Newrez, a large mortgage lender based in Pennsylvania, informed the state on Monday that it will fire another 317 workers in Colorado beyond the 103 it said it would dismiss in early May.
“Newrez LLC will be conducting a reduction in force at its Greenwood Village, CO facility located at 6200 S Quebec Street … on August 2, 2024. This mass layoff is expected to be permanent,” Donnie Gravley, a senior director of human resource operations at the company informed the Colorado Department of Labor and Employment in a Worker Adjustment and Retraining Notification letter.
On May 2, Gravley informed the state the company would let go of 103 workers at the Greenwood Village location effective July 1.
Mortgage lenders came under intense financial pressure after the Federal Reserve began raising interest rates in March 2022 to combat rising inflation. Higher mortgage rates caused the refinancing business to dry up, reducing the need for workers to process loans.
But this round of reductions appears more tied to an acquisition that Newrez’s owner, Rithm Capital Corp., announced last October. Rithm, a public company, acquired Computershare Limited Services Inc. for $720 million.
That purchase of Computershare’s loan servicing arm included Specialized Loan Servicing, a Colorado-based company that John Beggins founded in 2003. Specialized Loan Servicing, which collects payments from borrowers and handles delinquencies and foreclosures, was merged into Newrez and renamed Shellpoint.
Once the acquisition closed on May 1, the layoffs started.
Newrez was the nation’s fifth largest mortgage lender in the first quarter, producing $10 billion in loans, according to estimates from Inside Mortgage Finance as reported in HousingWire. Its portfolio of $536.6 billion in unpaid mortgage balances is the sixth largest in that category in the U.S.
The Consumer Financial Protection Bureau in May 2020 slapped Specialized Loan Servicing with more than $1 million in civil money penalties and restitution orders tied to alleged violations of the Real Estate Settlement Procedures Act.
The CFPB said Specialized Loan Servicing, going back to 2014, took “prohibited foreclosure actions against mortgage borrowers who were entitled to protection from foreclosure.”
Christian Wilson, a spokesman with Newrez, did not respond to an interview request asking how many Newrez workers would remain in Greenwood Village after the most recent layoffs are completed in August.
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The Colorado Department of Labor and Employment issued a corrected WARN count listing 317 jobs eliminated, not the 271 originally reported.
