A Nevada-based subprime wholesaler said it is taking a break from lending as it assesses its position in the mortgage market.
MLSG Home Loans recently had "halted its lending operations due to the current market instabilities," according to an announcement on its Web site last week. "We've appreciated the opportunity to serve you since 1990, and regret we can no longer be of assistance with your lending needs."
Brokers were advised to contact the company with any concerns regarding loans in the escrow and funding stage or to redirect files be to an alternate lender, according to the message.
But the lender has since revised that announcement, clarifying its intentions to only temporarily suspend operations.
While the company has not shut down, it has suspended originations and fundings until they "figure out what is going on in this crazy world," President and Chief Operating Officer Paul Russo told MortgageDaily.com.
"We're working with a skeleton staff right now," he said. "We haven't surrendered any of our licenses, we're still here -- just not originating loans. And right now, we're trying to sell loans that we have funded, but we ceased [additional] funding last week."
Originating first and second mortgages, MLSG is licensed in 22 states and has concentrated mainly on subprime and more recently Alt-A, Russo said.
Based in Reno, Nev. the 17-year-old company, at its peak, saw about $75 million in monthly production and had 130 employees, he added.
Right now, company executives are contemplating their next move, he said, and working with a small staff of about 20 to tie up any loose ends.
"We might do something else, maybe straight A paper or just concentrate on strictly Alt A," Russo said. "We'll sit back and weigh our options, make a decision in about 30 days or so."
They might even move into retail, he said, though he wasn't sure which direction they will go.
"Tough times for everybody, I just wish everybody luck that's still standing," Russo added.