Celebrity Home Loans is leaving the correspondent chain
mortgage lender Celebrity Home Loans closed its correspondent chain and laid off employees on Tuesday. Against a backdrop of market downturn, the company decided to focus on the retail lending business.
“As one of the few retail lenders to have seen production increase from the first to the second quarter, we have decided to focus on our greatest strength: retail lending,” wrote David Robnett, president and chief executive officer. general, in a press release. “Unfortunately, this means that the corresponding loan channel we were beta testing ended yesterday, affecting 10 members of our team.”
The executive said the corresponding production represents less than 0.1% of the overall volume in 2022, but declined to provide the total production. Celebrity is “honouring all pipeline locks, so no customers are disrupted,” Robnett wrote.
Part of the Financial Services Holding Celebrity Financier, Illinois-based Celebrity Home Loans is licensed in 48 states and has reached $21 billion in home loans since 2006, according to its website.
With the mortgage company acquisition strategy, Celebrity reached 29 different brands. Midwest Equity Mortgage was the first company incorporated in 2018.
Closure of the corresponding channel mainly affects Cypress Mortgage Capital, the corresponding division of Celebrity which offered unqualified mortgages, prime jumbos and reverse mortgages.
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According to Robnett, the Cypress brand is specific to the correspondent loan and limited to the 10 team members affected by the downsizing. He said the layoffs were for various positions and the company was offering severance packages. The company did not provide additional details.
As mortgage rates doubled in a year and the market tightened, many lenders began to focus on their most important channels – often at the expense of unproductive divisions.
Fame is the latest example. Tuesday, based in California loanDeposit, for example, announced it was exiting the wholesale business after a second-quarter loss of $223 million. In January, based in Chicago Guaranteed rate decided to discontinue its third-party wholesale channel, Big Stearns Loansjust one year after acquiring the multi-channel lender.