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Firms Aid Ailing LendersLegal assistance, repurchase consulting and mortgage acquisition touted

August 13, 2007

By SAM GARCIA

An entire industry has sprung up to help ailing mortgage companies. Among the latest services touted are non-performing mortgage acquisition, repurchase consultation and asset protection.

Oxford Funding Corp. issued a press release today indicating it acquires troubled mortgage loan portfolios at discounts ranging from 25 percent to 50 percent or more of face value. The company rehabilitates or restructures the loans and resells them at a profit.

Last month the Houston-based company announced the acquisition of a $3 million portfolio of underperforming loans at a 35 percent discount.

“We preliminarily expect to earn as much as 30% on the rehabilitation and resale of the portfolio,” Oxford President Robert Dunn said in today’s announcement. “In addition, we are currently negotiating to make a series of much larger portfolio acquisitions from this and other nationwide lenders over the next several months, and financing for us seems readily available.”

MortgageDaily.com advertiser Cirilli Capital has launched ScratchAndDentLoan.com.

The company claims it is able to get the best pricing for fallout and non-performing loans. Among the loans it buys are non-conforming, subprime and non-performing.

“One loan or large bulks, we will have up to 3 bids for you to choose from within 48 hours of submitting your loan pool information,” the company says on its Web site. “We will not accept low bids from investors trying to take advantage of your potentially vulnerable position.”

Repurchase Resolution Specialists Inc. launched in February “as a direct response to the growing catastrophe of the collapse of the residential mortgage market,” the company said in a press release today.

The Mountain Lakes, N.J.-based company, which said it is operated by mortgage professionals and staffed by industry insiders and banking lawyers, helps mortgage lenders and brokers create loss mitigation strategies and avoid repurchases. It reviews investor agreements, analyzes default and fraud files and writes detailed buyback defense letters.

As a last resort, Repurchase’s staff attorneys file lawsuits against borrowers, loan originators and other parties identified as the cause of a loan default, the statement said.

“When we were victimized by [third party origination] fraud, [Repurchase Resolution Specialists] tracked down the responsible professionals and recovered our losses of more than $175,000,” Paul Loiacono of Montgomery Mortgage Capital was quoted in the statement as saying.

“Their efforts over the past several months have helped us to maintain one of the lowest post-sale repurchase records we’ve ever had in over 10 years in business,” U.S. Mortgage Corp. CEO Michael McGrath reportedly said of the company.

The firm, which reports significant growth over the past few months, said it offers fixed-fee basic services as well as hourly charges for intense loss mitigation efforts.

Boldra, Klueger & Stein LLP is helping mortgage companies protect their assets.

The Los Angeles company specializes in sheltering assets from claims of creditors — a field of law known as asset protection, according to an announcement today. Prospective customers who foresee a possible collapse in their future can turn to the company to protect the personal assets of the owners, plan for a bankruptcy filing or even avoid bankruptcy filing altogether.

Boldra, Klueger & Stein noted sagging business at their conforming clients has left them unable to maintain their debt sevice payments.

“In some cases these are very significant companies that have been in the mortgage industry for many years, and the owners of these companies are just trying to salvage whatever they can. Many of them are anticipating a certain demise of their businesses,” partner Jacob Stein said in the statement. “We see a lot of mortgage companies with millions to hundreds of millions of dollars in debt to Wall Street and virtually no assets left.”

The firm added that the mortgage sector has recently helped drive its business to the highest level ever.

Mortgage companies facing or preparing for litigation may be able to find help at the Subprime Lending Litigation & Regulatory Enforcement conference being held Sept. 26 and Sept. 27 at The Madison in Washington, D.C.

“With new decisions on preemption, consumer groups seeking to lay blame for the mortgage crises and individuals looking to extricate themselves from liabilities, it is imperative that every entity involved in mortgage lending be prepared to defend their acts and practices from new and emerging claims,” said Renee Karibi-Whyte in the statement. She is with the show’s sponsor, American Conference Institute.

The conference schedule includes sessions on class actions, suitability standards and current enforcement priorities for mortgage lending, according to an overview of the conference.

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