New American Funding cuts 240 in another layoff round

New American Funding laid off another 240 employees this month, it confirmed, bringing its total to 941 terminated workers in a difficult year for the company and industry at large.

The move was made in response to mortgage market conditions, NAF said in a statement. Currently, seasonally adjusted volumes remain almost 70% lower than the same time last year, according to the Mortgage Bankers Association. NAF’s cuts affected personnel at multiple locations largely in mortgage operations, the company said. 

“We are all working hard to determine the best way to operate in today’s market,” said Rick Arvielo, NAF co-founder and CEO, in a statement. “It is our duty as stewards of this company to ensure that we are properly positioned and able to responsibly navigate the current marketplace.”

The layoffs, first reported by HousingWire, didn’t trigger Worker Adjustment and Retraining Notifications. NAF also didn’t specify whether impacted staff were being offered severance or extended health benefits.

The Tustin, California-based lender and servicer had approximately 4,500 employees at the end of last year. Its business fell with the refinance slide, as the percentage of NAF rate-and-term transactions went from 85% to about 10%, Arvielo told National Mortgage News in August after a prior workforce reduction. 

The privately owned company shed 300 staff in August and Arvielo then said the firm had slashed its payroll by 14% since the beginning of the year. He also said the company was still hiring experienced loan officers and call center agents as part of its expansion plans announced last summer. 

The company is a sizable lender, originating $31.8 billion in mortgage volume last year, it said. It also has a large servicing portfolio of approximately 233,000 loans totaling $61.9 billion as of July; NAF also slipped past Rocket Mortgage as the highest-rated mortgage servicer on J.D. Power’s customer satisfaction survey.

NAF is the latest real estate business to announce layoffs around the third quarter earnings reporting period, as other companies have also laid off hundreds of workers. Redfin Corp. let go more than 860 workers, or approximately 13% of its staff, a move coinciding with the shutdown of its iBuying business.

Other firms revealing new rounds of cuts through WARN reports include reverse mortgage lender American Advisors Group and Pennymac, both which disclosed their cuts in California notices. AAG laid off 204 workers at the end of October, while Pennymac announced 10 additional cuts to the 70 already announced effective Dec. 30.