PHH Mortgage Corp. will cut an additional 80 jobs at its Amherst location next year, and still more reductions are on the way.
The company said the cuts will take effect around the end of March, leaving a local workforce of about 100 people. At its peak, the company employed about 400 people here.
A subsidiary of New Jersey-based PHH Corp., PHH Mortgage specializes in processing and servicing mortgages.
With its local workforce shrinking, the company has also decided to move out of its Wehrle Drive building by the end of next year. The $34 million building was constructed for the company by Zaepfel Development when PHH Mortgage had ambitions to grow much larger.
The company was stung by a decision HSBC Bank USA made last year to sell the servicing rights to about 139,000 mortgage loans. Also, PHH moved mortgage origination work performed in Amherst to another site in Jacksonville, Fla. PHH had supported Merrill Lynch with mortgage originations from its Jacksonville office, but when Merrill Lynch decided to insource that work, it created capacity for PHH to fill from elsewhere in the company.
In September, PHH said it would cut 91 jobs at the Amherst location by the end of the year. The company expects to make more job cuts in the first half of next year, said Dico Akseraylian, a company spokesman.
Employees who continue working for PHH in Western New York will shift into telecommuting roles, Akseraylian said.
PHH agreed to move into the Amherst building when the company expected to grow much larger in the region. In 2012, HSBC Mortgage Corp. agreed to transfer its retail mortgage processing and servicing business to PHH. HSBC kept ownership of the loans, and paid fees to PHH to provide services.
PHH currently leases all of the 97,000-square-foot building at 1760 Wehrle Drive, said Ronald George, chief financial officer for Zaepfel. He said PHH's lease has "a good number of years" remaining on it, but declined to specify how many. Once PHH leaves, the company could sublease the space. If the developer finds a replacement tenant, Zaepfel could reach a lease termination agreement with PHH.
PHH's growth in the area was in question even before it moved into the new building. It cut 135 jobs in 2014, in the face of weaker loan demand.
"The market got softer and softer, and they've had other issues," George said.
In November, the state Department of Financial Services fined PHH Mortgage Corp. and an affiliate $28 million, citing “persistent shortcomings in their mortgage origination and servicing practices.”