National City Mortgage will no longer do business with mortgage brokers.
The company is closing down its entire wholesale lending division, spokesman Chris Kemper told MortgageDaily.com today.
The move by the Miamisburg, Ohio-based lender will result in approximately 900 layoffs, he said.
Kemper noted, however, National City Corp. remains committed to retail lending and will continue to originate mortgages through approximately 350 retail lending branches and roughly 1,200 banking branches nationally.
National City reported $3.7 billion in November residential fundings, of which $0.9 billion was from mortgage brokers.
In August, the company folded its home equity unit into its mortgage subsidiary, reportedly resulting in 300 layoffs. In October, National City shut down its correspondent lending operations.
“We have been proactive in our efforts to manage through the current environment,” a letter sent to employees today and reviewed by MortgageDaily.com stated. “This was a very difficult decision for us to make given the history and success of the NCM Wholesale organization and its predecessors — AccuBank, Commonwealth United, NCMÂ and NHE.”
The memo went on to say that while no new wholesale applications will be accepted, “we will absolutely honor our commitments to broker customers and borrowers through an orderly and expeditious funding of the active pipeline.”
In addition, the company plans to re-introduce retail home equity lending, with closed-end products expected to be available in February and lines-of-credit subsequent to that.
One MortgageDaily.com reader wrote in that account executives were told today that the closing of the wholesale channel was the result of their not being selective in choosing mortgage brokers.
