Posted by Becca_FL on 3/4/07 7:15pm
Msg #178258

Sub-prime market updates...Another one bites the dust

Something tells me the unemployment rate is going to rise for Q1 07, thanks to the many lenders closing shop all over the Nation.


Posted on a comment on the housingdoom blog:

This is from Yahoo Message Board for Fremont

-----Original Message-----
From: xxx
Sent: Sun 3/4/2007 4:22 AM
To: *Tampa 2 Office; *Tampa 1 Office; *ResRe Tampa 1 AE
Subject: Fremont ceasing doing business.

Teams,

It is with great regret that I must inform you that Fremont Investment and Loan will cease funding loans and doing business.

At 12:35 (pst) Saturday, Fremont General received notice from the FDIC that they are not permitting any more loans to be funded by Fremont. In short, our funding available was terminated by the Federal Home bank.

The suddenness of the change and the shift from our communication literally less then 24 hours previously simply perplexes me. However, this simply validates the volatility on our business. None of us in Hawaii realized or appreciated the gravity of the situation we were facing.

There are many questions that many of you have. There is a conference call that will be conducted on Monday that will answer many of these questions that you will have.

XXX will be able to communicate with you more specifics on Monday morning. Please show up for work to receive these instructions. I will be leaving the meeting here in Hawaii early and attempting to return to the office sometime on Monday.

In order to assist our clients with some instructions- I have listed some Q and A's to assist you in your communications:

Q: Do I continue to solicit loans?
A: No. As of the 3rd, we are no longer sourcing new business.

Q: Will I close what is in the pipeline?
A: This will be clarified on Monday. I would suggest to sent back all loans to the broker

Q: What do I tell the brokers?
A: Fremont Investment and loan is no longer conducting business. Any files that are pending or have been submitted will be returned to you.

Q: Will I get paid for the loans closed?
A: Yes.

Q: Does termination take effect immediately?
A: Clarification on this item will be determined on Monday.

Q: What about benefits and severance?
A: This will all be clarified on Monday or the early part of the week.

Everyone, I cannot tell you how sadly I am disappointed this industry has trended so deeply in this direction. You all have accepted me so warmly upon my arrival at Fremont and I will always cherish those relationships forever. At this point, I wish I had more information to share with all of you but I simply do not. My travel logistics are extremely complicated right now and hopefully I will have more information in the next 24 hours.

So I do not lose valuable contact with any of you, please forward to XXX your cell phone, home phone and home address. I would like to keep this information as we begin to search for alternative strategies to consider.

XXX

Reply by ZeeCA on 3/4/07 7:22pm
Msg #178259

interesting that they made the decision on a sunday and they

say they will pay for loans prev closed.... that will be interesting if they do as any company's only responsibility is the govt and employes than what ever is left.............. creditors....

Reply by Becca_FL on 3/4/07 8:56pm
Msg #178261

It gets better...

From Mortgage Implode site

Update, March 4th 2006: Fremont AEs and others report that FIL has apparently been shut down by the FDIC. That would seem to be the nail in Fremont's coffin.

Amusingly, this happened while the Fremont execs were all on their annual trip to Hawaii. Complacent AEs take note: collapsing does not wait till it is convenient for you.


All I can think about are the people that lost their jobs while the Execs were in HI drinking Daiquiris and eating pork fat. Sad.

Reply by ZeeCA on 3/4/07 9:09pm
Msg #178263

sad, sad, sad..... and golden parachutes will open.... n/m

Reply by pan/nd on 3/4/07 9:12pm
Msg #178264

Re: sad, sad, sad..... and golden parachutes will open....

In this case..I doubt there will be any golden parachutes.

I think a lead balloon will be more like it.

Reply by ZeeCA on 3/4/07 9:25pm
Msg #178265

high ranking execs will get something I am sure... n/m

Reply by Susan Fischer on 3/4/07 10:15pm
Msg #178270

Yeah, sued! n/m

Reply by MistarellaFL on 3/4/07 9:55pm
Msg #178267

Taking notes, folks?

What this infers to me is that things may get a little hairy and scary for 07.
I feel for all the lender employees who will be losing their jobs, and the new
NSAs that have been churned out by the XXX. Demand for new agents will surely
be reduced, and late-comers may not be able to stick it out with experienced
agents. Historically speaking, this could be the start of a
new recession.

Reply by Susan Fischer on 3/4/07 10:12pm
Msg #178269

I've been reading all day. Man, oh, manohman.

And the stories get more sorid by the hour. The arrogance and greed of some of these people turns my stomach - and the ranks of the unemployed are growing by the thousands by their hands.

And Greenspan's saying the R word...

Reply by John_NorCal on 3/4/07 10:48pm
Msg #178273

Re: I've been reading all day. Man, oh, manohman.

**And Greenspan's saying the R word... ***

I hope not... He isn't head of the Fed anymore. It's Bernanke....

Reply by Susan Fischer on 3/4/07 11:00pm
Msg #178274

Re: I've been reading all day. Man, oh, manohman.

No kidding.

If you think people don't still listen to Greenspan, think again. Folks pay his $150K speaker's fee to hear his analyses.

Reply by Joan_OH on 3/4/07 10:36pm
Msg #178272

Lets not forget they will be looking for jobs.....

specifically ours. Not all of them, but some of them.

Joan-OH

Reply by Becca_FL on 3/4/07 11:56pm
Msg #178275

Joan, Don't cha know that crossed my mind too.

Thank goodness it's too slow for newbies right now. You'd have to be a masochist to enter this business now.

I'm sure glad I have stability, longevity and darn good clients at this point in the game.

Reply by Susan Fischer on 3/5/07 12:10am
Msg #178276

Re: Lets not forget they will be looking for jobs.....

Or maybe starting SSs?

Reply by Gary_CA on 3/5/07 2:49pm
Msg #178337

No just subprime...

I do value reports for foreclosures, short sales and the like... was looking at price/sales statistics this morning and it confirmed my hunch...

The huge price drops are in the high end homes... and I've done more than a couple of those for upside down loans too...

Not arguing about what y'all seein the sub primes, but it's more than that.

Overextended borrowers, ridiculously high LTV 's (100% of the inflated BS value from the mercenary appraiser) and ridiculously low payments (neg am's and 2/28's, etc. etc.) are the problem.

Very commonly, but not exclusively, in the sub-prime market.

Bankers went from being incredibly fiscally conservative... to loaning to businesses without a profit plan in the 90's (the dot-gone boom) to loaning on homes as if they would always appreciate every year without exception).... it's almost like they all ate the same brownies or something.

Me thinks they'll be getting back to their conservative selves soon.

Reply by Becca_FL on 3/5/07 7:00pm
Msg #178380

Re: No just subprime...Gary

".... it's almost like they all ate the same brownies or something."

Spoken like a true Californian...too funny. :O