The mortgage broker and correspondent lending origination channels at ING Mortgage are shutting down. The move follows the recent acquisition of the company’s parent.
Mortgage broker clients were advised that their origination agreements terminated on Monday.
Brokers have until May 3 to submit loan applications that were already taken by the April 3 deadline. If an application that is submitted by the May 3 deadline is approved, then it must be closed and funded by July 2.
A California account executive for the company, Scott Gray, confirmed that the exit includes the elimination of correspondent originations.
ING departure from third-party lending follows the Feb. 17 acquisition of ING Direct by Capital One Financial Corp. from ING Group for $6.3 billion.
The acquisition made Capital One “the sixth largest depository institution and the leading direct bank in the United States,” according to a statement from the McLean, Va.-based company.
Capital One, itself, previously exited wholesale lending with the closing of its GreenPoint Mortgage subsidiary in August 2007.
“Current conditions in the secondary mortgage markets create significant near-term profitability challenges, given the company’s ‘originate and sell’ business model,” a statement at the time said. “Further, recent and continuing developments in the mortgage markets reduce the long- term outlook for profitability in the business, as the company expects markets for prime, non-conforming mortgage products are likely to remain challenged for the foreseeable future.”
Gray, the ING account executive, explained in a telephone interview that Capital One is only interested in retail originations.
“Their orientation is to do direct loans direct to the consumers and not to do broker loans or correspondent loans,” Gray stated, “so they made a decision to shut that channel down.”
He noted that ING Mortgage employs around 500 people and has operations centers in Los Angeles and Wilmington, Del. However, only “a handle of people” were specifically dedicated to broker originations.
Gray and his colleagues could find jobs elsewhere at Capital One.
“I’m told they have several thousand openings around the country,” he said.
