70 Percent of the Work Appraisers Did at Landsafe, Bank of America’s Appraisal Division, Was Related to Soured Home Loans
Bank of America Corp.’s appraisal division LandSafe reduced about 5% of its work force, beginning Feb. 22, Bloomberg News, The Appraisal Institute, and Housing Wire reported. LandSafe had more than 1,000 employees, the report said. Hugh Son at Bloomberg explains a bit about the move:
The dismissals from LandSafe’s workforce of more than 1,000 employees began Feb. 22, said the people, who requested anonymity because the matter is private. Those affected include appraisers, who estimate the market value of properties, and regional managers, according to a Feb. 25 staff memo from Tracy Sanderson, a LandSafe senior vice president.
“While we have known we were overstaffed since the fall, we did everything we could to delay impacts as long as possible,” Sanderson wrote. “We were hopeful that our volume would return and potentially reduce the number impacted.”
The bank has scaled back in mortgages after being saddled with more than $40 billion in costs tied to defective home loans. Most of those came to Bank of America through its 2008 takeover of Countrywide Financial Corp., whose operations included LandSafe.
About 70 percent of work done by LandSafe appraisers was related to transactions for soured loans, including the auction of bank-owned properties and short sales in which a borrower’s home is sold for less than the amount owed, said one of Bloomberg’s sources. The bank’s expected increase in originations this year isn’t enough to offset the drop in work resulting from having fewer overdue loans to service.
The Majority of the Work of the Home Appraisers Being Laid Off at Bank of America Was Related to Soured Home Loans
Bank of America Cuts Appraiser Staff by 5 Percent —Appraisal News Online (Appraisal Institute) 3/20
Bank of America Scales Back Staff —HousingWire 3/13
Sudden Rise in Home Demand Takes Builders by Surprise —New York Times (3/20)
New Indications Housing Recovery Is Under Way —New York Times (3/20)