Wingspan's Creditors Include Banks, Industry Vendors

Wingspan Portfolio Advisors owes unspecified amounts to several industry creditors, according to Chapter 7 documents filed this week in the U.S. Bankruptcy Court for the Eastern District of Texas.

Creditors of the special servicer and mortgage services firm include mortgage technology and services vendors, property management firms and law firms, banks, housing finance trade groups, and former and existing employees.

Companies that file for bankruptcy under Chapter 7 often liquidate, but they can continue operations under a court trustee in the interim. If they can settle with creditors, they can sometimes avoid liquidation.

The Dallas-based company conducted some layoffs last October. But that month it also said its finances had improved due to a multimillion-dollar capital infusion from a stockholder investment group and the divestment of an insurance claims management firm.

Some small servicers said early last year that they had been under pressure due to increased compliance costs. Wingspan's founder said at that time that it was strategically more difficult for smaller shops.