The Latest News...And It Ain't Good for FNLC

Our friends over at the Mortgage Lender Implode-O-Meter say things are looking dire in Boca Raton:

"Have we seen the last of First NLC? It's anybody's guess, but recent posters on Last NLC (note: thanks for the shout-out) seem to be convinced, if not actually happy about it.

"Layoffs and branch closures have been going on some time now, the most recent of which came to our attention when it was reported here that another 100 employees were let go and the Anaheim, CA office was also being consolidated to their East Coast headquarters. Calls to the offices still listed on CityTownInfo.com revealed only 2 locations still receiving calls: Anaheim, CA's answering system is still on, and the headquarters in Boca Raton, FL. The company's web site now shows just one location - Boca Raton. For those tracking the numbers, that represents 24 offices nationwide, and now, approximately 725 of 1,350 employees gone in the consolidation.

"Concerns over the company's continued viability stem largely from losses reported in their parent company's 3rd quarter financial statements. On 10-25-07, Reuters reported that FBR Group (Friedman Billings Ramsey Group, Inc.) realized write-offs of $90 million associated with the sale of securitized loans, and an additional loss of $67 million from the sale of mortgage-backed securities. A company press release of the same date revealed the following additional losses:

• "an economic loss of $17.2 million(2) associated with restructuring and operating costs at First NLC Financial Services (FNLC), of which $15 million was incurred prior to the agreement announced in July to sell FNLC to an affiliate of Sun Capital Partners (Sun Capital), and
• "a $27 million valuation loss relating to the portfolio of conforming and non-conforming loans originated by FNLC and for which FBR Group took ownership under the Sun Capital sale agreement, reducing the value of those loans to $203 million.
  

"FBR Group announced its plans to sell an 80% share in First NLC to a Sun Capital Partners affiliate on 7-26-07, as part of a recapitalization plan to enable the struggling sub-prime lender to continue operations and satisfy a negotiated settlement of this employee class action lawsuit which received preliminary court approval in late September. The transfer to Sun Capital is expected to be completed by 2007 year end."

Pretty soon, they'll be running this company out of the family's garage.

Here are some additional notes from The Truth About Mortgage:

• According to sources, First NLC Financial Services plans to close 24 branches nationwide, shuttering their operations on the west coast and cutting more than 100 jobs in the process.
• It is believed that only six retail branches will remain open, along with an operations center at its headquarters in Boca Raton, Florida.
• I’ve been told that most of the 100-odd employees at its loan center in Anaheim, California have been laid off as a result of the migration to the east coast.
• In August, First NLC laid off 645 employees, or nearly half of its 1,350 member work force as the mortgage crisis continued to deteriorate.
• First NLC is one of the top non-prime residential mortgage lenders in the nation, originating over $7.4 billion in mortgage loans in 2006.
  FBR bought the subprime lending unit in 2005 for $101 million and arranged a sale this summer to an affiliate of private equity firm Sun Capital Partners.

Gone Daddy, Gone

Rumours are flying that First NLC shut down this past Friday. I haven't received confirmation yet - it may be only another ops center that has closed. Whatever the case, my sympathy goes out to the few working folks who were just let go during the holiday season.

Of course, if the company has been closed for good, my overwhelming joy is reserved for the the execs that ran this company into the ground - they have finally attained complete and total failure. Couldn't happen to a nicer group of selfish, arrogant a-holes. You get what you deserve. Life just handed you a "doing what is required" card. I hope you all lost your a$$es in stock while being blackballed in this industry.

More Shutdowns

Chicago's call center has been shut down - no surprise. Rumors of additional shutdowns (what's left to shut down at this point? The vending machines?) continue.

I thought I'd share this comment from a former FNLC'er that was posted a couple of days ago - this person is also happy to see upper management flailing. Enjoy:

I'm a former FNLCer and laying me off was the best favor FNLC ever did for me. I, now, work for a company that has a bright future and employees, including me, are happy and don’t live in fear. It's such a refreshing change. I read people's blog entries and frankly I'm amazed and a bit confused as to why people still choose to continue to work for them...especially in light of all that has happened. FNLC's senior management (a.k.a. the Hxxxxxs and their kiss a$$ lackeys) are the worst so-called “management” team I’ve ever seen and the company is obviously going down the tubes. I hope you do realize senior management doesn’t care anything about you, your family or your well being. I do understand how difficult the job market is but it is possible to move on. Most of the employees I had the pleasure of getting know during my time at FLNC were good hardworking people. Have faith in yourself! But, in spirit of the holiday season, I want to say "thank you" to Mr. Hxxxxx and all of his minions for laying me off. No doubt it was challenging for me at first but I prevailed! I take comfort in knowing the Henchel’s company is failing while I am growing professionally and am financial better off than I was work for your sad excuse of a company. It really is sad to have such ill will toward a group of people but this particular group doesn’t deserve anyone’s compassion or respect since they never bothered to give either to any of their employees. I am a person that does believe in karma. What goes around comes around. Mr. Hxxxx and all your minions, keep that in mind!