B of A Nixes Sale of Correspondent Unit, Will Close It Instead
After several weeks of negotiations, Bank of America and Fortress Investments have ended talks over the bank selling its correspondent mortgage division to the publicly traded investment fund, officials close to the deal told National Mortgage News late Monday.
B of A spokesman confirmed to NMN that the correspondent unit will close by yearend, affecting 1,200 workers. "We will wind it down," he said. "We wil honor all rate locks up until October 30."
Sources said price was a major factor with Fortress insisting that B of A "pay them to take the thing off their hands," said one advisor.
In late August the bank said it would try to sell the unit, and if unsuccessful, would shutter the business.
In the second quarter B of A bought roughly $21.8 billion of loans from correspondents, ranking a somewhat close second to Wells Fargo which bought $26 billion, according to figures compiled by NMN and the Quarterly Data Report.