Originations

California Insurance Commissioner John Garamendi has upheld an administrative law judge's ruling that Radian Lien Protection is title insurance.Mr. Garamendi had rejected the decision in April and offered all parties the chance to offer additional evidence. In a portion of his ruling called "Determination of Issues," the commissioner ruled that none of the additional evidence "is relevant to the legal question presented" and therefore did not consider the evidence in reaching his decision. The next sentence tersely states: "The Radian Lien Protection Policy constitutes title insurance pursuant to California Insurance Code Section 12340.1." The ruling means Philadelphia-based Radian Guaranty cannot offer the product anywhere in the U.S. without risking the loss of its license in California. "Radian should become a licensed title insurer to issue this product and submit to the regulatory oversight that is in place to safeguard consumers," said James Maher, executive vice president of the American Land Title Association. Radian said it will appeal the order. "We are disappointed with Commissioner Garamendi's decision, and we respectfully disagree with his assessment of our product," said Howard S. Yaruss, Radian's executive vice president and general counsel. "Radian, along with various consumer groups, will take this fight to the California State Legislature, in order to break the title insurance industry's monopoly and put an end to years of price gouging."

Westin Hotel LP, White Plains, N.Y., has announced that it is making no recommendation on a tender offer by a group led by Windy City Investments LLC to purchase up to 20,340 limited partnership units of Westin Hotel.The offer from Windy City, as well as Madison Windy City Investments LLC, Madison Investment Partners 20 LLC, Madison Capital Group LLC, The Harmony Group II LLC, and Bryan E. Gordon, includes a purchase price of $525 per unit, minus a $50 fee charged by Westin Hotel for each transfer. The offer would also be reduced by the amount of any cash distributions made or declared on or after July 7, with interest at the rate of 3% per year from the expiration date of the tender offer to the date of payment. The board of directors of Westin Realty Corp., the general partner of Westin Hotel, said it is remaining neutral toward the offer. However, Westin Realty issued a number of statements for the consideration of limited partners, including one noting its efforts to sell or refinance The Westin Michigan Avenue in Chicago since 2001. "Due to current market conditions in the hotel real estate market, the general partner does not believe that it will be able to sell the Michigan Avenue at an acceptable price in the near future," Westin Realty said.

Phillip McCall has been promoted to president of Independent Realty Capital Corp., an Anaheim, Calif.-based company doing business as Independent Mortgage Co.Former president Jeff Barrett will now concentrate solely on his duties as Independent's chairman of the board, the company said. In addition, Janene White was promoted to executive vice president of operations. Mr. Barrett said the moves were necessitated by Independent's "unprecedented growth." Mr. McCall served most recently as Independent's chief operating officer and oversaw the firm's mortgage banking units and general operations. He was previously chief executive officer of Home Save Mortgage, a Florida-based mortgage banking company with regional offices in Southern California. Ms. White was previously Independent's senior vice president.

ComUnity Lending, Morgan Hill, Calif., has announced its entry into the subprime mortgage market with a pilot program aimed at enabling the company's net branches to increase their market share.The program will be launched in California, Washington, and Oregon, but will be expanded to all 38 states in which ComUnity does business, the company said. "The concept of net-branching has evolved in recent months," said Steve Walker, vice president of retail development for ComUnity. "Prospective branch managers are no longer wanting the parent company to be a quiet operational partner. They are looking for more than just payroll, AP, and compliance support. They want to know what the company will do to help them succeed in the slow times." The company can be found online at http://www.comunitylending.com.

NorthMarq Capital Inc., Minneapolis, is acquiring the commercial mortgage financing and commercial mortgage servicing businesses of Legg Mason Real Estate Services in a deal that NorthMarq said is expected to create the third-largest commercial mortgage banking organization in the United States.The terms of the deal were not disclosed, but Baltimore-based Legg Mason said it expects to record a pretax gain of approximately $11 million on the transaction, which does not include its real estate investment advisory business or any other Legg Mason business. NorthMarq said that, after the deal is done, it will have 28 offices across the country, 350 employees, more than $6.5 billion in annual commercial real estate financing (including both debt and equity transactions), and more than $21 billion in commercial mortgage servicing. "This transaction gives us a true nationwide presence with stable management and a strong industry reputation," said Edward Padilla, NorthMarq's chief executive officer. "We now can offer a national platform across multiple markets and provide more options to our clients than ever before." Walt D'Alessio, chairman and CEO of LMRES, will become vice chair of NorthMarq, and Craig Butchenhart will become president, reporting to Mr. Padilla.

Dan Porter, chairman and chief executive of Wells Fargo Financial, Des Moines, Iowa, the bank's consumer finance division, has resigned.In a statement dated July 18, Mr. Porter said he left the company "to pursue other opportunities" and to spend more time with his family. Mark Oman, group executive vice president of Wells Fargo & Co., will assume Mr. Porter's duties until a successor is found. WFF, which has $19 billion in receivables, has been the subject of predatory lending allegations raised by the Association of Community Organizations for Reform Now. A spokeswoman for Wells said Mr. Porter's resignation has nothing to do with ACORN or the issues it has raised. ACORN, though, issued a statement on Mr. Porter's departure, saying, "Any change at Wells Fargo Financial could hardly be for the worse." WFF engages in subprime residential lending, and the spokeswoman said 25%-30% of the $19 billion in receivables is housing-related.

Highwoods Properties Inc., a real estate investment trust based in Raleigh, N.C., has closed on a new $250 million senior unsecured revolving credit facility.The new facility replaces the REIT's previous $300 million unsecured line of credit. The facility, which is provided by 10 lender banks, was arranged and syndicated by Banc of America Securities LLC. The company can be found on the Web at http://www.highwoods.com.

Municipal Mortgage & Equity, Baltimore, has reported net income of $30.6 million ($1.05 per share) for the second quarter, compared with $2.9 million ($0.11 per share) for the comparable period of 2002.MuniMae, which invests in multifamily debt and equity, has structured $399 million in multifamily financing for the second quarter, and raised $38 million in tax credit equity. Commenting on the leap in income for the second quarter, Mark K. Joseph, MuniMae's chief executive officer, explained that "the company also experienced a significant increase in GAAP earnings due to the sale of a bond" in the second quarter. Mr. Joseph said MuniMae has completed the purchase of the Housing and Community Investing unit of Lend Lease Real Estate Investments. "HCI is a market leader in the syndication of low-income housing tax credits, and we expect their strong franchise to contribute meaningfully to our continuing efforts to increase our cash available for distribution and shareholder value," he said. MuniMae also reported the appointment of Fred N. Pratt Jr., co-founder of Boston Financial Group (which is now HCI), as a director of MuniMae. MuniMae can be found on the Web at http://www.munimaemidland.com.

The New York City Housing Development Corp. has closed a $5.38 million construction loan that will fund the first affordable housing development to benefit from Liberty Bond Program financing.The construction-to-permanent first mortgage loan will help construct 72 affordable housing units in the Far Rockaway area of Queens. The HDC said it will receive a 3% origination fee from project developers utilizing the Liberty Bond, which will be used to fund other affordable housing projects across the city. The HDC has also provided a $2.88 million second-position construction and permanent loan, whose funds are generated from the 90 Washington St. development -- the first project to receive financing from the Liberty Bond Program. The program was established in 2002 to help revitalize Lower Manhattan in the wake of the Sept. 11 attack on the World Trade Center.

The senior unsecured debt and preferred stock ratings of Post Properties Inc., Atlanta, have been lowered by Moody's Investors Service.The debt rating was lowered from Baa2 to Baa3, and the preferred stock rating was lowered from Baa3 to Ba1. The outlook is stable. Moody's said the downgrades reflect "prolonged weakness in Post's profitability," which it said could take several years to improve as Post's management refocuses the company and the multifamily property market recovers. The rating agency also cited Post's geographic concentration in Atlanta and Dallas. Post is a real estate investment trust that specializes in luxury apartment communities.

ProLogis, a Denver-based industrial real estate investment trust, has been added to the Standard & Poor's 500 Index.ProLogis will rank 340th on the index, based on an approximate market capitalization of $4.85 billion, and will constitute 0.05% of the index, ProLogis said. The company is the sixth REIT to be included in the S&P 500 Index, according to the J.P. Morgan Equity REIT team, bringing the total group weighting to 0.427%. The analysts view the inclusion as "further evidence that the group is gaining widespread visibility."

Stephen E. Adamo has been named president and chief executive officer of Citizens Mortgage Corp. by its parent company, Citizens Financial Group Inc., Providence, R.I.Citizens Financial said Mr. Adamo, who had been managing Citizens Mortgage on an interim basis during the search for a new president and CEO, will retain his responsibility as managing director of the company's New England Business Banking Group. He joined Citizens Mortgage in 1995 and was promoted to president and chief operating officer in 1998, the company said. Citizens Financial, which operates as Citizens Bank, can be found online at http://www.citizensbank.com.

Three classes of Asset Securitization Corp.'s commercial mortgage pass-through certificates, series 1995-MD IV, have been downgraded from CCC to D by Fitch Ratings.The affected classes were: class B-2, class B-2H, and class A-CS3. In addition, the ratings on six other classes of the same series were affirmed and one class was upgraded. Fitch attributed the downgrades to "the discounted sale of the Hardage loan, which has resulted in losses to the trust as well as the recent bankruptcy filing of the borrower of the Motels of America loan, combined with the loan's continued poor performance." Fitch can be found online at http://www.fitchratings.com.

Prime Retail Inc., Baltimore, has announced that two shareholders who own nearly a third of the company's series A preferred stock have objected to the proposed allocation of consideration in connection with a pending merger.The objections came in separate communications from Merrill Lynch & Co. Inc., which owns 511,572 (approximately 22%) of the preferred shares, and Fortress Investment Trust II, which owns 230,000 (approximately 10%) of the shares, according to Prime Retail. The companies maintained that the proposed allocation of $16.25 per share of series A preferred stock is inadequate, Prime Retail said. Prime Retail, a real estate investment trust, previously announced a merger agreement with an affiliate of The Lightstone Group LLC. The merger requires an affirmative vote of the holders of two-thirds of the outstanding series A preferred stock, the holders of two-thirds of outstanding series B preferred stock, and the holders of a majority of the REIT's common stock. Prime Retail said it plans to engage in discussions with Merrill Lynch and Fortress concerning the proposed allocation. The REIT can be found online at http://www.primeretail.com.

The single-family housing market remained stable in the second quarter, according to Mortgage Guaranty Insurance Corp.'s national Market Trends Index.The index stood at 6.63 for the quarter, up slightly from a revised 6.60 for the first quarter but down from 6.85 a year ago. The index uses a scale of 1 to 10, with 10 being the strongest. MGIC said a reading of 6 to 8 indicates a stable market. "The housing sector continues to support the economy," said Neil Siegel, senior market analyst for the Milwaukee-based mortgage insurer. "Home prices are rising in most markets; however, the rate of appreciation has slowed. The slower rate of home price appreciation is associated with the lack of job growth, rising unemployment, and concern with consumer credit quality." The company looked at 73 metropolitan statistical areas and found seven to be strong, 10 weak, and the rest stable. MGIC can be found on the Web at http://www.mgic.com.

Commercial Mortgage Trust 2003-C1 has issued approximately $1.22 billion in commercial mortgage pass-securities in a transaction lead managed by Greenwich Capital Markets Inc., according to RBS Greenwich Capital.Credit Suisse First Boston LLC and Morgan Stanley & Co. Inc. co-managed the issue, which is the fourth CMBS deal that RBS GCM has led for the depositor, Greenwich Capital Commercial Funding Corp., and the third CMBS transaction that RBS GCM has lead-managed in the last six months. Greenwich Capital can be found online at http://www.gcm.com.

The Arkansas Home Loan Protection Act, the state’s predatory lending law, went into effect on July 16.The law, which regulates only second-lien home equity loans, follows guidelines set forth under the Home Ownership and Equity Protection Act for defining a high-cost loan. It prohibits refinancing without "reasonable tangible net benefit," limits prepayment penalties, and establishes a form of assignee liability that Standard & Poor's has said will pose no problems. A representative from the community activist group ACORN maintained that the lack of regulation on first-lien home loans leaves room for further legislation, though the state legislature is out of session until 2005.

Meanwhile, the Pennsylvania Department of Banking has issued a letter to mortgage brokers warning that it will not tolerate the use of misleading or deceptive direct mail solicitations that use the name of other mortgage companies or lenders.William Schenck, Pennsylvania's secretary of banking, says in the letter that some brokers of first and second mortgages have been soliciting the customers of other lenders in such a way that "customers are led to believe that the solicitations have been sent by their current mortgage lender or that the current lender has shared the customer's private financial information with another entity." He goes on to say that such practices "are not ethical, will not be tolerated by the Department, and will be considered grounds for strong regulatory action." The department can be found online at http://www.banking.state.pa.us.

The attorney general of Pennsylvania has announced a legal action against Allied Home Mortgage Capital Corp., Houston, for allegedly failing to comply with the state's "do not call" law.AG Mike Fisher said the state's Bureau of Consumer Protection has entered into an "assurance of voluntary compliance" agreement with the company, which solicited Pennsylvania consumers by telephone for mortgage banking and brokerage business. Mr. Fisher said his office received complaints about the company from 48 consumers on the no-call list established under the state's Consumer Protection Law and Telemarketer Registration Act. "Many consumers also complained to my office that these telemarketers failed to promptly identify themselves and the purpose of the call," the state attorney general said. "My office addressed the issues raised by consumers and, as a result, the company has changed its business practices." Jim C. Hodge, Allied's president and chief executive officer, said the company had contracted with a third party to provide telemarketing services, and "at all times believed that this provider was in compliance with appropriate state and federal regulations. We are pleased to have reached an accord with the Commonwealth of Pennsylvania in this matter."

The average 30-year fixed mortgage rate jumped to 5.67% for the week ending July 18 from 5.52% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate climbed from 4.85% to 5.00%, and the average rate for one-year Treasury-indexed adjustable-rate mortgages rose from 3.55% to 3.58%. Fees and points averaged 0.5 points for fixed-rate mortgages and 0.6 points for ARMs. "Federal Reserve Board Chairman Greenspan told Congress that he's optimistic that the economy will take off in the second half of this year," said Frank Nothaft, Freddie Mac's chief economist. "This was seen as a sign that there was no more need for any additional rate cuts. In response, bond yields rose dramatically, taking mortgage rates up with them." A year ago, the average 30-year and 15-year fixed rates were 6.49% and 5.93%, respectively, and the average one-year ARM rate was 4.50%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.