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Inside Mortgage Trends

April 14, 2006

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Lender Shakeout Heats Up In March, More Non-Lenders Eye Market for Expansion

The last few weeks have seen yet another flurry of mortgage mergers and spinoffs. Centex Corp. is selling its Centex Home Equity Co. to hedge fund Fortress Investment Group. Executives expect the sale of the subprime unit to close in 120 days. The purchase price will be book value plus a premium that the parties will calculate at closing. Centex estimates it will receive about $575 million in after-tax cash from the sale. … Read More

Servicers Prepare for the Worst as Loans Reset, Interest Rates Rise and Home Prices Flatten

Originators are not the only ones starting to brace themselves for an expected surge in delinquencies and defaults as rising interest rates and flattening home prices take hold. Servicers should be ready to weather the storm as well, according to participants at the Housing Finance Summit last week sponsored by the Opal Financial Group. … Read More

As Other REITs Falter, Impac Welcomes Challenge Posed by Decreased Originations

It has been a tough year for mortgage real estate investment trusts. Aames recently dropped its REIT status in order to take advantage of more than $300 million in net operating losses and ECC Capital Corp. declined to distribute a first quarter dividend because of losses in its mortgage banking business. … Read More

Merrill Lynch Posts Strong YTD Return on Assets, Outdistancing Peers as Most Profitable Bank

The 10 most profitable mortgage-focused bank and thrift ranking shifted during the second half of 2005, according to a new analysis by Inside Mortgage Profitability. Merrill Lynch Trust Co. by far showed the most return on assets, 8.65 percent, last year and dominated the number one ranking. Second place shifted though.… [One data table included] Read More

GM, Cerberus Strike Deal for Sale of GMAC Controlling Interest, Business As Usual for ResCap

General Motors ended months of speculation by announcing it had sold a 51 percent state in General Motors Acceptance Corp. for what would end up being about $14 billion. But don’t expect any shake-ups with the jewel of GMAC, Residential Capital Corp. any time soon. GMAC officials are saying little about their future with the new controlling owners, Cerberus Capital Management and partner CitiGroup, except that no operational changes are expected, including no layoffs. But… Read More

Accounting Snafus Lead More Firms to Restate Financial Results, ECC Fires More Staff

Fieldstone Mortgage Co. joins a growing list of firms that are restating their financial statements due to accounting errors. The Columbia, MD-based lender will redo its annual financial reports for 2003 and 2004, and the first three quarters of 2005. The problem: accounting errors related to when the company recognized income tax paid on the sale of loans to its parent company, Fieldstone Investment Corp. The REIT originates non-conforming and conforming mortgages via a… Read More

IndyMac Plans Impressive Market Share Grab By Sticking to Its ‘Best Execution’ Strategy

IndyMac Bancorp, one of the highest-ranking thrifts in the mortgage market, has even loftier aspirations: to be a top six lender by 2010. Officials revealed that goal to investors at recent conferences sponsored by JMP Securities and investment bank Raymond James. Inside Mortgage Finance, an affiliated publication, ranks IndyMac as the 10th largest lender in 2005, with $60.77 billion in originations. To break into the top six, the thrift plans to stick with its “best… Read More

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