Exclusive: CrossCountry Mortgage demands payment from former LOs, invokes 2-year non-solicitation

Top-five mortgage lender CrossCountry Mortgage (CCM) has sent cease-and-desist letters to at least 25 former loan officers, according to documents viewed by HousingWire and interviews with one of their new employers. In the letters, CCM invokes a two-year, non-solicitation window and demands thousands of dollars in combined penalties under their employment agreements. The company cites a contractual provision creating a “legal presumption” that any mortgage product or service provided to a past, present or future CCM customer violates the agreement. Under that framework, CCM declares that “each loan is presumed to violate your non-solicitation covenant.” The letters, dated Oct. 29, were sent by Ashley C. Wakefield, senior corporate counsel for Cleveland-based CrossCountry Mortgage. Each document contains the same three-part demand: a cease-and-desist order, a demand for payment based on 75 bps for each refinanced loan, and a litigation preservation notice. CCM gives the recipients 10 business days to respond. According to the letters seen by HousingWire, the repayment amounts range from several thousand dollars to nearly $20,000 dollars in the case of one letter. Representatives at...