Residential Capital, the mortgage firm owned by
GMAC Financial Services
, is the latest lender to slash its workforce.
The Minneapolis-based residential mortgage lender plans to eliminate 3,000 jobs, or 25% of its workforce, mostly in the fourth quarter, it said.
As a result, the company expects to incur fourth-quarter charges in the range of $90 million to $110 million, related to severance charges and facility closings, it said.
The job eliminations will include a range of administrative and managerial positions to business units most closely tied to originating loans. ResCap will also continue to modify its product mix away from nonprime mortgages and non-conforming prime mortgages.
ResCap had cut 2,000 positions earlier this year.
Private-equity behemoth Cerberus Capital Management bought a majority stake in GMAC, ResCap's parent company, from
last year. GM still owns the remaining interest.
"We are focused on turning this business around," says Gina Proia, a spokeswoman for GMAC. "We are just sort of trying to structure it in a way where we have a bit more flexibility to scale the business based on market conditions."
The cuts come as lenders large and small slash staff to bring expenses in line with tumbling mortgage demand.
, the nation's largest lender, said in a filing that it will take a restructuring charge of up to $150 million to eliminate up to 20% of its workforce.
is also cutting 1,000 jobs, or 10% of its workforce.
ResCap said the mortgage industry continues to experience lower overall origination volumes, illiquidity in the secondary market and home price declines.