Kemper Mortgage, Inc. - Retail

Update - 2009-10-17: Kemper Mortgage's President and CEO Jason Messer contacted us recently with some additional details and corrections to our previous reports on the company.

Contrary to the information submitted to us by tipsters, Messer said that "Kemper Mortgage never had a warehouse line of credit with Suntrust nor with Colonial National in its entire 10 year history." He indicated Kemper's warehouse lines-of-credit had been with Flagstar, Comerica and National City. Regarding the line with Flagster, Messer said they had "reached the end of our agreement and mutually decided to not continue business together." The repurchase complaint filed (and subsequently withdrawn) by Colonial National Mortgage specifically refers to a "Mortgage Broker Agreement" with Kemper Mortgage, Inc. rather than a warehouse lending agreement, and we have made that correction where it is mentioned and linked to in an entry below.

In addition to the above, we were made aware that Kemper Mortgage Inc. had recently reached a settlement in the 2008-05-12 employee class action lawsuit we reported on earlier. According to Messer, "Kemper reached an out of court settlement with the plaintiffs attorney for $50,000 to mitigate the ongoing and substantial attorney fees," denying any wrong doing. The approved "Order Granting Motion for Preliminary Approval of Class Action Settlement" was filed in the U.S. District Court of Nevada on 2009-09-04.

Update - 2008-10-01: We received the following statement regarding former President & CEO Jason Messer of Kemper Mortgage, Inc. from David Van Horn, current President & CEO of Citizens Home Loans of Ohio, Inc.:

"Please note that Jason Messer started Citizens in October of 2007 while Kemper was still in operation and healthy, he has moved on to other ventures."

Included with that communication were copies of Consents by the Director and Shareholders of Citizens Home Loans of Ohio, Inc. removing Mr. Messer as that company's President & CEO, effective July 24, 2008.

Update - 2008-09-17: Even though the licenses are still listed as "active," we have reliable info that Kemper Mortgage, Inc. is no longer doing business. Tipsters indicated the owners had set up a new operation, and indeed it appears former Kemper President & CEO Jason Messer is now registered as President & CEO of Citizens Home Loans of Ohio, Inc., according to the listing on Manta.com and public records.

Several former employees we've been in contact with confirmed all staff except for a small "cleanup crew" were laid off on or about July 7th, 2008 at the Miamisburg (Dayton, OH) HQ office. We were told the company was doing over $50 million per month at peak.

As always, you're invited to contact us with additional details or feel free to comment below.

Original Ailing Listing - 2008-08-07: Based on information we have coming in from a number of sources, it appears Miamisburg, OH based Kemper Mortgage, Inc. may be near collapse. Although their web site is down, you can still view an archived copy here. Said one email to us, "they have laid off most of their staff, closed two offices, and are rumored to have lost their warehouse lines with Suntrust and Flagstar. Colonial National also cut them off."

An Ohio AE we spoke with told us their headquarter's office had gone from some 40 loan officers down to 4, and mentioned that on a recent visit it appeared "the staff were curiously digging through all the files." We got similar reports of the Tempe, AZ office. Another (former) employee wrote:

"They take an appraisal hold back from loan officers upon hiring -- $600.00 out of the first two commission checks, just in case the loan officer resigns and owes money on appraisals... They went from 25 loan officers in the Tempe office to 4 and a lot of those loan officers are not being paid their appraisal money."

A class action lawsuit (pdf) was filed on behalf of employees against Kemper Mortgage, Inc. on 2008-05-12 for "non-payment of overtime and failure to provide meal and rest periods." It was removed to the U.S. District Court on June 16th, and a hearing has been set for September 5th. The complaint states "the class consists of over 200 employees called "loan officers" employed throughout the United States" and notes "over 30" are believed to have been employed in Nevada. In subsequent filings relevant to the case, it is estimated damages if awarded, would exceed $5 million.

On another legal front, Colonial National Mortgage filed suit against Kemper Mortgage, Inc. on 2008-04-21 demanding the repurchase of five loans funded under their "Mortgage Broker Agreement". You can view the complaint (as amended 2008-06-05) here (pdf). A "Notice of voluntary case dismissal" (pdf) was filed by Colonial just yesterday, August 6th. Public records do not identify a reason for the withdrawal. Our call to Colonial's legal counsel was not immediately returned.

Volume info and a headcount of all employees was not readily available at the time of this writing. Kemper Mortgage, Inc. appeared to have six branch offices scattered among the states of AZ, CO, FL, IL and NV according to CityTownInfo.com.

Contact us with any additional information you can provide on this company.