Newrez veteran originators leave following uncertainty with retail channel

Uncertainty around the future of Newrez's retail operations pushed some veteran originators to seek greener pastures at rival competitors.

Following the departure of the company's head of retail James Hecht and some divisional managers to OneTrust Home Loans, others have also started transitioning out. Some managers and loan officers have jumped to organizations like Union Home Mortgage, CrossCountry Mortgage and The Money Store.

Some former staffers said their departures were prompted by unclear messaging from Newrez regarding how they'd recommit to retail, after efforts to sell the channel failed in 2023.

"The fact that they keep trying to sell the retail channel sends a confusing message where you're saying you're committed to retail, but then these things come out, and that's why my confidence started eroding," said one loan officer who recently left Newrez. "Last I heard, they're now pushing for a hybrid model between retail and direct-to-consumer where they'll pull leads out of their servicing portfolio…."

John Abraham, a top originator and producing manager, announced last week that he was jumping to The Money Store. Abraham spent over a decade at Caliber, which became a part of Newrez in 2021. The branch manager, whose team of three also transitioned to The Money Store, will serve as a vice president and producing manager based in Illinois, and will focus on driving loan volume growth at the shop, a press release said.

The veteran originator would not go into detail regarding why he left his old employer, but acknowledged he was aware of the lawsuit against Hecht.

Union Home Mortgage has also seen a notable influx of former Caliber/ Newrez originators in recent weeks, including the addition of Steve Kriegbaum, a veteran branch manager at Caliber. As of February, Kriegbaum became a sales manager at UHM, according to the Nationwide Licensing System. 

Movement of originators seems to have sped up after a bombshell suit was filed by Newrez against Hecht revealing he was tasked in late 2023 to explore a potential sale of Newrez's retail mortgage business. 

Currently the lender is trying to bar Hecht from continuing his employment with OneTrust.  Newrez accuses Hecht of staging a ruse in which he abruptly left to a direct competitor and brought his colleagues, a handful of divisional managers, along with him.

Newrez has expressed its recommitment to growing retail.

The mortgage lender is "100% committed to the distributed retail channel," an executive said Feb. 1. 

They also highlighted that "connecting our servicing portfolio and our servicing leads on a localized basis is really the differentiator on how we connect with our customers."

Rithm, the parent company of Newrez, reported that its originations and servicing segment posted a net loss of $120.9 million in the final three months of 2023, down from a gain of $421.5 million in the third quarter. Originations posted a $7.7 million gain in profits, up from $7 million the prior quarter. Servicing saw a $210.6 million gain in the fourth quarter, down from $444.5 million the quarter prior.