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Thread: big layoff in America's only 'growth' industry ...

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    Banned Melonie's Avatar
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    Default big layoff in America's only 'growth' industry ...

    " Ameriquest Move Raises Jobs And Bubble Debate

    Some press reaction to the Ameriquest layoffs. “The parent of Orange-based Ameriquest Mortgage said Tuesday it would lay off one-third of its nationwide workforce and close all 229 of its retail branches, in the latest sign of retrenchment in the real estate market. The move to cut 3,800 jobs from a total of 11,000 is a dramatic shift by Ameriquest, which in recent years became one of the largest lenders to people with poor, or subprime, credit ratings.”

    “As the company boomed, it faced allegations that some sales agents used heavy-handed tactics and deception to persuade consumers to take its loans.”

    “Some analysts said the decision to jettison Ameriquest’s branches suggested that the company might be concerned it couldn’t effectively control what went on in those offices. ‘I would guess it is very difficult to provide profit incentives to branch managers in far-flung locales and expect them to comply with all relevant laws,’ said Daniel K. Osborne, a Phoenix-based investment fund manager.”

    “A number of mortgage lenders have cut staff in recent months, including Washington Mutual Inc., Aames Investment Corp. and ECC Capital Corp. Orange-based Acoustic Home Loans, like Ameriquest a subprime lender, closed its doors last month. Orange County has been home to many subprime lenders.”

    “‘This is an inefficient market, dominated by many undisciplined participants’ who have been pricing their loans below cost in an attempt to gain market share, analyst Mike McMahon said. Cutthroat pricing has guaranteed a loss on virtually every transaction, he said. Irvine-based ECC Capital said that in the fourth quarter it was, in effect, making loans for $102 and selling them for $101.”

    “Ameriquest slashed 1,500 jobs in December. A sister company, Argent Mortgage, laid off 640 people in January. The closures include a handful of Ameriquest and Town and Country retail branches in Sacramento, Rancho Cordova and Stockton, possibly affecting dozens of employees in the region.”

    “The nine Massachusetts branch offices of the huge mortgage company Ameriquest will close as part of a nationwide cut of 3,800 jobs. The largest subprime lender in the Boston area, Ameriquest wrote $3 billion in mortgages in 2004 in Massachusetts.”

    “During his first day on the job Monday, Dennis Carroll eagerly looked forward to a bright future as the new manager of the Ameriquest Mortgage Co. office in downtown Salt Lake City. Carroll and 11 other employees were told that effective immediately embattled Ameriquest was closing the Salt Lake office.”

    “‘When they started courting me in February I was reluctant to even consider their offer. I was OK with the job I had,’ Carroll said. ‘But they kept making their offer sweeter and sweeter and after awhile I started looking forward to starting a new life with my family in Utah.’ Now, Carroll said, he’s stuck in Utah without a job.”

    “A banking giant shut down all of its branches in Western Washington on Tuesday, leaving thousands of local customers in the lurch. Ameriquest is closing 26 branches in Washington state. Peter Demerick of Bremerton thought all he needed to do was fax his mortgage papers in to Ameriquest. But he didn’t expect to get a disconnected number, and now he’s still trying to get answers.”

    “Demerick is sure his mortgage broker had no idea. ‘I’m sure he was totally shocked. If he knew about this yesterday, he was a great actor. At this point they’re cutting and running.’”

    From CNN Money. “Those looking to glimpse the future of the housing market may want to start watching help-wanted ads rather than the real estate section. Experts who say the housing market is cooling, but won’t implode, argue that solid job growth should be enough to prevent a collapse in home prices. But others who see a housing ‘bubble’ ready to pop say a developing slowdown in home building itself could hurt job growth enough to put a big dent in housing.”

    “‘We’ve been building too many homes in a market maintained by speculation. And job growth is not going sustain that,’ said Dean Baker, an outspoken advocate of the housing bubble theory.”

    “Add job losses at mortgage firms, building supply retailers and real estate agencies and the downturn in home building could itself further weaken one of the key supports for real estate. One of those worried about just that is James McShirley, owner of Sulphur Lumber near Indianapolis. He’s already laying off staff and not filling open positions due to a slowdown in orders from his builder clients.”

    “‘We’re holding off as much as we can because qualified people are hard to find,’ he said. ‘But there will come a point where we have to face that (more layoffs) and it could be soon.’”"

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    Default Re: big layoff in America's only 'growth' industry ...

    I used to do escrow for ameriquest mortgage, and I can't say that I am surprised. The branches I have worked with were the most disorganized I have ever seen in the mortgage industry. They concentrated on hiring young people with no experience, and had poor training. The majority of their employees were extremely rude as well. I am not surprised at all that the Salt Lake office was closed, as the other Salt Lake office closed a few months ago.


    This may be completely different in other areas of the country, however with the way I saw Ameriquest operate, I can't see how they would make consistant money.

    However, bad as their business practices were, this is a scary moment for the real estate market in general.
    I believe you Dottie and you have my support

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    Featured Member Vamp's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    Ameriquest is another subprime lender going under.

    This could be the tip of the iceberg.

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    Default Re: big layoff in America's only 'growth' industry ...

    ^^ agreed. Keep in mind that the real estate sales and finance industry has been virtually the only 'high pay, high growth' American industry over the past few years, and has provided lots of Americans who lost their previous jobs due to outsourcing, corporate cutbacks etc, an opportunity to work at a 'clean' 9 to 5 job that paid rather well.

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    God/dess whirlerz's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    Yes.^ I am in a dead end office job, & was considering this field.
    I also read in bankrate.com that this will hurt the subprime mortgage market...


    MANY MEN WANTED TO LAY ME DOWN, BUT FEW WANTED TO LIFT ME UP

    -Eartha Kitt

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    Featured Member Vamp's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    Banking or the finance field is not a bad field to consider. Just make sure the companies you work for offer many differant products and services. A bank or credit union is a good place to start. Generally speaking they arent risky lenders and have other loan products ie auto loans, credit cards ( financial institutions view these as loans), recreational vechile loans, etc. Not to mention the fact they are backed by the government in case of failure.

    Even though being a teller gets a bad rap. it is a great entry level position. It is where I started.

    These companies only offered subprime mortgages for the most part. Which is the main reason for their downfall. Now that the subprime mortgage market is going down hill so are they.

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    Featured Member Vamp's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    I wonder how Quicken Loans is fairing in this decline? I tried to find some info on it and couldnt.

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    God/dess Deogol's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    I don't know - my credit union has a new option on it's home pag - Repo Center.

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    Featured Member Vamp's Avatar
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    Default Re: big layoff in America's only 'growth' industry ...

    All lending institutions have repossesions and fraud. But when was the last time you heard of a credit union shutting most of their branches?

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