Is the subprime industry poised for a rebound? Now, I know what some of you are thinking: “Paul, the Rapture is coming and it’s finally damaged your brain.” Maybe, maybe not. From all those CCD classes I attended as a kid, I know that when the Big Man comes it will be like a “thief in the night.” And no one knows when that thief might strike. But even if the world doesn’t end this weekend, we might be looking at a subprime Rapture of sorts. Follow my logic here. Very quietly (like a thief in the night, so to speak) a company called Springleaf has filed a registration statement with the SEC to raise $500 million. Its goal: to originate and buy nonconforming mortgages and “consumer loans” through its 1,100 branches. And who exactly is, Springleaf? Answer: It’s the old gang at American General Finance in Evansville, Ind., an AIG company, except that AIG only owns 20% of Springleaf/AmGen. The other 80% was bought very quietly this past fall by a company called FCFI Acquisition LLC, a private equity fund. And just who manages this investment? Answer: An affiliate of Fortress—that would be Dan Mudd’s Fortress, Dan being the former CEO of Fannie Mae, the guy who had the GSE binge on too many alt-A loans and was at the controls when Uncle Sam knocked on the door. (Who says there are no second acts in the mortgage business? There are plenty.) Fortress also is trying to take Nationstar public, Nationstar being a specialty servicer for Fannie. Anyway, will Springleaf be able to raise the $500 million? Will it buy nonconforming loans and hold them in portfolio, adding liquidity to a starved market? And what type of LTVs will it require? We’d love to ask Springleaf officials all these questions and more. Then again AmGen has had a history of not talking to the press…
In case you need more details about the Springleaf story, NMN reported on the stock offering on its website on Friday, miles ahead of the competition. If you need a subscription to NMN and its website (and our paper edition) call 800-221-1809…
Also, Springleaf hopes to be spun off as a REIT. It would seem that the REIT structure is “back” so to speak, but we’ve also heard scattered reports that some companies tried to pull off a public REIT filing earlier this year and the deals were snuffed out before an S-1 was even filed…
THIS JUST IN: As we reported early Friday, Ocwen is one of three bidders taking a close look at buying Goldman Sach’s Litton Loan Servicing division. Subsequently we’ve heard that two other investors have looked at the company: Nationstar and Carrington. According to figures compiled by the Quarterly Data Report, there are roughly 20 firms servicing or subservicing subprime mortgages. If you need a list of these firms (or a ranking of all top 100 “A” paper servicers) drop a line to
We understand there soon may be an update on plans to change servicing compensation for Fannie Mae and Freddie Mac loans. Stay tuned…
Also, some executives are telling us that although profit margins are still decent (though production volumes could be better) a few companies see trouble ahead in regard to the compensation contracts they inked with their LOs. “Some of these companies want to keep the good ones and cut nice packages, but if profit margins begin to slide they might want to renegotiate those deals,” one manager told us. Have any intelligence on this? Drop me a line at
This past week we forgot to mention that Interactive Mortgage Advisors is selling a $107 million portfolio of bulk Fannie/Freddie servicing rights. We try to keep readers informed on all such deals…
WASHINGTON NEWS: Banks will face increased costs and reduced revenues as the federal government drafts and implements a new series of regulations affecting mortgage lending and servicing, according to the Comptroller of the Currency. Acting comptroller John Walsh said many of these regulations—including risk retention and mortgage disclosures—are mandated by the massive Dodd-Frank bill. The OCC chief believes these regulations could fundamentally change the residential lending business while the housing market is still struggling, he told a Financial Services Roundtable meeting late this week. "Are we trying to do too much, too quickly?" the comptroller asked, speaking at a Financial Services Roundtable meeting. (Reporting by NMN’s Brian Collins.)
OTHER FINANCE-RELATED BLOGS: For those of you with a keen interest in the repo market, my colleague Mary Fricker (an award winning journalist many times over) has launched
DATA NOTICE No. 1: NMN is still collecting quarterly origination and servicing stats for its 1Q edition of the Quarterly Data Report. We also are collecting figures for our annual rankings which will appear—along with my data analysis—on MortgageStats.com. If you would like to send us your numbers drop a line to
DATA NOTICE No. 2: If you’re looking for a full-year ranking of all the top ranked correspondent loan buyers and wholesaler funders (and more) that information is in the new Annual Data Report, which is published by National Mortgage News. The ADR, an Excel spreadsheet, also includes the nation’s top 100 retailers, servicers and much more. If you need telephone numbers and contact names that information can be found in the new edition of MortgageStats.com. For more on the ADR and M-Stats drop an email to
KEY CONFERENCE YOU NEED TO ATTEND: On June 16-17 SourceMedia will hold its annual Distressed Assets Conference in the Big Apple. Upcoming: SM’s Third Annual Best Practices in Loss Mitigation Conference. That show is in Dallas. SourceMedia is the publisher of NMN, Origination News, Mortgage Servicing News, Credit Union Journal, U.S. Banker, American Banker and other assorted financial publications.
CALLING ALL LOAN OFFICERS: We want to know how you did in 2010 and your outlook for this year. NMN's new LO survey can be found at
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THE LAST WORD: Hey NFL owners: strike a deal already. Don’t be greedy. Have a good weekend.
