Mortgage companies scaled back their payrolls by 5,900 full-time employees in January, as the decline in subprime originations and rising defaults took a toll on wholesalers and mortgage brokers.The U.S. Bureau of Labor Statistics reported that employment in the mortgage banking/broker sector declined from 495,100 in December to 489,200 in January. Since October, employment in the mortgage industry has declined for three consecutive months, and 15,500 employees have lost their jobs. NMN's Quarterly Data Report shows that subprime originations declined by 18.2% during the fourth quarter, to $143.6 billion. Meanwhile, rising defaults have forced over 20 subprime lending shops to close their doors. The default rate on subprime mortgages rose to 10.12% during the fourth quarter, up from 7.07% in December 2005, according to a report by Friedman, Billings, Ramsey.
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The massive mortgage business saw a first quarter profit mitigated by nearly $300 million in hedging losses.
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The Consumer Financial Protection Bureau has seen excessive property-inspection charges, fees that loan mods should eliminate and improper line-item labels.
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Michael Tannenbaum, whose experience in the financial services industry spans over 15 years, has a track record of helping companies scale and grow.
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A majority of consumers earning more than $100,000 annually said they were concerned about their own ability to purchase a home, demonstrating how affordability issues are impacting those at many socioeconomic levels, the University of Michigan study found.
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The nonbank's results add to other indications that the first quarter's "higher for longer" rate scenario had an upside for efficient servicing operations.
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The latest rate increases contributed to a 1% drop in purchases from the previous week and 15% annually, according to the Mortgage Bankers Association.
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