The mortgage market has already seen seismic changes in recent weeks, as lenders across the board shapes and sizes made changes their loan standards to deal with current economic conditions in the United States. Other lenders have put some loan programs pending or suspended loan absolutely.
And now, one of the biggest players in the mortgage market is shutting down one of its lending channels, but he says the change is not due to the coronavirus.
According to the company, wholesale loans made up only a small portion of its global loans and it is now focusing on these larger channels.
“After careful consideration, Mr. Cooper has made the decision to cease its wholesale lending operations, a segment of the business that we entered into as part of the acquisition of Pacific Union Financial,” the company said in a press release provided to HousingWire.
“The origination team was successful in making Mr. Cooper one of the top 15 lenders, through the continued growth of the Direct-to-Consumer and Correspondent channels. As the market evolves, we are focusing more on our current customers and continue to prioritize investments in their experience to create lifelong customers, ”the company continued.
“In addition, we will continue to invest in the growth of our chain of correspondents. The wholesale platform represented less than 5% of our total assembly volume, and we believe reallocating resources to other segments within assemblies will help us better meet the needs of our customers today. The company added. “The pandemic was not the driving force behind this decision. “
Mr. Cooper is the third largest mortgage service provider in the United States, saying it serves 6% of the entire mortgage market. But the company has a growing origination arm, including a program to acquire service customers and convince them to use Mr. Cooper as a lender for refinancing or buying a home.
And now the company will focus on lending in this and other channel instead of wholesale.
According to the company, the change will result in a “small number” of layoffs, but the company did not disclose the number of employees who would be made redundant.
“We were able to find new roles within the company for the majority of our wholesale team members, moving them primarily to our direct-to-consumer lending team,” the company said. “We regret that this has had an impact on a small number of team members, especially in these uncertain times. We work with these people to find new opportunities in other organizations, in addition to offering outplacement services and severance packages.