In Brief: Westmark Stepping In As Credit Depot Folds

Westmark Group Holdings Inc. has agreed to assume the wholesale subprime mortgage production capabilities of Credit Depot Corp., a Gainesville, Ga., company that is liquidating its holdings.

For Westmark, parent of Westmark Mortgage Corp., the transaction represents a continuation of its mergers, acquisitions, and growth strategy. In mid-October Westmark acquired the wholesale mortgage assets of Prestige Financial Services Corp. of Boynton Beach, Fla.

Credit Depot, one of many subprime mortgage lenders that ran into trouble due to the liquidity crisis, said Monday that it would close its loan origination network and liquidate its holdings.

The agreement gives Westmark the right to re-underwrite and close all loans now being originated by Credit Depot. Westmark will then pay Credit Depot an agreed-upon fee on only those loans that meet Westmark Group's underwriting criteria and are funded by Westmark.

Credit Depot said it intends to remain open for a time to honor its mortgage loan funding commitments and to liquidate its warehoused loan portfolio.

The company said that during the next several weeks it will ask creditors to approve its liquidation plan. It is anticipated that no distributions will be available for the stockholders.

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