amazing..after reading their news on Tues. I was a little weary about this one. I almost sold it for a tiny loss the other day. Glad I DIDN'T!
Thurs, March 20
Fremont to Sell Loan Servicing Rights
Fremont General to Sell Mortgage Servicing Rights to Carrington Capital for Undisclosed Price
BREA, Calif. (AP) -- Financial services company Fremont General Corp. said Thursday will sell the servicing rights on certain securitized mortgage loans to a subsidiary of Carrington Capital Management LLC for an undisclosed amount.
The underlying mortgage loans have a total remaining principal balance of about $1.9 billion, or roughly 13 percent of the total remaining principal balance currently serviced by Fremont.
In addition to the purchase price, Fremont will be reimbursed over a 12-month period for outstanding advances it previously made up to the expected closing date of April 1.
Carrington is not acquiring the bank's servicing platform, nor is it assuming any of the bank's pre-closing liabilities, Fremont said.
The mortgage servicing rights represent the present value of expected fees that are paid out of the securitized loan pools for activities such as loan collection, customer service and loss mitigation.
The sale of these rights means the collection, customer service and loss mitigation activities on the related loans will become the responsibility of Carrington upon closing of the deal.
Fremont General has been struggling to turn itself around following the collapse of the subprime mortgage industry.
Earlier this month, the company said it received default notices on $3.15 billion in subprime mortgages it sold to investors a year ago. It also warned it likely would fail to meet conditions of the deal that call for the bank to maintain a minimum net worth or buy back the loans.
Fremont shares rose 2 cents, or 4.8 percent, to close at 44 cents. Shares continued to rise in aftermarket electronic trading, gaining 15 cents, or 34 percent, to 59 cents.
It closed in the green 0.19 with a change percentage at 45%..I leave for 2hrs and come back to see this great news!! I'll be looking to get out early next week!