There's an interesting little story concerning buybacks making the rounds (that I can't confirm) and it goeslike this: midsized lender has been getting stung by buyback requests. The primary owner has staved off the problem,somehow, for months but the day of reckoning is approaching. His firm has a decent net worth but the buybacks itfaces would put him out of business. So what does he do? He plans on bankrupting his current mortgage firm, shiftingall the assets over to a new one. Sound crazy? One banker I ran it by had this to say: "Not crazy at all.Makes perfect sense to me. Why let the greedy Wall Street bankers making billions of dollars a year take you down?"Stay tuned...
An active secondary market has developed for buyback loans. As we went to press, one large subprime lender wascoming to market with a $580 million portfolio of buybacks. To find out which firm read the Monday edition of NationalMortgage News. Don't subscribe? Call: (800) 221-1809...
Former Aegis Mortgage CEO Rick Thompson is out talking to venture capital firms about raisingmoney. Rick left the firm in early November. Also, see Monday's NMN...
Accounting firms never learn. The Office of the Comptroller of the Currency has fined Grant Thornton$300,000 for its audits of a West Virginia high-LTV lender that inflated its assets by nearly 25%. The accountingfirm said it would appeal the comptroller's action. Comptroller John Dugan said the audit of the failedFirst National Bank of Keystone departed "so far" from accepted standards that it represents "recklessconduct" on the part of the accounting firm. Grant Thornton filed an unqualified opinion of Keystone's financialstatement a few months before the OCC closed the bank in September 1999. Several years back Grant Thornton wascalled Alexander Grant & Co. In the mid-1980s, AG&C was sued for doing a poor job auditing E.S.M.Government Securities. E.S.M.'s collapse sparked the Ohio savings and loan crisis...
In recent securitization news, subprime lender NovaStar came to market with a $1.25 billion asset-backeddeal. Delta Financial priced a bond backed by $625 million of mortgage loans...
CORRECTION: In last week's column I misstated the restatement years for Fannie Mae. The GSE restatedearnings for 2002 to 2004, not 2001 to 2004.
WASHINGTON NEWS: The Office of Federal Housing Enterprise Oversight has directed Fannie Maeand Freddie Mac to comply with the federal banking regulators' nontraditional mortgage guidance when purchasingand securitizing interest-only and payment-option mortgages. See Brian Collins' story in NMN.
MORTGAGE PEOPLE: GMAC Mortgage has named Ray Morris vice president of sales and marketing.Ty Miller will serve as vice president for client relationship management. LIME Financial has namedGreg Haase vice president and Northwest regional sales manager.
DATA NEWS: Looking for a great contact directory on mortgage bankers, servicers, brokers and loan officers?What about a database on every multifamily lender in the U.S.? That would be the Mortgage Industry Directory,which is available online as well as in print. The MID/eMID also has exclusive rankings on lenders and servicersthat you cannot get elsewhere. The online version also provides recent news articles on lenders and servicers rankedin the book. For more information e-mail
