If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Fremont General, the parent company of the Investment and Loan that was slapped with a cease-and-desist order for its role in questionable subprime lending, was downgraded by ratings agencies and faces liquidity concerns reports Market Watch.
From the article covering Fremont’s downgrade and liquidity concerns:
Standard & Poor’s downgraded Fremont General to CCC+ from B- late Tuesday and warned that the Californian lender may not be able to meet its debt obligations. “Liquidity at the holding company has deteriorated substantially,” S&P credit analyst Adom Rosengarten said in a statement. Liquidity remains strong at the company’s banking business. But Fremont has been hit with a cease-and-desist order from regulators which restricts the bank unit from paying dividends to the holding company during the past year, the analyst noted. That’s greatly decreased liquidity levels at the parent company, he said. “We have concerns about the parent’s ability to meet its debt obligations, given our assessment of its reduced cash holdings,” Rosengarten concluded.
Fremont Investment and Loan was known as one of the most “subprime” of all the subprime lenders with underwriting guidelines that were nearly non-existent. Their lending practices got them in to hot water with Feds back at the beginning of the crisis when they were served with an order that prohibits the bank from making mortgage loans and paying dividends to parent company choking off cash flow needed to service the existing debt of the company.
Dang, wish I had a chance to work for that company befor the $h*t hit the fan…
Kind of amusing…the house around the corner from me was is now owned by Freemont, listed for almost 200K less than what they were on the hook for. Never could understand what the previous own did for a living, and how he could drive around in a new Escalade. It’s all making sense now.
I worked for Fremont in the Foreclosure/Loss Mitigation Department for several years. Non-existant underwriting guidelines is an understatement. Fremont got exactly what they deserved!
how does one get to talk to a real person/decision maker in this company? Have been trying since this summer to work with these people to save our home and get someone to work with us!!
wendy rob » Great question. now that the mortgage division is closed you may have a hard time reaching folks. I recommend also trying the Hope Now Alliance: Hope Now has supported a toll-free hotline, 1-888-995-HOPE, which is available 24-hours a day to provide mortgage counseling in multiple languages.
Morgan,
We are seeing lots of bank-owned properties now hitting our market - seems we’re moving past the short sale phase and into the liquidating inventory stage. I feel for the seller who are relocating or getting divorced - your neighbor’s house is killing your equity!