MortgageChronicle.com -- Free Mortgage Industry News Archives January 14, 2005

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Last Updated Friday, January 14, 2005 11:12 AM CST

Lenders Tout Construction Programs
American Home Bank announced it will provide a construction to permanent loan that allows borrowers to lock in low construction and permanent mortgage rates up front, with no long term lock fees and no payments until construction is completed. InterFirst Wholesale Mortgage Lending previously announced it began offering renovation and rehabilitation mortgage loans which, granted as first mortgages, can be used to finance additions, structural repairs and renovations.

Former Mayor Now Mortgage Broker
After spending more than half his life in the banking business, a former New Hampshire mayor along with his wife have launched a new mortgage company to serve local and surrounding communities. He said his political ties and community service, such as sitting on the local hospital board, has helped him build a lucrative client base. "People just know me from being active in the business community."

New Century Launches Retail Brand
New Century Financial Corp. announced its retail division is now Home123. The 74 retail-branch offices will transition to the new brand identity beginning next quarter.

Rate Watchers Eye Inflation
The 30-year fixed-rate mortgage averaged 5.74%, slipping from the prior week, according to Freddie Mac's latest survey. While Freddie recently said it expects the 30-year to average 6.0% next quarter, a Freddie economist noted, "One wrinkle in our forecast would be the emergence of unexpected inflation."

Ohio Fraud Network Costs Lenders $10 Million
The owner of a Cincinnati mortgage company and a real estate investor have plead guilty in U.S. District Court to bank, wire, mail and mortgage fraud charges. Their pleas bring to 13 the number of people who have admitted their guilt in the property flipping scheme that cost ABN AMRO and other lenders millions of dollars.

Wisconsin Giving Undocumented Aliens Mortgages
Immigrants without a social security number are able to use their individual taxpayer identification number through a program offered by the Wisconsin Housing and Economic Development Authority. "We saw this was a large group being underserved by the private market, or badly served by it in most cases, or not being served at all, so we decided on the program," a WHEDA spokesman told MortgageDaily.com.

ABN AMRO Reverses Production Spiral
ABN AMRO Mortgage Group Inc. announced that production totaled $3.6 billion in November, up from the previous month. ABN AMRO's fundings had not risen every month since April.

Borrowers Sue Foreclosure Attorney, Lenders
In a lawsuit filed in New Orleans Civil District Court, a group of low income homeowners allege that a Louisiana law firm has been charging fees so high in potential foreclosure cases that some people have been forced from their homes, according to a community activist that has been working with the homeowners. A total of 19 homeowners have reportedly joined the class action lawsuit

Mortgage Co Gives Needy Family 2-Year Free House
A home a Detroit family was renting was being foreclosed on due to the landlord's neglect to pay the mortgage -- ultimately forcing them out of the house. But a local mortgage company came to the rescue, giving them use of a Detroit home -- mortgage- and rent free -- for two years followed by the option to obtain a zero percent mortgage to buy it.

Fidelity, Capital One Announce Upcoming Deals
Fidelity National Financial Inc. and its unit, Fidelity National Information Services Inc., announced it will sell a minority equity interest in the common stock of the subsidiary to an investment group. Also expected to close this quarter is Capital One Financial Corp.'s acquisition of an online home equity loan originator and its related escrow company.

Flagstar Quarterly Production Up
Flagstar Bancorp reported fourth quarter production of $8.7 billion was up from the previous quarter. In all of 2004, however, Flagstar's production was down 38% from the record-breaking fundings reported in 2003.

2004 Volume Off at Countrywide
Countrywide Financial Corp. fundings for all of 2004, reported at $363 billion, did not manage to surpass the record level reported in 2003. Countrywide noted that its annual production decline is in line with the expected volume fallout from 2003's record levels for the industry.

Best Mortgage Employers
Based mostly on surveys of randomly chosen employees, FORTUNE magazine released it's latest list of the 100 Best Companies to Work For. Among the top mortgage-related entities to make the list were HomeBanc Mortgage, Quicken Loans and Republic Bancorp.

First Horizon Inks 2 Stadium Deals
First Horizon Home Loans acquired the naming rights to the new homefield of the minor league team in Greensboro, North Carolina, while First Tennessee Bank gained rights for the to-be-built stadium of a Nashville team.

E-LOAN, CDA Boost Warehouse Lines
In a FORM 8-K filing with the SEC, E-LOAN Inc. reported it established a $150 million warehouse line with JPMorgan Chase Bank, N.A. Consumer Direct of America announced it expanded its warehouse financing capacity to $35 million from $20 million.

Record 2004 at New Century
New Century Financial Corp. announced record-breaking annual originations of $42.2 billion -- up 35% from 2003. "For fiscal 2005, we are targeting production volume at $45 billion or more," the company's chief executive said in the announcement.

1st Lien HELs Growing
The 18th Annual Home Equity Lending Study by the Consumer Bankers Association and BenchMark Consulting International indicated an increasing use of first lien HELs, a growing acceptance of HELs by seniors and a rise in 90-day delinquency. The study was based on activity of 23 banking participants, according to an announcement.

Lenders Help Fund Inauguration
A review by MortgageDaily.com of contributions posted on the 55th Presidential Inauguration Web site indicates mortgage companies, their top executives and trade-related lobbying groups have given more than $1.6 million to the inaugural committee. And while certainly many of the donors are civic minded, the industry may also be looking for some payback for its benevolence.

Fitch Ditches Indiana High Cost Loans
Fitch Ratings announced it will no longer rate RMBS pools that include Indiana "high cost" loans. The move is a result of Indiana's High Cost Home Loan Law, which became effective Jan. 1, 2005, and applies to residential owner-occupied Indiana mortgages meeting one of the high-cost home loan triggers.

HEL Delinquency Rises
Third quarter home equity loan delinquencies increased to 2.82%, the American Bankers Association reported in its latest Consumer Credit Delinquency Bulletin. Of all the analyzed credit categories at the banking institutions, home equity lines of credit reportedly continued to be the category with the lowest delinquency rate.

This mortgage news summary reprinted with permission of