IMH - Impac Mortgage announces cost cuts business model rejig

2023-03-08 17:11:42 ET

Impac Mortgage ( NYSE: IMH ) on Wednesday announced cost cuts as part of its business model review to navigate current market and industry conditions.

The mortgage lender negotiated a buyout of its legacy commercial lease for $3M, reducing its office space footprint from 120K to 19K sq. ft, owing to its hybrid and remote work model. The new lease term runs through July 31, 2025 with a total expense of ~$800K over the term.

Impac ( IMH ) repositioned its retail consumer direct lending division into a mortgage broker fulfillment model. This allows Impac ( IMH ) to originate products that serve its consumer base at a reduced cost per loan due to significant cost abatement relative to specialized staffing, operations, technology and business promotion.

Impac's ( IMH ) third-party origination channel experienced significant volume and margin deterioration in 2022 and these issues have persisted into Q1 2023. It decided to wind down operations within the TPO channel, but will honor its pipeline and related commitments to its partners.

Due to a lack of conventional GSE origination volume and servicing rights over the past few years, Impac ( IMH ) will voluntarily relinquish its GSE Seller/Servicer designation.

Earlier, Impac ( IMH ) reported Q3 results .

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