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Hello Real Estate Agents, We Want Your $100000 Signing Bonus Back – MishTalk - Mish Talk

Author: Mish Talk

Source: https://mishtalk.com/economics/hello-real-estate-agent-we-want-your-100000-signing-bonus-back/

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On the basis that it was a loan, a mortgage company with the ironic name “Guaranteed Rate” is demanding ex-employees return their signing bonus, some up to a million dollars.Lenders Want Ex-Employees to Give Back Their BonusesThe Wall Street Journal reports The Mortgage Market Is So Bad Lenders Want Ex-Employees to Give Back Their BonusesDavid Siegel went to work for an affiliate of Guaranteed Rate in 2021 and got a signing bonus of more than $100,000.Interest rates were super low, and mortgage bankers were raking in cash.Now that business has dried up, the mortgage company wants its money back.He said it fired him one month shy of the date when it could no longer ask for the bonus back, then demanded the money.Guaranteed Rate and its affiliates are also telling hundreds of other former employees that they have to return their signing bonuses, people familiar with the matter said.Its general counsel, Anwar Shatat, said, “We are not going to be apologetic about exercising our legal rights to recover our money.”“The former employees who have been sued know very well that they signed agreements, including promissory notes, making it crystal clear what they needed to do to receive and earn the money,” said Shatat, Guaranteed Rate’s general counsel. “They have been sued because they have, and continue to, blatantly violate these agreements, and have steadfastly refused to repay what they clearly owe to the company.”“I’ve been in this business 40 years and I don’t remember a correction like this,” said David Stevens, a former housing-finance regulator who now consults for the industry.Correction or major bear market?Few want to admit reality.Not a Signing Bonus, It’s a LoanThe signing bonus wasn’t a bonus, it was a loan unless the employees stayed two years and met performance goals.Nations Lending and CrossCountry Mortgage also seek return of signing bonuses.Steve Walsh at Scout Mortgage says headcount is down about 90%.Walsh wants to downsize. but he has been unable to sell his 7,700-square-foot house at the $3 million he is seeking.Amazing Greed EverywhereFor starters, only someone very greedy would sign a two-year promissory for their “bonus” when too many things can go wrong in two years.Guaranteed Rate lured many of its hires from Wells Fargo, who now no doubt is happy to be relieved of those employees.Hoot of the DayWells Fargo CEO called Guaranteed Rate CEO Victor Ciardelli and asked him to stop poaching Wells employees.Ciardelli accused Wells Fargo of treating its bankers poorly.Now Guaranteed Rate is firing people 1 year and 11 months into a contract demanding signing bonuses back.Existing Home Sales Drop Another Two Percent to a 13-Year LowOn October 19, I noted Existing Home Sales Drop Another Two Percent to a 13-Year LowExisting home sales are down 37.5 percent in less than two years.Home sales were 6.34 million in January of 2022 at a seasonally-adjusted annualized rate. They are now 3.96 million.LookingAheadMortgage applications are a a 30-year low.And it will not get any better with mortgage rates hovering near 8 percent, a 23-year high.Who wants to trade a 3 percent mortgage for an 8 percent mortgage?How the Fed Destroyed the Housing Market and Created Inflation in PicturesThere’s plenty of blame to spread but especially the Fed for creating the artificial boom in housing.For discussion, please see How the Fed Destroyed the Housing Market and Created Inflation in PicturesAlso see Fed Chair Jerome Powell’s half-baked admission What the Fed Could Have Done to Prevent Inflation Rise.Despite this sorry state of affairs being a tragedy of the Fed’s making, does anyone feel sorry for people signing two-year promissory notes as a signing bonus?

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