Fremont Sells Its Texas Servicing Facility
Fremont General Corp., which does business as Fremont Investment & Loan, said that it has agreed to sell the fixed assets and assign its lease obligation for an Irving, Texas, loan servicing facility to an unnamed buyer.
Fremont did not sell any mortgage servicing rights along with the facility and will continue to service loans through its primary loan servicing center in Ontario, Calif.
Fremont says it anticipates annual cost savings of about $12 million as a result of the transaction.
Fremont said the transaction was expected to close in the first quarter of this year.
"The transaction related to the Irving, Texas, loan servicing facility represents a component of the company's strategic plan to reduce overhead expenses, in this case by eliminating operational inefficiencies inherent in operating two loan servicing centers," said Stephen Gordon, chairman and CEO of Fremont, in a news release.
He said it is also part of a strategic plan to "fully transition out of the company's discontinued residential real estate business as we work towards the successful turnaround of the company."
Fremont General Corp., with $8.8 billion in assets as of Sept. 30, 2007, is a depository bank servicing the coastal and central valley areas of Southern California. It serves the residential real estate mortgage servicing industry though Fremont Investment & Loan.
Like many lenders, Fremont ran into trouble last year when the secondary market for nonconforming mortgage loans dried up. (c) 2008 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com/ http://www.sourcemedia.com/