The $3.26 Charge That Could Blow Up My Mortgage Plans

Happy Thursday! Today we're digging into a fight that lit up Mortgage LinkedIn 🫣 this week: a recruiter told NFM staffers he heard the company had layoffs (it didn't), & NFM's Greg Sher decided a private DM deserved a very public callout.

Both sides talked to The Mortgage Scoop, & neither is backing down. It's a story about the ethics of recruiting, how information travels in this industry & what happens when someone w/ 40K followers decides to name names.

Also today: a $3.26 charge tanked my credit score 116 points right as I start house hunting (yes, really), & NewRez's distributed retail play rides into the sunset.

The scenario: A recruiter pings a select group of your LOs & branch managers on a Thursday morning. He says he heard your company had layoffs & pitches them on greener pastures. If there was no layoff, is it ethical to put the recruiter on blast?

Greg Sher says it's fair game — & the only way to clean up what he calls damaging, "lazy" recruiting.

Sher called out MTG Services' James Zeldin, a longtime mortgage recruiter & operator, this week for messaging a dozen or so NFM sales staffers. Zeldin wrote that he heard NFM "let go a large percentage of its team," asked if they were open to a move & noted that he represents 25+ lenders, most paying up to 100 bps on trailing 12 months of production.

NFM didn't let anyone go & is actually hiring, according to Sher. "If the best recruiting performance you can put forward is one that leads with, 'I heard something about your company,' you need to find a different profession," he wrote.

Sher took some flak in the comments. Is it appropriate to use a 40K-follower platform to "punch down" at an individual recruiter? Why not DM Zeldin privately & correct the record? A public callout can do real reputational damage.

I reached out to Zeldin. He told me he sent the message to a small group "based on info provided by one of [NFM's] underwriters that wanted to start looking for a role. This was never a public post. I was told they let go staff so I decided to reach out to a few people to see if any were interested in also leaving. Nothing more. He made this a public post."

Zeldin said he wouldn't do anything differently b/c he had no reason to doubt the source. His business partner at MTG, Richard Bitner, told me he felt Sher was bullying Zeldin to gin up content.

"James wouldn't have sent the message if the info had come from outside the organization," Bitner said. "Somebody may have lied, that's possible, I don't know. Maybe somebody had a vendetta. But it came from inside the house & that's the reason why we did this. It was a private fucking message."

He added: "You got a problem, be a man, pick up the fucking phone & call. Don't whine about it to 40,000 people. You got a problem, look in your own mirror b/c clearly people within your own organization aren't happy about what you're doing, which is why they're talking to us."

Sher was unapologetic.

"Someone needs to call these guys out so they have a reason to be cautious, careful & to check & double check their sources before putting something so blatantly false & careless out there," he wrote. "Nothing is private in the world we're living in now — recruiting needs to get cleaned up for the folks who do it the right way. This is the only way to get that done."

Picking up the phone wouldn't have made a dent, Sher told me.

"This shit has been going on for years, people making stuff up or not doing their homework," he said. "I had to spend an hour scraping his branch manager off the wall insisting that the company is not heading in the wrong direction… It's lazy recruiting & I feel a responsibility having a big following to put my foot down & say it's not OK. It was reckless, it was untrue."

Calling people out by name is rare, & it's arguably a risky approach. Public callouts invite purity tests. As HousingWire's Diego Sanchez asked in the comments: "Can you say with 100% certainty that all DMs and texts from NFM recruiters are above board 100% of the time? If not, you're opening yourself up here."

Stepping back: I spend probably 15-20 hours a week debunking & confirming industry rumors. A lot of the BS comes from recruiters trying to destabilize branches. (I'm not saying that happened here — Zeldin says he believed it was good intel from someone w/ no incentive to lie.)

Branch & LO recruiting has gotten extremely aggressive in recent years. There are fewer producers to go around, & consolidation among deep-pocketed lenders is raising the stakes, particularly for recruiters whose payday depends on getting LOs to move — & move quickly.

That's what makes this more than just Bravo-style LinkedIn hot goss theater. Recruiters say they're operating on imperfect intel in a brutal market. Executives say imperfect intel spooks teams, destabilizes branches & forces them to spend hours cleaning up a mess they didn't create. Sher's argument is that sunlight is the only real deterrent. Zeldin & Bitner's: private outreach w/ no ill intentions shouldn't become public punishment.

Can both things be true?

I should be sending out this newsletter, but instead I’m on the phone w/ Chase right now. Here’s why: My apartment building in Brooklyn just sold & the new landlord wants all the tenants out.

Now I’m looking to buy an apartment for my growing family. Last night I gathered all of my docs for a mortgage preapproval & checked my credit score. It’s been in the 800s for a while now; I take great pride in having exceptional credit. But when I looked on the BofA app, it said my FICO score fell 116 points(!) on June 25 to 686. WTF!!! How did that happen? This must be some kind of mistake. 

So I go through the whole report (which isn’t exactly consumer-friendly btw) & see that I had a 30-day late fee from JPMorgan Chase on a credit card w/ no balance that I hadn’t used in months. I looked further & it stems from a $3.26 charge from Bluehost, a service I thought I had canceled months prior. Since I didn’t use the credit card & thought I had canceled the underlying service, I didn’t notice the $3.26 charge. So now I’m trying to get Chase to provide a goodwill removal. If they say no, I guess I’m just shit out of luck & suffer a 116-point drop?

How is this a fair system or an accurate reflection of credit risk?

A source Wednesday morning told me that NewRez had struck a deal w/ Synergy One to transition what’s left of its distributed retail team. A few hours later, S1 confirmed that it had onboarded the team today. 

This is the second notable deal in the last month involving S1, which is now operating as a dba under American Pacific Mortgage. If all goes well, Aimee Dawson Dennis’s West Coast-concentrated group of roughly 125 people should bring in a solid book of business to Steve Majerus & Co.

Terms of the transaction were not disclosed & the firms said it’s not a merger or acquisition. The deal, however, would appear to spell the end of NewRez/Caliber’s distributed retail play. (I broke the story of large-scale layoffs/retail restructuring in early ‘24.) NewRez still be in the retail mix a bit via JVs. FWIW, I heard a number of non-sales staff were let go as part of the “transition” to S1…

(🙏 If you like what you’re reading, tell a fellow mortgage junkie to sign up here.)