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Facing a liquidity crunch, Reverse Mortgage Investment Trust (RMIT) filed for bankruptcy on Wednesday, a day after its subsidiary Reverse Mortgage Funding (RMF) slashed 80% of its staff.
RMF, one of the nation’s largest reverse mortgage lenders, laid off more than 400 employees during several conference calls on Tuesday, according to a source who wished to remain anonymous.
Following that announcement, RMIT – a Starwood-backed specialty finance company – filed for Chapter 11 bankruptcy protection in Delaware, hoping to “preserve value and monetize its assets.” The New Jersey-based company attributed its financial burdens to unprecedented interest rate hikes combined with credit spread widening and overall volatility in fixed-income markets.
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