twitter linkedin
facebook google+

Mortgage News

News by Subject
Complete list of specialty news sections.

Purchase Subscription
Subscribe to and get immediate access to all news, statistics and archives.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Consumer Mortgage News
Free mortgage news for prospective borrowers.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from

Mortgage News Reprints
Put entire stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed stories free on your Web site or for your RSS reader.

News Archives
Archive of stories by month going back to 1999.

Press Releases
Reports and announcements from

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Directories
Directories of lenders, branch operators and mortgage service providers.

Mortgage Graphs
Directories of lenders, branch operators and mortgage service providers.

home subscribe advertise reprints e-mail help RSS about us LOG IN

Mortgage News


Mortgage News

HOT Topics









site map
The Mortgage Graveyard
Failed, closed and a c q u i r e d mortgage-related entities.

Lack of FHA Kills Ohio Firm

Coldstream closes

October 7, 2008


A once-booming mortgage company that specialized in subprime refinances has shut down. The Ohio-based company's demise appeared to be tied to its lack of government loan programs.

In February 2006, Coldstream Financial Services Inc. had 80 employees, including 60 loan officers, co-founder Nolan Marx told in an interview at the time. He noted that the mortgage broker recruited most of its new loan officers and other staff at college job fairs.

Just this year, Coldstream was still actively recruiting from colleges. In March, it participated in a career fair at the University of Cincinnati. A few months earlier, it was a recruiter at the Bowling Green State University Career Fair.

Originations at the Cincinnati-based company -- which was founded in 2003 by Marx, J. Scott Thompson and Jeff Herr -- were $246 million in 2005. About 80 percent of the business was subprime.

In the 2006 interview, Marx projected 2006 production would double over 2005.

Coldstream had promoted itself as Cincinnati's largest lender.

But the broker was not approved to originate loans insured by the Federal Housing Administration -- leaving it excluded from just about the only current growth area in the mortgage industry.

The lack of FHA programs was apparently fatal.

Calls to the company's main office yielded busy signals. Calls to Herr at his home were not returned.

The closure came as Coldstream lost its licenses in two of the three states in which it was licensed.

Coldstream's Indiana license was revoked on Aug. 5 after it failed to meet a July 5 deadline for the state's requirement to register the principal manager of its mortgage broker business, an official in the Indiana Secretary of State's securities division told

And Coldstream failed to renew its Ohio license, which was then canceled on Oct. 3, a state Division of Financial Institutions spokesman said. The renewal deadline, he said, was April 30, with a one-month grace period.

photo of ColdStream founders
Coldstream founders

That left Coldstream with only a Kentucky license that was scheduled to expire on Dec. 31. But in 2006 Coldstream was cited by that state for allowing three brokers to repeatedly violate state and federal laws, including originating mortgage loans on properties within the state without being registered with the state's Office of Financial Institutions. In August 2007, it agreed to settle the complaint by paying a $5,000 fine.

Without FHA approval, Coldstream saw its subprime business rapidly decline. Many loan officers began leaving early this year.

"I quit before they shut down because I had a gut feeling on my part," one former loan officer, who did not want to be identified, told "That was months before it happened."

He estimated that more than two-thirds of Coldstream's originations were subprime refinances.

An active mortgage broker for 14 years, who was also a Cincinnati real estate agent, told that he often discussed declining business with vendors when they visited his office.

"Vendors told me Coldstream was basically down to two or three people and that was months ago," the broker/Realtor, who asked not to be identified, said.

He further noted that Coldstream officials had boasted in local media that as much as 90 percent of their originations were being funded through subprime lender First Franklin Financial Corp.

First Franklin was shut down last March by new owner Merrill Lynch. Merrill had acquired First Franklin from National City Corp. on Dec. 30, 2006, and began laying off workers by Sept. 2007.

"Coldstream did well during the boom period but they didn't have sustaining power," the Cincinnati mortgage broker concluded. "Their business was focused on subprime. They would push all their clients into subprime whether they would qualify for conventional loans or not. So it was just a matter of time.

"If you're not doing a real service for your clients you're not going to last."


Key to One Ohio Mortgage Banker's Success
Bridal shows and home improvement shows are just some of the places one Cincinnati-based mortgage banker drums up leads for its originators. But before they start on the leads, salespeople, who are recruited from a local university, must first endure a 3-month boot camp.
photo of ColdStream founders

Jerry DeMuth is an award winning journalist who has been reporting for four decades.

e-mail Jerry at [email protected]

FHA News | Government Resources | M o r t g a g e e Letters | FHA Statistics
FHA, VA and HECM mortgage news. HUD and G i n n i e news also. Originations, servicing and FHA approval.

Nonprime and Subprime News | Subprime Statistics
Stories about non-QM products. Coverage of subprime, Alt-A and
hard money lending. Home-equity loans and home-equity lines of credit.

Corporate Mortgage News
M e r g e r s, a c q u i s i t i o n s and private and public offerings. Other corporate activity including executive appointments, bankruptcies name changes.

Logout forgot

SUBSCRIBERS: Edit Subscription | Subscription Help | or call 214.521.1300

Subscribe Contact Us Site Map

Copyright © 2017 Mortgage Daily, D a l l a s
Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

p r i c i n g engine directory

wholesale lender directory

More Mortgage News Resources (full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter


mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

real estate news

refinance news

reverse mortgage news

secondary marketing

social media

servicing news

subprime news

wholesale lenders