January 10, 2012

MetLife Shutting Down Mortgage Business

January 10, 2012

MetLife Shutting Down Mortgage Business

In October, MetLife announced they were mostly exiting their mortgage origination business, retaining only their reverse mortgage division, and looking to sell the rest.

Today they announced they haven’t found a buyer and are ceasing forward mortgage operations. Here’s the meat of the press release:

NEW YORK–(BUSINESS WIRE)–Jan. 10, 2012– MetLife, Inc. (NYSE: MET) announced today that it is exiting the business of originating forward residential mortgages. MetLife Home Loans, the residential mortgage division of MetLife Bank, N.A., will no longer accept new loan applications for forward mortgages. MetLife Home Loans continues to originate reverse mortgages.

MetLife Home Loans will continue to service its current mortgage customers. In addition, MetLife Home Loans will honor all contractual commitments for loans in process and expects the majority of loans to close in 90 days.

MetLife expects $90 to $110 million, after tax, in costs related to exiting the business to be incurred over the next year, with no expected impact on the company’s operating earnings.

On December 27, 2011, MetLife announced that GE Capital Financial Inc. had agreed to acquire most of MetLife Bank’s depository business, including certificates of deposit and money market accounts.

MetLife’s entire retail banking business, including mortgages, represented under two percent of MetLife’s 2011 operating earnings as of September 30.

Also, they sent a memo to all the mortgage broker firms who originate and send loans to MetLife (via their wholesale mortgage division, also being shut down), saying that today is the last day to submit loans.

If you’re a consumer working with a MetLife agent, ask them to brief you on your timing. If you’re working with a mortgage broker right now, ask them if they’re placing your loan with MetLife, and what impact this may have.

My hat’s off to MetLife loan agents who didn’t have a choice in this matter.

Here’s my advice to MetLife agents and more details on this big news that I wrote when it was first announced.