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Bloomberg.com - June 24, 2009 |
Citi Halts Mortgage Applications
 - MBS' David Lykken Quoted by Bloomberg.com -
Bloomberg.com – June 24, 2009 – Citigroup Inc. suspended loan applications at a unit that produced half of its $115 billion in mortgages last year after a review found that some property appraisals and income-verification documents were missing.
The suspension of correspondent lending is “a bold step” that may frustrate Citigroup’s mortgage-banking partners and put them on notice that the company will no longer tolerate incomplete loan submissions, said David Lykken, managing partner at consultant Mortgage Banking Solutions in Austin, Texas.
“You need to have a hard stop,” Lykken said. “It is better to pull people off the line, and have a thorough re-education of what goes into a loan, so they can come back and do this the right way.”
Independent mortgage bankers trying to unload their loans during the suspension will have to turn to Citigroup’s competitors, Lykken said.
Click here to read the entire article from Bloomberg.com. |
