Mortgage Lenders Network USA, the troubled subprime lender based in Middletown, Conn., has been hit with a temporary cease-and-desist order from the Connecticut Department of Banking that prohibits it from funding new loans.Company president Mitch Heffernan explained that the order is part of "an overall process" between the lender and regulators and eventually will allow the company to "move forward with its business." A spokesman for MLN said the order was not unexpected. He also told MortgageWire that Lehman has funded at least 500 loans that were in progress when MLN closed its wholesale division in late December. (Wholesale accounts for 90% of its production.) Early reports had Lehman funding close to 900 loans. One loan agent told MW that a mortgage she worked on had closed, but did not fund, just days before the wholesale shutdown. The agent, who did not want to be identified, said MLN has yet to contact her about the loan. MLN's spokesman said the company is working on a plan to fund some of the mortgages that Lehman did not pick up. MLN is also working on a plan to restart part of its shuttered wholesale network, but there is skepticism in the industry that it will ever happen.
