Top-five U.S. mortgage lender Newrez, owned by asset manager Rithm Capital, is imposing a round of layoffs to its workforce following the acquisitions of Computershare Mortgage Services and its affiliate Specialized Loan Servicing (SLS).
On May 2, Newrez sent Worker Adjustment and Retraining Notification Act (WARN) notices to state authorities in Florida and Colorado, confirming that 123 employees are expected to be separated from employment beginning July 1, 2024.
The layoffs include mortgage professionals such as processors, underwriters and loan officers. Several departments were affected, including legal, secondary market and quality control. The job cuts were imposed on analysts, coordinators and senior employees, among others.
A spokesperson at Newrez did not reply to a request for comment.
According to Inside Mortgage Finance (IMF) estimates, Newrez was the fifth-largest mortgage lender in the country in the first quarter of 2024. From January to March, the lender produced $10 billion in loans, up 13.5% quarter over quarter and 44.9% above year-ago levels.
HousingWire reported in February that the lender and servicer restructured its distributed retail mortgage business, resulting in cuts to regional and divisional managers while reducing compensation for loan officers.
When considering its owned servicing portfolio, Newrez was the sixth-largest U.S. company with $536.6 billion in unpaid principal balance (UPB) in the first quarter, down 1.5% year over year, per IMF estimates.
The job cuts follow the conclusion of the previously announced acquisition of Computershare and SLS, which will bring $149 billion in UPB of servicing to the Newrez portfolio, including $104 billion in third-party and other servicing.
The deal adds to Rithm’s core strategy of diversification as an alternative asset manager, according to a statement from chairman and CEO Michael Nierenberg during the announcement of the deal’s closing.
Due to its servicing book, Rithm has had a positive financial performance of late. According to Securities and Exchange Commission (SEC) filings, the company delivered $261.6 million in GAAP net income from January to March, compared to a $87.5 million loss in the prior quarter.
Top executives at Rithm said they continue to evaluate taking their mortgage business public.
