Industry News

More problems in mortgage lending reported as Fed meets

Impac, Accredited, NovaStar detail losses, operational cutbacks

Several mortgage lenders issued reports this week detailing losses or cutbacks in operations as members of the Federal Reserve Board's Open Market Committee meet today to consider slashing the federal funds overnight rate. Among the reports: Impac Mortgage Holdings said it will stop funding Alt-A loans, the company's core business, citing market disruptions, illiquidity and lack of investor confidence. Accredited Home Lenders, which last month said it would close its retail lending business and lay off more than 1,000 workers, filing a belated report for the first quarter revealing it posted a $260.2 million loss. NovaStar Financial Inc. said it will relinquish its status as a real estate investment trust (REIT) because it could not pay the required $157 million dividend -- a move that will subject the company to a retroactive tax bill. Lehman Brothers Holdings Inc. said after adjusting for gains for hedging, it was forced to reduce by $700 million the value of fixed-income in...