahead of the market with some of these things. We feel pretty good that things are going to stabilize hopefully sooner than later. And, uh, but you're right. It's, there's, there has been a pause and it's, it's like holding your breath. What's, what's going to be said next?
Right.
Right. What's, you know, what's the next bomb that's going to be thrown? And, uh, it's, it's, it's a shame, but it is what it is. And so we're, we deal with it and, and, and our deal is just be opportunistic.
Right.
You know, just focus on what you can control. Focus on our product, our people, our brokers, our clients, and just, just stick to that and everything seems to work out.
So for Velocity, what is your sweet spot? What is, what is the thing that you guys are the absolute best at?
So, uh, we're known actually for our 30-year fix, 1 to 4 long-term rental. We don't have a DSCR requirement. So, yeah, that's what, yeah, we don't have a DSCR requirement. So we calculate DSCR, but it, it doesn't affect our underwriting decision on it.
So if somebody's upside down where, where they're at a 0.7, you're okay?
Well, it, it depends on, again, it's everything's situational, right? We don't underwrite to that. It, it's always, they could be in between rents, you know, they could be, um, you know, they could have a ton of cash flow, right? Um, they can have $2 million in reserves. So they're gonna make the payments.
It really depends. We, we look.
We look at value, right? We want to make sure we're safe. And then we look at the experience of the investor, right? Is the DSR going to come and play with a first-time investor who doesn't have a lot of reserves, credit's a little shaky?
Right, right.
And guess what?
Yeah.
We're going to make an underwriting decision. Right, right, right. So, but we, you know, but that's a big part of it.
And then it's a common sense.
Very common sense.
It's not system driven. It's common sense driven.
It's common sense driven. And more than anything is, is we, is understanding the, the market, understanding the value and understanding our borrower in general and just in making a decision off that. And that's what we do. Commercial side, it's a whole different ballgame.
Oh yeah.
Whole different ballgame. Yeah. It's, we're, it's DSCR driven. Um, we want to make sure, uh, that, you know, moving property in that space is, is a lot more difficult. And so we want to make sure we get the, we want to get the value right, but more than anything, We want to make sure it's income producing.
So on your commercial side, have you guys seen a decline in commercial acquisitions? And when I'm talking about business, office buildings and all that.
Office building, obviously since COVID has taken a major, major decline. We don't even mess with that really much anymore. Yeah, but our appraisal orders are in businesses increased in the last 18 months significantly.
Really?
Yeah.
Well, and we've all seen an uptick in the last 2 weeks. And I think, I think it kind of goes back to that the investors are tired of waiting. Yeah. They know that nothing's going to change significantly. So it's time to get back to work.
Yep.
And that's what we're seeing. You guys seeing the same thing? Absolutely.
Yeah, absolutely.
What, uh, where do people find you, Marco?
info@velocitymortgage.com is our email address. I manage that address. We have about 80 seasoned account executives I can assign you depending on what area you're in. And, uh, just info@velocitymortgage.com.
Awesome.
Reach out to me, say you saw me on the, on the, on the podcast or on the panel, and I'll make sure I get you, uh, a good rep. We actually have 4 of our top salespeople here in, in, uh, in our booth.
Yeah.
So if they want to stop by and check 'em out.
Perfect. So I know Velocity guys. I've, I've dealt with Velocity when, when, when COVID hit in 2020 and capital markets shut down, we scrambled. Got my NMLS license. My wife had hers. We signed up with Velocity. They were a lifesaver for us because I still had full staff. We didn't lay anybody off, and we needed to be able to do things. They still had money, they still had capital, they were still lending. They were one of the lifesavers that we used, and I am proud to say I support them 1,000%.
