Home Front

A blog about the economy and the Sacramento-area real estate market.

August 31, 2010
We're hearing about huge uncertainty at HomEq

WEDNESDAY A.M. UPDATE: Here is the story we wrestled together for this morning's print edition. Ocwen remained silent throughout and HomEq employees were told not to talk with the media. But it sounds as if the pink slips might begin this morning.

I got a call about an hour ago that subprime loan servicer HomEq is shutting down today or tomorrow? I don't have anything confirmed yet from its parent firm, Ocwen Loan Servicing. But an insider at HomEq said employees are in meetings today about the operation closing. And they have been ordered not to talk with the media or they will lose their severance pay.

This could mean several hundred layoffs eventually,if true, into a regional economy with 12.7 percent unemployment.

Here is Ocwen's second-quarter earnings report in which it says its purchase of HomEq in May is expected to close Sept. 1.  There are mentions in there of closing HomEq and spending $1.5 million to add new facilities. The firm notes on its web site that it outsources some of its loan modification work to Uruguay and India.

Near as we know HomeQ has about 1,000 employees in North Highlands and a couple hundred more in Raleigh, N.C.

It's still pretty fuzzy. If you can shed any light on this please call me at 916-321-1102 or email jwasserman@sacbee.com.


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