GMAC Financial to close retail offices
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Published: September 7, 2008
LOS ANGELES — Lender GMAC Financial Services said Wednesday it will close all of its 200 retail offices and lay off about 5,000 employees as part of a plan to reduce its mortgage lending and servicing operations because of the housing market downturn.
The majority of the layoffs are slated for GMAC's mortgage lending division, Residential Capital LLC, or ResCap, and will reduce work force at the unit by 60 percent, the company said.
GMAC operates two mortgage offices in Vermont in Rutland and Burlington, according to the Department of Banking, Insurance, Securities and Health Care Administration. A third office in Lyndonville was closed last month, a department spokeswoman said Wednesday.
"While these actions are extremely difficult, they are necessary to position ResCap to withstand this challenging environment," Tom Marano, ResCap's chairman and CEO, said in a statement. "Conditions in the mortgage and credit markets have not abated and, therefore, we need to respond aggressively by further reducing both operating costs and business risk." Some 3,000 employees may receive word of the cutbacks this month. Other cutbacks are expected to take place by the end of the year, the company said.
The Fort Washington, Pa.-based company also said it would stop making mortgage loans through external, wholesale brokers.
ResCap will continue servicing loans and lending through brands such as Ditech or GMAC Mortgage Direct, which customers can reach online or through call centers, said spokeswoman Jeannine Bruin.
— Staff reports
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