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  • Bank of America Corp. (BAC) Not to Accept Third-Party Broker Mortgage Applications

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    Wednesday Oct. 6, 2010 at 11:25 pm EST
     
    Bank of America Corp. (BAC) getting Strict on 3rd Party Mortgage Applications
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    Bank of America Corp. (BAC)Bank of America announced today that it will leave the business of making mortgage loan through the third-party brokers. The bank said that this move will allow to devote more resources to direct mortgage loans to the consumers. It will still continue corresponding lending business. Corresponding lending refers to any loans originated by credit unions, community banks and other lenders, which are later purchased by Bank of America Corp. They have stopped accepting new applications from brokers, but will complete the in-process applications. Initially in 2007, BofA had taken a similar step of not accepting applications from third party brokers, but it got back into this business in 2008 after it bought Countrywide Financial Corp.

    Barbara Desoer, president of BofA Home Loans said in a statement, "By exiting the first mortgage wholesale channel, we can redirect critical operational resources to further enhance our capabilities in direct-to-consumer channels." BofA reported that in 2009 it held 22 percent of the retail mortgage lending market, citing Inside Mortgage Finance statistics. The wholesale market, the broker originated loans, consisted of around 8 percent share, whereas its corresponding lending share was around 26 percent. Bank spokesman Dan Frahm said that around 1000 employees of BofA work in the wholesale business, in Texas, California, Arizona and Florida. Majority of these employees will be given a chance to move to the other sector of mortgage.

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