EquiFirst - FHA, Nonprime, Alt A
For the third and perhaps final time, Equifirst Corporation rises to the top of the list as most recently imploded. Retail and wholesale operations are being permanently shut down per an announcement emailed to brokers:
"Effective immediately, EquiFirst Corporation is ceasing its lending operations and will no longer accept mortgage loan applications for any type of mortgage loan product."
There reportedly was a company-wide conference call from CEO Jeff Tennyson at 9:00 AM EST. One tipster indicated parent Barclays Group had actually "pulled the plug" last week, and said, "Employees were just notified today." The source guessed about 100 employees were left in the Charlotte, NC headquarters.
We have received over 45 copies of the notice, and continue to gather details. Stay tuned!
Prior Listing - 2008-04-23: After receiving this tip, we called an inside source to confirm:
"EquiFirst has suspended all subprime lending. They are going to concentrate on rolling out FHA products when they haven't completed their required test files as of yet. One "branch" in the company is the only one allowed to submit FHA loans while the rest of the company has a projected rollout date of May 15 (which has been postponed every month this year - we've heard since December that it will rollout the 15th of the next month)."
An attached memo effective 2008-04-22 announced "No new submissions will be accepted." Per our source, 9 states are in the test case phase for FHA, and between 150 - 160 remaining AE's are receiving a small guarantee as compensation while they await the nationwide FHA rollout.
Update - 2008-04-02: In emails sent to us today by several brokers, it appears Equifirst has eliminated their subprime products completely. One AE writes "We are true full doc only now. W2 pay stubs or full tax returns." Another explained to brokers "We have continued to offer products that disappeared months ago for our competitors including bank statements, stated, and full doc with 1099 only.
Barclays, who owns EquiFirst, made the decision to portfolio these loans thereby enabling EquiFirst to continue to offer these products. But as more lenders pulled out of the products it left EquiFirst in a situation where risk outweighed the ability to continue portfolioing. So the day has come when they are no longer available." AEs were notified of the changes in a late day company-wide conference call on 2008-03-31.
Update - 2008-01-05: Sent in today by a reader:
"Just an update, EF laid off over 400 employees in August 2007 and as of Friday had many positions work sent to the corporate office leaving no work to be done in the phoenix branch. As of Monday, phoenix branch office is to allegedly be eliminated while all of Charlotte will take over its work flow."
Original Posting - 2007-04-02: Another back-add (2007-06-07), a reader submitted to us that EquiFirst should be added to our list of "imploded" companies as it was acquired on April 2, 2007, by Barclays Bank. The reader noted:
As we have noted, "imploded" companies include those that are bought out in a "firesale" transaction. As a 66% decrease in offer price would seem to qualify as a "firesale" purchase, we are adding EquiFirst to our list as the Barclays acquisition was completed on April 2, 2007.
NYMortgageBroker at 09:31 2009-03-09 said:We were pretty impressed with Equicredit, when we saw how the others were closing and giving up.. Equicredit, hung in there... and changed their wholesale operations to go from subprime to FHA lending. They tried to adapt and for awhile it appeared from the emails they were going to be ok.. They always had professional reps, friendly people on the phone, and they were obviously smart enough to be flexible and attempt to adapt. Too bad for Equicredit..... Maybe they will come back around in a new form and revive themselves in some new opportunity! They were service oriented and it is a shame to see them go! Permalink
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Important: This company is on our list of lending operations that have "imploded". However, please note that "imploded" is a somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or "firesale" acquisition. All information here is provisional, and may contain inaccuracies (especially newer information). If you are planning on doing business with this company or any other one listed on this site, you should inquire with them directly on whether they can still meet your needs. Many are still operating in some capacity.