Pioneer of reverse mortgages nutter mortgagealso known as James B. Nutter and Co.provided RMD with additional details about the impending layoffs and shutdowns.
“Sadly, after more than 70 years of helping people across the country realize the American dream of owning a home, the Nutter family has made the very difficult decision to exit the mortgage business,” a company spokesperson said. “The family will continue to be actively involved in other businesses and civic interests in the Kansas City community.”
Employees affected by the closure are being directed to resources to assist with the transition, a spokesperson said.
“We are now committed to taking care of our many loyal and long-time employees by providing professional placement services to pursue other opportunities to continue their careers. ‘, said the spokesperson.
Responding to ongoing lawsuits
The company also has an ongoing Department of Justice lawsuit With regard to reverse mortgages initiated between 2008 and 2010, it reiterated that recent actions have slowed progress on the issue.
“James B. Nutter & Company continues to deny all allegations in the DOJ complaint,” the company said. “This case is currently under investigation, and recently, at the request of the Department of Justice, the court extended the end of all investigations until September 2023.”
Department of Justice filed a lawsuit In late 2020, the lender allegedly forged certificates and used unqualified underwriters to approve them Federal Housing Administration (FHA)Home Equity Conversion Mortgage (HECM) loans initiated between 2008 and 2010.
The company again called the allegations “meritless,” and in its first complaint filed in September 2020, it said, “None of Nutter’s borrowers were or were not eligible for the loan, or Nutter took. We do not claim that our actions harmed any borrower.” method,” said a company spokesperson. “The Justice Department is trying to get to the point, win inappropriate windfalls, and recover damages not caused by the government.”
The company remains committed to challenging the allegations and is ready to proceed with the lawsuit, the company told RMD.
“Nutter is disappointed with the Department of Justice’s decision to bring this lawsuit to the first instance, but he intends to defend himself vigorously through the trial if necessary, and is confident that he will prevail.
If the allegations are true, they would undermine the financial viability of the HECM program within the Mutual Mortgage Insurance (MMI) Fund, and this action is an indication that the federal government is taking seriously the threat to the integrity of the HECM program. HUD inspector general said. Ray Oliver Davis.
“Lenders who deliberately ignore the FHA’s requirements for HECM loans expose the program to significant financial losses that threaten the future availability of this important program for seniors,” he said in late 2020. After the first complaint was filed, Davis said. Vigorously investigate allegations of misuse of the HECM program by FHA lenders. ”
Nutter Home Loans news close It was first reported last Monday by media in the local Kansas City, Mississippi area.an anonymous source who spoke with kansas city star The length of the upcoming trial, coupled with the company’s CEO James Nutter Jr.’s ongoing health problems, is the reason for the company’s closure.
The lender stopped structuring mortgage loans on Oct. 20, according to Reuters. StarThe company, which has an estimated 125 employees, said only a few would remain on hand and the rest would be laid off.
Nutter Home Loans is considered a pioneer in the reverse mortgage industry due to its rapid adoption of the HECM program after passage of the Housing and Community Development Act of 1987. Mason of Fairway, Kan. by James B. Nutter Company.
In its heyday, Nutter was servicing about $7 billion a year in mortgages.According to mortgage software Modex, Nutter has taken out just $102 million in mortgages so far this year. In 2021, he has originated $503 million and in 2020, he has originated $590 million in mortgages.
These days, only a small percentage of the company’s originations are reverse mortgages.