NovaStar Closing Warehouse Unit

NovaStar Financial Inc. is closing down its small warehouse lending unit, WarehouseUSA Capital Corp, over the next few weeks in response to the correction in the subprime mortgage market.NovaStar "decided this business is no longer strategic," said company spokesman Dick Johnson, and it wants to focus on its core nonprime mortgage lending business. He said the warehouse lending team has already informed customers about the decision, and they are helping those independent mortgage bankers/brokers make the transition to other warehouse providers. WarehouseUSA Capital, Roswell, Ga., had $39.5 million in warehouse lines outstanding as of Dec. 31. NovaStar, based in Kansas City, Mo., originated $11.2 billion in subprime, alternative-A, and jumbo loans in 2006. NovaStar can be found online at http://www.novastarmortgage.com.