Castle Point Mortgage - Wholesale and Retail

Update - 2008-05-26: Info has begun to flow in that Castle Point Mortgage, Inc. is shutting down completely. We first received this tip:

"The Federal Reserve has closed down the North Andover Mass Office of Castle Point Mortgage Due to suspected Fraud. An in house Word Document was found to be used to manipulate W2's, Pay Stubs and even Appraisals. The entire 15,000 sq foot office has Been left behind and ALL the employees have been Laid OFF.. The Feds are now auditing the New Jersey and Maryland Locations for the same Offenses."

Another writes "the office they just shut down was inside broker/lender sales . with a sales force of about 40 at one time and when they shut it down it was 3 teams of about 8 each that got laid off or fired....They still have 2 locations left 1 in NJ and the other in MD that are now both under investigation for the same fraud..."

Castle, we discovered, is the primary defendant named in a 2008-01-24 lawsuit that alleges multiple TILA and RESPA violations in addition to violations of New York state laws in relation to a mortgage refinance transaction performed there. Also named as a defendant is Royal Settlement Services, Inc., which acted as the settlement agent in direct violation of RESPA. According to the complaint, the principals of Castle Point Mortgage are majority owners of Royal. The suit seeks penalties of $2,000 each for the multiple TILA and RESPA violations, and punitive damages in the amount of $10 million dollars among other considerations.

It isn't clear how many employees in all are affected, but in a 2006-04-28 Baltimore Business Journal article, it was reported that the 48,000 sq. ft. office in Elkridge, MD was planning to bring on as many as 350 employees in addition to 150 they had at that time. One source told us "Castle Point in Elkridge, MD, just (yesterday or today) laid off a TON of employees in their mortgage division. Offered some the option of a job in sales, but others were just laid off, no severance."

Another tipster writes:

"I was a new hire ... and was laid off today May 15 along with a large amount of other new and seasoned employees. No reason has been expressed why this happened, luckily I was new and can probably get my old job back. The same can not be said for others. Not too sure what happened, hopefully this website can tell me the reason for my short stay at castle point."

Hopefully we've been able to shed some light here. See our Discussion Forum topic for this company, and contact us if you can provide additional info.

Original Listing - 2007-08-31: We have been forwarded an email from a representative of Castle Point Mortgage indicating that they will no longer be accepting wholesale broker applications. Per an announcement similar to that sent by email, posted on their website here:

Dear Broker Client,

Effective August 31, 2007, Castle Point Mortgage will no longer accept wholesale broker applications.

Suspense of our wholesale lending division is in direct response to the deteriorating secondary market. At this time, we cannot offer a significant number of competitive products to meet our broker's needs. The decision to halt the wholesale lending has guaranteed that the company will continue to meet the mortgage financing needs and goals of hundreds of customers in our retail division, thereby remaining true to the Castle Point mission.

...

We have also learned that Castle Point's retail arm will continue to operate.

Estimates are that around 30 employees have been affected by the closure of Castle Point's wholesale operations.

We have yet to receive clear indications of how large Castle Point Mortgage's wholesale operations were at peak. If you have any of this information, please let us know.