ResCap to Cut More Than 300 Jobs
Residential Capital (ResCap), the money-burning real estate finance arm of GMAC, is expected to slash more than 300 jobs at locations in Costa Mesa, California and Charlotte, North Carolina.
The Charlotte office will be shut down entirely, while the Costa Mesa office will retain roughly 30 people, according to a company spokeswoman.
Many of the job losses are tied to the Ditech brand, which offers home loans to consumers via the retail channel, mainly online.
Back in 1999, the company employed about 800 people, before being sold to GMAC.
The more troubled wholesale lending arm of ResCap, Homecomings Financial, ceased operations back in September 2008.
At that time, all 200 GMAC Mortgage retail locations were also shut down, resulting in roughly 5,000 layoffs company-wide.
ResCap will continue to make home loans through its own staff and via correspondent lenders, and still operates a servicing unit that ranked fifth in the nation in 2009.
Tomorrow GMAC may report a loss of more than $10 billion for all of 2009 thanks to surging defaults at ResCap; it lost roughly $5 billion in the fourth quarter alone.
The U.S. government already controls a 56 percent stake in GMAC thanks to a series of taxpayer bailouts, and could end up with more than 70 percent when all is said and done.
(photo: sociotard)
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