Pennymac to close Tennessee office, lay off staff

Pennymac will close its office in Franklin, Tennessee, and lay off staff within its consumer direct lending operations, citing challenging macroeconomic conditions, the company confirmed on Monday.

“Given the current market environment and following a careful review of our staffing needs, Pennymac has made the difficult decision to close its Franklin, Tennessee site and reduce the associated positions within our consumer direct lending operations,” a company spokesperson told HousingWire.

The spokesperson did not disclose the specific number of employees affected or their roles. But the impacted staff will receive severance and “a number” of employees will have the opportunity to transition to other roles within the company. The layoffs were first reported by The Mortgage Scoop.

The move comes as newly appointed Federal Reserve Chair Kevin Warsh and other central bank officials forecast increases to the benchmark interest rate in 2026 in an effort to push inflation down to their 2% target. A higher-for-longer rate environment is expected to pose continued challenges for lenders across the industry.

Pennymac was the third-largest U.S. mortgage lender in the first quarter of 2026. The company posted origination volume of $36.7 billion from January through March, representing a 29% year-over-year increase, according to data from Inside Mortgage Finance.

The Westlake Village, California-based lender and servicer reported a first-quarter net income of $82.3 million. Stronger mortgage production revenues helped offset weaker servicing results stemming from mortgage servicing rights (MSR) valuation changes and hedging losses.

In February, Pennymac announced its acquisition of Cenlar Capital Corp., the country’s second-largest mortgage subservicer, marking the first major acquisition in the company’s history. The all-cash transaction included an upfront purchase price of $172.5 million, with up to $85 million in contingent consideration payable over three years.