American Home Mortgage to close Friday

[Mojorabbit]

Source: reuters

NEW YORK (Reuters) - American Home Mortgage Investment Corp. plans to close most operations on Friday and said nearly 7,000 employees will lose their jobs as the lender becomes one of the biggest casualties of the U.S. housing downturn.

Experts said it is likely the Melville, New York-based company will have to seek bankruptcy protection, and no later than Monday.

In a statement, American Home on Thursday night confirmed earlier reports that it was ceasing most operations. The company said its employee base will be reduced to about 750 workers, down from the 7,409 it reported at the end of last year. The terminations are effective Friday.

Read more: http://www.reuters.com/article/ousiv/idUSN0245508920070803

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More people out of work.

[rpannier]

1. While I'm sorry these people are out of work...This part from the story makes me less sorry the

company is going out of business:

About half of those mortgages were adjustable-rate loans, whose defining feature is an interest rate that can be adjusted upward.

Companies the provide these loans are on level with predatory lenders (IMO)

[Connonym]

2. I'm in total agreement

I'm a pretty intelligent person but even I got sucked in on a predatory loan. There's fine print in those contracts that require the Hubble telescope to view. Fuck them all and the horse they came in on. Banking in the US has become a predatory animal and it's time for some oversight that helps the people and not the banks.

[mancandy]

8. I agree, but we also need to

increase federal presence in the mortgage industry to help protect banks (by insuring mortgages for low and middle income earners) and borrowers (by having fed insurances, a much lower and fixed interest rate).

[OzarkDem]

12. Student loans are the new predatory lenders

They're the worst I've ever seen. I pity a lot of kids who will be stuck with the equivalent of a major mortgage payment when they graduate from college.

[Skittles]

15. it is criminal they way they are preying on students

absolutely unconscionable

[sarcasmo]

3. The Arm Mortgages have really hurt this industry.

I sure hope consumers have learned the lesson to stay away from ARM. Kick and NOM.

[Gregorian]

6. And there was Greenspan, just promoting them publicly.

Many of us were in awe when we saw him doing that. Now Greenspan of all people knew better.

The question I ask is why he did that. What bigger reason was there for him to be doing that lie.

[sarcasmo]

7. If you look at his portfolio I bet he owned something in a sub prime Mortgage company somewhere.

Just a hunch.

[OzarkDem]

11. Someone was paying him, most likely

He's "retired", doncha know?

[Tempest]

4. There's a lot more than 7,000 people losing their homes

Because of the lending practices of the company.

[BigDDem]

5. People who cant figure out what

"adjustable rate" means have no business getting a mortgage.

P.S. "adjustable" can go up or down, not a hard concept

[mbperrin]

16. Trouble is, they were sold HARD to get a mortgage.

And ARMS go up. Never heard of one going down, regardless of the rest of the interest rates in the real world. Thankfully, we used owner financing and skipped all the bank bs altogether.

[MGKrebs]

9. Sad that it's harder for individuals to file bankruptcy, while

companies that insist on gaining more clients by offering credit to less and less qualified people can continue to walk away from most of their self-created risk and debt.

[redqueen]

13. More than sad... IMO it's criminal. n/t

[NewYorkerfromMass]

10. $59 billion in loans originated last year

American Home, founded in 1987, by its own reckoning had become the 10th largest U.S. retail mortgage lender, originating $59 billion in loans last year.

[Phrogman]

14. Article of interest...

http://www.larouchepub.com/other/2007/3430bank_failure_crash.html