Two of the top mortgage firms cut nearly 10,000 positions last year in bids to stay lean as losses rocked lenders.
Rocket Companies — parent company of Rocket Mortgages — and United Wholesale Mortgage combined to cut 9,500 roles last year, according to annual earnings reported by Inman.
Rocket cut 7,500 employees last year, reducing its workforce by 29 percent. The company lost $493 million in the fourth quarter, but reduced its 2022 expenses by 25 percent to $5.1 billion, which helped turn a $700 million profit for the year.
The cuts and quarterly loss comes as chief executive officer Jay Farner announced he is retiring at the beginning of June after 27 years with the company and six in the chief role. Former CEO William Emerson will serve on an interim basis until a successor is chosen.
UWM cut 2,000 positions last year, reducing its workforce by 25 percent. The country’s top provider of home loans lost $62.5 million in the fourth quarter, which CEO and new Phoenix Suns owner Mat Ishbia attributed to a $150.8 million writedown on the value of its mortgage servicing rights. The company reported $932 million in profits for the year.
Neither company was willing to use the word “layoff” to describe the job cuts. Instead, they pointed to attrition, not filling vacant roles, or the accepting of voluntary buyout offers. Ishbia claimed on CNBC’s Squawk Box the company has never conducted layoffs and “never will.”
Last year was a challenging one for mortgage lenders. Mortgage rates ended 2022 almost double their levels from 12 months earlier after a series of interest rate hikes by the Federal Reserve. As the housing market cooled from its historic levels, dozens of mortgage, residential and proptech firms were forced to gut their staff to stay afloat.
— Holden Walter-Warner
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