Mortgage – HousingWire |
- Layoffs, again: Better.com to ax 3,000 employees
- Welcome to Walmart. Here’s your mortgage
- ATG to merge with Guaranteed Rate
- Cash-out refis reach $1.2T in 2021, highest level since 2005
| Layoffs, again: Better.com to ax 3,000 employees Posted: 08 Mar 2022 08:41 AM PST Pink slips will arrive for 3,000 employees of Better.com, the mortgage lender that received a mountain of bad press three months ago when its CEO, Vishal Garg, fired 900 workers via Zoom and chastised their work ethic to remaining employees. The new round of layoffs reaches 35% of Better.com's staff and hits workers in the United States and in India, according to a person familiar with the lender's decision. TechCrunch first reported rumors of the layoffs on Monday. Like many mortgage lenders, Better.com made a killing in 2020 thanks to low rates and a homeowner rush to refinance, but latter half of 2021 and 2022 have not been as kind. Interest rates have climbed well above 3%, turning the mortgage market to purchases, which Better isn’t well positioned to capitalize on. The reputational damage from the December layoffs also hinders the company’s ability to develop relationships that lead to purchase business. "As you know, the residential real estate market has been changing rapidly, and our entire industry is facing a dramatic drop in origination volume due to rising interest rates," Kevin Ryan, CFO and interim president, said in an email to Better.com employees reviewed by HousingWire. "Unfortunately, that means we must take the difficult step of streamlining our operations further and reducing our workforce in both the U.S. and India in a substantial way." Ryan, a former executive at Morgan Stanley, stepped in to manage day-to-day decisions of the company in December, when Garg took a leave after laying off staffers in a webinar. Specifically, Garg accused former employees of "stealing" from the company by working a mere two hours per day, which laid off employees denied. The CEO made a somewhat surprising comeback in January. Garg took the time to "reflect on his leadership duties [and] reconnect with the values that make Better great," the board said in an internal memo. This time, according to the letter, Better.com is doing "everything possible" to personally reach all employees affected by the layoffs. They will receive a call over the coming days from a member of the leadership team. However, Techcrunch reported that some affected workers found out about their job status by seeing a severance check in the company's payroll app. HousingWire reached out to the company seeking a comment, but received no answer. Better.com said affected employees will be eligible for a minimum of 60 working days – and as much as 80 working days – to receive cash severance payments. Also, health insurance coverage in the U.S. will be extended through March. Better.com partnered with a career transition company, Randstad RiseSmart, to support affected employees with career services. RiseSmart can identify and connect departing employees directly to employers who are actively hiring. The mortgage lender said it will not enforce existing non-compete provisions based on individual circumstances, but non-disclosure provisions will remain in effect. Better's financial backer, SoftBank, made a $750 million cash infusion last year, out of a total $1.5 billion in committed funding. The remaining $750 million is to be doled out after the company goes public via a special purpose acquisition company. But when – or if – that will happen has been thrown into question. The post Layoffs, again: Better.com to ax 3,000 employees appeared first on HousingWire. |
| Welcome to Walmart. Here’s your mortgage Posted: 07 Mar 2022 01:44 PM PST Lenders One Cooperative announced on Monday that it has struck a deal to lease retail space in Walmart stores to sell mortgage products and services. The cooperative inked a deal for space at three Walmart locations, but said there are “many more opportunities to come.” Lenders One will be selling purchase, refinance and home equity products at its “store-in-store” branch locations. Justin Demola, president at Lenders One, wasn’t immediately available for comment. In a statement, Demola said that the initiative is part of the cooperative’s mission to help members “improve their profitability and better compete against larger, well-funded mortgage lenders.” Walmart isn’t the first warehouse-style retailer to offer mortgage products on location. Similar to Walmart, Costco has a partnership with Ohio-based retail lender CrossCountry Mortgage, which in 2020 acquired First Choice Loan Services, Costco’s mortgage program provider. Founded in 2000, Lenders One Cooperative has a network of more than 240 independent mortgage bankers, banks, credit unions, correspondent lenders, and suppliers of mortgage products and services. The platform is managed by a subsidiary of Altisource Portfolio Solutions, a service provider and marketplace for the real estate and mortgage industries. Sponsored Video The cooperative members cover the entire lending spectrum, originating between $50 million and $25 billion per year. Collectively, their origination volume reached around $780 billion in 2020, the cooperative claims. According to the company, the Walmart deal is part of a plan to improve its members’ profitability by manufacturing loans more efficiently and closing a greater number of loans. The cooperative also launched a full credit reporting agency (CRA), which will offer its members a full tri-merge credit report, fraud reports, undisclosed debt notifications, verification of employment and assets, and other services. Another initiative is a cloud-based technology called Lenders One Loan Automation (LOLA), launched to automate the loan manufacturing process. Members can order and receive cooperative solutions without human intervention. In 2012, one-third of people surveyed said they would consider a mortgage from retailer Walmart and almost half would consider one from PayPal. Neither company offered mortgages. The post Welcome to Walmart. Here’s your mortgage appeared first on HousingWire. |
| ATG to merge with Guaranteed Rate Posted: 07 Mar 2022 07:35 AM PST Illinois-based title insurance underwriter Attorneys' Title Guaranty Fund (ATG) has entered into an agreement to merge with mortgage lender Guaranteed Rate. ATG president and CEO Peter Birnbaum announced the plans for the merger in early January in an email to ATG agents and shareholders. The transaction is still subject to regulatory and shareholder approval, but it is expected to close later this month. Attorney members who joined ATG between 1964 and 2007 and their successors have been asked to vote on the merger. Birnbaum and the other members of the firm's senior team plan to stay on after the merger. The financial terms of the deal have not been disclosed. "The ATG Board and Senior Management have debated issues related to ATG's ownership for several years," Birnbaum wrote in the email. "In the end, we concluded that a change in ownership was not only advisable, but necessary." ATG was founded in 1964 by Stan Balbach, who hoped to create a "guaranty fund" (today known as a title underwriter) owned by members of the Illinois Bar. "Stan envisioned the creation of this ‘guaranty fund’ to give lawyers the ability to issue title opinions backed by an insurance underwriter," Birnbaum wrote. "After we raised enough money in the ‘guaranty fund’ to qualify as a title underwriter, we continued to sell shares to individual lawyers and firms. For a variety of reasons, we stopped selling shares in 2007. Today, we have roughly 1,900 shareholders; because there is no market for those shares, shareholders have been unable to unlock the significant increase in their value." Birnbaum cited shareholder's inability to unlock the value of their shares, a desire to preserve the lawyer's role in real estate transactions (Illinois is not a so-called "attorney state," requiring a lawyer to be present at a closing, however it is customary to have a lawyer review the purchase agreement.) and the potential to grow the business, as the primary motivators for the merger with Guaranteed Rate. Guaranteed Rate, one of America’s largest retail lenders, already offers title insurance services to clients; it owns Guaranteed Rate Insurance and Ravenswood Title Company. The post ATG to merge with Guaranteed Rate appeared first on HousingWire. |
| Cash-out refis reach $1.2T in 2021, highest level since 2005 Posted: 07 Mar 2022 04:30 AM PST Record home prices in recent years have pushed tappable home equity to new heights, increasing the demand for one specific product: cash-out refis. "We've been discussing this shift to an equity-centric market for some time, and our Optimal Blue rate lock data showed that cash-out activity continued to increase in January of this year as well," Ben Graboske, data and analytics president at Black Knight, said in a statement. Here's how home price appreciation impacts taxes – And what that means for servicers Real estate prices (and home appreciation) have been on a tear over the past few years. But sooner or later all this good fortune will translate into higher assessments and tax increases. Here's what servicers should be doing to anticipate tax issues this year. Presented by: LERETAOverall, originations reached $4.4 trillion in 2021, up from $4.3 trillion in the previous year to post a record volume. Refinances decreased 34% last year, to $2.7 trillion — rate/term refis volumes declined even more, 60% compared to 2020. Lenders originated a record $ 1.7 trillion in purchases last year. The post Cash-out refis reach $1.2T in 2021, highest level since 2005 appeared first on HousingWire. |
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