Subprime lender ACC Capital Holdings, parent company of Ameriquest Mortgage Co. and Argent Mortgage Co, says it is closing operations centers in five states.
Although ACH is not disclosing the number of employees affected, some reports say the company plans to lay off half of the 6,000 employees at subsidiaries, which include Ameriquest, a retail mortgage originator, and Argent, a wholesale lender.
In a statement, ACH said it was centralizing its retail origination and portfolio retention operations to Southern California, and consolidating its New York wholesale loan production operations to facilities in Illinois.
A company spokesman confirmed that ACH is closing retail call centers in Connecticut, Arizona, Sacramento, Calif., and Schaumberg, Ill. ACH also closed a wholesale loan production center in White Plains, N.Y., Thursday, moving work performed there to Rolling Meadows, Ill., ACH spokesman Chris Orlando told Inman News.
In White Plains, N.Y., Argent Mortgage employees estimated that 400 to 600 lost their jobs, the Journal News reported. The White Plains office, which formerly employed more than 1,000, was hit by layoffs about a year ago, employees told the paper.
There were also hundreds of layoffs at Ameriquest headquarters in Orange, Calif., where one supervisor who was not authorized to speak for the company told the Los Angeles Times that ACH is planning to lay off 3,000.
An Ameriquest board member told the Times the 3,000 figure was too high, but ACH has provided no detailed information on how many employees it laid off Thursday or how many may ultimately lose their jobs. Orlando would not confirm or deny published reports on the number of layoffs.
ACH closed all 229 Ameriquest and Town & Country Credit retail branch offices in May, laying off 3,800 employees nationwide as part of a plan to consolidate its retail mortgage lending operations. The job cuts amount to a one-third reduction of ACC Capital’s work force of 11,000, according to media reports at the time.
The layoffs followed a January 2006 settlement in which Ameriquest agreed to pay $325 million to resolve allegations that Ameriquest and its subsidiaries deceived borrowers, falsified loan documents and pressured appraisers to overstate home values. Ameriquest denied the allegations, but agreed to provide restitution to borrowers who obtained loans through Ameriquest Mortgage, Town and Country Credit Corp. or Bedford Home Loans from 1999 through 2005.
A Web site and toll-free telephone number were created to help consumers who may be entitled to restitution. The Web site is http://www.ameriquestmultistatesettlement.com/, and the toll-free number is 1-800-420-5875.
More recently, things appeared to be looking up for ACH and its subsidiaries, which also include AMC Mortgage Services, which is in the loan servicing and capital markets business.
On Feb. 28, ACH announced that Citigroup’s Markets and Banking Division had agreed to provide additional working capital and become ACH’s primary warehouse lender.
The deal gave Citi the option to acquire ACH’s wholesale mortgage origination and servicing platforms if certain business milestones were achieved, and regulators signed off on the deal. Ameriquest’s retail branch network and brand were not part of this transaction.
Orlando declined to comment on speculation that the latest round of layoffs is being conducted to facilitate a sale.
ACH is a privately owned company, founded by Roland E. Arnall, currently the U.S. Ambassador to the Netherlands.
According to Arnall’s official State Department bio, “Ameriquest’s success is based in part on the fact that it helped modernize the nonprime lending industry, which today is recognized as an essential part of home financing in America.”
