Impac Mortgage Holdings in Irvine said today it’s cutting 144 jobs nationwide, or roughly 30 percent of its workforce, will stop nearly all of its loan making, and will not pay a dividend for at least the rest of the year amid a severe credit crunch.
The announcement comes four weeks after Impac cut 351 jobs, or about 44 percent of its staff. After the cuts it will be down to about 300 workers, by my math.
Lenders are struggling and failing amid a nearly two-year housing slump and rising loan defaults.
Joseph Tomkinson, chief executive, said in 25 years in the business he has never seen a credit crisis of the same “scale and magnitude.”
Impac is abandoning the Alt-A sector, or loans to people with minor credit issues, which has been its focus since the company was founded in 1995. In early August the lender stopped making Alt-A loans because investors stopped buying them. Today’s announcement seems to suggest the move is more permanent.
Impac will also stop providing funds to smaller lenders and halt commercial lending.
However, the company will keep making home loans at its retail branches that it can sell to Fannie Mae and Freddie Mac — just about the only ones buying loans these days and turning them into securities to sell to Wall Street Investors.
Impac said it does not expect to pay dividends on common stock for at least the rest of the year. It does expect to pay dividends on preferred stock.
“Unfortunately, given the severe dislocation of the market place, which included unprecedented margins calls, we are left with no other alternative, but to down size our company to better operate and navigate through this difficult and unrelenting environment,” Tomkinson said. “As a smaller organization, we will concentrate on maximizing the income and cash proceeds from our long-term investment operations, continue to service our past mortgage customers through our master servicing operation, and make selective strategic investments.”
He said the company has found it extremely difficult to sell $900 million in residential and commercial loans.
“While we are still committed to selling the remaining loans held-for-sale, the Company is currently working with its warehouse lenders to determine the most effective method to sell these remaining loans,” he said.
To read the full release CLICK HERE.
Oh man, wasn’t the CEO in the OCR defending the company as healthy?
I see a perp walk soon!
i’d still like to know if gretchen (CFO) is back in the office; can someone comment?
Joe T,
Forget about trying to turn the company around, and just join me for a cold one at the Crawford Ranch.
Your buddy,
Kenny Boy
“Joseph Tomkinson, chief executive, said in 25 years in the business he has never seen a credit crisis of the same “scale and magnitude.””
hmmm… I wonder if he also made as much money in the past 6 years as he did in those 25 years in the business. And those layoffs are the same 60 day letters that others got just a few weeks ago. Now it is middle management being laid off, but not upper management who made all the underwriting/funding decisions, whether or not they were qualified to do so.
Another bites the bust what else is new?
Let the class-action lawsuits begin!
Stockholders are still in the dark (for the most part). Time to turn the lights on and watch the Impac cockroaches scramble.
I have to try to be humble here but I am going to agree with SBG that the next news we get from Impac will be the perp walk.
If they are going to exit the commercial business that tells you three things. 1. That market has felt the pain of the credit crunch and clearly it has spread. 2. What does that tell you that really is happening in the commercial market? Commercial always follows residential on the way down. 3. That was the one thing that Impac had going for them that had any chance of profit.
If they are pulling out of the warehouse business they just screwed a bunch of brokers. They aren’t going to be able to find warehouse lines anywhere now with WAMU, Impac and others yanking them. It looks like the days of correspondent lending are over and the days of correspondent brokers not having to disclose the YSP are over with it.
For the hard working and honest employees of Impac I hope that you all can learn from this and move on to a better place. I feel sorry for those who have been strung along and dragged through this dibacle. You should all get together and start a ex-Impac employee Costa Rica vacation fund. That way you can all go down to Costa Rica together and crash at Joey’s house. Putting you guys up at his place is the least he can do.
Impac give severance packages out to these employees? Is there a law when mortgage companies lay people off of how long they have to pay the employees, one week, one month, 2? Im curious, as I work for another lender who is going to layoff a lot of people very soon.
There is no law in FL regarding severance packages. In CA, from what I’ve learned is that if they give you 60 days notice they don’t have to pay severance. We were told in FL that severance is a “gift”.
really! Well I did not know there is no law in FL. Interesting…Well we got an email on 08/31 that we will be laying off but it did not say when or who just an amount of how many employees…would this date of 08/31 count for 60 days even though it doesnt state when the layoff will be? so if we get canned 10/31 its 60 days from 08/31? im wondering if that 08/31 email counts…even though there is no date
It is time they drag these thieves out in handcuffs. This is a publicly traded REIT which has concealed their business practices and losses, defrauded investors and their own partners, lied and manipulated their employees. Impac is not a bank or a mortgage company it is a REIT, which are held to higher standards. Therefore senior management is responsible for the mismanagement and gross negligence which resulted in this felonious conduct. And as a REIT they dont get to just walk away. Its JAIL TIME lock them all up
Add two more to the list of OC mortgage companies gone under. The Lending Connection of Costa Mesa closed its door July 27,2007 and today H R Block Mortgage in Irvine closed its doors. Who’s next?
IMH is next…$$ is running out. Word is they will start paying out severences to some of the people on the 60 day list and let them go early because there is absolutely no work to be done. Just bodies laying around, using up electricity and resources…They should try turning off all the lights to save on some utility fees…
They are going down, if you know something call the feds. Sarah speak up, they need to know the truth. The feds are waiting. If impac has comiited these crimes Speak up. They will all go to jail.
Sorry Sarah, the Feds have no interest in anything you may have to say. I have file cabinets full I offered in 2005 (both to the media (CBS)and the feds(FBI)) and again in 2006 (media and Feds) and 2007 (media (Matt) and Feds (FBI special agent in Santa Ana). I was told they were too busy, but thanks for the offer.
to BnCinsider,
Dude, you never offered me file cabinets full of docs. Bring ‘em by Grand Ave. anytime.
impac has been a shystee company for a while now. I used to work for them and got a good look at how things were run in their organization. I always got the impression there was a lot of ego on the top and not a whole lot of concern for the people that worked for them. They let go of most of the good people in Jan 06 when they started their first round of lay offs. Same day they announced they had hired attorneys to clear of them of some stock mishandling. They should be held to a higher standard since they were an REIT company. From the sound of things it seems like they will walk away from all of it with a slap on the wrist and pockets full of money.
BnCInsider,
Sorry you are full of it. The day that Matt doesn’t give time to his readers is the day he leaves. I can personally attest that Matt will read and answer your emails and will meet you personally if you have anything of value to offer. He will also respect confidentiality and put it in writing. If you had offered some juicy info he would have welcomed it. If you don’t believe me ask him if I have supplied him with some interesting info. He can confirm that I have given him info and what that is you will never know because it is confidential.
I am getting tired of these posters who claim they have some great info and never follow through. If you really do then fine give Matt the info but if he comes on here and says that you never did what you said then we know you are full of it.
Dr. What,
You crack me up. You are now a two time champ for best post of the day. I think we should join in on the ex-Impac employee Costa Rica vacation fund. How fun would it be to be there to see that?
Bncinsider , i have a agent that is willing to look at all of that immediatly. let me know if you are intrested. He wants them in jail. HE will give you total protection.
You guys should spend more time looking for a new job then bitching about the one you lost. The entire market came down, not a shocker–it was expected. So you didn’t get a nice shiny apple with your 60 day notice–grow up. Severance is not required by law at all!
No one is saying give us money. What we are saying if there is evidence out there give it to us and we will get the feds on it. No one should get away with it. If, anyone knows anything let me know and i will get it taken care of.
Augie
300 workers left at Impac. Are they all as happy as you bloggers? (one g or two?)
Graphrix -
I know that we must know one another!
I agree with what is being stated about turning over documentation to Matt or the authorities. You may not want to be a whistle blower… and you may think that by doing so, you could possibly find it more difficult to land your next position.
The reality is that for most of us, the next position will not likely be in the mortgage banking industry with 100,000+ out of work. Secondly, companies like Impac have tarnished our resume’s with their complete disregard of their own credit policies.
If you have evidence, DO WHAT IS RIGHT. Do it for everyone that ever worked at Impac that believed they were providing loans for all the right reasons. Greed was only prevelant in Sales related areas (together with senior and executive management). DO WHAT IS RIGHT and show the banking industry that ‘we the people’ can stand up to these crooks… and take back this industry that we (as a whole) helped to build. DO WHAT IS RIGHT on behalf on the stockholders that have been taken on a ride from here to Costa Rica.
DO WHAT IS RIGHT and put Tomkinson and Ashmore where they belong.
DO WHAT IS RIGHT.
Does that 300 include all the people still working at PInnacle???
Don’t forget that Pinnacle is still the retail platform for Impac
Is the cafe still open?
Are the exec.’s still going to get end of year bonuses?
Is it easier to find a parking spot now?
How do Joe and Bill sleep at night ?
Wonder what the name will be of the lending company Joe and Bill will open next.
…i’m still curious whether their CFO is back in the office.
Their CFO is probably in cuffs? Missing for a while now
Hey Graphix, Dr. What and Matt,
I’m cracking up at some of your posts. Especially about the Costa Rica comments. So true. Here’s food for thought which I think is totally ironic: Joe T. OWNS Convict Lake up by Mammoth. Did you all know that?? I just saw a commercial advertising it and it reminded me of that. He offered me and significant other a room out there if we wanted to just relax.
Matt -
Booooo! Cheers to censorship in the news media.
I feel like Lenny Bruce!
Graphrix… Where are you when I need you?
Dr. What -
There’s a line. It’s not entirely solid, but it’s there. Please stay on the clean side of it.
Thanks.
-YOUR BLOGGER
Dr. What & Graphrix,
My, my, what a pair. Do you two lay awake at night wondering how you can bring Joe and Bill down? Get over it and MYOB. You both act like you’re on the trail of Osama Bin Laden!! Hey, that’s an idea. Why don’t you two join forces and go over to Afghanistan and put all your energy into finding him? We sure could use a break from the likes of you both. Sheesh!
Former Impac Employee - I am also a former employee and think we know each other - what position were you in when you left impac……
it is so pathetic what is going on there - its hard to read about it -
anyone have news on gretchen…..
Knows Better is that you Joey? No sorry I sleep fine but then I didn’t ruin a major mortgage banking REIT so it is much easier to sleep at night. Oh and last I checked Impac is a public company so their business is anyone’s business. Only 11 days until the end of the month are you going to have the August monthly fact sheet ready? Read the posts of the people that use to work for you or still do. Sad, really, really sad that if you mangaged the company better all these people wouldn’t be complaining and could have a job.
Dr. What,
It does sound like we may have crossed paths at some point. If not I am sure we know some of the same people. Sorry that Matt censored you but I don’t think it was him as much as his company. I didn’t think it was all that bad and I doubt that many people got the reference.
KL,
Convict Mountain? You have to be kidding me? That is amazingly way too ironic.
Knows Better –
I’m certain that if Graphrix, our new comrade Sarah, and I were paid the salaries of Joe & Bill… we could BLOG Bin Laden out of the Middle East!
Graphrix –
We’ll have to have Matt set up a meeting place and we’ll need the ‘Cone of Silence’ for sure!
Sarah-
I’m sorry… Not familiar with anyone named Sarah! Except for Sarah Lee… I’m very familiar with her!
Matt-
I hope you saved my TOP 10 LIST. When you break this story wide open I expect to see it in your Pulitzer award winning article.
My Editorial: I’m sorry if former employees (and the 5 remaining ones) are tired of our humorous posts. Read between the lines… we know too much. Yes, I was familiar with Convict Lake… Yes, I know that Joe owns a mile long stretch of Costa Rican Beach, and, yes, I know a lot more.
As for the comments regarding the CFO… note that she was the only brilliant one of the bunch. Bottom line is/was that Joe controlled Executive Management and Joe controlled the Board. Don’t hold your breath waiting for the board to turn on him… they know Joe knows too much also!
DO WHAT IS RIGHT. Hand over incriminating evidence to Matt and demand that he re-post my TOP 10 LIST!
Graphrix:
I am sorry you are getting tired of posters who claim to have great info but never follow through.
Here’s a little of my perspective - imagine being involved in Federal investigation of mortgage fraud involving the company for whom you work. The primary focus of such an investigation is broker fraud. Your company is perceives as “the victim”. You on the other hand, understand and have first hand knowledge that your company is complicit in this fraud. The investigations were the tip of the iceberg.
After 15+ years in the subprime industry and having left many postions due solely with ethical conflicts related to how the industry was evolving, you challenge my integrity. 3 years ago I put my career, my livelyhood and possibly my well being at risk and contacted both the media and the same FBI agent I had spoken to in the investigation I of which I was involved, and asked someone to help put a stop to this criminal behavior. None were willing to listen. Not the media, not the Feds.
The reality is there will be no jail time for these guys. They have gone to great lengths to maintain the element of plausible deniability that will keep them out of jail. The idea 3 years ago was in hopes of preventing what has now happened. There is little point now.
A nay sayer I may be, a liar I am not.
BnCinsider -
Big difference between 3 years ago and today. Then, if you kept your mouth shut, you could easily find new employment in most any direction. Today… you are just 1 of 100,000+ looking for employment in ANY industry.
3 years ago it was not NEWS WORTHY. Today it is front page news.
I will not call you a liar… but I do question how well YOU sleep at night. If you have evidence of fraud and or SOX violations… drop them in a bag in front of the OC Register… Otherwise, you are just as good as an alibi to the powers that shouldn’t be.
Feds don’t know where to start. Help them today and be on Good Morning America tomorrow. DO WHAT IS RIGHT.
BnCInsider,
If you have been following the Impac threads and I know you have then you know that at least a dozen people have claimed to have some sort of info. And every time Matt, Dr. What and I have said fine prove it! Now I have met Matt in person on a few occasions and have emailed him many times. Each and every time he has taken time to talk to me. In fact he has really gone out of his way for me. So when I hear someone that claims Matt ignored him/her I just don’t believe it. If you provided him with info three years ago then maybe but that was before he was the “mortgage blogger”. Back then he didn’t have me or Tanta to help explain how the tranches work in a MBS pool. Three years ago all the OCR could print is how high home prices are and how low the defaults were. So if you really have info that is substantial, relevant, legit and verifiable then please give it to Matt because he will use it. If you have info on a former extra sleazy large subprime shop that recently closed and why was in part by a large seven figure Vegas marker without the copy of the marker don’t expect to see that story in print. You are right though three years ago no one would listen. Just know you are not the only one.
Oh and I refer to the CEO of Impac as Joey because a CEO in a Hawaiian shirt can not be taken seriously. That right there should have been everyones red flag.
Hi it’s Gretchen.
I have been busy shredding the evidence.
I worked in IT….
I’m surprised with all of the comments that have made it to the blogs, not one comment from anyone regarding harassment.
One other note: Pointing fingers at Tomkinson and Ashmore are appropriate. I believe that Verdugo has/had always been the one true executive at this company and that she likely exhausted all of her energy to keep things moving in the most responsible and respectable manner. Everyone needs to keep in mind that Tomkinson makes/made all the major decisions, and everything revolved around Sales, Sales, Sales.
Dr. What? Says:
September 20th, 2007 at 9:04 am
I’m surprised with all of the comments that have made it to the blogs, not one comment from anyone regarding harassment.
I left before the current situation, been gone over a year. The only thing I remember was being told to not log overtime and replace it with comp-time instead because there were days I was working until 11 at night.
Folks asking about Gretchen:
In its Form 10-Q for the period ended June 30, 2007, the Company previously reported Gretchen Verdugo’s leave of absence with an expected duration of about September 15, 2007. Joseph R. Tomkinson, the Company’s Chairman and Chief Executive Officer, is continuing to perform the functions of the principal financial officer while Gretchen Verdugo, the Company’s Executive Vice President and Chief Financial Officer, continues to be out due to an illness. Ms. Verdugo’s medical leave of absence has been extended until October 15, 2007; however, it could be further extended for an indefinite period of time. Further information regarding Mr. Tomkinson, his business experience and arrangements with the Company are hereby incorporated by reference from the sections entitled “Information Concerning Director Nominees” and “Employment Agreements” of the Company’s proxy statement filed with the Securities and Exchange Commission on April 27, 2007.
-YOUR BLOGGER
…so if someone said they saw her drinking at the taste of newport, that would be odd then, right?
hmmmmm, one of those medical conditions that requires wine.
I would have a medical condition too if I had to work with Joe and Bill on a daily basis on all of these fraudlent loans… and yes, alcohol would be part of the rehabilitaion process.
Graphrix / Matt:
Just for clarity, I have offered to provide insight into the subprime mortgage implosion under the blogger name BnCynical. I am sure the 2 of you put together my comments an know BnCInsider and BnCynical were one in the same. I have not in the past offered documentation to Matt, only to the major networks and the FBI, all of whom either did not respond, stated they were interested but never followed up, or said they were too busy to bother (FBI). I do not wish to imply that Matt has not acted in a professional manner. I did offer my insights as a former high ranking manager in one of these firms.
I was not, nor am I looking to profit by providing such information or documentation, and specifically wish to remain anonymous.
What I can tell you factually is that the subprime mortgage debacle was calculated, deliberate and orchestrated by executive management from all aspects who where complicit. The guise of plausible deniability could easily be broken by talking to the right people. Joe Tompkinson, Mark Ernst, Ed Gotshell, Kyle Walker….. etc are not the right people. From Joey’s 90 cents on the dollar for his non performing loans, to his baby and the bath water comments, it was clear he is as slippery as the rest of them. I can offer no insights into the IMPAC mess, other than the first hand knowledge of the products they orginated and the risk they represented to the investor community.
It’s not all that hard to piece together.
You are correct Graphrix, I am not the only one out there with this information and understanding.
BnCInsider,
No worries. I just have to stick up for Matt since he has been so accommodating when it comes to getting info. Just know he knows a lot more than what he has been able to print.
It sucks because there has not been an open ear including the FBI in which I and several others contacted about a fraud ring in Irvine. Oh well now Impac is trying to sell them at the REDC auction but with little success.
So you mean that selling brokers on the option arm because of the 3 point rebate was a bad thing? Hey don’t worry about the qual rate just go stated.
They all created a pretty bleeping big mess didn’t they?
THE SAD REALITY:
The SEC does not know what to do about this mess as it relates to publicly traded companies. The mere fact that they have yet to pull the plug on IMH is dumbfounding to state the least.
The FBI does not know where to start. They are still trying to get a handle on FLIPS. Unless they receive glazing evidence handed to them on a platter, they likely will not be in any position to accomplish anything for months if not years.
The Mortgage Bankers Association has its own set of issues to deal with that are much more important.
Such as:
1. What will Open Session Guest Speaker, Sir Richard Branson prefer… carbonated water or flat?
2. What impact will Bono have on attendance if he wears black? Can we persuade him to maybe wear something a bit more conservative… possibly outfitted by the Nordstom suit department? Maybe even a blue blazer, paisley tie and some wing tips?
3. How will we distribute the 25,000 George Foreman “Countrywide-sponsored” Grills at the conference entrance? Can we get MERS to hand them out?
4. How much extra do we have to pay Martin Short for him to do his Ross Perot impression?
5. With all of the space we decided NOT TO SELL in the exhibit hall, can we move forward with our reenactment of the Boston Tea Party?
- - - Bottom line is that the MBA has their heads in the clouds. They are more concerned about making money from their conferences than they are about the crack down of the mortgage banking industry. Let’s face it… They are mortgage bankers protecting mortgage bankers.
-
Thank you Dr. What! It’s pathetic that all of this has gotten so far out of control. It’s nice to have some laughs over the insanity.
As a contract employee I have given Matt as much info as I could at the time. I’m no longer in the building so I’m not that privy to info anymore. I am just enjoying what Graphix and Dr. What are saying because it breaks the monotony of my daily work stress. And yes to Graphix, Joe owns Convict Lake, I didnt know it was also Convict Mountain. I think it ironic. Actually its Bill I believe is the reason behind the Impac problems. I don’t believe Joe is innocent however he is actually a pleasant guy its Bill who manipulates Joe. Bill and Richard were trying to get Joe to retire a couple of years ago, but as soon as that happened Richard was demoted and Gretchen took his place.
As for you Dreggas……. I know you, you used to were that black shirt with the flames. We used to talk politics.
I know you too dreggas… .renaissance man….
I know someone who said she was in the office on the monday the 17th, she was answering questions and seemed fine. She told him that she didnt want to be there.
KL and KennyBoy,
Feel free to look me up on yahoo. Still around, watching.
Ok - I still dont get it what is wrong with Gretchen??? Is she really ill or is it she doesnt want to be there — Im so confused
gretchen is not physically ill, i’ve seen her out and about town.
does anyone have info on why they would sell off all non-performing assets (REO) by auction through really an unknown entity? Is there an inside connection? doen’t seem like best execution for the shareholders or creditors.
Rosey - The longer they hold on to the non-performing assets, the worse the company looks on the books to other investors and thus their report for the investors. Once they cut out some of the investments dragging them down, they can say that “they eliminated the worst of the problems” although they just gave them to someone else. When I say gave, they probably took a loss to seel those assets, but a loss can be recovered much quicker than a non-performing assett which shows both loss & liability plus incurs costs for maintenance.
What happened to the Pinnacle Offices they purchased earlier this year?