Industry News

Secondary markets continue to weigh on mortgage lenders

Aegis files for bankruptcy; Accredited sues former suitor

Early payment defaults and margin calls by creditors have forced Aegis Mortgage Corp. to file for Chapter 11 bankruptcy protection, a week after laying off more than half its work force. Aegis said in a bankruptcy court filing Monday that it owed more than $600 million to creditors, including an affiliate of Cerberus Capital Management that holds an 80.9 percent equity stake in the firm, Reuters reported. Houston-based Aegis laid off 782 of 1,305 employees on Aug. 7 but is continuing to service loans, Reuters said. In other news, subprime lender Accredited Home Lenders said it filed a lawsuit against Lone Star Funds after Lone Star allegedly backed out of a $400 million deal to acquire the troubled San Diego-based lender. Accredited originated $1.7 billion in mortgage loans during the second quarter, down 59 percent from the same time last year, the lender said in a Securities and Exchange Commission filing, and expects losses for the quarter will total $40 million to ...

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