New Century Financial Corp., Irvine, Calif., disclosed late March 2 that it is the focus of a criminal probe by the U.S. attorney's office in central California regarding trading in the company's securities and errors tied to its accounting for loan repurchases.In trading Monday morning, its share price was down 60% to just over $6. (Its 52-week high is $51.97.) In a filing with the Securities and Exchange Commission, the nation's second-largest subprime funder said it expects to violate certain warehouse lending covenants stipulating that it must earn a profit for a minimum of two consecutive quarters. New Century notes that lenders on six of its 11 warehouse agreements have executed waivers. The company says it currently has $13 billion in committed lending facilities and $4.4 billion in uncommitted borrowing capacity. Over the past six months, company insiders have sold 796,445 shares while buying none, according to Thomson Financial. New Century recently cut 300 jobs, or about 4% of its work force, including 124 positions in Orange County.
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The Consumer Financial Protection Bureau has seen excessive property-inspection charges, fees that loan mods should eliminate and improper line-item labels.
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Michael Tannenbaum, whose experience in the financial services industry spans over 15 years, has a track record of helping companies scale and grow.
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A majority of consumers earning more than $100,000 annually said they were concerned about their own ability to purchase a home, demonstrating how affordability issues are impacting those at many socioeconomic levels, the University of Michigan study found.
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The nonbank's results add to other indications that the first quarter's "higher for longer" rate scenario had an upside for efficient servicing operations.
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The latest rate increases contributed to a 1% drop in purchases from the previous week and 15% annually, according to the Mortgage Bankers Association.
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The top five producers had an average dollar volume of VA and USDA loans of more than $35 million in 2023.
April 24