(update)
H&R Block said today it will cut 575 jobs, or more than 20 percent of staff, at its Irvine-based subprime unit Option One Mortgage Corp.
The cuts include 85 positions in Orange County, a spokesman said. Employees were notified last month when the company first said layoffs were coming, the spokesman said.
Option One will have about 1,700 employees left nationwide after the cuts, he said.
The company expects a pre-tax charge of $19 million related to the cuts.
In a filing the tax preparer said, “The restructuring plan is designed to reduce costs and improve operating efficiencies in response to reduced mortgage loan origination volumes and current secondary market pricing levels.”
More cuts could be coming, the company said.
In May, Option One cut more than 600 jobs, including 133 or so in Orange County. That left the company with about 2,400 workers, of which about half are in the county.
H&R Block previously said it’s trying to salvage the sale of Option One to Cerberus Capital Management. Option One is in violation of certain aspects of the sale agreement.
They just need to put a fork in them. The slow death is inevitable. Crooks should be put in jail.
GS,
Just so you understand… The majority of layoffs will be operations people. These people are not loan officers or brokers. They do not make anywhere near 7 to 10 to 15 thousand or more a month. Their avg. pay is from $2,000 to $4,000 a month. Some have been there for years and have never made more than $40,0000 a yr. Not all there are crooks. In fact, the biggest problem were the brokers putting through bad deals and too lenient of guidelines on Option Ones part. The tightened their guidelines, however it was too little too late.
Yes, I worked for the company, No I was not someone laid off today, and I also don’t care for upper magmnt there, but I feel bad for the really good, hardworking folks who have lost their employment today.
If these people were really good, honest, hard working Americans, maybe they should come forward and tell of the abuses. Come clean and tell the world how they made a living off deceiving others.
I didn’t hear any honest people from Option One before this crash. Of course, honest people stood up before the crash and everyone called them bears and unAmerican.
Are any of these honest people going to stand up to the Federal Reserve and say, “STOP.” Stop trying to bail out these criminal organizations. I doubt it, honesty only goes so far. I mean, everyone else was doing it, Option One employees had to do it to keep up.
One thing we do know is that these unemployed people won’t be working as truck or bus drivers…Bush and his merry band of Republicans have replaced those jobs with illegal immigrant bus and truck drivers.
DEAR “Republicans are traitors”;
YOUR AN IDIOT.
If you have been able to read and think you would have found out that it HAS BEEN WALL STREET THAT LIED ABOUT THE RISK. IT WAS WALL STREET AND THE NEW YORK BANKS THAT DESIGNED THE PROGRAMS. IT WAS THE BANKS AND ONLY THE BANKS THAT DID FIXED INCOME STATED LOANS. CHASE AND INDYMAC, AND INDYMAC DID THEM PAY OPTION ARMS ALSO. FIXED INCOME ELDERLY AND BEING SOLD A 1% RATE.
NEW YORK AND CALIFORNIA ARE DEMOCRATIC STATES. OC IS REPUBLICAN BUT NOT BY ALOT JUST ENOUGH TO WIN. THE NEW JERSEY GOVENOR WAS CEO OF GOLDMAN SAKS THAT PACKAGED ALOT OF THESE BONDS - DARN HE IS A DEMOCRAT.
WAKE UP AND STOP BEING AN IGNORATE VOTER, BECOME AN EDUCATED ONE.
Proof Matt neeeds to read every post before publishing. See above.
Dear, Republicans are traitors,
You need to be educated greatly! Did you not read a word of what I wrote? I said,… Lots of Honest, Hardworking people worked there. Some saw the signs on the wall and they left the company. Some others, Myself included left the mortage industry.
Ya know, it seems as though so many people complain that the mtg companies caused the rise of home prices, and that they raised the interest rates etc… No, the mtg companies didn’t raise the home prices. That was the out of control appraisers, brokers, realtors and Yes… American public. and the feds raised the interest rates. 4 years ago, the american public had no complaints, because everything was just wonderfull, so to speak in housing. Now, because people didn’t want to belive that it would end, they didn’t prepare. I can’t tell you how many people that I speak to that tell me that they never even read their loan documents before signing them. Ignorance is not bliss.
By the way… Option One NEVER sold ANY Pay Option Arm loans!!!
hey 16 yr mtg vet- guess what oomc was as guilty as the next lender. those honest, hard workers would be the first to say, gee joe borrower doesn’t qualify- what about switching him to stated and add that *wink wink* extra income he makes on the ummm weekends doing ummm handyman work- yea right handyman, joe’s handyman service. kick that package back to the broker and have him fix it- rahrahrah we made quota again this month! don’t kid yourself, vet- you were all in on it, regardless of what income you made or what position you filled. take the hit, quit whining, and realize how lucky you all were to make the cash that you did. and if you were smart, you saved some of that money you were making- ’cause you ain’t never gonna see what happened these past few years again in your lifetime.
I have worked for Option One for the last three years and I am still employed. Were there dishonest people who worked here? Sure. There are dishonest people in EVERY industry and at every company. However, I can tell you that the values of the company have always been “Do what is fair, ethical and makes good business sense.” As an associate, I have always felt these values from day one. The main goal has always been to provide a mortgage solution for someone who doesn’t have perfect credit. There are many families out there who have had a difficult path and who do not have good credit because of it. Don’t these people deserve a home too? The goal of our 2 year or 3 year ARMs was for these individuals to get a product they could afford, make payments on time for the first few years, and then refinance into a better deal once they have established better credit. Unfortunately, greed got the best of many borrowers and brokers.
BTW…these “new” layoffs are old news. The announcements were made weeks ago. Nothing new was announced this week.
Why do people always respond to my posts with Anti-Democrat messages? I have never voted for a democrat and I personally believe we only have one party with a few players. Before you call me an idiot you misspelled “your”. You are trying to say “you are” so the correct spelling would me “you’re”. Finally, I am an informed voter that is why I have come to the conclusion that Republicans are Traitors. They have been in charge of EVERY branch of government for the past decade. The Presidency, House of Representatives, Senate, Supreme Court, Federal Reserve(Note: Private Co. illegally stealing tax dollars), California Governorship etc. The REPUBLICANS are to blame for this housing bubble, the devaluation of our dollar, the insane inflation, our lack of border security, illegal Mexican truck drivers, and worst of all, they have imprisoned our soldiers and INS agents. PS- Orange County voters are not as Republican, for good reasons, as they used to be, but make no mistake the LINCOLN CLUB runs/ruined this county. They put Street, Corona, Rackaukus, Moorlach, Nguyen, Campbell, Bates and Norby in office. OOMC I am glad you supported my point. There are people that were corrupt there and they should have been exposed by the honest people. And I am sick and tired of everyone in your industry who is excusing these criminals. You come up with excuses like “everyone one doing it” and “every company has bad people in it”. That is not true. Companies that survive are honest and ethical, that is why OOMC will go bye bye.
Anti democrat
you use the name ” republicans are traitors ” Pretty stupid come back.
“Republicans are traitors”,
I was not excusing anyone’s behavior. Just looking at things realistically. The vast majority of associates at OOMC are hardworking, ethical individuals. Were there a few unethical individuals. Of course. And I stand by the statement that you will find dishonest, unethical individuals in every industry and every company. That is the reality of this world we live in.
“Chief Executive Officer Mark Ernst said last month the company would reduce subprime lending by 80 percent to minimize the losses of Option One as he waits for the sale to be completed by the end of this year. If Cerberus walks out because the reduced lending violates the original sale agreement, H&R Block will shut down Option One altogether, Ernst said.”
Dear, Are you prepared,
Boy you are as ignorant as that Republicans are traiters poster!!!
DID You Not read my orgional post or not even finish reading my second post??? I left Option One more than seven months ago!!!! I went back to my roots of insurance. and if you had read my post you would have seen that YES, I have saved my money over the last sixteen years and I have never lived beyond my means. I have 1 car, just a Toyota, 1 condo, bought 18 years ago before I was even in mtg and I only worked as a loan officer for seven months. The rest of my 16 years were in operations, never making more that $4,500 a month.
As I said before, if you would have read,… There are people who got in the business about 5 to six years ago when things got reallt great. THEN there are the people who have been in the industry for a long time and have already seen htis happen in the seventies, eighties and nineties. Good lord!, I remember when an 18% rate was normal!
So YES, there ARE good, Honest, Hardworking folks out there who have been through this many times and were prepared. It still doesn’t mean it will be easy on them. Losing employment never is!
You may want to research or just simply take the time to read before you make accusations and assumptions. You know what they say about people who assume right?
By the way…, have you ever worked in mtg? Do you own a home? Do you even know anything about the industry?
BTW… Option One has been around since 1992. They were not a new kid on the block, so to speak. They have been doing sub prime since then. H&R Block is the third co. They were prevously owned by Fleet and prior to that they were the non prime side of Plaza Home Mtg. ( I worked for Plaza in 1992.)
OOMC Employee…, I hope I didn’t offend you. Like I said before, I may not work there anymore and I don’t care for some upper management, BUT… I do know, as you said, There are tons of very Honest, Hardworking, Good folks that do and have worked there. I still wish the company the best of luck and It’s hard to see this happening to the company that I have fond memories of.
All my best to you and my former OOMC and HRBMC Associates.
OOMC Employee: “There are many families out there who have had a difficult path and who do not have good credit because of it. Don’t these people deserve a home too? The goal of our 2 year or 3 year ARMs was for these individuals to get a product they could afford, make payments on time for the first few years, and then refinance into a better deal once they have established better credit”
Shouldn’t those folks have been told to improve their credit first and their downpayment? If they don’t have good credit while renting, what makes you think they would have better credit after aquiring more debt and increase their monthly expense obligations?
Last time I checked, buying a home lowers your credit score until you prove that you have been paying on time for some time.
You’re statements don’t make sense. People were put into exotic financing to help them afford a home they normally would not be able to afford.
Do you not think it is irresponsible to buy a house on the gamble that you will improve your credit score in 2 or 3 years when you just increased your monthly expenses, rates will stay the same or decrease, and home prices will stay flat or increase? Only the foolish would put their families under such risk. There was nothing wrong with those people renting until they proved they were credit worthy, built up a downpayment and allowed themselves to completely enjoy homeownership the way is was meant to be.
vet- i started doing mortgages in the 70s, yes, i do own a home, and i know a lot more about the industry (and the history of oomc) than you do. not buying it says it quite well- you weren’t doing those borrowers any favors by giving them a 2/3 yr arm and the false hope of qualifying for “a better deal once they established better credit”. only thing that did was guarantee repeat business, and more money for everyone trying to “help” them. fair, ethical, good business sense- yeah, keep patting yourself on the back if it makes you feel better.
A common theme across these blogs is to blame lenders for loose underwriting standards and basically lending to people they shouldn’t have.
Remember- For over a decade the govermment has had a goal of increasing homeownership among lower income and minority borrowers. They rated banks and mortgage companies based on how well they acheived these goals. The only way to reach these borrowers was to loosen underwriting standards and lower rates. The feds lowered rates and the banks loosened underwriting standards.
So- I would suggest that we first look at our elected policy makers before we place blame on lenders & banks. They were encouraged to loosen standards by the Feds.
Option One’s Customer Retenetion Group just shut their doors today, leaving a few (25) unfortunate souls to mop up the pipelines…This equates to 100+ O.C. layoffs.