Industry News

Accredited Home Lenders gets $200 million cash infusion

Subprime lender will pay 13% interest on rescue loan

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Accredited Home Lenders Holding Co. will pay 13 percent interest on a five-year, $200 million loan that will help the subprime lender stay afloat. In addition to the high interest rate, the loan from Farallon Capital Management LLC comes with other strings attached, the company said Tuesday in a Securities and Exchange Commission filing. Farallon will get options to buy 3.3 million shares at a price of $10 each, which it has 10 years to exercise. Farallon will also have the right to purchase additional securities, the filing said. Accredited Home Lenders announced last week it was selling nearly all of its warehouse and other loans -- $2.7 billion in total -- at a discount of $150 million. The lender retained only $120 million in loans, most of them originated since March 7. The company has said it is the subject a delisting procedure by the NASDAQ stock market for failing to file its annual report on March 15, and is the target of a class-action lawsuit alleging that company officia...