IAC Vacancy
Thomas J. Reddin, the chief executive of IAC/InterActiveCorp.'s financial services and real estate division, which includes the lead-generation business LendingTree LLC, will leave the company May 7.
In an e-mail to co-workers describing his decision, Mr. Reddin said he planned to to spend more time with his family. He will take a year off and "then re-create myself in a new field."
A spokeswoman said Wednesday that a search was under way for Mr. Reddin's successor.
IAC, which is based in New York, also said Wednesday that it had named Bret Violette the president of both the RealEstate.com listings service and associated real estate brokerage operations that have been a part of Mr. Reddin's portfolio.
Mr. Violette, who joined RealEstate.com in 2005, will report to Doug Lebda, IAC's president, in his new role.
LendingTree, of Charlotte, said in March that it had
Ownit Invoked
The Center for Responsible Lending made fodder of comments Bill Dallas, the founder and chief executive of the bankrupt Ownit Mortgage Solutions, made to The New York Times.
During a New York University conference on mortgage fraud and predatory lending, Ellen Harnick, the chief policy counsel for the Durham, N.C., center, said Wednesday that regulation was needed to prevent predatory practices "if the market is providing incentives for unsound lending."
Ms. Harnick used quotes attributed to Mr. Dallas in the Jan. 26 issue of the Times to illustrate the secondary market's role in fueling unsavory lending practices. "The market is paying me to do a no-income-verification loan more than it is paying me to do the full documentation loans," he told the newspaper. "
She said her group advocated regulations that would force lenders to reimburse borrowers for the market value of their homes when they become victims of appraisal fraud.
Ms. Harnick said the center was already speaking with some lenders, as well as regulators and homeowners. "I think it depends on all of us," she said. "It certainly depends on the regulators."
In an email Wednesday night, Mr. Dallas wrote that his comments had been taken out of context.
Ninety percent of Ownit's customers provided full documentation, he wrote, but Merrill Lynch & Co., "our main loan buyer and market confidant at Ownit, told us to sell more stated [income] loans because we were leaving a quarter [point] on the table...We told ML we couldn't do it and stuck to our guns."
Merrill would not comment.
Colonial Expansion
Colonial Savings FA of Fort Worth, a thrift and mortgage lender, said Wednesday that it had agreed to acquire a package of servicing rights that would increase its servicing portfolio by 15%, to $12.7 billion.
Colonial will take over servicing on the 18,431 loans with a principal balance of about $1.7 billion from a Midwest bank on June 1.
The company, which has assets of close to $1 billion, did not say what it agreed to pay or name the seller.
The loans are primarily 15- and 30-year fixed-rate mortgages, J. David Motley, the president of Colonial's mortgage division, said in an interview Wednesday.
Colonial typically prefers to build its servicing portfolio through its originations, since it is generally cheaper than buying on the open market, but this was a uniquely attractive deal, Mr. Motley said.
"We're always in the market for good bargains on servicing," he said.
James E. DuBose, the company's chief executive, said in a news release that the acquisition would reduce Colonial's "average cost-to-service by approximately 16%."
As of June 30, Colonial was the
Checklist
A Chicago consulting firm has put together a list of
In a report released Tuesday, Huron Group said the questions were aimed at evaluating the credit risk and quality underlying subprime assets that are being sold.
Directors and executives should ask sellers of subprime portfolios about the effectiveness of antifraud controls and reliability of financial statements, as well as details about repurchase exposure, Huron Group said.
Alt-A Exposure
Frederick Cannon, an analyst at KBW Inc.'s Keefe, Bruyette & Woods Inc., says many large-cap mortgage lenders are "somewhat protected" from problems with alternative-A mortgages, which reached an estimated 32% of U.S. mortgage production in 2006.
In a report published Tuesday, Mr. Cannon wrote that alt-A makes up a small share of these lenders' overall businesses. But midcap banks, thrifts, and real estate investment trusts generally do not have the benefit of diversified balance sheets and may have relied on alt-A lending for gain-on-sale income, without setting aside appropriate reserves, he wrote.
Mr. Cannon wrote that he also saw the risk of early-payment defaults reducing income for lenders that relied on gain-on-sale from alt-A loans.
