Starpointe Mortgage - Subprime

Starpointe Mortgage recently, and quite abruptly, shut down. According to a Detroit News article titled Brokerage shutdown draws prob published on July 3^rd:

Troy-based mortgage brokerage that left home loans in limbo, put more than 50 home office staffers out of work and darkened 35 branch offices from Florida to Alaska.

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Meanwhile, several now-unemployed Starpointe loan officers say they are working without pay to make sure committed loans successfully close.

The biggest losers in the closing appear to be branch managers of Starpointe, who typically deposited $20,000 to $55,000 in reserve accounts to open their branch offices. Several managers say they discovered these accounts -- which could have totaled more than half a million dollars -- were liquidated after Starpointe CEO Michael Cosentino announced the company's surprise closing in a companywide e-mail last week.

If that's not bad enough, the article goes on to explain how not seven days prior to StarPointe's closure an email was sent out regarding new agencies and new loan officers that concluded "Keep GrOwing [sic]!!!"

It would seem that there may have been some extraordinary shenanigans going on at StarPointe. You can actually find some commentary including ex-CEO Michael Cosentino's email regarding the shutdown, as well as a copy of the "Keep GrOwing!!!" email alluded to above on ActiveRain. In Cosentino's parting email he notes:

We our not able to fund payroll Friday, and certainly understand the hardship this causes, after discussion with our lenders ,creditors and liens put against our company and Bank account, we will have a better idea if this can happen this will take several weeks.

With respect to health insurance, those who participate in our health plan our good through the end of June .thereafter the plan will be terminated. Because the plan will terminate on June 30th there is no cobra. Please make arrangements for alternative insurance coverage to be in place by July 1st.

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None of us could have anticipated such an abrupt downturn in the industry and our business ...

We have been unable to discern the volume of loans handled by StarPointe. Should you have any details please contact us.