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Mortgage lender Newrez LLC is cutting an additional 277 positions, including senior executives in Colorado, Arizona and Florida, bringing the total to 750 after parent company Rithm Capital Corp’s recent acquisition spree.
Newrez cut 473 jobs in May and June after Rithm completed its $720 million acquisition of Specialized Loan Servicing LLC and its parent Computershare Mortgage Services Inc.
The latest round of layoffs at Newrez’s Greenwood Village, Colo., plant will take effect Aug. 26 for 187 employees; and 78 workers in Tempe, Ariz.; according to a Worker Adjustment and Retraining filing filed by Newrez in Jacksonville, Fla. Notification (WARN) Act notification, the state has 12 employees.
In Florida, Nurez will part ways with three senior vice presidents, one vice president and two assistant vice presidents. Three vice presidents and two assistant vice presidents will lose their Colorado jobs, as well as operations staff including dozens of customer support specialists, application support analysts, cashier assistants and special loan assistants.
Nurez said in a statement to Inman that the acquisition of Specialized Loan Servicing resulted in layoffs that the company took several months to evaluate.
“Our recent decision to reduce the number of positions in certain areas of the Newrez organization is a necessary step as we continue to focus on and invest in our core markets,” the company said. “We take all personnel decisions very seriously and are committed to Support affected employees through this transition period.”
Nurez declined to comment on whether further layoffs were possible.
Newrez, headquartered in Fort Washington, Pa., funded 731 mortgage loan originators at 86 branches, down from 983 loan originators at 155 branches in October, according to records from the National Multi-State Licensing System.
Newrez also has established multiple mortgage joint ventures with real estate brokerages through its Newrez Ventures platform (formerly Shelter Mortgage Company).
With the acquisitions of Specialized Loan Servicing and Computershare Mortgage Services, Rithm added $149 billion to its mortgage servicing portfolio, which totaled $857 billion as of March 31 (including $225 billion for other lenders that retained servicing rights USD loan).
Rival loan servicing giant Mr. Cooper, which has grown its loan servicing portfolio from $650 billion in 2021 to more than $1 trillion this year, has also laid off hundreds of employees and is investing in a multi-year artificial intelligence initiative to Hundreds of employees are being cut.
In February this year, Newrez announced a partnership with Microsoft to leverage its Azure OpenAI service to provide 24/7 customer support using artificial intelligence-driven chatbots and analyze customer profiles and preferences to recommend suitable products.
Kedar Sutter
“Artificial intelligence will help us reimagine how we serve customers and run our business,” Kedar Sathe, chief information officer of Rithm Group and Newrez, said in a statement at the time. “We have access to vast amounts of data about customer behavior, products and markets – we We are just beginning to see the application of this technology to fundamentally change the mortgage customer journey. The projects in this program enable our customers to interact with us anytime, anywhere, while enabling Newrez to operate more effectively and efficiently.
Asked whether investments in artificial intelligence were a factor in the recent layoffs, Nurez said only that the company would continue to “evaluate the use of artificial intelligence to enhance the capabilities of our employees.”
Some of the employees Newrez laid off had similar roles to those at Computershare Mortgage Services and Specialized Loan Servicing, which now does business as Shellpoint.
On May 2, the day after the SLS acquisition closed, Newrez notified the Colorado and Florida labor departments that it planned to lay off 156 workers starting July 1, including 103 in Colorado and 53 in Florida.
On June 3, Newrez filed another WARN Act notice with Colorado officials, informing them of plans to lay off 317 employees starting Aug. 2 at the company’s Greenwood Village plant.
The origins of Newrez and its growth under Rithm
Source: Newrez LLC.
New Residential Investment Corp., as the company was then known, acquired Caliber Home Loans and Genesis Capital in 2021 before changing its name to Rithm Capital in 2022.
Caliber Home Loans’ $1.675 billion deal is part of a strategy to expand the company’s origination, servicing and asset management capabilities, including mortgage servicing rights worth $141 billion. Most of Caliber’s loan originators were laid off after the deal closed.
Rithm is laying off more than 6,500 employees in 2022 to reduce expenses, primarily in its mortgage origination division. Rithm started 2022 with 12,296 employees, then cut its workforce by 53%, ending the year with 5,723 employees.
Caliber’s operations were fully integrated into Newrez in the fourth quarter of 2023, with many former executives ultimately joining Ohio-based Union Home Mortgage.
Rithm closed another big deal in November — the $720 million acquisition of Sculptor Capital Management Inc., a hedge fund that invests in debt, real estate and a “multi-strategy platform” with $32 billion in assets under management. .
As of December 31, 2023, Rithm reported a total of 6,570 employees, 5,656 of whom were engaged in mortgage loan origination and servicing.
Editor’s note: This article has been updated with additional comments from Newrez.
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