Arizona-based mortgage lender Suburban Mortgage Inc.’s website is down and employees’ emails are disabled, indicating that the company apparently shut down its operations and laid off its employees.
HousingWire reached out to representatives for the company, but they did not respond to requests for comments. A former employee told HousingWire that executives sent an email on Friday morning informing them about the decision to cease operations by 4:30 PM that day. The message did not provide further details, such as the reasons for shutting down and the future of the loans portfolio.
According to the former employee, Suburban laid off around 80 employees with no severance payment. The last paycheck was paid on Wednesday, but commissions on closing loans will happen through the end of September.
“We had employees that had been with us for 33 years. None of the owners will talk to us,” the former employee said on condition of anonymity.
Suburban was founded in September 1988 and has 38 licensed mortgage loan officers, according to the Nationwide Multistate Licensing System (NMLS). The company is licensed in Arizona, California and New Mexico, with branches in Casa Grande, Mesa, Peoria, Prescott, and Scottsdale.
Suburban may be the latest reported case of a company closing doors since mortgage rates surged and origination volumes dropped.
On June 24, Pimco-backed First Guaranty Mortgage Corporation (FGMC) cut about 80% of its workforce and stopped accepting new mortgage applications, filing for Chapter 11 bankruptcy protection one week later.
Sprout Mortgage informed the more than 300 workers of the shut down in a conference call on July 6. The NY Attorney General‘s office is looking into complaints that the company collected health insurance premiums, but canceled coverage retroactively to May 1.