The move is expected to help the company retain over $100 million per year
Michigan-based Home Point Capital is set for another round of mass layoffs, its latest SEC filing has revealed.
In an 8-K filed on the last day of August, the wholesale mortgage giant disclosed that it has “taken additional cost-saving measures that, combined with those taken in the second quarter, are expected to result in savings of more than $100 million on an annualized basis.”
These “cost-saving measures” translate to organization-wide layoffs in Michigan and beyond.
Company spokesman Brad Pettiford confirmed that, starting in November, Homepoint will slash 217 jobs at two offices in Ann Harbor, Mich. To put that in perspective, the firm employed approximately 3,000 employees last month, with around 500 people in Michigan.
“We are in the process of taking the painful step of reducing our workforce to ensure Homepoint is best positioned to navigate the current high-rate, low-margin environment,” said Pettiford.
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While the company tried to avoid major layoffs, Pettiford said that “continually worsening market conditions” have pushed Homepoint to make this “additional step.” Employees have been given a 60-day notice.
“While these decisions are difficult, we remain committed to building a sustainable company that provides a best-in-class experience to the partners and customers we serve,” Pettiford added.
Homepoint posted a $44.4 million loss in the second quarter of 2022 as higher interest rates and intense competition in the wholesale space put pressure on its margins.
“Looking at 2022, the mortgage industry is entering a challenging part of the mortgage cycle with higher rates leading to a shrinking refinance market, while industry capacity remains at an all-time high,” said Willie Newman, president and CEO of Home Point Capital. “We are focused on navigating through this downturn while continuing to enable future growth. As such, these are Home Point’s priorities. Liquidity, we have thoroughly evaluated our balance sheet and are monetizing nonstrategic assets at attractive levels.”
