Originations

The Association of Community Organizations for Reform Now has released a study showing a jump in the number of subprime loans received by minorities and low-income borrowers that ACORN says may represent an increase in the incidence of predatory lending.Over a million subprime refinance and home-purchase loans were originated in 2001, up from over 100,000 in 1993. Compared with white borrowers, the study found that African-Americans were 4.4 times as likely -- and Latinos were 2.2 times as likely -- to receive a subprime loan. The number of subprime loans to minority and low-income borrowers "skyrocketed" in 2001. "In our 2001 report we found that in 2000 African-Americans were 2.8 times as likely as whites to get a subprime loan," said ACORN spokesman David Swanson. "This year, we found that in one year, it has increased to 4.4 times as likely." Similarly, for Latinos the relative likelihood of getting a subprime loan increased from 1.5 times to 2.2 times. The Washington, D.C.-based association can be found online at http://www.acorn.org.

Stewart Title Co., Houston, has acquired First Data Systems Inc. and Cumberland Title Co., both of Nashville, Tenn., for an undisclosed amount, according to Stewart Title's parent company, Stewart Information Services Corp.Stewart Morris Jr., president of Stewart Title and president and co-chief executive officer of the parent company, said Stewart has had a long-term relationship with FDS, which he termed the largest distributor of Stewart's title production software, AIM for Windows. Cumberland is one of the largest real estate closing operations in Tennessee, providing title insurance, escrow, closing, and real estate information through seven offices in middle Tennessee, the company said. Patrick L. Vaden will remain as president of both FDS and Cumberland. "The addition of Stewart technology products -- in particular, its SureClose transaction management platform -- will enhance the services we provide to our customers," Mr. Vaden said. Stewart can be found online at http://www.stewart.com.

Sales of new single-family homes fell 4.5% in October, but remained above the 1.0 million mark for the third month in a row.The U.S. Commerce Department reported that new-home sales fell to a seasonally adjusted annual rate of 1.01 million units in October from 1.05 million in September. Sales declined in the Northeast and the Midwest, while rising in the South and the West. The inventory of unsold new homes rose from a 3.8-month supply in September to a 4.1-month supply in October. The Commerce Department can be found online at http://www.doc.gov.

Fannie Mae and Freddie Mac will reach a little deeper into the mortgage market next year when they raise the ceiling on single-family home loans they can purchase or securitize to $322,700.The 7.33% increase from $300,700 this year isn't as great as expected. "Prices bounce around from month to month," said Tim Forsberg of the Federal Housing Finance Board. "I guess we got 'em on the downside." Increases in the conforming loan limit are based on the board's survey of housing costs from one October to the next in 31 major markets. The average this October was $235,700, compared with $219,600 a year ago. But just a month earlier, the change was even more dramatic, with prices rising 8% -- from $219,900 to $237,600 -- over the 12-month period. Nevertheless, the two government-sponsored enterprises say as many as 250,000 higher-end home buyers and owners will reap the rewards of somewhat lower interest rates starting Jan. 1. Currently, Fannie's and Freddie's combined loan purchases represent an estimated 64% of total industry production, according to the Quarterly Data Report, a MortgageWire affiliate. In addition, the Federal Housing Administration is expected to raise the limit on loans it can insure to $280,749 in high-cost markets and $154,896 is most other places.

Oakwood Homes Corp., the bankrupt Greensboro, N.C.-based builder and financier of manufactured homes, has received $415 million in various lines of credit.This includes $215 million of debtor-in-possession financing from Berkshire Hathaway Inc., Greenwich Capital Financial Products Inc., and Ranch Capital LLC. The DIP includes a $75 million loan servicing advance line. In addition, the company has negotiated an agreement for continued access to its $200 million loan-purchase facility, allowing it to continue to originate as usual. An agreement has been reached with Berkshire Hathaway, its largest senior unsecured creditor, for the Warren Buffett-controlled firm to become the largest shareholder in Oakwood when it emerges from bankruptcy.

Two classes of Opryland Hotel Trust's commercial mortgage pass-through certificates, series 2001-OPRY, have been downgraded by Fitch Ratings.Class C was downgraded from A to A-minus, and class E was downgraded from BBB-minus to BB and removed from Rating Watch Negative. In addition, the ratings on three other classes of the deal were affirmed. The certificates represent the beneficial ownership interest in the trust, which consists of the fee interest in the 2,883-room Opryland Hotel/Convention Center in Nashville, Tenn. Fitch said the downgrades resulted from the decline in performance at the property since closing. The underwritten net cash flow, as calculated by Fitch based on trailing 12-month financial statements, had declined 45% as of Sept. 30, the rating agency said.

Once terrorism insurance-related legislation is signed into law by the president, many real estate projects that had been stalled due to lack of terrorism coverage will move forward, according to Kaye Insurance Associates, New York.At a New York City meeting organized by the company, Bruce D. Guthart, Kaye's chairman and chief executive officer, said the legislation "will [ultimately] allow for business and economic recovery." Joel Wood, senior vice president of government affairs at the Council of Insurance Agents and Brokers, told the meeting that the council doesn't know exactly how the marketplace will respond in the coming months, according to the company. "We do know that the impact will be immediate upon President Bush's signature -- insofar as terrorism exclusions will be voided pending the acceptance or rejection of consumers to an offer for the coverage," Mr. Wood was quoted as saying. "We know that the boundaries of risk for terrorism have now been largely defined for insurers, if only for a temporary time. Beyond that, we think that the marketplace response will be neither price-gouging nor a giveaway." Kaye is a subsidiary of Hub International, an insurance brokerage company.

WSFS Financial Corp., Wilmington, Del., has sold its reverse-mortgage loan portfolio to an affiliate of Lehman Brothers, New York.WSFS said its net proceeds from the sale are $136 million, including $10 million in investment-grade mortgage-backed securities. The reverse-loan portfolio had a book value of $33 million. WSFS said it expects to report an after-tax gain from the sale of $67 million in the fourth quarter. The thrift holding company acquired the loans in 1993 and 1994 in two separate purchase transactions; it has not originated any reverse mortgages since then.

Sales of existing single-family homes rose a surprising 6.1% in October, and house prices rose an astonishing 9.8% on an annualized basis -- the biggest jump since 1987.The National Association of Realtors reported that single-family resales rose from 5.27 million in September to a seasonally adjusted annual rate of 5.77 million in October. As a result, resales in 2002 are going to "shatter the record" of 5.3 million set in 2001, NAR chief economist David Lereah told reporters. "It is clear the housing markets remain robust," Dr. Lereah said. "This is a very healthy market." He also told MortgageWire that resales of upper-end homes ($500,000 and up) were "healthy" in October -- contrary to a lot of anecdotal evidence.

Boston Properties, a Boston-based real estate investment trust, has sold two Washington, D.C., office properties to Wells Real Estate Investment Trust for $345 million.Proceeds from the sale of One and Two Independence Square, which have a total of 948,813 square feet, have been used to repay first-mortgage debt of approximately $190 million as well as to pay off some unsecured debt, the office REIT said. The sale represents the first phase of the REIT's strategy of "recycling its capital through asset sales" to permanently finance the acquisition of 399 Park Avenue in Midtown Manhattan on a "leverage neutral basis." The building was acquired for $1.06 billion from Citibank.

Irvine, Calif.-based First Alliance Corp., a bankrupt former subprime mortgage lender that is being liquidated, has announced the cancellation of all its outstanding shares of common stock.The company said a previously announced settlement involving allegations of deceptive lending practices made by federal and state agencies and private plaintiffs took effect Nov. 19, along with the company's liquidation plan. (First Alliance Mortgage Co. and its owners agreed in March to pay $60 million to settle the allegations.) Investors who held First Alliance shares on Nov. 19 will be paid $1.50 per share, or the shareholder's purchase basis of such shares prior to cancellation, whichever is less, provided that total payments do not exceed $3.25 million (in which case the payments will be reduced proportionately until the total does not exceed $3.25 million).

Joining citywide criticism of expected New York City budget cuts, religious leaders from the five boroughs have called upon Mayor Michael Bloomberg to renew public investment in housing and support the Housing First! 10-year, $10 billion plan to help create and preserve affordable housing.Urging the mayor "to enact a visionary plan to address New York City's housing crisis," 60 members of the New York City clergy gathered at the steps of City Hall to "personally" deliver a letter of support for the plan. Housing First, a coalition of over 200 community, business, civic, labor, and religious organizations, aims to create at least 100,000 new affordable housing units and preserve another 85,000 through public funding, new land-use policies, and the removal of regulatory barriers. Attendees expressed concern about statistics showing that an "unprecedented" 36,000 New Yorkers are homeless, the vacancy rate is falling below 3%, and over half a million households will have to spend over half their income for rent. Telephone calls seeking comment from City Hall were not returned by MortgageWire's deadline.

Four classes of Asset Securitization Corp.'s commercial mortgage pass-through certificates series 1995-MDIV have been downgraded and removed from Rating Watch Negative by Fitch Ratings.The downgrades were as follows: class B-1, from BB to B; and classes B-2, B-2H, and A-CS3, from B to CCC. The ratings on six other classes of the same series were affirmed. Fitch attributed the downgrades to "continued poor performance and deterioration of the hotel loans in the transaction, which account for 49% of the current pool balance." The rating agency can be found on the Web at http://www.fitchratings.com.

With commercial real estate markets still in the doldrums, investors should take a cautious approach to acquisitions next year, according to Jonathan Miller of Lend Lease Real Estate Investments Inc., New York."We are raising not a red flag, but certainly a yellow flag," he told real estate executives at a breakfast meeting in Washington. Mr. Miller, the editor of Lend Lease's "Emerging Trends in Real Estate," noted that property expenses are increasing due to security concerns and rising taxes. In New York City, the mayor is seeking a 25% increase in property taxes. Although capital is flowing into prime properties in downtown areas, such as Washington, rents are falling in the suburbs and vacancies are close to 20%. "Around the country there is increasing concern about the real estate market," Mr. Miller said. "And there should be." Lend Lease expects that real estate returns will remain positive -- in the mid single digits -- in 2003 and that delinquencies will rise but remain manageable. Although some real estate investment trusts are under pressure to cut dividends, Lend Lease expects REITs to be a "leading indicator" of a recovery that could take place in 2004 or 2005.

Sam Liberto has been named vice president and manager of the Tennessee Division of Stewart Title Guaranty Co., Houston.Mr. Liberto, who was most recently the company's West Tennessee district manager, was president of Stewart Title of Memphis for 22 years. Stewart Title is a wholly owned subsidiary of Stewart Information Services Corp., which can be found on the Web at http://www.stewart.com.

Camden Property Trust, a Houston-based real estate investment trust, has priced a $200 million offering of 5.875% senior unsecured notes at 99.565.The multifamily REIT will use the net proceeds of approximately $198 million to reduce the balance under its unsecured credit facility. The 10-year notes have been rated Baa2 by Moody's and BBB by Standard & Poor's and Fitch, Camden said. Camden can be found on the Web at http://www.camdenprop.com.

Four classes of COMM 2001-J1 commercial mortgage pass-through certificates have been downgraded by Fitch Ratings.The downgrades were as follows: class G, from BBB to BBB-minus; class H, from BBB-minus to BB; class J, from BBB-minus to BB; and class M, from AA-plus to AA. In addition, Fitch affirmed the ratings on 10 other classes in the deal. The rating agency attributed the downgrades chiefly to "the deteriorating performance of the Thayer Hotel Portfolio and 165 Market Halsey loans," which have shown "a significant decline" since issuance that Fitch said it expects will continue. The Thayer loan is secured by six full-service hotels in New Jersey, Louisiana, Florida, and Texas, and the Market Halsey loan is secured by a 16-story hotel in Newark, N.J. The rating agency can be found on the Web at http://www.fitchratings.com.

The New York City Council has overridden the mayor?s veto of its predatory lending ordinance by an overwhelming vote of 40-5.The ordinance (No. 67) will prohibit lenders and purchasers of predatory loans, as defined in the ordinance, from doing business with the city. The Bond Market Association, which opposed the ordinance, argued when the legislation was first passed that it "lacks a sense of proportionality between the punishment and any violations, especially when one considers the fact that secondary market participants face potential penalties for the actions of lenders over which they have no control." The association has maintained that secondary market participants would not be able to comply with many of the ordinance's provisions.

In a surprise move Nov. 20, the Texas Savings and Loan Department announced a decision to scrap a proposed rule that would have barred state mortgage brokers from charging or retaining loan discount points.Stacy G. London, a member of the Texas Mortgage Broker Advisory Committee, said the panel has formulated a substitute for the proposed rule. "Rather than prohibit discount points like the old rule did, this rule allows brokers to charge discount points, but they would have to be separately identified on the Good Faith Estimate as being paid to the broker vs. the lender,? Ms. Gordon said. She added that it will probably take a few weeks to publish the substitute. "I think what they are going to do is put it up for the remainder of the public comment period,? she said. The advisory committee is appointed by the governor to advise the commissioner of the S&L Department and the Finance Commission on matters relating to the state?s Mortgage Broker Licensing Act.

National Commerce Financial, a bank holding company in Memphis, will acquire BancMortgage Financial Corp., Atlanta.BancMortgage is currently owned by Habersham Bancorp, Cornelia, Ga. Under the terms of the agreement, Robert Cannon and Anthony Watts, the co-vice chairmen of BancMortgage, will use their option to buy the company from Habersham and then sell it to NCF. The terms of the transactions were not disclosed. According to BancMortgage, it did $1.4 billion in loan volume in 2001. NCF said the deal will approximately double its originations business. After the deal is completed, NCF will continue its practice of selling all its production on a servicing-released basis. BancMortgage will retain its name in the Atlanta metro area. NCF is making a big push in the Atlanta market through its retail banking subsidiary National Bank of Commerce. The company entered the market in April on a de novo basis through branches in Kroger supermarkets and recently added 22 full-service branches from Wachovia.