Colonial Savings, F.A., a Fort Worth, Texas-based financial institution, on Thursday said it will end its mortgage origination business, effective July 31, 2023.
Colonial Savings has originated mortgages since its founding in 1952, but with the changing market dynamics and a strategic evaluation of its business operations, the company has decided to streamline its services and reallocate its resources to banking and mortgage servicing.
"We are deeply grateful to our employees, customers, and partners for their unwavering support and loyalty throughout the years," said Dave Motley, president of Colonial Savings. "It is with a heavy heart that we make this difficult decision, but we firmly believe it is the right course of action for the company's future."
The bank did not say how many employees work in its origination business, nor whether any layoffs will result from the decision.
Colonial Savings said it is committed to ensuring a seamless transition for its existing mortgage customers. All outstanding mortgage loans will continue to be serviced in accordance with the terms and conditions of the agreements. Customers can expect uninterrupted access to their accounts, dedicated customer support, and reliable mortgage servicing throughout this transition, the bank said.
Founded as Fort Worth Mortgage Corp., Colonial is now a national, multi-service financial institution. A federally chartered thrift, Colonial is one of the largest servicers of residential mortgage loans in the United States, with a servicing portfolio of $20 billion. It operates a network of six consumer/commercial banks throughout North Central Texas.
A spokesperson for Colonial Savings did not respond to a request for comment.
Colonial Savings' decision follows a decision by San Antonio-based Frost Bank to re-enter the mortgage origination business. Frost Bank got out of the origination business 20 years ago, but decided to restart it earlier this year with the goal of being fully up and running to offer mortgages to the public by the end of the year.