Servicing

Opteum Inc., Vero Beach, Fla., has filed a form 12b-25 with the Securities and Exchange Commission, notifying the regulator that it will not file its 10-Q until Aug. 14.Opteum revealed that it expects to report a loss of $162.5 million ($6.53 per share) for the quarter, with $82.0 million coming from continuing operations and $80.5 million from discontinued operations (its mortgage originations business). During the second quarter, Opteum shut its wholesale and correspondent channels and sold its retail business. It also sold $5.67 billion of its mortgage servicing portfolio. The company reached an agreement to sell the remainder of the portfolio, $2.97 billion, on July 26. "The magnitude of our second-quarter estimated losses is far greater than we could have imagined when the second quarter began, and such losses were precipitated by the now well-known developments in the secondary market for mortgage loans," said Jeffrey J. Zimmer, chairman, president, and chief executive officer. "We were unable to immunize ourselves from these developments, and our second-quarter results were significantly impacted as a result. However, unlike some other mortgage market participants, we have survived the recent market turmoil and we believe that we are well positioned for the future."

Fannie Mae has announced that it plans to file its 2006 annual 10-K financial report on Aug. 16.The government-sponsored enterprise said it will host a conference call for the investment community at 1 p.m. EDT on that date. Several Fannie executives, including Daniel H. Mudd, president and chief executive officer of the company, and chief financial officer Robert T. Blakely, are scheduled to discuss the filing with analysts and investors during the call. Fannie Mae also announced the filing of a Form 12b-25 with the Securities and Exchange Commission to report that it will not timely file its Form 10-Q report for the second quarter. The mortgage giant has not filed a timely quarterly financial report since the second quarter of 2004, before an accounting scandal came to light later that year. Fannie Mae can be found online at http://www.fanniemae.com.

Subprime lender NovaStar Financial, Kansas City, Mo., has reported that it lost $54.5 million in the second quarter, noting that the nonprime securitization market "continues to be illiquid."During the quarter, NovaStar set aside $73 million for credit losses and took a $22.5 million impairment charge on mortgage securities. In the same quarter last year, the nondepository earned $33 million. Despite the loss, its shares were up slightly in trading Friday morning.

The Securities and Exchange Commission is said to be looking into the accuracy of Wall Street firms' subprime mortgage-related valuations, according to the Wall Street Journal, but the commission itself -- while acknowledging that it "generally looks at things like that on a regular basis" -- is neither confirming nor denying the report.The commission, for example, recently settled entered into a settlement with First Bancorp, Puerto Rico, involving charges that the bank holding company had "concealed the true nature" of "transactions involving 'nonconforming' mortgages," a category which it said "can constitute 'subprime mortgages'." The SEC can be found on the Web at http://www.sec.gov.

The Federal Reserve has begun providing liquidity to a market hard-hit by the subprime mortgage-sparked credit crunch and said it will continue to "provide reserves as necessary."The Fed said Friday that it is providing the support "to facilitate the orderly functioning of financial markets," noting that "in current circumstances, depository institutions may experience unusual funding needs because of dislocations in money and credit markets." The Federal Reserve can be found online at http://www.federalreserve.gov.

Mortgage giant Washington Mutual, Seattle -- citing the current subprime crisis -- says in a new public filing that its liquidity may be affected by its "inability to access the capital markets or by unforeseen demands on cash."As of MortgageWire's deadline, WaMu's stock was trading down $1 a share at $36. In a filing with the Securities and Exchange Commission, WaMu noted that liquidity "is essential to the company's business," adding, "liquidity in the secondary market for nonconforming residential mortgage loans and securities backed by such loans has diminished significantly." According to the Quarterly Data Report, WaMu is the nation's sixth-largest residential funder. It also ranks sixth among subprime firms.

In a new filing with the Securities and Exchange Commission, Countrywide Financial Corp. -- the nation's largest mortgage banking firm -- revealed that it had $190 billion in short-term liquidity, but that just one-quarter of it ($46 billion) "is highly reliable and available."In early trading Friday morning, its stock was down 13%, or $4 a share. Countrywide filed its 10-Q with the agency late Thursday night, a day in which world stock markets cratered amid concerns that America's subprime crisis has spread overseas, causing large losses at foreign banks that bought risky nonprime bonds and residuals. In its filing, Countrywide notes that "the secondary market and funding liquidity situation is rapidly evolving and the potential impact on Countrywide is unknown." Countrywide adds that market conditions are forcing it to hold more loans on its balance sheet. The company can be found online at http://www.countrywide.com.

Class M-II-3 of Residential Asset Mortgage Products Inc. Trust's series 2003-RS7 asset-backed securitization deal has been downgraded from Baa2 to B3 by Moody's Investors Service.The downgrade was based on credit enhancement levels that are deemed to be low in view of projected losses on the underlying pools, Moody's said. The transaction consists of a fixed-rate and an adjustable-rate pool containing mortgages that are not eligible for inclusion in Residential Funding Co. loan program securitization because they do not satisfy the program guidelines. The mortgage loans were originated by affiliates of RFC and serviced by HomeComings Financial Network Inc., a wholly owned subsidiary of RFC. Moody's can be found online at http://www.moodys.com.

Nearly 50 classes of subprime residential mortgage-backed securities with outstanding balances totaling more than $1 billion were downgraded by Fitch Ratings on Aug. 8.Fitch also affirmed the ratings on classes with outstanding balances of more than $8.5 billion. Among the downgrades were 42 classes from five issues of Long Beach Mortgage Loan Trust asset-backed certificates. Fitch reported that as of the end of the day on Aug. 8, it had downgraded 546 classes (with an outstanding balance of $10 billion) from subprime RMBS deals placed Under Analysis on July 12 and affirmed the ratings on 1,009 classes with an outstanding balance of $86 billion.

Citing capital markets turbulence, Hanover Capital Mortgage Holdings Inc., a real estate investment trust based in Edison, N.J., has announced a postponement of its earnings report for the second quarter and an investor conference call previously scheduled for Aug. 9."Recent turmoil in the capital markets and certain demands on our liquidity have necessitated the company to re-examine its position regarding declines in the fair value of its available-for-sale portfolio of subordinate mortgage-backed securities collateralized by prime mortgage loans," said John A. Burchett, Hanover Capital's president and chief executive officer. The mortgage REIT said it has until Aug. 14 to file its quarterly report and "plans to file by that deadline." Hanover can be found online at http://www.hanovercapitalholdings.com.