The rate of bank failures in 2013 slowed to the lowest level in six years, helping to drive down overall mortgage-related casualties by more than a quarter. Several wholesale lenders have recently closed down.
Last year, Mortgage Daily tracked 62 mortgage-related businesses that either failed or were closed down by their owners.
The number of casualties declined from 2012, when a revised 83 were tracked, and has plummeted from the recent high of 235 tracked during 2009.
In fact, the last time there were so few closings was at the outset of the mortgage crisis in 2006, when just 32 were tracked.
Closings in 2013 included 22 non-bank entities.
Bank failures tumbled by more than half from 2012 to 24 last year — the fewest since 2007, when just three FDIC-insured banks went under.
Credit union casualties, however, inched up to 16.
|
Type
|
2013 |
2012
|
| Non-Bank Closings | 22 | 17 |
| Bank Failures (FDIC) | 24 | 51 |
| Credit Union Failures | 16 | 15 |
| Total | 62 | 83 |
Some notable casualties in 2013 included SunTrust Mortgage Inc.’s wholesale lending division, which said in October that it decided to stop accepting loans originated by mortgage brokers.
In December, BB&T Corp.’s correspondent division stopped accepting business originated by mortgage brokers.
“Of the seven mortgage-related business closings identified so far in 2014, three were wholesale lenders,” said Mortgage Daily Founder and Publisher Sam Garcia. “But some firms like Stonegate Mortgage, United Wholesale and Carrington Mortgage are stepping up their third-party originations and picking up some of the slack.”
Mortgage Investors Corp. closed in November. The St. Petersburg, Fla.-based firm had claimed to be the biggest originator of loans guaranteed by the Department of Veterans Affairs.
Wells Fargo & Co. pulled the plug on its joint venture alliance business, leading to the closing of several joint ventures including Edward Jones Mortgage LLC.
Inc 5000 company IFG Mortgage Corp. closed down in September.
Pacific Mercantile Bank disclosed in December that its board of directors decided to exit consumer mortgage originations, and it terminated the operations of its mortgage banking division.
