Non-QM lender lender lays off three-fourths of workforce, saying it’s experienced “significant operating losses and cash flow challenges” and has been unable to obtain funding.
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Saying it’s experienced “significant operating losses and cash flow challenges” and has been unable to obtain funding — a Texas-based national mortgage lender that specializes in riskier “non-QM” loans laid off three-quarters of the employees assigned to its headquarters office on Friday.
The sudden and unexpected layoffs at Plano, Texas-based First Guaranty Mortgage Corp. have left borrowers and FGMC’s wholesale and correspondent lender partners in the lurch, according to former employees. The layoffs were first reported by HousingWire on Friday, quoting anonymous former employees who said the company had “essentially shuttered,” after a major investor divested its stake in the company.
FGMC did not respond to Inman’s requests for comment. But according to a letter the company sent to Plano, Texas Mayor John B. Muns, FGMC fired 428 of the 565 workers who were assigned to its headquarters office, on June 24.
“FGMC has experienced significant operating losses and cash flow challenges due to unforeseen historical adverse market conditions for the mortgage lending industry, including unanticipated market volatility,” the letter said of layoffs affecting 76 percent of the company’s workforce. “In addition, FGMC’s recent efforts to obtain funding that could have prevented this layoff…