Hometown Lenders’ CEO announced a headcount reduction Friday and said that it will transition from a retail shop to a broker model. Billy Taylor, the founder of the company, described the current state of the market as “maddingly unpredictable” and stated in his email that employees will not be paid on time because a planned “pipeline sale” was not finalized. “It is in your best interest for us to terminate your employment effective immediately,” wrote Taylor in an email that was shared with National Mortgage News. Over 100 employees were allegedly let go across all departments further slimming ranks at the company, according to an employee with knowledge of the inner workings of the company.

READ MORE: Hometown Lenders slashes headcount, transitions to broker model

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Adjustable-rate mortgages surge with lending near longtime lows

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A drop in the adjustable-rate mortgage average provided some lift to loan activity last week, as beleaguered trade groups sought help from the Federal Reserve in hopes of providing some market stability. The Mortgage Bankers Association’s Market Composite Index inched up a seasonally adjusted 0.6% from the previous week for the period ending Oct. 6. Despite the slight upturn, “application activity remains depressed and close to multi decade lows,” according to Joel Kan, MBA’s vice president and deputy chief economist. Seven days earlier, the index had fallen by 6%, while year-over-year, activity was 16.3% lower.

CFPB sues Freedom Mortgage for ‘widespread errors’ in home loan data

The Consumer Financial Protection Bureau filed a federal lawsuit Tuesday against Freedom Mortgage Corp., one of the largest nonbank mortgage lenders, alleging the company submitted data on home loan applicants that was riddled with errors, in violation of the Home Mortgage Disclosure Act. In a 10-page lawsuit filed in U.S. District Court for the Southern District of Florida, the CFPB said that Freedom Mortgage violated a 2019 consent order that resulted from revelations that it intentionally misreported data concerning the race, ethnicity, and sex of loan applicants from 2014 to 2017. The company provided data on more than 700,000 loans and applications.

CFPB clamps down on ‘excessive’ account information fees

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The CFPB has issued an advisory opinion barring banks and credit unions with more than $10 billion in assets from charging consumers “excessive fees” for basic information about their own accounts. The bureau cited, in its rationale for the advisory opinion, a provision in the Consumer Financial Protection Act that requires banks and credit unions with more than $10 billion in assets to provide account information when it is requested by consumers. The CFPB said it “does not intend to seek monetary relief” for potential violations of this provision that occurred before Feb. 1, 2024.

MBA, NAHB and NAR urge Fed to project calm around rates

The housing market’s leading trade groups are pleading with the Federal Reserve to publicly project calm to help stabilize “painful and unprecedented” mortgage rate hikes. The Mortgage Bankers Association, the National Association of Home Builders and the National Association of Realtors wrote Monday to Fed Chairman Jerome Powell, urging the central bank to make two statements. The Fed, the groups say, should declare it’s not contemplating further rate hikes and that it won’t sell off mortgage-backed securities until the Treasury yield curve normalizes. The groups’ letter came a day before a top Fed official Tuesday suggested the central bank leaders are in a position to “proceed carefully.” Atlanta Federal Reserve Bank President Raphael Bostic meanwhile Tuesday afternoon said no more rate hikes were needed.

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