IndyMac cutting 3,800 jobs & stopping most mortgage loans

One of the Largest mortgage lenders in the U.S., IndyMac Bancorp Inc are to cut 3,800 jobs as well as stopping most home loans. Currently IndyMac employ 7,200, so they will be losing 53 percent of their workforce.

These job cuts will be done over the next few months, these cuts are hoped to reduce their operating expenses by 60 percent, and these cuts are on top of the 2,700 cuts that the lender already made earlier this year.

As of now IndyMac are no longer accepting most retail and wholesale mortgage applications, however they will honor rate-locked loan commitments. The lender is now focusing on their mortgage servicing unit along with their 33-branch southern California thrift, which has $18 billion of deposits; IndyMac will also focus on their Financial Freedom reverse mortgage unit.

IndyMac are a shadow of their former selves, they once was one of the fastest growing mortgage lenders in the U.S. as they specialized in “Alt-A” home loans, these mortgages were perfect for those who could not document income or assets.

IndyMac shares are down 98 percent from last year and things look set to get worse, they expect their second-quarter loss to be greater than $184.2 million. Perry has asked IndyMac’s board to halve his base salary, but that will not be any comfort to one of those 3,800 people who work for IndyMac.

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