MortgageIT - Wholesale

The official announcement was just sent out:

"Deutsche Bank has made the difficult decision to close the MortgageIT US Wholesale Lending Division. MortgageIT will cease accepting new business as of December 11th and focus on existing business based on the below timeline:

• New locks and/or new submission will not be accepted as of Thursday,December 11th.
• All loans that have been previously submitted regardless of status must be locked no later than Wednesday, December 24th.
• Locked loans must be submitted no later than Wednesday, December 31st.
• Loans must be closed and funded on or before Friday, January 30th.

The Business Journal in Milwaukee reports 72 employees will be affected by the closure.

Update - 2008-12-10: We are just now getting news that MortgageIT just announced in a conference call to AE's that Deutsche Bank's Wholesale Lending operations are shutting down. From one Broker:

"Just heard from my AE that Duetsche Bank is shutting down MortgageIT effective February 9th. They will not accept any new locks as of tomorrow but will honor what is in their pipelines up until Feb 9th!!!!"

From another tipster, "Last day to lock/submit is December 11."

We are awaiting official announcement and confirmation from the company before we transfer this to the Implode list.

Update - 2008-02-29: From an AE who contacted us: as of today, "all production offices except the one in Madison, WI and Portland, OR, will be closed." Forum posters report severance packages were received today for affected employees ... excluding AEs. Several have told us they received a base salary, but in one former employee's words it was the "same severance as the October 2nd layoffs. AE's didn't get anything then either." Emails have been streaming in from AEs expressing their farewells to Brokers since our last update.

Overall, the company's business is plummeting. One poster reported January 2008 volume of $115 million, and preliminary figures for February of $35.5 million.

Another tipster wrote:

"They plan to fund no more than 300 units per month or 100 million a month, just enough to keep their toe in the market and when it comes back to get back in by restaffing.

Their plan is to control pricing to keep production in that narrow scope of 300 units or 100 million. It has been said they are more concerned about risk and the quality of the loans than the production.

All production office across the country will be closing with all production centralized through Madison, WI. A few satellites will be staying open. Portland, OR, and Jacksonville, but that is it, around 2000 employees around the country are being given the axe."

MortgageIT had over 2500 employees according to their web site when we checked today. Madison will stay open to clean up the pipe according to sources. Time will tell...

Update - 2008-01-23: There are rumblings in the ranks of soon-to-be ex-employees of DB's MortgageIT. It seems there may be some unexpected changes to severance benefits, according to posts on our Forum.

In one comment from Janurary 17th:

"This morning, MortgageIT's employees received an email from John Novak, Director, Global Banking HR with an attachment referencing the severance policy. LOW-AND-BEHOLD there is a NEW paragraph added stating: Employees of dbhomelending, LLC, MortgageIT, Inc, and Urbistar, Inc shall not be eligible under these benefits....blah, blah, blah. It also came with a revision date of March 22, 2007."

Click here to visit this Discussion thread.

Update - 2008-01-16: In an expected announcement, MortgageIT and DB states they are committed to the Wholesale channel, but admits their current organizational structure does not work. Expect ALL Branches to close except Madison.

"In order to transition to this revised business model, beginning in the next few weeks, we will be closing most of our production branch offices and migrating production fulfillment to our branch in Madison, Wisconsin. Over the next few days, branch employees will be notified of the specific plans for their office and the timeline for an orderly transfer of any loans in process to Madison."

To view the entire letter, please visit our Forum here.

Original Post - 2008-01-07: The rumormill is about to fly off its axle with regard to MortgageIT (subsidiary of Deutsche Bank). A lending guide announcement issued to brokers and correspondents on 01-02-07 highlights the newest round of product and program modifications and eliminations just days after news broke that Deutsche Bank would be reviewing its mortgage operations going into 2008.

Deutsche Bank To Review Mortgage Operations

December 28, 2007

Deutsche Bank will reportedly conduct at top-to-bottom review of its various mortgage operations, according to a news brief published Friday at National Mortgage News.

Citing an unnamed spokesperson for the bank, NMN confirmed that Deutsche Bank will reassess its mortgage business in the first quarter of 2008; the spokesperson is quoted as saying "there may be a reallocation of assets."

We've been hearing about layoffs and office closures for sometime. While the company website indicates some 20 wholesale offices nationwide, tips have come in that several have or will be closing. One contributor writes:

"The Concord and Phoenix offices received notice on the 31st (Oct) that they will be closing - no official date of closing provided - the latest being mid February but some layoffs may occur prior to the closure date."

Another wrote in that Rancho Cucamonga got the same notice. A broker wrote in about the closure of the Las Vegas office, noting that they stopped accepting new loans on 11-2-07.

Previously, we reported on the Implosion of MortgageIt's Retail operations on 11-12-07. A layoff of 580 employees was announced just weeks earlier.

We will continue to follow this as it unfolds. Please contact us if you have more information.

Visit our forum here or here for hundreds of postings regarding this company.