GMAC Lays off 5000, Shutters 200 Retail Branches
- By:
- Bill Rice | September 04, 2008
Cuts Target Retail Branches and Wholesale Lending
GMAC has specifically targeted immediate cuts to its retail lending branches and Homecomings wholesale broker channel and seeking strategic opportunities to sell its GMAC Home Services business and non-core servicing divisions.
Chairman and Chief Executive Officer Tom Marano explained that although difficult the cuts are unavoidable as "conditions in the mortgage and credit markets have not abated and, therefore we need to respond quickly and aggressively by further reducing cost and risk."
ResCap Subprime will Take Most of the Downsizing
The majority of the layoffs are expected to center around Residential Capital, LLC or ResCap a GMAC mortgage lending division based in Ft. Washington, PA. Some portion--estimated at 2000 employees--may be reduced as a part of selling these discrete business lines over the remainder of the year.
Ditech and GMAC Consumer Direct Continue Lending
According to GMAC spokesperson Jeannine Bruin, "We're not going to have a retail presence where customers can walk in the door," but assured that GMAC would continue to origiante mortgage loans and service existing clients.
GMAC will continue to operate their more popular consumer brands Ditech and GMAC Consumer Direct from centralized call centers and mortgage operation centers.
GMAC Continues Drag on Troubled GM
Tied to another troubled industry, US automakers, GMAC has been a non-core business distraction and earning drag for General Motors (GM) that resulted in selling a controlling interest in the financial arm in 2006. Cerberus Capital, a private equity firm now owns 51 percent and GM 49 percent of the mortgage business.
Bankruptcy Reform Back on the Table
- By:
- Bill Rice - MortgageLoan.com | November 21, 2008
One of the earliest ideas for helping homeowners facing mounting mortgage debt and potential foreclosure on their home was to reform bankruptcy laws. The concept is now officially back on the table, introduced into the Congressional lame-duck session by Senator Richard Durbin (D-IL).
TARP is Closed for Relief Until Further Notice
- By:
- Bill Rice - MortgageLoan.com | November 20, 2008
Remember what a crisis the $700 billion mortgage market bailout was--the very existence of the American financial order hung in the balance.
Fixing the Housing Market, Lots of Ideas...Any Answers?
- By:
- Bill Rice - MortgageLoan.com | November 19, 2008
Almost a year into the dawning of the housing crisis (many chronologist are setting that around the January 2008 crumbling of Countrywide) ideas continue to flow, but few seem to be the answer. In fact, this seems to be the growing consensus--there is no silver bullet.
G-20 Lots of Motion, Will There Be Action?
- By:
- Bill Rice - MortgageLoan.com | November 18, 2008
The 20 most powerful industrial nations, and now the caretakers of an unprecedented global financial crisis, assembled in Washington DC over the weekend. Their mandate was broad and daunting--stabilize world markets.
FDIC Challenges Treasury with New Loan Modification Proposal
- By:
- Bill Rice - MortgageLoan.com | November 17, 2008
On the heels of the Treasury and Federal Housing Finance Agency's (FHFA) loan modification plan for Fannie Mae and Freddie Mac, the FDIC releases their own proposal. In this unprecedented, unilateral, and aggressive move by a Federal agency the FDIC is essential fighting a very public political battle directly with the Treasury and the current Administration.
Mortgage Rates Drop for Second Straight Week
- By:
- Bill Rice - MortgageLoan.com | November 14, 2008
Another week of dismal economic data have again pushed down mortgage rates. Freddie Mac reported Thursday that 30-year fixed-rate mortgages averaged 6.14 percent, down from 6.20 percent last week. This demonstrates a steep decline from 6.46 percent two weeks prior.
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