I’ve heard from multiple sources that Countrywide laid off a very large number of employees today and has closed multiple Full Spectrum Lending branches, while cutting nearly half the employees at one of their Correspondent Lending Division offices in California.
From what I’ve heard, Countrywide laid off 50% of employees at its Correspondent Lending Division in West Hills, California.
A week earlier, one of the managing directors quit – apparently he knew more than us.
I’m also getting word of mass layoffs in Plano, Texas and Calabasas, CA.
Layoffs reported in San Diego, CA as well.
Forty people have lost their jobs at the Chandler, Arizona office.
One source reported 225 layoffs at a Tampa loan center.
I’ve been told from another source that there were “major layoffs” and that the correspondent division is now working with a skeleton crew, to the effect that they may be winding down the unit entirely.
Another source said Countrywide has closed nearly 100 Full Spectrum Lending branches, the subprime unit of Countrywide Financial.
It is also believed that a number of layoffs struck the Countrywide Wholesale Division as well, although I’m still waiting for more specific information regarding that.
There are reports that all divisions within the company throughout the country have been affected by layoffs today, but I’m still working on concrete numbers and more detailed information.
I’ve also been told that some Countrywide employees were given letters stating they were no longer employees of Countrywide as of November 5th, but that they would be given regular benefits, including vacation and 401K through Nov. 5th.
This could explain why large news agencies are reporting a smaller number of layoffs.
Related to this, another news outfit reported that laid off employees were explicitly told not to talk to the media, and by doing so they would put their severance packages at risk.
I had talked about Countrywide closing their correspondent and wholesale channels several times over the last month after I received word from an inside source that they had liquidity issues, and simply wouldn’t have enough money to keep those units open.
Though that was before the Fed came to the rescue.
The news will likely be hard on mortgage brokers and correspondent lenders who relied upon Countrywide and their wide array of loan programs.
From sources I’ve gathered the total layoffs should be in the thousands…and this appears to be the beginning of a long series of layoffs nationwide.
I’ve heard that they are laying off employees in batches of 1,000 per week for the next eight weeks.
This is apparently the maximum number the infrastructure can handle, although this hasn’t been confirmed, and there quite possibly could be other, more complicated (legal) reasons for the process.
Another source says there will be 20,000 total layoffs, so I suppose time will tell which is correct.
Either way, these series of layoffs will have a strong impact on Countrywide, and may eliminate certain aspects of their business model entirely.
Before you think that Countrywide is going under, note that they’re also actively hiring. So this isn’t the end of Countrywide, it’s the birth of a new retail-centric Countrywide.
Stay tuned for more as it develops.
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