Mortgage company folds, surprising regulators
2003-08-16
by Greg Heberlein
Journal Reporter
BELLEVUE -- A large California mortgage company went belly up Friday, surprising bretheren and regulators alike and sending 43 employees to the company's Bellevue office into the unemployment lines.
The Capitol Commerce Mortgage Co. of Sacramento, with many billions of dollars of mortgages funded since it started business seven years ago, announced it is seeking protection from creditors under Chapter 11 of the federal Bankruptcy Code.
Last year alone, Capitol funded 6,814 loans out of its Bellevue office worth an average $169,000, or $1.15 billion in all.
Maggie Blair, who runs the Bellevue office, referred calls to Sacramento. The head office did not return calls. But others spoke.
``I was really shocked,'' said Sarah Gilcrist, a senior loan officer for United Pacific Investments in Federal Way. United was one of the couple dozen mortgage companies that relied on Capitol for funding.
``This is very scary,'' Gilcrist said. ``We didn't see this coming at all.''
Nor did the state of Washington's Department of Financial Institutions.
``They reported to us in March,'' said Scott Kinney, the regulator's communications director. ``It showed they had significant money to operate and do business.''
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