Bill Tessar took the helm of CIVIC Financial Services back in 2017, three years into its founding, and turned it on its head. He guided the company into becoming one of the leading institutional private money lenders in the industry. CIVIC Financial Services, headquartered in Redondo Beach, California, is one of the premier private money lenders in the country that provides bridge, fix-and-flip, rental, rehab, construction, and multifamily loans in 29 states – with products available through retail, wholesale, and correspondent channels.

For The Year in Review issue of Originate Report, we sat down with Tessar to discuss CIVIC’s banner year, his thoughts on leading the company, and how CIVIC will continue to transform the industry as a whole in the years to come.

The Transition

CIVIC has funded more than $6 billion in loan originations since its start. That includes $1.7 billion in 2021, a huge milestone after the four years it took them to reach that first billion, and light-years away from the $20 million per month they averaged back in 2017. With Tessar’s leadership, the strength of his team, and the power of a publicly traded bank behind them, the company’s continued momentum has poised it to reach new heights. Tessar says, “the runway is long and wide, and [CIVIC] intends to use all of it.”

When the company brought in Tessar, they knew they were adding a heavy hitter. A veteran in the industry – before it even was an industry – Tessar founded New Freedom Financial in 1989 and then Capital Line Financial in 1995, both retail mortgage banking firms that specialized in conventional residential and commercial mortgages and employed up to 150 loan officers combined. When he went on to become President of Skyline Home Loans, he brought originations to a new level. In his 10 years at that company, Tessar took Skyline, a retail mortgage company, and built it into a multi-channel originator funding $3.5 billion annually.

But there was more on the horizon for the visionary leader. Tessar left a remarkable 30-year career in conventional lending to join CIVIC because he saw the untapped potential of the company and the private lending industry as a whole.

“In conventional lending, margins are paper-thin,” said Tessar. “And you have to be exceptional in all aspects of that business in order to be successful. So, the way I thought about the private lending space when I made the decision to come over in 2017 was that if we applied some of that reference and some of those disciplines to CIVIC that we could actually build something special.”

Built on a Strong Foundation

In order to get CIVIC to expand and grow the way Tessar envisioned, there needed to be an unbreakable foundation, and that begins with seasoned leaders. Bill Tessar and Merced Cohen, Executive Vice President of Operations, came into the organization and sat back to observe, listen, and learn for the first 90 days. It was important that they fully understand the lay of the land and identify opportunities to add to the potential of an already strong entrepreneurial culture, rather than bulldoze it and start anew.

After the 90-day observation period, they built upon that strong foundation, and transformed CIVIC into the company it was always meant to be. They accomplished this through a focus on platform infrastructure, new technology, digital branding, reputation management, social media and most importantly, bringing in quality individuals.

The Importance of Core Values

On that note, CIVIC is heavily invested in their people and they all live and work by a customer-for-life approach. The company has received several awards for being one of the best places to work in the financial industry — the byproduct of their philosophy that the happiness of their employees transpires into the happiness of their clients. What many lenders call “transactions”, CIVIC calls “relationships”. To ensure a servant attitude is delivered to all of their clients and partnerships, CIVIC vets and hires not just hard workers, but smart workers – and CIVIC is “chips all in” (as Tessar says) with their smart workers. The company has 20 full time employees in People and Culture alone, whose sole responsibility is to nurture and improve the health, morale, and well-being of their employees.

In 2017, CIVIC had a total of 30 employees. Today, they have more than 400. This growth is a testament not only to Tessar’s innovative leadership, but to CIVIC’s core values and overall culture that has empowered the company to thrive. CIVIC is people-first, and this is emblemized by the coins that each employee carries on their person. Much like a challenge coin, which was historically used in the military to prove membership when “challenged” and to enhance a unit’s morale, the CIVIC coin is used to symbolize esprit de corp and adoption of the company’s five core values: act with honor, be a great partner, communicate clearly, create smiles, and simplify.

While they may sound simple, these values are not just empty phrases. They are words to live by – simple reminders, remnant of the North Star, to guide team members through choices they may be facing. The challenge that put not only the company but the whole world to the test was the pandemic. “When COVID-19 hit, the financial markets fell flat,” said Tessar. “There were margin calls, paper was devalued, and meeting with clients came to a halt. But one glance at that coin and the CIVIC team knew that they would make it out on the other side; a reminder that there have been fires, earthquakes, wars and the financial crisis over the last 30 years. Just think, right foot left foot, and keep going. No matter what, don’t stop moving forward, just keep looking down the road.”

Unparalleled Growth

The last 18 months have amounted to the most challenging time of Tessar’s career. Acting with honor, being a great partner, communicating clearly, creating smiles, and simplifying seemed out of grasp in the face of a global pandemic, but again served as the basic guide. COVID-19 took CIVIC out of their comfort zone in the best possible way: they doubled down on marketing and customer experience; they connected with customers virtually, and People and Culture adapted faster and better than ever imagined. The result of their efforts was the funding of more than $1 billion during a pandemic shut down that caused other private lenders to pause operations or exit the market altogether.

CIVIC became an unstoppable force, the waves of which were noticed by Pacific Western Bank, who made the previously unheard-of decision to acquire the company.

“When COVID hit and Wall Street froze, the first company to step back up and to continue purchasing loans uninterrupted was Pacific Western Bank,” said Tessar. “They saw the quantity of loans that we were doing, the quality of the loans in terms of how they were performing and the consistency that we were doing this month after month after month. And so, it was really accretive to what their short- and long-term corporate objectives were – and we ended up working out that acquisition over about eight months.”

CIVIC is a wholly owned subsidiary, powered by the bank. They have kept every single employee, and in fact have added more than 50 people since the acquisition. The reduction in cost of capital has allowed CIVIC to continue to invest in its infrastructure, invest in its people, and reduce its interest rates… three times in 2021, to be exact. The ability to sharpen pricing across the board while dropping a greater profit to the bottom line is positioning CIVIC to dominate the market more fiercely than ever before.

Through a pandemic, exponential growth, and acquisition, CIVIC continues to be a lender that empowers not only its investors, but its employees as well, through their impeccable care and remarkable values. They take care of their people.

“Whether you’re an experienced investor, first-time borrower, or in search of the best fit for your clients,” noted Tessar. “CIVIC is there as your trusted capital partner for your real estate financing needs.”