Originations

Mike Taylor has been named manager of the loan servicing department at MILA Inc., a wholesale lender based in Mountlake Terrace, Wash., and Douglas E. Schwed has been named MILA's general counsel.Mr. Taylor was formerly vice president of loan servicing at Citigroup, and has more than 30 years of experience in the mortgage industry, MILA said. Mr. Schwed has more than 20 years' industry-related experience as a lawyer. The company can be found online at http://www.mila.com.

The Market Composite Index, an overall measure of mortgage applications, fell from 646.3 to 642.7 on a seasonally adjusted basis during the week ended Aug. 27, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications declined 1.9% on the week but were up 2.6% from the level of a year earlier. The Purchase Index fell from 443.7 to 443.1 on a seasonally adjusted basis, while the Refinance Index declined from 1824.9 to 1804.1. Refinancings represented 40.7% of total applications, up from 40.4% the previous week, while adjustable-rate mortgages accounted for 33.1%, the MBA said. The average contract interest rate for 30-year fixed-rate mortgages fell from 5.78% to 5.75%, and points (including the origination fee) decreased from 1.37 to 1.32, for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mortgagebankers.org.

The price of an average U.S. home increased 9.36% in the second quarter, the largest such price increase in 25 years, according to figures released Sept. 1 by the Office of Federal Housing Enterprise Oversight.The increase reflects price hikes from June 30, 2003 to June 30, 2004. "These data show no signs of the long-anticipated, and ultimately inevitable, slowing of house price inflation," said OFHEO chief economist Patrick Lawler. But Mr. Lawler added: "House prices may become increasingly vulnerable to potential sustained higher interest rates in the future, but that has not happened so far." The four states experiencing the greatest home price appreciation are Nevada, Hawaii, California, and Rhode Island. The states with the smallest increase are Utah, Texas, and Indiana. OFHEO can be found online at http://www.ofheo.gov.

Fannie Mae has announced that it is expanding its "HouseWyoming" investment plan to provide up to $2 billion in affordable homeownership and rental opportunities in Wyoming over seven years in cooperation with the local private, public, and nonprofit sectors.The new investment plan, which targets more than 20,000 working families, is an extension of Fannie Mae's 1999 "American Dream Commitment for Wyoming" plan to invest $1 billion over seven years. Fannie said it surpassed that goal by investing $1.5 billion in affordable homeownership and rental housing to serve more than 12,000 Wyoming residents. "Our new $2 billion affordable housing plan will help create new homeownership opportunities for first-time homebuyers and increase the supply of housing where it's needed most," said Randy Dancliff, director of Fannie Mae's Wyoming Partnership Office. Fannie can be found online at http://www.fanniemae.com.

Moody's Investors Service has placed LNR Property Corp.'s debt and preferred stock ratings on review for possible downgrade following the announcement of LNR's agreement to be acquired by Riley Property Holdings.The affected ratings are as follows: senior unsecured debt shelf, (P)Ba2; senior subordinated notes, Ba3; senior subordinated shelf, (P)Ba3; and preferred stock shelf, (P)B1. Moody's said it expects the transaction to be highly leveraged, putting additional pressure on LNR's fixed-charge coverage and effective leverage. "LNR's permanent capital structure is uncertain at this time," Moody's said. The rating agency can be found online at http://www.moodys.com.

LNR Property Corp., Miami Beach, Fla., a real estate financing and development company, is being acquired by Riley Property Holdings for a total consideration of about $3.8 billion, including the assumption of debt.LNR shareholders are to receive $63.10 per share in cash compensation, LNR said. LNR chairman Stuart A. Miller and his family are also exchanging a part of their shareholding for about a 20.4% interest in Riley, which is majority-owned by affiliates of Cerberus Capital Management and its real estate affiliate, Blackacre Institutional Capital Management. The merger agreement permits LNR to consider other "unsolicited proposals," according to LNR. The approval of LNR shareholders is required for the transaction to close.

Arden Realty Inc., Los Angeles, has announced the placement by affiliate Arden Realty LP of $200 million of senior unsecured notes due Sept. 1, 2011.Arden said the all-in effective rate of the notes, including offering expenses and the settlement of three forward-starting swaps, is 5.45%. Arden Realty, a real estate investment trust that specializes in office properties in Southern California, can be found online at http://www.ardenrealty.com.

CBL & Associates Properties Inc., Chattanooga, Tenn., has reported the completion of a new, unsecured credit facility of up to $400 million.The facility has an initial term of two years, with three one-year extensions at the company's option. It carries an interest rate, depending on leverage, ranging from 100 to 145 basis points over the London interbank offered rate, CBL said. The facility replaces a $130 million unsecured credit line that was to expire in September. The real estate investment trust can be found online at http://www.cblproperties.com.

A joint venture partner of Simon Property Group, G.K. Las Vegas LP, has filed a lawsuit against the Indianapolis real estate investment trust seeking more than $1 billion in damages.The California limited partnership's lawsuit, filed in the U.S. District Court for the District of Nevada, alleges that SPG and its affiliates "violated Federal and Nevada racketeering statutes, violated Nevada securities laws and breached its contractual and statutory fiduciary duties under a joint venture agreement with GKLV." The lawsuit involves the Forum Shops retail mall in Las Vegas, which until March 2003 was owned and operated under a joint venture agreement between GKLV and Simon, according to GKLV. In a news release, GKLV said Simon "systematically abused its position as managing general partner and exploited The Forum Shops for the benefit of other Simon wholly owned malls by skimming the joint venture's profits, converting the joint venture's property and opportunities, and coercing GKLV to forgo legitimate business interests." Commenting on the lawsuit, SPG referred to Sheldon Gordon, a principal of Gordon Group, Greenwich, Conn., the managing partner of GKLV. "Any allegation by Mr. Gordon that Simon Property Group coerced him into selling his interest in the Forum Shops at Caesars at below its value is baseless, as it was Mr. Gordon who initiated the process," SPG said. "Since Mr. Gordon voluntarily triggered the buy/sell provision of the partnership agreement, he controlled the timing of the transaction and the sales price of his interest."

Mortgage rates are expected to rise slightly by year-end, with 30-year fixed-rate conventional loans averaging about 6.25%, according to some of the nation's top housing and mortgage economists.Currently, conventional FRMs carry a coupon of about 5.8%. During a conference call Aug. 30, five economists whose organizations fund the Homeownership Alliance predicted that the second half will bring continued success for the housing market. It is expected that 2004 will be another record year for new- and existing-home sales. Fannie Mae economist David Berson predicted that new- and existing-home sales will total 1.17 million units and 6.4 million units, respectively. He noted that this would make the current year "the fourth consecutive record year for home sales." Next year is expected to be good, but likely will be the second- or third-best year for home sales, he said.

Four classes of Salomon Brothers Mortgage Securities VII Inc., CDC Securitization Corp., commercial mortgage pass-through certificates, series 2002-CDC, have been downgraded by Moody's Investors Service.The downgrades were as follows: class X-2B, from Baa3 to Ba1; class H-DEN, from Baa1 to Baa2; class J-DEN, from Baa2 to Baa3; and class K-DEN, from Baa3 to Ba1. Moody's also upgraded five classes in the deal and affirmed the ratings on nine other classes. The certificates are collateralized by participation interests in four mortgage loans, all of them secured by first liens on 29 commercial properties in five states, the rating agency said. All the loans are floating-rate and interest-only. The downgrades were attributed to the poorer performance of the Denholtz Portfolio Loan, the largest in the pool ($94.6 million, or 49.5%), which is secured by 26 office and office-flex properties in seven states. The portfolio totals approximately 2.6 million square feet and was 73.3% occupied as of June 2004, compared with 82.0% at securitization, Moody's said. The rating agency can be found online at http://www.moodys.com.

Aimbridge Home Loans, a Denver-based mortgage provider for credit unions and their members, has announced an agreement with the Nebraska Credit Union League & Affiliates naming Aimbridge as the league's mortgage provider.Aimbridge said it integrates a hyperlink into a credit union's existing website to provide instant access to the mortgage website and allows CU members to choose a loan program, interest rate, and closing to fit their specific needs. The credit union can co-brand the mortgage site so that members recognize it as an extension of the credit union's website. "By partnering with Aimbridge Home Loans, credit unions receive professional handling of the entire mortgage process from origination to closing to servicing," the company said. Aimbridge can be found online at http://www.aimbridge.com.

Commercial mortgage originations totaled $33.2 billion in the second quarter, up 17.4% from the level recorded a year earlier and up 54.1% from that of the first quarter, the Mortgage Bankers Association has reported.The MBA said the major quarter-to-quarter increase "reflects the traditional cycle of low levels of first-quarter originations followed by a pick-up in the second quarter." With second-quarter originations going strong, 2004 is now "on pace to exceed 2003's record origination volumes," said Doug Duncan, the MBA's chief economist and senior vice president. Multifamily property saw the most originations for the second quarter, at $13.4 billion (40.8% of the total). However, multifamily originations were down 4% compared with those of last year, the MBA said. Office and retail property originations were at $8 billion and $6 billion, respectively, for the period. Conduits purchased $9.5 billion of the second-quarter originations, followed by Fannie Mae/Freddie Mac at $6.6 billion, life insurance company volume of $5.9 billion, and commercial bank volume of $5.6 billion. The MBA can be found online at http://www.mortgagebankers.org.

Five classes of Credit Suisse First Boston Mortgage Securities Corp. commercial mortgage pass-through certificates, series 2001-CF2, have been downgraded by Moody's Investors Service.The downgrades were as follows: class J, from Ba2 to Ba3; class K, from Ba3 to B1; class L, from B1 to B2; class M, from B2 to Caa1; and class N, from B3 to Caa2. In addition, Moody's affirmed the ratings on 15 other classes in the deal. The downgrades were attributed to realized losses, expected losses on specially serviced loans, and LTV dispersion. Moody's said 16.6% of the pool has a loan-to-value ratio greater than 100%, compared with 0% of the pool at securitization. The rating agency said the certificates are collateralized by 166 mortgage loans secured by commercial and multifamily properties. Nine loans representing 1.8% of the pool are in special servicing, and Moody's said it has projected aggregate losses of approximately $5.1 million for those loans.

Flagstar Bank and Fannie Mae have announced a five-year $100 billion affordable housing initiative that will benefit underserved and multicultural borrowers nationwide.Announced in Pontiac, Mich., the alliance is part of Fannie's "American Dream Commitment" for Michigan, a seven-year, $50 billion investment aimed at helping finance affordable housing for 500,000 families across the state, as well as part of Fannie's nationwide commitment to tackle the toughest housing problems in America, including efforts to raise the national minority homeownership rate to 55% by 2010. Flagstar will offer mortgage loans for single-family homes, including two- to four-unit properties. Besides agreeing to purchase these loans, Fannie said it will assist Flagstar to identify business partners, develop outreach efforts, and provide various emerging-market products. Flagstar, based in Troy, Mich., can be found online at http://www.flagstar.com, and Fannie Mae can be found at http://www.fanniemae.com.

Highridge Partners, Los Angeles, has launched Crestridge Investments, an El Segundo, Calif.-based real estate financing and investment company that will make private placements in operating companies with a "direct or indirect connection" to real estate, including public companies.Crestridge -- which Highridge describes as "the successor" to Haverford Capital, a real estate financing company -- will "pursue a broad strategy from equity participations to investments in operating companies." Crestridge will also provide venture capital in the real estate arena. The company has "a significant pool of capital earmarked for these new categories of proprietary investments," Highridge said. The company will be led by Chris Grey and David Feingold, Crestridge's managing directors, who are launching the firm in association with John Long, the founder of Highridge. Both Mr. Grey and Mr. Feingold are also associated with Highridge.

The average 30-year fixed mortgage rate inched up to 5.82% for the week ending Aug. 27 from 5.81% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 5.19% to 5.21%, while the average rate for one-year Treasury-indexed ARMs rose from 4.01% to 4.05%. Fees and points averaged 0.7 of a point for 30-year fixed-rate mortgages and 0.6 of a point for the other two mortgage categories. "Mortgage rates were mostly unchanged this week, amid conflicting economic reports as to the strength of the economy," said Frank Nothaft, Freddie Mac's chief economist. "July home sales fell from their record rate, but remain strong by historical standards." A year ago, the average 30-year and 15-year fixed rates were 6.28% and 5.60%, respectively, and the average one-year ARM rate was 3.84%, Freddie Mac said.

TD Bank Financial Group, Toronto, has agreed to become the majority shareholder in Banknorth Group, Portland, Maine.TD Bank Financial will acquire 51% of the outstanding shares of Banknorth in a deal valued at $3.8 billion (just under C$5 billion). Banknorth shareholders will receive $12.24 in cash, 0.2351 shares of TD Bank, and 0.49 shares of "new" Banknorth stock for each share of Banknorth stock. There are options that would permit TD Bank to acquire two-thirds of Banknorth's stock. "This strategic acquisition provides us with an expanding beachhead in the Northeastern United States and an outstanding personal and commercial banking complement to our strong U.S. wealth management franchise," said Ed Clark, president and chief executive of TD Bank. Banknorth, according to the 2004 Mortgage Industry Directory, finished 2003 with $3 billion in loan originations and ranked 112th for the year. As of Dec. 31, 2003, it had a servicing portfolio of $2.7 billion, making it the 113th-largest servicer in the industry. TD Bank is the parent of TD Canada Trust, a depository and mortgage lender north of the border.

Countrywide Home Loans Inc., Calabasas, Calif., has launched a radio advertising campaign designed to appeal to African-Americans who aspire to homeownership.The company said the ad campaign focuses on "perceived barriers" to homeownership, including misconceptions about credit issues and downpayment costs, among other things. Countrywide said the ads are aimed at "fostering Countrywide as the lender of choice among African-American consumers" and promoting products such as its new Optimum Loan, which offers low downpayment options and relaxed credit guidelines. The company can be found online at http://www.countrywide.com.

The Market Composite Index, an overall measure of mortgage applications, fell from 689.4 to 646.3 on a seasonally adjusted basis during the week ended Aug. 20, according to the Mortgage Bankers Association's Weekly Mortgage Applications Survey.On an unadjusted basis, applications declined 7.3% on the week but were up 1.8% from the level of a year earlier. The Purchase Index fell from 467.1 to 443.7 on a seasonally adjusted basis, while the Refinance Index declined from 1982.7 to 1824.9. Refinancings represented 40.4% of total applications, down from 40.7% the previous week, while adjustable-rate mortgages accounted for 32.1%, the MBA said. The average contract interest rate for 30-year fixed-rate mortgages rose from 5.75% to 5.78%, and points (including the origination fee) decreased from 1.45 to 1.37, for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mortgagebankers.org.