Citi Temporarily Suspends Correspondent Channel

Citigroup has suspended purchases of new loans through its correspondent channel until July 6 while it re-engineers CitiMortgage's quality control processes, the company said. "We will temporarily suspend the acceptance of correspondent mortgage loan registrations while we work with correspondent customers to make improvements to this important business that will ensure the continued delivery of superior quality loans," Citi spokesman Mark Rodgers said. As part of an internal review, CitiMortgage decide to put new processes in place for handling appraisals, income statements and HUD-1 settlement forms. The Fallon, Mo.-based mortgage unit suspended purchases on June 23 after giving its customers 24 hours notice. The temporary suspension does not affect the retail or wholesale channels. Last October, Citigroup made huge cuts in its wholesale division and mortgage broker networks. In the first quarter, CitiMortgage purchased $17.3 billion in loans through its correspondent channel, according to NMN's Quarterly Data Report. For full year 2008, correspondent purchases totaled $58.5 billion.