Cenlar FSB names Jim Daras as CEO and president

Cenlar FSB names Jim Daras as CEO and president
Cenlar FSB, the second-largest mortgage servicer and largest sub-servicer in the U.S., has appointed D. James ‘Jim’ Daras as its CEO and president.

Daras’ professional career spans more than four decades in the banking and mortgage banking industry. His specializations include risk management, banking and corporate finance functions, bank restructuring, company start-ups and venture capital investing, according to a statement from Cenlar. 

“Jim is an accomplished and exceptional executive leader with a great deal of experience who will ensure Cenlar continues its commitment to providing high quality service to our customers,” said Dave Applegate, chairman of Cenlar’s board and former CEO of Fannie Mae-Freddie Mac joint venture Common Securitization Solutions, Homeward Residential, Radian Mortgage Insurance and GMAC Mortgage and Bank.

In August 2022, Applegate succeeded Greg Tornquist as the Cenlar FSB chairman. 

Daras and Robert “Rob” Lux, Cenlar’s executive vice president and chief operating officer, were appointed co-CEO roles after Tornquist announced his retirement. Lux will continue in the role of COO and will report to Daras.

Daras’ association with Cenlar dates back to 1985 when he initially joined the company. He left Cenlar in 1990 to join New York City-based Dime Bancorp as its chief financial officer but returned to Cenlar in 2015.

He then worked as Cenlar’s chief risk officer from 2015 to 2019 before taking on an advisory role at the company in 2019. Last year, Daras joined Cenlar in a full time capacity as the executive vice president in charge of managing the company’s banking functions.

“I am thrilled and honored to have been named CEO at this point in Cenlar’s journey. Cenlar was built on collaboration, expertise, client and homeowner care, and the ability to transform itself during each part of its journey, and I am confident in Cenlar’s long-term success,” Daras said.

In September 2022, Cenlar hired Gary Gaskin as its vice president of transfer services. 

Cenlar currently operates in 50 states and U.S. territories. The company has about 4,000 employees, and the federally chartered wholesale bank’s client base includes banks, credit unions and mortgage bankers.
Source: https://www.housingwire.com/rss

AmeriSave accused of defamation, failure to pay wages in lawsuit

AmeriSave accused of defamation, failure to pay wages in lawsuit
A group of 11 former employees are accusing AmeriSave Mortgage Corp. in a new lawsuit of failing to pay the wages, bonuses and commissions that were agreed to when they were hired by the company. The group also alleges that the company conducted a defamatory campaign against them after their layoffs in July 2022. 

According to the class-action-seeking lawsuit, filed in California, AmeriSave hired 200 loan officers to focus on the West Coast region in early 2022. It was part of the Atlanta-based mortgage lender’s strategy for developing a retail mortgage sales division. 

During job interviews, executives at AmeriSave allegedly said the company had a $1.5 billion war chest to navigate the challenging market, according to the lawsuit. 

“They said the upcoming ‘rough times’ would eliminate the competition and leave AmeriSave in a dominant position,” attorneys for the plaintiffs wrote. 

However, the employees say they spent between one to three months at AmeriSave before the company imposed layoffs. In total, about 140 employees separated from the company between July 15, 2022 and August 15, 2022, the attorneys estimate. 

According to the former employees, AmeriSave did not pay the wages, bonuses and commissions guaranteed by their offer of employment. 

In addition, the lawsuit alleges that after the layoffs, executives at the lender communicated with some of the top industry recruiters to say the former employees had not met performance goals and also made “derogatory entries” on the Nationwide Multistate Licensing System (NMLS). 

According to a spokesperson, “As a policy, AmeriSave Mortgage does not comment publicly on pending litigation.” National Mortgage News first reported on the case. 

The lawsuit also alleges that the LOs’ NMLS records showed a termination “for cause,” which gives regulators cause to investigate the former employees.

According to the lawsuit, “this sort of notation gives rise to speculations that the true cause might have been rape, or sexual harassment, workplace violence, theft or other serious, or even criminal issues.”  

The lawsuit includes allegations of fraud, breach of contract, negligence, intentional interference with prospective economic relations, violations of the Warn Act and defamation, among others. Attorneys for the plaintiffs estimate that the total amount owed is at least $43.5 million when considering all 140 potential class members. 

AmeriSave is ranked No. 38 among the top U.S. mortgage lenders. The company originated $12 billion in 2022, down 62.2% year over year, according to Inside Mortgage Finance estimates. 

In September, HousingWire reported that AmeriSave exited the wholesale channel. This decision came after the mortgage lender imposed numerous layoffs across the company, according to former employees and business partners. 
Source: https://www.housingwire.com/rss

Housing Market Tracker: Housing inventory falls once more

Housing Market Tracker: Housing inventory falls once more
We are off and going now, as seasonality has kicked into full gear with the purchase application data. And, so far, it’s been a good start to the year.

Here’s the housing market rundown for the last week:

Purchase application data showed positive weekly growth again — and the bounce from the bottom is more noticeable now.

Housing inventory decreased by 6,468 units, a more pronounced decline from the previous week. 

The 10-year yield can’t break lower from the critical level I have discussed, so not much is happening with mortgage rates.

When I talk about seasonality, I am talking about the second week of January to the first week of May. Total volumes traditionally fall after May, so you can get a good sense of how spring is turning out by the end of March.

We have had back-to-back weekly growth of 25% and 3%. However, the key is that the year-over-year declines have stopped going lower, and we have risen noticeably higher from the bottom.

Remember, though, that this is always the case. We had a waterfall dive in purchase apps in 2022 — a historic dive, I would say — so there is a shallow bar to bounce off of. Does this move have more legs to run, and will we need lower mortgage rates to get more growth in this data line?

The key with purchase application data is that this data line looks out 30-90 days, so the growth we see here takes about 30-90 days at minimum to hit the sales data. As I have stressed for some time, this data line started to improve on November 9th, 2022. It will take until February or March to see it in sales data for January and February.

The most recent pending home sales data from last week went positive; this runs in line with what we saw starting in November and December. It’s low bar bounce for now, but the bleeding in housing has stopped, and we are showing some growth.

We focus on the weekly data to give us a forward-looking idea of where sales are going. Hopefully, the evidence I have shown you above, and the fact nobody else was talking about how the purchase application data internals were getting better starting from November 9th, will give you some faith in my models — kind of like the “America is back” recovery model of 2020.

Weekly housing inventory

There is, again, another downside report on weekly inventory, as inventory has fallen noticeably again this week from the week prior. We are running into a timeline where the inventory can fall just because demand has picked up slightly from the lows, and I am keeping an eye on it.

I was concerned about how fast inventory was falling earlier in the year, and then we paused for about two weeks. However, it has now fallen again, and inventory decreased by 6,468. This is not what I want to see, but this is the reality of the world we live in post-2020.

Hopefully we get the seasonal inventory push sooner in 2023 than we did in the last two years, but thankfully, inventory is still higher this year than last year.

Weekly inventory change (Jan. 20-27, 2023): Fell From 472,122 to 465,654

Same week last year (Jan. 21-28, 2022): Fell from 276,865 to 271,954

In June 2022, I predicted that as long as mortgage rates stayed high, weakness in demand over time could create more inventory — and we could get back to 2019 levels of inventory in 2023, meaning inventory breaks over 1.52 million using the NAR inventory levels.

Right after I made that forecast, new listing data started to decline earlier and faster than usual, which put a big dent in the forecast. This forecast will get even more complicated if the weekly inventory levels don’t grow.

The NAR data lags a bit, but the most recent existing home sales report shows inventory broke to under 1,000,000 again. This is only the second time in recent modern-day history that inventory starts the year under 1,000,000.

NAR total inventory is currently at 970,000.

It will be critical that we keep an eye on purchase apps and inventory levels going into spring, as we should see the traditional inventory increases that have occurred every spring season outside of 2020. The question is: Will the higher demand trends eat into the inventory growth, and is this happening already?

Even with the big hit in demand in 2022, it’s been a struggle to get total inventory levels back to 2019 levels, which were the four-decade low in active listings before the Covid 19 pandemic hit us.I would like the traditional spring season inventory levels to grow quicker than we have seen in the last two years. As of now, this hasn’t happened yet — at least not in any meaningful way. However, I am very grateful that total inventory levels are higher this year than last year.

10-year yield and mortgage rates

There wasn’t much action in mortgage rates last week. The 10-year yield has simply been unable to break under the critical level I have been talking about of 3.42%-3.45%.

For now, we are just floating around between 6.15%-6.21%, the mortgage rates last week. This happened while last week’s PCE inflation data showed a cool down continuation of the growth rate of inflation. That inflation data didn’t move the market.

Part of my 2023 forecast for the 10-year yield is that if the economy stays firm, the 10-year yield range should be between 3.21%-4.25%, meaning mortgage rates between 5.75%-7.25%. With economic weakness, bond yields could quickly drop to 2.72%, taking mortgage rates near 5%. 

The economic data has been firm enough to keep the recession talk at bay as the labor market is still holding up. However, we have a lot of data coming up next week — and a Federal Reserve meeting. 

The week ahead

We will have a busy week thanks to the Fed meeting, job openings data, jobless claims data, and the Friday jobs report — all of which could move the markets. Oh my, it’s going to be fun!

The Fed wants to see labor markets and wage growth weakness. We will see if Chairman Powell has anything to say about current markets betting on future rate cuts.

This week, we’ll also learn whether the job openings data falls or grows. A decline in job openings is something the Fed believes will bring down inflation, as job openings are too high for their taste. While wage growth is cooling down, the Fed prefers to see more weakness in the labor data.

I will also be visiting the great state of Texas and speaking in Houston and San Antonio.Any weakness in the labor market and wage growth should move bond yields lower. However, as I have talked about for the past few weeks, it’s been hard for bond yields to break lower recently. For example, despite the clear downtrend in the PCE inflation report last Friday, bond yields didn’t go down that day.

We have a busy and critical week ahead of us, which will cap off the exciting month of January. Overall, we have had a positive month in housing data in January, but I would like to have seen more inventory by now. However, the fact that we are above last year’s levels is a plus for everyone.

We will keep a close eye on all the data this week to offer the most updated take on the U.S. housing market. 
Source: https://www.housingwire.com/rss

How JVM Lending plans to expand without any loan originators

How JVM Lending plans to expand without any loan originators
Most retail lenders are desperately seeking high producing loan originators to make up for the losses that occurred in 2022. The majority of lenders easily lost half of the volume last year that they originated in 2021, and LOs who have their own databases to tap into are highly sought after. 

California-based retail lender JVM Lending plans to drum up business this year — but by doing the exact opposite. The lender runs its business based on a “no-loan-officer” model in which all of its 45 employees are licensed and delegated to a specific role in closing a loan. 

After the 2008 mortgage meltdown, JVM let go of all its loan originators and trained its employees to target the jumbo loan market in the San Francisco Bay area instead.

“Back in the 2007-2009 meltdown, we had loan officers with us at that time. We would feed them leads, but they came back to us because they didn’t know how to structure the full document deals,” Jay Voorhees, co-founder at JVM Lending, said in an interview with HousingWire.

Under the revamped mode, business development officers build relationships with real estate agents to get leads and client advisors take incoming leads from borrowers. Mortgage analysts are in charge of pre-approving buyers, contract desk employees take in incoming contracts and send it to the underwriting team, and closing specialists process the loans and take over all communication with escrow, real estate agents and buyers to close loans. 

“In the Bay area, where we are located, we are primarily in a jumbo market and loans are very complex (…) We still have the expertise niche that comes in a complex environment,” Voorhees said.   

A lender with $624.6 million in production volume in 2022, JVM saw its origination decline by 51% from the previous year’s $1.28 billion, primarily due to banks’ aggressive price cuts — which led to losing 70% of its jumbo loan business.

“They undercut us by 75 basis points on every single product, and suddenly we started losing borrowers (…) About a month ago, the banks started to push up their rates, probably because their cost of funds increased,” Voorhees said.

This year, JVM Lending plans on diversifying their business to closing loans for investment properties rather than being heavily dependent on jumbo loans. The goal for the lender is to have half of its production volume come from investment properties in 2023 — up from the current 10 to 15%. 

JVM, which has also had a market presence in Texas since 2017, saw opportunity for investment properties and plans to capitalize on the growing market. 

“Last five years, we focused in Texas, we never focused on investment property realtors,” Heejin Kim, co-founder of JVM said. “I thought it was sparse. We are going to pursue the investor niche aggressively, meeting very specific realtors. We have our virtual assistants and our team looking for realtors who focus heavily on investment properties.” 

JVM Lending is optimistic about the idea of reaching its sales goal of $1 billion in 2023 based on increased request leads starting from December, which were up 10% compared to the same period in 2021.  

“We got a huge upsurge in business in late January, which we haven’t seen in years. We have this week alone one of our best lock-ins, [which] we haven’t had in a long time. I’ve never expected to see it this early, so we’re extremely optimistic right now,” Voorhees said.
Source: https://www.housingwire.com/rss

Biden administration rolls out renter protections as rent prices soar

Biden administration rolls out renter protections as rent prices soar
As housing prices remain high across the nation, the Biden administration is taking action. The administration announced new actions earlier this week to protect access to housing and make rentals more affordable.

According to the White House, roughly 35% of the U.S. population — or over 44 million households — live in rental housing, but there are no comprehensive federal laws to protect renters. While not binding, the “Blueprint for a Renters Bill of Rights” offers guidelines for keeping renters in affordable housing, along with “access to safe, quality, accessible and affordable housing” and “clear and fair leases.”

The federal government and numerous federal agencies will take action on these and other issues outlined in the blueprint. The administration said it will also launch the “resident-centered housing challenge,” which leans on housing providers and state, local and tribal governments to expand access to housing through stronger policies. The challenge is set to take place this spring and will affect more than 15 million rental units.

Rent hike protections

Nearly one-third of all rental units nationwide are financed with federally backed mortgages — and the blueprint may help curb some of the steep rent price increases for these properties. The Federal Housing Finance Agency (FHFA), along with Fannie Mae and Freddie Mac, stated in the blueprint that the agencies will consider the establishment of tenant protections to limit “egregious rent increases” for properties purchased with certain types of federal mortgages.

In addition, the Federal Trade Commission (FTC) stated that it will use its authority to “take action against acts and practices that unfairly prevent consumers from obtaining and retaining housing” — including high application fees, deposits and background check screening algorithms that do not conform to the Fair Housing Act.

The focus will also be put on the multifamily market. The Federal Housing Finance Agency (FHFA) stated that it will launch a public process to examine renter protections and rent hike limits, which aims to increase affordability of multifamily rental properties.

The FHFA will also require half of all Freddie Mac and Fannie Mae multifamily purchase loans in 2023 to be “mission-driven.” Fannie Mae provided more than $69 billion in debt financing to support the multifamily market last year.

But while these guidelines are intended to help limit high rent increases, organizers with People’s Action told the Washington Post that the policies are unlikely to “change tenants’ lives materially today” due to a lack of binding conditions on matters like federal financing.

“The White House announcement introduces potential for agency-level action but falls short of issuing directives to regulate rent and address consolidation of the rental market,” said Tara Raghuveer, the homes guarantee campaign director at People’s Action, told the Washington Post.

“The rent is too … high, and landlords, many who receive federal financing and subsidies, made record-setting profits in the past two years. There is much more the president can do to provide material relief to tenants, and we’re counting on this administration to continue working with our campaign to make it happen.”

Eviction protections

More than 2 million eviction filings and approximately 900,000 evictions occurred every year prior to the pandemic, which disproportionately affected Black women and children, according to the report.

And, according to reports, most rental assistance — including the approximately $47 billion the Biden administration earmarked for rental assistance programs during the COVID-19 pandemic — has nearly dried up or failed to reach at-risk tenants. That puts at-risk renters in a precarious position, one that could lead to eviction.

The blueprint’s eviction guidelines aim to curb some of the potential issues. According to the blueprint, if an eviction is filed, tenants should get 30 days’ notice and counsel during an eviction proceeding.

In addition, the Department of Housing and Urban Development (HUD) will award $20 million for the Eviction Protection Grant Program to fund the provision of legal assistance by non-profit and government organizations to low-income evicted tenants or those at risk of eviction. 

But while eviction protections may be in the blueprint plans, the guidelines have their fair share of opposition.

Bob Pinnegar, the president and CEO of trade group the National Apartment Association, told CNBC that the industry is opposed to the expansion of federal involvement in the landlord-tenant relationship.

“Complex housing policy is a state and local issue and the best solutions utilize carrots over sticks,” Pinnegar said.

Protections for military members, disabled tenants

Other protections in the blueprint focus on military members and disabled tenants. The Department of Justice (DOJ) stated in the blueprint that it has the duty to guarantee housing to military members and to assist them in housing inspections before signing a lease. It will also assist in rent negotiation, lease reviews, and addressing discrimination complaints.

The Department of Housing and Urban Development (HUD) says it plans to improve its accessibility standards for disabled tenants, acting on the feedback of tenants and advocates.

The United States Department of Agriculture (USDA) will also ensure that tenants who are seeking compliance with the terms of their leases can do so without retaliation risks. In addition, the USDA is developing a lease structure that follows the HUD Section 8 model.

“We are heartened to see the Blueprint outline the need for federal, state, and local governments to protect against source of income discrimination; solutions to improve the Section 504 program which is essential to supporting housing for people with disabilities; and the need for guidance on the use of tenant screening algorithms that create barriers for renters and may violate the Fair Housing Act,” Nikitra Bailey, executive vice president of the National Fair Housing Alliance (NFHA), said in a statement.

Will the guidelines be enough?

While the guidelines outlined in the blueprint are a start, chances are that they won’t curb the rental crisis in America, according to Diane Yentel, president and CEO of the National Low Income Housing Coalition.

“The hard truth is that administrative action on its own can’t resolve the housing crisis that we’re in,” Yentel told the Washington Post. “It’s going to require major action from Congress, and unfortunately, the opportunity we had through Build Back Better passed by … We are clear-eyed about the limitations of administrative actions but are still pushing to do all we can now. The need is greater than ever.”
Source: https://www.housingwire.com/rss

Top Fairway LO Dave Medina decamps for Movement Mortgage to spread his wings

Top Fairway LO Dave Medina decamps for Movement Mortgage to spread his wings
Top-producing loan officer Dave Medina and his team at the Temecula, California-based branch have left ​​Fairway Independent Mortgage to join Movement Mortgage.

The move, which marks the start of Movement’s branch partnership strategy, comes four months after the South Carolina-based lender hired two top executives away from Fairway. 

“In the 20 years that I’ve been doing this business, I’ve only moved companies once, and that was when the company sold the mortgage division to another,” Medina said in an interview with HousingWire. “Outside of just doing mortgages, I want to be part of something bigger and Movement had some opportunities for me to get involved with national coaching.”

Spokespersons for Fairway and Movement Mortgage did not respond to requests for comment on Thursday.

Medina, who had been at Fairway since April 2017, said his team’s production is about $100 million annually. His branch includes Medina, four loan originators and two support staffers. Medina said that his personal production, which was about $60 million in 2021, declined to $45 million last year. 

“My new responsibilities involve my production, growing and managing our branch location in Temecula and the goal of building additional market centers or branches throughout the country,” Medina said.

South Carolina-based Movement built a war chest over the last couple of years when its volumes boomed due to low mortgage rates. The company has used the cash to acquire new businesses, such as the indie retail lender Mortgage Network and the brokerage Superior Rate Mortgage of New England. 

Another strategy, which starts with Medina’s team, is to partner with branches across the country. 

“Dave will be the first office in our new branch partnership model, and he will be involved in our national coaching platform,” Dennis Hueman, regional vice president at Movement Mortgage, wrote in a post on social media. 

According to Medina, the branch partnership model “is new to Movement but certainly not to the industry.” It gives branch managers more autonomy in managing staff and requires financial responsibility. It’s a more entrepreneurial style, but compensation follows the traditional model at retail lenders. 

Medina and his team’s transition to Movement Mortgage follow in the steps of Sarah Middleton and Kevin McGovern. The two executives moved from Fairway to Movement in August 2022 to boost the lender’s growth and develop its distributed retail sales team.  

Middleton, a 34-year mortgage industry veteran, was named to the new position of chief growth officer. McGovern was named director of coaching and is responsible for creating a coaching platform for Movement. 

Wisconsin-based Fairway, ranked No. 12 among mortgage lenders in America, originated $42 billion in 2022, down 33% compared to the previous year, according to Inside Mortgage Finance figures. Meanwhile, Movement originated $23 billion last year, down 20% year over year, enough to make the lender No. 24 in the ranking, per IMF.
Source: https://www.housingwire.com/rss

Old Republic’s net income was down over 55% in 2022

Old Republic’s net income was down over 55% in 2022
The rapidly cooling housing market in 2022 was not kind to Big Four title insurer Old Republic. While the century-old firm, which is celebrating its 100th anniversary in 2023, did generate net income for both the fourth quarter of 2022 as well as for the year as a whole, it was down substantially last year.

During the fourth quarter of 2022, Old Republic recorded a net income of $512.1 million, down from $627.0 million in Q2 2021. The firm generated a net income of $686.4 million for the full year in 2022 compared to $1.534 billion in 2021. Despite being down drastically compared to last year’s record-breaking numbers, executives told investors on the firm’s fourth-quarter and year-end earnings call on Thursday that they were in line with expectations.

Hampered by the volatile interest rate environment and dramatic drop off in refinance transactions, the firm’s title insurance sector saw its pretax operating income drop 67.2% year over year in 2022 to $45 million.

During Q4 2022, Old Republic’s title insurance net premiums and fees generated were down to $836.4 million, a drop of 29.4% compared to a year ago. For the full year 2022, title net premiums and fees recorded a yearly drop of 13.0% to $3.8338 billion.

Carolyn Monroe, the president of Old Republic’s title insurance segment, attributed the relatively small yearly drop in 2022 to a strong performance by the firm’s commercial title insurance sector.

“While increasing mortgage rates, refinance decline, and a softening housing market impacted our residential activity, our commercial activity remained strong in the fourth quarter, with commercial premiums up 13% over fourth quarter 2021 — and they represented 26% of our total premiums compared to 18% in the fourth quarter of ’21,” Monroe said. “Commercial premiums reported for full year 2022 represented an all-time high for the title group. As we enter 2023, we will continue with a focus on commercial opportunities. During 2022, we transformed and aligned our commercial operations with an internal structure that allows us to leverage more tools, resources and support to enhance our capacity to deliver in the sector.”

Aside from leaning into their commercial title segment, Monroe also said the firm hopes to continue improving its technology usage and offerings in 2023.

“The ability to electronically record with counties is an essential step in our digital intimate process vision. Throughout 2022, our e-recording company EPM has had the fastest growing network of county connections of the major platforms,” Monroe said. “This growth in our network will give our offices and agents additional access to counties throughout the country for closing files electronically.”
Source: https://www.housingwire.com/rss

Pending home sales rise for the first time since May 2022

Pending home sales rise for the first time since May 2022
Pending home sales ended 2022 on a positive note. After six consecutive months of declines, the Pending Home Sales Index rose 2.5% month over month in December to a reading of 76.9, according to data released Friday by the National Association of Realtors (NAR).

“This recent low point in home sales activity is likely over,” Lawrence Yun, NAR’s chief economist, said in a statement. “Mortgage rates are the dominant factor driving home sales, and recent declines in rates are clearly helping to stabilize the market.”

Despite the monthly increase, pending home sales are down 33.8% compared to December 2021. An index of 100 is equal to the level of contract activity in 2001.

“We now have multiple leading housing indicators that are pointing to modestly higher sales activity. Mortgage applications have been trending higher alongside lower mortgage rates, pending-home sales are up, and home builder confidence increased in January.” Odeta Kushi, First American’s deputy chief economist, said in a statement.“Interested buyers are out there. From a financial perspective, the decision to buy a home comes down to a payment-to-paycheck calculation, and lower mortgage rates may help to reduce the mortgage payment while higher incomes can increase one’s monthly paycheck.”

On a year-over-year basis, all four of the major U.S. regions recorded declines, with the West recording the largest yearly decline at 34.5%, down to a reading of 58.6.

Two of the four regions experienced declines month over month, with the Northeast (64.7) and the Midwest (77.6) falling 6.5% and 0.3%, respectively. The South (94.1) and the West rose 6.1% and 6.4%, respectively.

“The new normal for mortgage rates will likely be in the 5.5% to 6.5% range,” Yun added. “Job gains will steadily become important in driving local home-sales markets. The South, in particular, is set to outperform the rest of the country, thanks primarily to better job market conditions in this part of the country compared to other regions.”
Source: https://www.housingwire.com/rss

Flagstar Bank makes big cuts to retail mortgage operation

Flagstar Bank makes big cuts to retail mortgage operation
Two months after receiving the Federal Reserve’s approval to merge with New York Community Bank, Michigan-based Flagstar Bank is reducing its footprint in the retail channel and laying off hundreds of staffers, according to laid off employees. 

“I just got news this morning that the company is scrapping retail outside of where the bank footprint is,” a former Flagstar Bank regional manager posted on social media. 

A former mortgage underwriter wrote, “Flagstar just laid off everyone, so after 2 1/2 years, I’m back in the job market.”  

Layoffs occurred on Thursday morning with no warning, according to former employees. Their access to the company’s systems, computers, and emails was shut off immediately. The company offered severance payments based on tenure and job position.  

“Hundreds of us were told to get on a call this morning at 11:00 AM, and they told us all that they were shutting down the retail division of Flagstar Mortgage,” a former loan advisor told HousingWire. “They denied us access immediately after the call, so we could not access our computers or contact information. It came as quite a surprise to all of us.” 

A spokesperson for Flagstar Bank did not respond to a request for comments on Thursday. HousingWire did not find Worker Adjustment and Retraining Notification (WARN) related to the layoffs.

It wasn’t immediately clear if Flagstar had reduced headcount in areas where the bank has no brick-and-mortar footprint or if cuts include branch territories. 

Flagstar, No. 19 among mortgage lenders in America, and New York Community Bank, one of New York City’s largest multifamily lenders, announced in April 2021 a $2.6 billion merger deal. 

The Office of the Comptroller of the Currency approved the merger in late October, followed by the Fed in November. 

Flagstar originated $27 billion in mortgages last year, down about 38% year-over-year, according to figures by Inside Mortgage Finance. Like its competitors, Flagstar’s performance deteriorated as time went on, declining from $8.2 billion from January to March 2022 to $4.1 billion from October to December 2022.  

The bank originated $6 billion in the first nine months of 2022 through the retail channel, down 54% year over year, per IMF data. Meanwhile, the wholesale channel reached $17 billion in the same period, down 35%. 

Following the OCC’s approval for the merger in October, Flagstar said the combined company would operate its mortgage division nationally through 81 retail lending offices in 26 states. The wholesale network had approximately 3,000 third-party originators.

According to the companies, the merger creates one of the largest regional banks in the U.S., operating 395 branches across a nine-state territory, including the Northeast and the Midwest, with exposure to high-growth markets in the Southeast and West Coast.
Source: https://www.housingwire.com/rss

Expansion-hungry APM acquires over two dozen Lend Smart branches

Expansion-hungry APM acquires over two dozen Lend Smart branches
California-based lender American Pacific Mortgage (APM) announced an asset purchase agreement with retail lender Lend Smart Mortgage on Thursday in its latest move to drum up production across the country. 

APM bought assets that include about 25 branches from the Minnesota retail lender Lend Smart. APM also acquired a database of referral partners as well as the branch leases that they had, Bill Lowman, CEO of APM, said in an interview with HousingWire.

Lend Smart will retain its name and brand and have access to APM’s mortgage products. 

“Our intention is to retain all of their production and operational leadership,” Lowman said, declining to comment on whether Lend Smart will reduce its headcount. The executive also declined to comment on the terms of the deal.

Lend Smart, a company with 107 active loan originators, is licensed in 29 states and originated $378.8 million in volume last year — a steep decline from the nearly $800 million in originations in 2021. 

With purchase mortgages accounting for 70% of the entire transaction volume in 2022, most of the company’s sales came from Minnesota and Arizona, mortgage data platform Modex showed. 

“In addition to the model and cultural match, a lot of their production is from the Midwest. That’s one of the geographies that we are targeting for 2023,” Lowman said.

Most of APM’s business is from California, and the lender is looking to increase its presence beyond the West Coast, Lowman noted.

“We’ve only held licenses east of the [state] Mississippi for about the last four years. Most of our business historically has been west of the Mississippi, so we are targeting east of the Mississippi for our growth in 2023 and 2024,” Lowman said.

APM, which has 445 branches and 2,587 loan officers across the country, expanded last year by recruiting employees from struggling lenders or firms that shut down. Its production volume fell by more than 55% to $12.13 billion in 2022 from the previous year’s $23.6 billion. 

APM most recently brought over about 150 employees from 20 AmeriFirst Financial branches after the Arizona-based lender ceased originations in December. 

High-producing and profitable branches from AmeriFirst were recruited in January, which included branch managers, loan originators and processors, Lowman said in an interview last month. 

The lender also hired former employees from about 35 to 40 retail branches of Finance of America Companies Inc. after it shut down its forward mortgage segment in October. In July, APM acquired Arizona-based Sunstreet Mortgage, a boutique lender that originated $293.2 million in loan volume last year. 

“We retained our earnings to take advantage of market share opportunities in a downmarket,” Lowman said, noting that APM plans to continue to explore opportunities for M&As and asset purchases in 2023. 
Source: https://www.housingwire.com/rss