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Over 100 Mortgage Failures

Mortgage News

DALLAS — (July 20) /PRNewswire/ So far this year, more than 100 mortgage-related operations have shut down, according to data tracked by the MortgageGraveyard.com — a journal of failed, ailing and acquired lenders operated by MortgageDaily.com. The majority of the failures were U.S. banks.

From Jan. 1 through July 20, MortgageDaily.com reported on 103 mortgage-related entities that have either failed or been shut down.

Mortgage origination is dominated by federally insured financial institutions, and 57 such banks have failed so far this year — more than double the level for all of last year.

On July 2 alone, seven federally insured institutions were seized. Six were in Illinois, controlled by just one family and operated under a model that concentrated exposure.

The closing of four institutions on Friday was projected to cost the FDIC’s Deposit Insurance Fund $1.1 billion.

The Office of Thrift Supervision oversaw some of the biggest U.S. bank failures. Among failed institutions it previously supervised were BankUnited, IndyMac Bank and Washington Mutual Bank. The Obama administration is calling for the agency’s dismantling.

The number of non-bank mortgage operations to close this year has reached 40. This group generally includes firms with at least 50 employees.

World Alliance Financial Corp., which operates the Senior Lending Network, said this month that funding was no longer available for reverse mortgages. The company warned it might wind down the business if it doesn’t find a buyer or partner.

In June, Michigan regulators seized mortgage servicer Northwestern Financial Corp. for allegedly pocketing investors’ payments and siphoning off escrow funds.

Also during June, Arizona regulators seized hard-money lender Landmarc Capital and Investment Co., which subsequently consented to permanent receivership.

Mortgage-Related Closures

Company Type 2009
(through 7/20)
2008
(full-year revised)
non-banks 40 84
banks 57 25
credit unions 6 14
Total 103 123


But the news isn’t all bad.

CitiMortgage Inc. resumed its correspondent lending operations — which were suspended on June 23. The resumption followed an overhaul of quality control procedures.

Complete details about all failed companies are available at:
https://www.mortgagedaily.com/MortgageGraveyard.asp

http://www.MortgageGraveyard.com

https://www.mortgagedaily.com

About MortgageDaily.com

Founded in 1998, MortgageDaily.com is a dominant online source of mortgage news for the mortgage industry. Around 1 million news pages are viewed monthly at MortgageDaily.com and affiliated publications.

CONTACT:

Sam Garcia

[email protected]

214.521.1300

3811-700 Turtle Creek Blvd.

Dallas, TX 75219

Source: MortgageDaily.com

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