GMAC's Subservicing Unit Fires Six Managers

In yet another round of belt tightening, Residential Capital Corp. has fired six managers in its subservicing operation, leaving the group with roughly 10 supervisors, a quarter of its head count of a year ago.

A spokeswoman for the GMAC-owned company confirmed six people were let go in its subservicing business, which the company refers to as "fee-based" servicing.

Spokeswoman Jeannine Bruin declined to provide any further details except to say, "These reductions are part of the company's ongoing efforts to reduce costs appropriately and streamlines its mortgage operations."

Among those let go was Ray Morris, who headed sales. During his career, Mr. Morris also worked at Chase Home Finance. Others dismissed worked in sales, client management and trading.

Earlier this month Horsham, Pa.-based GMAC/ResCap fired Tony Renzi, a 24-year veteran of the company as part of a reshuffling of its servicing management team. A former employee of GMAC said Mr. Renzi wanted to grow ResCap's third-party servicing business but was rebuffed by management.

"When I was there they had 40 people," said this former employee, requesting his name not be used. "Now they're down to 10."

To make matters worse, GMAC's volume of subservicing contracts is slipping. According to figures compiled by Mortgage Servicing News, the company ranks fifth among subservicers with $27 billion in contracts, a 20% decline from a year ago.

Employees who were let go in the division have complained about a lack of marketing and aggressiveness on the part of the company, issues GMAC would not discuss.

"I'm not sure they're going to let the business run off entirely," said one company veteran, "but they're not making it a priority. When you get rid of people in sales that's not a good sign." GMAC has discussed selling its mortgage unit but there is no offering book.

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