Capitol Commerce Mortgage Co., a wholesale mortgage bank with offices in eight states, abruptly ceased operation last week, California loan brokers said.
The Sacramento lender, which observers said priced loans more aggressively than competitors, ranked among the top 15 mortgage banks in its home state. It also had offices in Oregon, Washington, Arizona, Florida, Illinois, Texas, and Colorado.
Capitol Commerce informed brokers late last week that it had "ceased conducting new business," the Sacramento Bee newspaper reported Friday. The company left, it to the brokers to break the news to people who had loans pending.
A message left at Capitol Commerce's corporate offices was not returned by press time.
Industry observers said the company might not have hedged properly for the recent jump in mortgage rates, which depressed the prices at which it could sell loans in the secondary market. They problem may have been compounded, they said, by more applications, closing than the company had expected.
Capital Commerce financed $3.7 billion of mortgages last month, one of the busiest in its 17-year history, its account executives told The Associated Press.
