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GMAC-RFC to close High Street Home Loans, cutting over 200 jobs

GMAC-RFC has announced – during today’s pre-budget report – that it will be closing its sub-prime subsidiary High Street Home Loans and cutting around 266 jobs.

GMAC-RFC corporate relations manager Julie Gaskin says it informed staff of the changes at 3pm today and will now enter a 90-day consultation period.

She says it will be cutting 200 jobs from GMAC as well as 66 employees from Newcastle-based High Street Home Loans.

Gaskin says that it cannot go into specifics of which departments will be affected by the job cuts at GMAC but that the restructuring is going to affect most departments.

She says that GMAC will honour all offers made by Home Street Home Loans.

“We’re not immune to the current market conditions. We’ve had to react by making these moves. We will still continue to offer mortgages to all parts of the market but currently the share of the non-conforming sector is not there”, she adds.

In a statement GMAC says it will re-focus its UK business, “tackling the changing lending environment head on and securing a strong position for the future”.

It says the business will concentrate on creating cost efficiencies across its divisions and focus on further utilising its technology platform, POSO.

This comes after several reports in the market that High Street Home Loans was pulling loans amidst the market turbulence.
 
Chief executive officer Simon Knight says: “The market will be smaller, especially in the non-conforming space – that’s a reality.  While the majority of our business is in the prime space, we are not immune to the unprecedented volatility in the global credit markets which lenders have been facing.  We have to react quickly to change and these moves are designed to put us in a very strong competitive position for next year and beyond.
 
“It is sadly necessary for us to make redundancies and close one of our businesses.  Not an easy decision for any company to make.  But we believe these actions will place us in a position of strength to take advantage of the opportunities that will inevitably surface from this market adjustment.  Our management team is committed to ensuring that leaving employees are fully supported during this process.”
 
He adds:  “GMAC-RFC has a strong track record of success. We will continue to be a leader in and be committed to the intermediary mortgage market and build on our strong relationships with business partners, brokers and packagers.  We will continue to develop on our technology offering and supply of innovative products backed by a best in class service delivery. We look forward to working closely with all of our business partners as the market realigns.”

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