Mortgage Servicers

Mr Cooper Divorces from Beaverton, Oregon at a cost of 1,600 promised Jobs and Nearly a Million Dollars in Subsidies

Mr Cooper, a Texas based loan servicing company that once promised more than 1,600 Oregon jobs in exchange for a $900,000 public subsidy now says it will close its Beaverton site and lay off the remaining workers.

Oregon paid $900,000 to a business that promised 1,600 jobs; now it’s closing Beaverton site and laying off the whole staff

A Seterus call center in Salem closed in 2018. Its 200 employees were given the option to move to the Beaverton site that will now also close, according to a Salem Statesman Journal report.

In the throes of the Great Recession, Oregon economic development officials worked in 2010 to persuade the business to expand here rather than move the jobs to North Carolina or Oklahoma. Sites in Beaverton and Salem employed 710 at the time but IBM indicated they could grow to 1,600 in exchange for state support.

So Oregon offered a nearly $900,000 package through four funding sources:

  • $550,000 from Salem Workforce Partners
  • $49,500 from the City of Beaverton
  • $200,000 from the governor’s “Strategic Training Fund”
  • $100,000 from a state Strategic Reserve Fund

The $100,000 in state money was tied to a promise that IBM would add 600 Oregon jobs by the summer of 2014.

After a pair of layoffs at the Beaverton site, state officials told The Oregonian/OregonLive in 2015 they could not tell if the site had met the 2014 job creation target required by its subsidies. The following year, in 2016, officials concluded IBM had hired just 351 of the 600 required employees.

So Business Oregon, the state’s economic development agency, reclaimed $41,500 from the original subsidy, plus $13,700 in interest, according to documents provided by the agency.

It’s not clear whether the other subsidies had clawback provisions and officials in Salem and Beaverton said Wednesday they were not immediately able to ascertain what rules applied to the incentives when IBM collected the money in 2010.

The IBM/Seterus subsidy was relatively small by Oregon standards.

Local governments provide hundreds of millions of dollars annually in tax exemptions to large companies, primarily Intel, Amazon, Google and Apple.

Most of those dollars don’t come with job guarantees – but they also don’t take money directly from public coffers. Instead, they exempt a company from property taxes on new projects or capital investment. That means companies don’t save anything unless they spend money on a project that would otherwise be taxable.

The funding for the IBM/Seterus deal, by contrast, were straight-up government subsidies.

Tax watchdogs have campaigned for more oversight of Oregon tax breaks, seeking a cap on the value of incentives per job created, limits on the number of tax breaks a project can receive, and a regular review of all incentive programs. The proposals have made no headway in recent legislative sessions.


Mr. Cooper shuttering Oregon office, laying off 301 employees

Employees were part of Seterus acquisition

Posted; Jan 29, 2020

For the second time in just over a year, more than 300 people employed by mortgage servicer Seterus are about to see their jobs eliminated.

Just over a year ago, IBM laid off just over 300 employees within its mortgage servicing operation, Seterus. That move came just days after Mr. Cooper Group announced it was purchasing Seterus from IBM.

And now, one year later, Mr. Cooper is laying off another 300 employees from within the Seterus servicing operation.

Mr. Cooper (the company formerly known as Nationstar) is shutting down a Beaverton, Oregon office location that was part of the Seterus acquisition and eliminating all 301 positions at that location.

The layoffs were revealed in a WARN Notice filed with the state of Oregon. According to that WARN Notice, which can be read here, the closure of the Oregon facility is “expected to be permanent” and the layoffs are “expected to be permanent.”

The facility is expected to close on March 18, 2020.

“Mr. Cooper Group continuously looks for ways to further increase efficiencies that best meet the needs of our team members, customers and shareholders and ensures the long-term success of the business,” the company said in a statement.

“After careful consideration of all our options and strategic priorities, we made the decision to close the Beaverton, Oregon location,” the company continued.

“While we deeply regret team members in Oregon will be impacted, we believe our changes will allow for investments that further our goals and improve the customer experience,” the company concluded. “We are dedicated to supporting our Beaverton employees in this transition with career services and, where we can, have worked to find new opportunities for them within the company.”

According to the company, the affected employees were told two months in advance that the office would be closing. Beyond that, the company is offering career transition support, including career coaching, resume and cover letter assistance, networking tips, mock interviews, and other aid to the affected employees.

Beyond that, the affected employees will have the option of consider a move to Mr. Cooper’s Texas offices and receive a stipend for relocation.

Seterus became part of Mr. Cooper in March 2019. At the time, Mr. Cooper said that the deal would add 300,000 new mortgage servicing customers to its portfolio. The deal included $24 billion in government-sponsored enterprise mortgages and a subservicing contract for $24 billion.

“We are excited to welcome more than 300,000 customers and the Seterus team to the Mr. Cooper Group family,” Mr. Cooper Group Chairman and CEO Jay Bray said when the deal was first announced.

“We are confident our new team will be energized by our people-first culture, and our new customers will benefit from our user-friendly mobile and online tools designed to help them manage their home finances,” Bray continued. “This transaction is consistent with our outlook for profitability targets and portfolio growth.”

But now, nearly a year later, more than 300 of those Seterus employees are about to be out of a job.

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