78% of the Loan Officers "Competing" for Your Client's Business Don't Even Live in Colorado.

And 20 years of economic research proves it's costing our state $83 million a year.

By Tim Chase · CEO, 719 Lending Inc. · Colorado Springs, CO

Here's a number that should make every Colorado realtor stop and reread it: of the 19,837 mortgage loan originators licensed to originate loans in Colorado, only 4,373 — roughly 22% — actually live here.

The other 15,464 are sitting in California, Arizona, Michigan, Texas, Florida, and 40+ other states, pulling commissions out of Colorado closings and spending that money in their own neighborhoods. Not ours.

That's not a rounding error. That's not a fluke. That's the entire market structure of mortgage lending in Colorado in 2026 — and it's the single biggest hidden tax on your clients that nobody's talking about.

The Math Nobody Wants You to See

When your buyer asks you for a lender recommendation and you send them "shopping around," here's the lottery they're walking into:

Read that again. There are more loan officers in Arizona originating Colorado loans than there are in half the state of Colorado. Michigan alone has 1,722 MLOs sitting in Detroit suburbs writing Colorado Springs mortgages. Missouri has 784.

Your client has roughly a 1 in 4.5 chance of randomly landing with an MLO who actually lives in the state they're buying a home in.

This Isn't Opinion. The Research Is Rock Solid.

Here's where this stops being a gut feeling and starts being economics. For over 20 years, two independent research organizations — Civic Economics (a private economic consultancy) and the Institute for Local Self-Reliance — have been running studies across dozens of American cities measuring exactly what happens to a dollar when it gets spent local versus non-local.

The results are staggering. And remarkably consistent.

The Local Multiplier Effect

When you spend $100 at a locally owned, independently operated business, on average $48 of that dollar stays in the community on the first pass — going to local employees, local suppliers, local rent, local charitable giving, and local owner profits that get spent at other local businesses.

When you spend that same $100 at a national chain or absentee-owned business, only $14 stays in the community. The other $86 immediately leaks out to corporate headquarters, out-of-state shareholders, national supply chains, and executive compensation that gets spent somewhere else.

That's not a small difference. That's a 3.4× multiplier in favor of local.

Where These Numbers Come From

This isn't a single study — it's a two-decade body of research that keeps reaching the same conclusion. Among the most prominent:

• Civic Economics has conducted "Indie Impact" studies in Austin, Chicago, San Francisco, Grand Rapids, New Orleans, Phoenix, the Upper Valley (NH/VT), Dane County (WI), and dozens of others since 2002. Aggregate finding: local independents recirculate roughly 48% of revenue locally, while national chains recirculate about 13.6%.
• Institute for Local Self-Reliance (ILSR), Maine communities study (2003): every $100 spent at local independents generated $45 of local spending, compared to only $14 for a big-box chain.
• American Booksellers Association national summary of 10 Civic Economics studies (2012): local retailers return an average of 52% of revenue to the local economy, vs. 14% for chains — "almost four times as much economic benefit."
• Vital Communities (Upper Valley NH/VT, 2022): local retailers returned 55.5% of revenues to the regional economy; local restaurants returned 68.4%. The four major national chain retailers measured (Barnes & Noble, Home Depot, Office Depot, Target): average of just 13.6%.
• Salt Lake City retail study: local retailers recirculated 52% of revenue locally; national chains recirculated just 14%.

The numbers vary by a few percentage points depending on the city and the industry, but the core finding doesn't budge: local independents recirculate three to four times more of every dollar than absentee-owned businesses.

And here's the kicker — this research is mostly about retail and restaurants. For professional services like mortgage origination, the local multiplier is actually higher, because service businesses are more labor-intensive (more money goes to local payroll and less goes to out-of-state wholesale inventory). A local mortgage broker doesn't buy inventory from Shanghai. Every dollar of revenue is payroll, overhead, local vendors, and owner profit — the kind of spending that stays in the community at the highest rates.

What This Means for Colorado — The $83 Million Leak

Let's run the math for Colorado using conservative numbers:

• Colorado averages around 75,000 home sales per year (conservative estimate)
• Median Colorado home price is roughly $545,000
• At 80% LTV, that's an average loan size of $436,000
• Total lender revenue per transaction averages roughly 1.5% of the loan amount, or about $6,540 per deal

That means the total annual pool of Colorado mortgage origination revenue is roughly $490 million a year.

Now apply the 78/22 license split. Even if we conservatively assume only 50% of that revenue actually flows to out-of-state loan officers (it's probably higher, given they make up 78% of the licensed pool), that's $245 million in commissions leaving Colorado every year.

Apply the Civic Economics recirculation gap of 34 percentage points (48% local vs. 14% non-local), and Colorado's economy is losing approximately $83 million a year in lost secondary spending.

Eighty-three million dollars. Gone. Every single year. Money that should be paying Colorado Springs mortgages, eating at Denver restaurants, funding Fort Collins youth sports, tipping servers in Durango, buying school clothes in Pueblo — instead funding someone else's community in Phoenix, Detroit, and Tampa.

That's enough to fund roughly 900 Colorado teachers. Every year. In perpetuity.

What It Looks Like Per Deal

Take a single Colorado Springs home sale. $545,000 purchase, $436,000 loan, $6,540 in total lender revenue.

Now multiply that by the tens of thousands of Colorado closings every year that go to out-of-state MLOs. This is the leak.

Why This Matters — And It's Not Just About the Money

Beyond the raw economics, here's why using an out-of-state LO is bad for your client's deal:

1. Time zones kill closings.

   When a 4:45pm appraisal issue hits on a Friday in Colorado Springs, your Phoenix-based MLO is on Pacific time — that's 3:45pm their time, and they're already checked out for the weekend. Your Michigan MLO is on Eastern — it's 6:45pm, their kids are at dinner, and your file sits untouched until Monday morning. By then, you've lost the 30-day close window, the seller is nervous, and your buyer is texting you asking if the deal's dead.

2. They don't know our market. At all.

   Ask an out-of-state MLO what a "Banning Lewis Ranch HOA assessment" is. Ask them why Black Forest comps are weird. Ask them about the appraisal quirks in Teller County, the well-and-septic issues in unincorporated El Paso County, or how VA loans work differently when your client is PCS'ing out of Fort Carson. You'll get a blank stare — or worse, confident wrong answers. I've seen deals die because an MLO in Tampa didn't understand why a Colorado Springs home had a mineral rights exception on title.

3. They've never met your people.

   Your local title rep. Your local appraiser. Your local inspector. Your local processor. A Colorado-based MLO has worked with these people for years, has their cell numbers, and can pick up the phone at 9pm on a Tuesday to unstick a file. An out-of-state MLO files a ticket and waits.

4. The money leaves. Permanently. $83 million a year.

   Every time a Colorado realtor sends a client to an out-of-state loan officer, you are — unintentionally — participating in the biggest capital outflow in Colorado's housing economy that nobody talks about. You're a Colorado realtor. You pay Colorado taxes. Your kids go to Colorado schools. Your business depends on Colorado communities staying strong. Why send the single biggest chunk of every transaction to someone who's never set foot in the state?

The "Big National Lender" Myth

Here's the counter-argument I hear: "But the big national lenders have better rates and more products."

No, they don't. Not in 2026. Not even close.

Every wholesale lender a local Colorado broker has access to is the same wholesale lender the national call centers have access to — we're buying from the same rate sheets. A Colorado-based independent broker can shop 40+ wholesale lenders on every file and genuinely find the best rate for each individual borrower's scenario. A national call-center LO is usually stuck selling their one employer's product whether it fits your client or not.

The "better rates" story is marketing. The reality is the opposite: local brokers almost always beat the call-center quotes because we're not paying for Super Bowl ads and 3,000-person Phoenix call floors.

The Ask

I'm not asking you to pledge an exclusive. I'm not asking you to stop shopping rates. I'm asking you to do one thing.

Before you send your next buyer to "whoever's cheapest online," ask the lender one question:

"Do you live in Colorado?"

If the answer is no, ask yourself why a person sitting 1,500 miles away — who has never driven I-25, never seen the Front Range, never set foot in your client's neighborhood — should get paid to originate the biggest financial transaction of your client's life.

Then send the file to someone who lives here. You're not just helping your client. You're plugging the $83 million leak, one closing at a time.

Why We Wrote This

719 Lending is a Colorado Springs-based mortgage brokerage. Every one of our loan officers lives in Colorado. Every commission we earn gets spent here. We've been building this business with one principle: Coloradans deserve mortgage professionals who actually show up — in person, in the same time zone, in the same community.

The 78% number isn't an accident. It's the result of a decade of national lenders and call centers harvesting Colorado deals from a distance. The only way it changes is if Colorado realtors start treating "where does my lender live" as a qualifying question — the same way you treat "are you licensed" and "do you have a DU approval."

It's not protectionism. It's not gatekeeping. It's common sense — and now, thanks to 20 years of economic research, it's backed by hard numbers.

Support local. Use local. It's your economy. Defend it.

Tim Chase is the CEO of 719 Lending Inc., a Colorado Springs-based mortgage brokerage. He has 23+ years in the mortgage industry and writes about Colorado real estate finance, market trends, and the independent broker movement.