Guaranteed Rate conducted two rounds of layoffs this month

Guaranteed Rate, the seventh-largest mortgage lender in the country, has laid off hundreds of employees across two rounds of layoffs this month, according to former staffers who were affected.

In the first round, the Chicago-based lender laid off project managers, director- and senior- level positions, as well as tech staff, multiple sources told HousingWire. The second round of layoffs this month mostly affected non-tech workers and included its vice president of creative, an operations training manager and a human resources director. 

Loan officers were let go in August as well, according to former employees. The company had 2,186 sponsored LOs as of Wednesday, per the National Multistate Licensing System (NMLS). 

One worker who was let go in the first round of layoffs said she was told the job cuts in August totaled about 800 positions.

“There was a budget number that every department was required to hit. Higher salary and director-level titles were affected mostly to hit the number,” the impacted former employee told HousingWire.

According to the former employee, the layoff came following weak sales in July. Mortgage recruiting platform Modex shows that the company originated $1.64 billion in July, down 30% compared to the previous month. The volume is still higher than the $1.17 billion in January, the lowest level in the current mortgage business cycle. 

“I would say the turnaround time on marketing projects has been slowed down because of the market for sure,” another former employee said on the condition of anonymity due to fear of retaliation.

Guaranteed Rate, a private company controlled by founder Victor Ciardelli, wrote on its website that it had more than 15,000 employees as of 2022.

Like other mortgage lenders grappling with sky-high rates and few home sales, Guaranteed Rate has seen significant turnover over the past year, former employees said.

HousingWire was unable to independently confirm the size of the layoff or details of the severance package, but multiple former employees said the layoffs were in the high hundreds. There have been at least five other layoff rounds since July 2022, former workers said.

Guaranteed Rate declined to comment on “any personnel matters.” No Worker Adjustment and Retraining Notification Act (WARN) notice had filed with the Illinois Department of Commerce and Economic Opportunity as of Tuesday. 

Guaranteed Rate originated $10.6 billion in the second quarter, up from the previous quarter’s $7 billion — totaling $17.6 billion in the first six months of 2023, according to data from Inside Mortgage Finance. The production volume in the first half of this year was down about 47% from the same period in 2022. Guaranteed Rate ended the second quarter with 2.5% market share, IMF data showed.

In a shrinking mortgage market, G-Rate has targeted first-time homebuyers and concentrated on products that aid affordability concerns. The lender launched a down payment assistance program in July. G-Rate will provide 2% of the required 3% minimum down payment for a conventional loan or up to $2,000 — whichever is lower. 

Last year, the lender rolled out its first personal loan product.

Other mortgage lenders have also been making large cuts to their already-dwindling workforces.

BMO Financial Group announced that it will let go of 248 employees in California next month and Wells Fargo will issue pink slips to 105 employees in Florida through early October, according to WARN notices from both states. 

Employment numbers in credit intermediation jobs — including LOs and tellers at depository institutions — fell to 2.67 million between April 2021 and July 2023, according to the U.S. Census Bureau.