Mortgage Firm Sells $500 Million in Stock
By BLOOMBERG NEWS
Published: August 31, 2007
Thornburg Mortgage, a jumbo-mortgage specialist that was forced to stop making new loans, has sold $500 million of convertible preferred stock to raise cash...
nytimes.com
...The transaction follows the Countrywide Financial Corporation’s sale of $2 billion of similar securities to Bank of America last week. Mortgage lenders like Countrywide and Thornburg are turning to costlier financing after being shut out of the short-term debt market. Thornburg had to sell more than a third of its mortgage assets this month to meet obligations it could not refinance.
While Countrywide sold its convertible preferred stock to Bank of America at a discount to market value, Thornburg set its conversion price at a 3 percent premium....
Bankrupt American Home to sell $1.62 bln mortgages
Wed Aug 29, 2007 6:14PM EDT
reuters.com
...The company said Broadhollow Funding LLC and Melville Funding LLC would auction the loans on the morning of September 11 at a Wilmington, Delaware law office. Bidders wishing to participate must notify the U.S. bankruptcy court in Wilmington by the previous day, it said....
...Broadhollow Funding and Melville Funding are not subject to the Chapter 11 filing, American Home said.
Reporting by Jonathan Stempel
U.S. Stocks Rise on Bush Mortgage-Aid Plan
bloomberg.com
ABX subprime mortgage index rises 2 pts
Fri Aug 31, 2007 9:22am ET
today.reuters.com
Investors Default
On Outsize Share
Of Home Loans
By MICHAEL CORKERY and JAMES R. HAGERTY
August 31, 2007; Page A1
online.wsj.com
...As a result, some investors have "simply walked away from their mortgages," said Doug Duncan, chief economist of the MBA, echoing recent comments from executives of Countrywide Financial Corp., the nation's largest mortgage lender.
Investor defaults are likely to add to the spate of foreclosed homes hitting the market over the next year or two, even as much tighter lending standards cut many potential buyers out of the market.
The darkening outlook for the housing sector has prompted economists at Goldman Sachs Group to predict that home prices nationwide will fall an average of about 7% both this year and next. Alarmed by such prospects, a group of top executives from home-building and supply companies are scheduled to meet next Wednesday with Federal Reserve Chairman Ben Bernanke to argue for Fed actions to support the housing industry...
..."For a while it went their way, they bought two or three homes and continued to roll the dice,'' said Mr. Cecere. "But that goes the other way when the prices go down.''...
...Underscoring the growing pessimism about housing, economists at Goldman Sachs in New York raised their forecast for the drop in U.S. home prices this year to 7% from a previous 5%. The forecast is based on the S&P/Case-Shiller national home-price index, considered the best such gauge by some housing economists. The Goldman economists expect a further 7% decline in house prices next year. In this year's second quarter, the index was down 3.2% from a year earlier.
Another house-price index, produced by the Office of Federal Housing Enterprise Oversight, or Ofheo, showed that prices in the second quarter were up 3.2% from a year earlier, the federal regulator announced yesterday. The Ofheo index, based on loans guaranteed by Fannie Mae and Freddie Mac, excludes homes financed with mortgages above the current $417,000 limit of the two federally sponsored mortgage giants. As a result, it misses much of the market in California and other high-price areas. The Ofheo index has lagged other gauges in tracing the housing slump of the past two years.... |
