Origination

The $1.3 billion refinancing this week of One Bryant Park, a Midtown Manhattan office tower, may be the first deal of its kind.

Valuation Partners, a national appraisal management company, named John Golletti vice president, national account executive, and Dan Kennard vice president, operations. Both Golletti and Kennard join Valuation Partners as veterans of the mortgage industry, with senior management experience from loan origination, processing and operations to appraisal and settlement services product sales among many other responsibilities. Golletti has been hired to broaden the company's sales reach, and will focus his initiatives in the Eastern United States. Kennard has been brought on to utilize his operational expertise to provide better service to the company's customer base.

Ladder Capital Finance Holdings LLC, a New York-based commercial real estate specialty finance company, has appointed Thomas Harney as head of Merchant Banking & Capital Markets to lead Ladder Capital's newly-created Capital Markets/M&A Group. With more than 25 years of experience in real estate and capital markets, including serving as senior managing director and co-head of real estate investment banking at Bear, Stearns & Co. Inc., Harney has completed over $70 billion in real estate M&A and capital markets transactions during the span of his career. Harney will be joined by Summer Nemeth, who has been appointed as a director of capital markets for the new Capital Markets/M&A Group. Nemeth worked extensively with Harney at Bear Stearns.

Fitch Ratings has downgraded 10 classes of a synthetic transaction, Home Re Ltd. 2005-2, which references mortgage insurance provided by Mortgage Guaranty Insurance Corp. The issuers of the securities, Home Re Ltd., and Home Re Credit Ltd., entered into a reinsurance agreement with MGIC on the pool of first lien mortgages. The stated maturity date for the notes is Oct. 25, 2012. The rating agency calculated an overall frequency of foreclosure of 30% of the outstanding exposure amount of $483 million. Fitch is estimating that 60% of the total losses will be realized before the notes mature. It calculated a total loss amount for the transaction of 12.30%. Besides the downgrades, Fitch assigned negative outlooks to five classes, M2 through M6, because it is concerned that if expected losses are realized faster than being projected, the transaction could be exposed to additional losses prior to maturity. The rating agency explained that losses are allocated to these notes in the reverse order of priority. The notes are not written down by losses, but an impairment amount is calculated based on the amount of losses allocated to that class.

LendingTree has launched its first Blackberry app, called the Mortgage RateFinder. The free application allows users to obtain on-the-spot loan offers anonymously. "In today's low-rate mortgage environment, it's important for consumers to shop around to ensure they're receiving the best possible rate," said Doug Lebda, founder and CEO of LendingTree. "In fact, since the introduction of our iPhone Mortgage RateFinder app in January, consumers have received more than 51,000 loan offers from participating lenders." In using the app, consumers have to enter information about the loan they would like and the app will instantly provide users with up to 30 different, customized loan offers from network lenders. Once a great offer is found, users can click to be contacted by that lender and move forward with the loan request.

The financial services reform bill does little to help consumers shop for a loan, according to the National Association of Mortgage Brokers. NAMB chief executive Roy DeLoach said the government is trying to impose its choices on consumers. An amendment by Sen. Jeff Merkley, D-Ore., restricts the way brokers can be paid by lenders and consumers. It is "too big brotherish," he said. NAMB feels regulators should be given the flexibility to make changes to the compensation provisions. The trade group also is worried about a safe harbor provision that limits points and fees to 3% of the loan amount. Congress directed regulators to make adjustments, giving lenders an incentive to make loans under $100,000, a move that helps low- and moderate- income homebuyers. "This will help to counter any unintended consequences for consumers," DeLoach said in an interview conducted during NAMB's annual meeting in Phoenix.

Due to opposition from the Treasury Department, Sen. Christopher Dodd, D-Conn., blocked an amendment that would allow covered bonds to get a start in the U.S. mortgage market. Treasury is "strongly opposed" to covered bonds. "We will probably go with a study," Sen. Dodd said late last week during the House-Senate conference on the regulatory reform bill. Sen. Bob Corker, R-Tenn., said a study would be "worse" than doing nothing, because it would delay legislative action for two years. The House conferees approved an amendment by Rep. Scott Garrett, R- N.J., that would create a legal and regulatory framework for the development of a covered bond market in the United States. But the Senate conferees rejected the Garrett amendment by one vote, according to sources. This was a disappointment for banking consultant Bert Ely and other covered bond supporters. "It prevents the emergence for a new way to finance housing in this country that would actually help to facilitate the resolution of Fannie Mae and Freddie Mac," Ely said. Covered bonds won't replace the GSEs or securitization, he added, but it will "help to fill that funding gap." Meanwhile, House Financial Services Committee chairman Barney Frank, D-Mass., said he will hold a markup on Garrett's covered bond bill in July. Senate Banking Committee chairman Dodd said he would hold a hearing on covered bonds. Under the Garrett bill, the Treasury Department would be the primary regulator of covered bonds, and set standards and reporting requirements for issuers.

If anyone in the mortgage broker industry thinks that the bills being proposed and/or passed by Congress are bad, they should have seen what the National Association of Mortgage Brokers' lobbying team and staff were able to keep out of them, newly-installed president Bill Howe told the audience at the group's annual meeting in Phoenix. In his final speech as president, Jim Pair elaborated on some of those successes during the past 12 months. They included changes in the Federal Housing Administration program that takes away the need for audited financials and opens up the program to more mortgage brokers. The SAFE Act created national education standards and the loan originator registry system, both of which Pair pointed out, were long-held positions by NAMB. As for the Home Valuation Code of Conduct, Pair lauded the results of the financial services reform bill conference committee and said that it will be likely that in the future, mortgage brokers would once again be able to order appraisals. The future of the industry is good, he said, declaring, "consumers still need us, wholesalers still need us." Brokers are the originators who need to meet education standards and be licensed, and they need to take pride in NAMB's Lending Integrity seal. As for NAMB itself, Howe said the organization has downsized and now operates out of a virtual office. It is working on several initiatives to improve communications with its members, including the use of video e-mails. Howe also announced a deal with the University of Phoenix, where members who hold the CMC and CRMS designations would be able to receive school credit for them towards a degree.

PennyMac Mortgage Investment Trust, a mortgage vulture fund that also is working on a new conduit, has signed up Impac Mortgage Holdings as a correspondent lender, according to industry officials. At press time both companies had not responded to telephone calls about the matter. The publicly traded PennyMac, a REIT based in Calabasas, is reportedly gathering product for a future securitization but has not released details about its plans. Impac, a former alt-A lender, has managed to survive the financial crisis and is acting as both a servicer and broker of loans, in addition to other side businesses. The company is based in Irvine.

Morgan Stanley & Co. Thursday afternoon agreed to pay $102 million to Massachusetts homeowners and the state, settling allegations that it aided and abetted subprime lender New Century Financial Corp. in taking advantage of consumers. State attorney general Martha Coakley, announcing the settlement at a press conference, said Morgan provided billions of dollars in credit lines to New Century "which used Morgan funds to target lower-income borrowers and lure them into loans that consumers predictably could not afford to repay." She added that some Morgan executives referred to New Century as Morgan's "partner" in subprime lending. The Irvine, Calif.-based NCFC filed for bankruptcy in early 2008. For much of the decade it was one of the largest subprime lenders in the nation, according to figures compiled by National Mortgage News. As part of the settlement, Morgan agreed to "change its business practices" and to provide the AG's office with "information and materials" as part of its ongoing probe of subprime lenders and the securitization process. In a court filing AG Coakley notes that other Wall Street firms are under investigation regarding their securitization practices. Morgan agreed to the deal without admitting or denying any wrongdoing.