Originations

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.

The average 30-year fixed mortgage rate rose to 6.03% for the week ending Nov. 22 from a survey-record low of 5.94% the previous week, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from a survey-record low of 5.32% to 5.44%, while the average rate for one-year Treasury-indexed ARMs increased from a survey-record low of 4.09% to 4.14%. Fees and points averaged 0.6 points for all three mortgage categories. "Economic reports are mixed, and this will keep mortgage rates bouncing up and down somewhat, probably for the rest of this year," said Frank Nothaft, Freddie Mac's chief economist. "For example, housing starts for October were weak, but housing permits picked up to their highest level since February. This is a good indication that the housing industry is still in great shape despite last month's apparent lull." A year ago, the average 30-year and 15-year fixed rates were 6.75% and 6.24%, respectively, and the average one-year ARM rate was 5.18%, Freddie Mac said. Freddie Mac can be found on the Web at http://www.freddiemac.com.

Zacks.com, a unit of Zacks Investment Research Inc., Chicago, has issued its No. 1 Strong Buy rating to Fidelity National Financial, Irvine, Calif."In the past 30 days, analysts have upped estimates on the company by approximately +9% for this year and about +7% for next," Zacks said in its notes on the company. "With solid earnings estimate surprises in its past six quarters, FNF looks like it's on the right track and could add a little reassurance to your portfolio." Zacks can be found online at http://www.zacks.com.

Liberty Property Trust, Malvern, Pa., has entered into a $123 million joint venture with the Public Employees' Retirement Association of Colorado.In this connection, the real estate investment trust said it has sold or contributed 28 distribution centers totaling 3.1 million square feet, and about 50 acres of land, from its southern New Jersey industrial portfolio. Liberty is retaining a 25% stake in the venture and has realized proceeds of approximately $110 million from the transaction, the REIT said. The venture -- from which Liberty will receive management fees and possibly a performance-based interest -- will be financed with approximately 60% debt. Liberty, which specializes in office and industrial properties, can be found online at http://www.libertyproperty.com.

Fog Cutter Capital Group Inc., Portland, Ore., has reported the sale of certain mortgage-backed securities by its subsidiary Fog Cutter Capital Markets Inc. for approximately $53.2 million.Fog Cutter, which invests in mortgage and real-estate-related assets, said the sales were completed via arm's-length transactions with an unaffiliated buyer. They are expected to result in gains on sale of about $13.3 million in the fourth quarter and the repayment of $33.1 million of related debt. "The sale of these securities positions us to strategically redeploy our capital into new opportunities which we expect will arise from the current global economic environment," said Andrew Wiederhorn, Fog Cutter's chairman and chief executive officer.

New Century Financial Corp., Irvine, Calif., has entered into a forward sales commitment for $1.5 billion of its fourth-quarter production.This brings the total forward sales commitment for the three-month period to $3.5 billion. Robert K. Cole, New Century's chairman and chief executive, said the fourth-quarter loan commitments "represent sales to 'repeat' institutional investors who remain very satisfied with the credit quality and performance of our product. That is a fairly good indication that our investors have determined that our product consistently meets the test of institutional quality standards in the marketplace." For the full year (including the fourth-quarter commitments), New Century has sold or will sell approximately $12 billion of whole loans. New Century can be found online at http://www.ncen.com.

Mortgage applications jumped 21% on a seasonally adjusted basis for the week ended Nov. 15 as the Refinance Index surged past the 6000 level, according to the Mortgage Bankers Association of America's Weekly Mortgage Applications Survey.On an unadjusted basis, applications were up 20.3% on the week and 22% from the level recorded a year earlier. On a seasonally adjusted basis, the Purchase Index rose from 333.3 to 345.0, while the Refinance Index surged from 4825.6 to 6174.1. Refinancings represented 77.6% of total applications, up from 73.0% the previous week, while adjustable-rate mortgages accounted for 11.9%. The average contract interest rate for 30-year fixed-rate mortgages climbed from a survey-record low of 5.74% to 5.94%, and points (including the origination fee) decreased from 1.52 to 1.44 for loans with 80% loan-to-value ratios, the MBA reported. The MBA can be found online at http://www.mbaa.org.

The NAHB Housing Market Index rose two points to 65 in November, according to the National Association of Home Builders.In addition, the index gauging builder sentiment about the current single-family sales market rose two points, to 71, and the measure of expected sales over the next six months increased two points, to 70. The reading for prospective homebuyer traffic rose one point, to 48, the NAHB said. "With long-term mortgage rates slipping below 6%, builders are certainly finding buyers who can qualify to purchase homes in most price ranges right now," said NAHB president Gary Garczynski. Regarding the possibility of a housing price "bubble," Mr. Garczynski said markets where demand is exceeding supply and rising land prices are pushing up builders' costs present no reason for concern. But he said builders in some areas are lowering their expectations for sales in the top price ranges because of losses in the stock market by prospective buyers. Anything above 50 in the index and its components, which are based on surveys of hundreds of builders, means homebuilders believe that the single-family housing market is doing well. The NAHB can be found online at http://www.nahb.com.

Single-family housing starts fell 7% in October even though builders took out an unusually high number of housing permits.The Commerce Department reported that single-family starts fell from a seasonally adjusted annual rate of 1.45 million in September to 1.35 million in October. The National Association of Home Builders expected starts to decline, but not by this much, according to NAHB economist Michael Carliner. He pointed out that construction permits are at very high levels for this phase of the housing cycle and there is a very large inventory of unused permits. "The permit number says things are doing just fine," Mr. Carliner said, suggesting that single-family starts will "remain fairly strong." Meanwhile, the Commerce Department reported that multifamily starts plunged from 322,000 in September to 221,000 in October. The department can be found online at http://www.doc.gov.

Taubman Centers Inc., a real estate investment trust based in Bloomfield Hills, Mich., has replied to what it termed "numerous and repeated misleading statements" by Simon Property Group Inc. regarding Taubman's 1998 restructuring.Taubman recently rejected an unsolicited offer by Simon, an Indianapolis-based REIT, to acquire Taubman for $17.50 per share in cash, sparking a round of recriminations. "Any allegation by Simon of impropriety or invalidity with respect to the company's 1998 restructuring is a 'red herring' and utterly baseless," Taubman said. "The Taubman family gave up pre-existing special rights in the 1998 restructuring, and a democratic voting and governance structure was established. In the 1998 restructuring, the independent directors of the company, after undertaking an extensive process during which they received independent financial and legal advice, unanimously approved the restructuring." Simon has alleged that certain preferred shares were improperly obtained by the Taubman family in 1998 without a shareholder vote. Taubman can be found on the Web at http://www.taubman.com.

Class A-4 of Asset Securitization Corp.'s commercial mortgage pass-through certificates series 1997-MDVII has been placed on Rating Watch Negative by Fitch Ratings.The ratings on eight other classes of the same series were affirmed. Fitch attributed the Rating Watch placement to a special-event report by the special servicer, Clarion Partners, indicating that the Fairfield Inn borrower failed to make the full November debt service payment. Pacific Life, the master servicer, advanced the approximately $400,000 balance due. Citing the Clarion Partners report further, Fitch said the Fairfield Inn borrower "has expressed uncertainty" about its ability to make the December debt service payment. Fitch can be found on the Web at http://www.fitchratings.com.

Levitt Companies, Fort Lauderdale, Fla., has launched a new division that will specialize in acquiring and financing commercial real estate transactions that are owned, controlled by, or occupied by investment-grade public companies in the United States.Levitt Realty & Finance will focus on transactions such as sale/leasebacks, financing of long-term-leased properties, and credit facilities to fund corporate-sponsored real estate loan programs, Levitt said. Thomas Dujanovic will be president of the new division. Levitt is a subsidiary of BankAtlantic Bancorp, which can be found on the Web at http://www.bankatlantic.com.

Conseco Inc., Carmel, Ind., has reported a net loss of $1.77 billion in the third quarter, compared with a loss of $410.6 million for the same quarter in 2001.This loss was due to an impairment charge of $701.3 million related to retained interests in securitization transactions held by subprime lender Conseco Finance, realized investment losses of $277.9 million, and a goodwill impairment charge of $500 million. So far this year, Conseco has lost $6.15 billion. The company also announced that William J. Shea has been named chief executive, formally ascending to the top slot at Conseco that was left vacant when Gary Wendt resigned under pressure. Mr. Shea remains president and chief operating officer. Eugene M. Bullis has been named chief financial officer, replacing Mr. Shea, who had held the job on an acting basis since March of this year.

The National Community Reinvestment Coalition is backing Radian Lien Protection as a low-cost alternative to traditional title insurance, and the coalition is urging the California insurance commissioner not to ban the sale of the product."We strongly urge the insurance commissioner to act in the best interest of the American people by allowing this cost-effective alternative to title insurance to be sold in California," NCRC president John Taylor said. The California commissioner halted the sale of RLP on June 20, which forced its sponsor, Radian Guaranty, a Philadelphia- based mortgage insurance company, to stop sales nationwide. Radian appealed the commissioner's decision, and an administrative judge is expected to rule in the case by early next year. Radian estimates that its lien protection product, which insures lenders from losses caused by undisclosed liens, could save $395 million a year for California homeowners who are refinancing or taking out a second mortgage.

Prime Retail, a Baltimore-based real estate investment trust, is selling its retail outlet center in Barceloneta, Puerto Rico, for approximately $36.5 million.The approximately 176,000-square-foot property has a nonrecourse mortgage with an outstanding principal balance of about $19.37 million as of Sept. 30, the retail REIT said. After repayment of existing mortgage debt and closing costs, the sale is expected to generate net proceeds sufficient to satisfy the December 2002 principal repayment requirements under the REIT's mezzanine loan, which had an outstanding principal balance of $31.1 million as of Nov. 1. The REIT will continue to manage the property on behalf of the buyer, for a fee.

Meanwhile, Simon Property Group has taken issue with recent statements by the Taubman Centers real estate investment trust regarding the Taubman family's voting interest and Simon's corporate governance.Taubman "is simply wrong in suggesting the Taubman family has a voting interest commensurate with its economic interest in the publicly traded REIT," Simon said. "As revealed in their 13-D filing on Friday [Nov. 15], the Taubman family owns less than 1% of the REIT, although they control over one-third of the votes, largely through the Series B preferred shares." Simon asserted that certain Series B preferred shares were "improperly obtained by the Taubman family in 1998 without a shareholder vote" and predicted that the family's ability to vote the shares "will not survive a legal challenge." Simon also said the Simon family "has no veto power or other control mechanism that could block a sale or merger transaction" as Taubman has stated. Simon can be found on the Web at http://www.shopsimon.com.

The senior unsecured debt and the preferred stock of Simon Property Group LP, a real estate investment trust, have been downgraded by Moody's Investors Service.The debt rating was lowered from Baa1 to Baa2, and the preferred stock rating was lowered from Baa2 to Baa3. The actions followed the REIT's announcement that it had made an unsolicited offer to acquire Taubman Centers for $1.5 billion in cash and to assume approximately $2.4 billion in Taubman's share of secured debt. Simon's offer was rejected by the Taubman board. Moody's noted that Simon's bid for Taubman's "highly levered and entirely encumbered portfolio" came on the heels of its participation in the $5.3 billion acquisition of the Rodamco regional mall portfolio with a group of REIT partners. "Although Moody's recognizes that Simon may ultimately not be successful in taking control of the Taubman portfolio, Moody's expects Simon to continue to be an active participant in transactions for regional malls in order to maintain its leadership position, even if doing so results in coverage levels and secured debt levels that are inconsistent with its Baa1 rating," the rating agency said. Moody's can be found on the Web at http://www.moodys.com.

New Boston Fund Inc., Boston, has announced the formation of a $350 million closed-end, commingled investment fund designed to take advantage of opportunities in the real estate market over the next two to three years.The investment strategy of the fund, New Boston Real Estate Investment Fund LP VI, will combine a mix of core, value-added, and deeply discounted acquisitions with "selective risk-averse development" and will target a blended rate of return of 15%-20%, New Boston said. "Fund VI follows five very successful commingled funds organized between 1993 and 2000 that have catered to a well-balanced mix of affluent and institutional investors who are seeking current cash flow, superior overall returns, capital preservation, and portfolio diversification," said Jerry Rappaport Jr., president of New Boston. The company can be found on the Web at http://www.newbostonfund.com.

First American Title Insurance Co., Santa Ana, Calif., has acquired San Benito Land Title Corp., Hollister, Calif., for an undisclosed amount.First American Title said San Benito provides title and escrow services to San Benito County, covering new residential developments "that offer Silicon Valley commuters reasonably priced homes within 30 miles of San Jose, Calif." Mark Sachau, First American Title's regional vice president, said First American has held an interest in San Benito Land Title for many years. First American Title is the largest subsidiary of The First American Corp., which can be found on the Web at http://www.firstam.com.