As I’ve been posting on MetLife’s gradual exit from the mortgage business since October, I’ve gotten lots of emails from MetLife folks thankful to see their side of the story for once. Most notable were my email exchanges about business models and the state of our industry with Ted Rood, a former MetLife loan agent. My two main takeaways: Ted cares about his clients, and he’s got a good sense of humor.
After MetLife shut their last remaining mortgage unit two days ago, Ted sent me these satirical edits he made (in bold) to a Reuters story. One last bit of catharsis for the former MetLife crew. Godspeed…
METLIFE “CHANGES ITS MIND”, EXITS REVERSE MORTGAGE BUSINESS
(Reuters) – MetLife Inc (MET.N), the largest life insurer in the United States and also the country’s largest reverse mortgage lender, changed course on Thursday and said it would sell off its reverse mortgage business as part of its exit from banking-related activities despite numerous previous claims that reverse mortgage origination was an integral part of its overall business plan and that Met was firmly committed to it.
MetLife has been actively/frantically shedding its banking and mortgage operations in a bid to drop its bank holding company charter, but as recently as January it had said/claimed it would continue writing reverse mortgages due to the remarkable networking success of leading rep Dennis Cooper.
But the company said Thursday that Nationstar Mortgage LLC would buy its reverse mortgage servicing portfolio, adding that MetLife Bank would not accept any new applications “at this time. Even though we remain firmly committed to the reverse mortgage business, we simply have stopped taking applications, processing loans, or paying our faithful employees who have remained with us despite our previous “changes of heart” regarding the depository business and forward mortgage originations.”
It was not clear whether the move would lead to job cuts or if employees would simply be paid forever despite their jobs being eliminated, and spokesmen for the company were not immediately available to comment as they were busy deleting previous emails they sent regarding the reverse mortgage department’s integral part of MetLife’s overall business plans.
According to market data company Reverse Mortgage Insight, MetLife Bank was by far the biggest reverse mortgage lender in the country in the first quarter, with 23 percent market share. At the same time, the industry has been shrinking, with volume in March at nearly a seven-year low, RMI said.
MetLife stopped taking applications for traditional mortgages earlier this year amid a flurry of refinance activity by leading originator Ted Rood, and struck a deal last year to sell MetLife Bank’s deposit business to General Electric Co’s (GE.N) GE Capital. At that time, MetLife Home Loans president Brian Hale reassured forward mortgage employees that MetLife remained “completely and singularly” committed to the forward mortgage business but commented that “Met is a publicly traded company, and everything is for sale every day, even my size 48 boxer briefs”.
Earlier this year, because of the oversight role it has through the company’s bank charter, the Federal Reserve blocked MetLife from raising its dividend or buying back shares, amid concerns about some of its capital ratios.
MetLife executives have said they would seek to drop the charter like a used condom as soon as MetLife Bank’s operations were sold, and to raise the dividend and buy back shares thereafter.
Related (in reverse chronological order):
–MetLife Ceases Reverse Mortgages, Completing Mortgage Exit