Mortgage Industry Producing Lots of Unemployed

I’ve written quite a bit about the nations biggest and best banks sending tens of thousands of jobs overseas; Citigroup 26,500, Washington Mutual 10,000, New Century 6,500 and American Home Mortgage 6,250. But there are hundreds smaller companies involved in the mortgage industry that are closing or belling up to the bankruptcy bar.

Some of the following names haves no numbers attached, Mortgage Lenders Network USA laid off 80% of their staff or 1,440 in January.

So the following is a lists of the ones that I have been able to come across. From The Truth About Mortgage.com:

Aegis Funding – closed
Accredited – rumors of a closure
Acoustic Home Loans – closed
Ameriquest – laid off 3,800, closed 229 retail branches after $325 million settlement
Argent – for sale
Axix Mortgage – closed
Bank of America – continued layoffs, mulling Countrywide merge
Broad Street Mortgage – sold to Wausau Mortgage Corp.
Citigroup – bought ABN AMRO Mortgage Group
Clear Choice Financial – in default, Bankruptcy possible
Concorde Acceptance – rumored to be closed
Countrywide – layoffs, may be bought out by Bank of America
DeepGreen Financial - closed
Decision One – closed six regional centers
E-loan – closed sub-prime wholesale division
ECC Capital/Encore Credit – sold to Bear Stearns
Equibanc - closed
Fieldstone Mortgage – closed Las Vegas branch
Fremont General – exited secondary sub-prime market
FundingAmerica - not accepting any new business
HMIC – closed
Indymac – bought retail arm of New York Mortgage Trust
Lender’s Direct Capital Corporation – closed wholesale lending operations
Loancity – closed 7 branches
Loans 123 – no longer taking anymore business
Mandalay Mortgage – closed
MGIC – bought rival mortgage insurance provider Radian Group
Millenium Bankshares – closed mortgage division
Mortgage Lenders Network – stopped residential loan production
New Century – stock plummeted after announcing huge losses and buybacks
Novastar – facing potentially huge lawsuit
Oak Street Mortgage – closed
Option One – for sale
Own It Mortgage – closed
Popular Financial Holdings - exited the wholesale sub-prime mortgage market
ResMae – for sale
Right Away Mortgage – closed
RFC – layoffs
Rose Mortgage Corp. – closed
Saxon – layoffs
Sebring Mortgage – closed
Secured Funding – closed
Silver State Financial Services – closed
Sovereign Bancorp – exited wholesale market
Summit Mortgage - closed
Wachovia – layoffs
Washington Mutual – exited correspondent market

These lay offs are just in Orange County, CA and was posted by djGT in the forums at DI.FM:
(Updated July 26, 2007. Citigroup and new Impac Mortgage layoffs added.)
Acoustic Home Loans, Orange. Closed in April 2006. Laid off 203 people.
ACC Capital Holdings, Orange. Laid off an estimated 3,000 of the 6,000 employees at its Ameriquest Mortgage Co., Argent Mortgage Co.and AMC Mortgage Serviceson March 15. Reported 1,072 layoffs in Orange County as of June 22 to the EDD. Last year, the companies laid off more than 4,000 people.
BNC Mortgage LLC, Irvine. Reported 94 layoffs to the EDD, effective Aug. 12.
Citigroup Inc., Brea. Reported 77 layoffs to the EDD effective June. 29.
Countrywide Home Loans, Anaheim. Reported 59 layoffs in January to the EDD.
ECC Capital, Irvine. Sold its mortgage operation to Bear Stearns in February but said it would keep its 350 local workers. The company laid off about 600 people nationwide last year.
Express Capital Lending, Newport Beach. Reported 36 layoffs March 30 to the EDD.
Dana Capital Group, Irvine. The lender reportedly closed the first week of May. Layoffs unknown.
Ditech.com, Costa Mesa. Reported 181 layoffs effective July 3 to the EDD.
First NLC Financial Services LLC, Orange. Reported 113 layoffs in March to the EDD.
First Street Financial, Irvine. Ceased operations June 15. Layoffs unknown.
Fremont Investment & Loan, Brea. The company announced March 2 that it was exiting the subprime business after federal regulators issued a proposed cease and desist order. Reported 62 initial layoffs in Anaheim March 5 to the EDD. Additional reported layoffs in Anaheim and Brea brings total to 470 as of Aug. 6.
H&R Block Mortgage Corp., Irvine. Announced 50 layoffs May 17. The company reported additional layoffs effective July 10 bringing the total to 183.
Home Loan Center Inc./Lending Tree Loans, Irvine. Reported 271 layoffs effective July 10 to the EDD.
Homeview Lending Inc., Lake Forest. Reported 21 layoffs March 16 to the EDD.
Impac Mortgage Holdings Inc., Irvine. Announced May 9 that it laid off about 100 people out of about 800 in its workforce nationwide. On July 25, the company said it would lay off an additional 190 workers nationwide, including 43 in Orange County.
IndyMac Bancorp., Irvine. Announced 400 layoffs nationwide July 19 including 20 in Irvine.
Master Financial Inc., Orange. Stopped lending March 14. Reported 50 Orange County layoffs to the EDD.
New Century Financial Corp., Irvine. Filed for bankruptcy April 2. An initial 2,000 workers were laid off nationwide, including nearly 500 in Orange County. The company reported to EDD that as of May 4, it had laid off a total of 1,051 people in its Irvine and Santa Ana offices.
Novastar Mortgage Inc., Lake Forest. Reported 56 layoffs March 16 to the EDD.
Opteum Financial Services, Foothill Ranch. Reported 130 layoffs as of June 23 to the EDD.
Option One, Irvine. Parent company H&R Block said in November that it would sell Option One and close 12 branches, none in Orange County. On May 16, it announced 615 layoffs nationwide, including 133 in Orange County.
People’s Choice Home Loan, Irvine. Filed bankruptcy March 20. Reported 242 layoffs effective May 22 to the EDD.
Quick Loan Funding, Costa Mesa. Owner Daniel Sadek told the Orange County Register in May that the company payroll had shrunk from 700 at its height to about 125 now.
ResMae Mortgage Corp., Brea. Filed bankruptcy Feb. 12, saying it would keep 800 out of 1,037 jobs. Reported 185 layoffs effective May 19 to the EDD.
WMC-GEMB Mortgage Corp., Costa Mesa. Reported 29 layoffs effective May 7 to the EDD.

New Century – Case In Point

Since the downfall of New Century is practically history I wasn’t going to write this article, but after reading the Companies History from their web site there were several things that need to be said.

New Century is a classic example of the ideal modern business. This is what everyone dreams of; making outrageous money moving other people’s money. Yes, they brought home ownership to difficult to finance individuals, but in the process they became one of the preferred vehicles for property speculation. They had to be so leveraged out that a relatively small dip in housing, not commercial real estate, brought the company down.

This was a young company that made its first loan in 1996 and went public in 1997.

From the Company History section of their web site:

“As the company has grown, so has recognition of its success. The company was named to FORTUNE Magazine’s list of “FORTUNE’s 100 Fastest Growing Companies” – ranking 12th in 2003 and third in 2004. In 2005, it ranked third on The Wall Street Journal’s “Top Guns” list of the best performing companies…”

“…New Century kicked off the “New Shade of Blue Chip” brand identity campaign in February 2005, with the message that the company wants to be seen as a modern blue chip company, while striving to become a world-class mortgage company. New Century’s goal is to become one of the top 10 U.S. mortgage companies for volume and one of the top five for revenue.”

“We’ve achieved a lot in our first 10 years,” says Brad Morrice, Vice Chairman, President and COO, New Century Financial Corporation, “but as I like to say, for New Century the best is yet to come!”

From the New Century web site the company peaked last year with 6,800 employees. And from a Los Angeles Business from bizjournals article they are currently laying off 2,000 more leaving only a 250 “corporate team” to finish burying the company.

Our systems award the “fast-buck” and puts up road blocks to the slow solid growth type businesses. One look at the current budget before Congress shows draconian cuts in the programs that aid small business while heaping on additional taxes and regulation. Common sense just isn’t popular in our financial and regulatory circles.