Detroit-based Rocket Mortgage said Friday it has offered a second round of voluntary buyouts to a small percentage of its employees.
Rocket Mortgage, the country's largest mortgage lender, also reduced its workforce in April with a similar program that involved Amrock, its title company. The buyouts come as mortgage companies grapple with a shrinking market.
"Having experienced several market cycles in our 37-year history, we recognize career growth options in certain areas of our business are limited right now, while the housing market normalizes following two years of unprecedented volume," Mike Malloy, chief administrative officer for Rocket Central, said in a statement Friday.
"As a result of today's market, some team members have told us they are considering a move to another position or a completely different industry and have asked that we reinstate our career transition incentive, first offered earlier this year."
Rocket Companies, which includes Rocket Mortgage, employs 26,000, mostly in Detroit. Earlier this month, Rocket Companies reported a sharp drop in its second-quarter profits amid rising interest rates and decades-high inflation.
Rocket Companies reported net income of $60 million on revenue of $1.4 billion in the second quarter, down 94% and 48%, respectively, from the second quarter of 2021.
"The mortgage industry has shifted rapidly, and it's facing challenging times. Volatility in interest rates and declining consumer sentiment has contributed to overall uncertainty about the economy," CEO Jay Farner said on the company's earnings call.
Freddie Mac reported Thursday that the average 30-year mortgage rate had jumped from 5.13% to 5.55% last week, and on Friday, Federal Reserve Chair Jerome Powell warned that policymakers would continue to boost interest rates to fight inflation.
The latest round of buyouts was first reported by Crain's Detroit Business.
The buyout plan offers several months of salary, a portion of banked personal time off, benefits coverage through the end of the year and career transition services.
