And Another One Bites The Dust! Homestar Financial Shuts Down Amidst Mortgage Volatility
Please pray for all the displaced employees of this great organization. Yes, I’m still working on loans and with my borrowers that are house hunting. I’ll be reaching out and updating you all as I work through the details. The Lord has carried me over bumpy roads before and I trust Him to lead me forward along this new path.
Homestar told employees in an internal memo that will cease all operations by Tuesday, Oct. 31, 2023.
Homestar Financial CEO Announces Company Is Shutting Down
The memo went on to explain how market conditions have made mortgage lending unsustainable.
Homestar CEO Wes Hunt wrote in the email:
During the past two decades, I have always been able to successfully lead us through the cyclicality of the ever-shifting housing and mortgage markets, however, over the past year, that has not been the case. The financial losses for mortgage lenders continue to mount due to continued market compression leading to lower margins and higher interest rates leading to lower volume. As we head into a period of historically seasonal lows, for protection, with no end in sight for margin compression or realistic prospects of lower rates, I have decided not to incur further financial risk over the coming months.
Homestar will continue to fulfill its financial obligations and any locks that occur before Oct. 31st.
The company originated over $10 billion in consumer mortgages over the past five years and $2.4 billion last year. However, between April and October of this year their volume has plummeted from $122.5 million to $0.00
According to the NMLS, 184 loan originators work for the company. According to Modex, 117 were considered active at the firm’s 45 branches. The company did not make a statement on what type of post-employment services their employees would receive.