ResMae Mortgage Corp., a U.S. home lender to people with bad credit, filed for bankruptcy protection and said Switzerland's Credit Suisse Group agreed to buy most of its assets for $19.1 million.
``The subprime mortgage market has recently been crippled,'' ResMae said in its Chapter 11 filing yesterday. The company didn't have enough reserves to cope with an ``enormous'' surge in loan defaults, it said.
Closely held ResMae is at least the 20th mortgage company to be sold or closed as delinquencies rise and the market for home loans to risky borrowers contracts at the fastest pace ever, according to a Bloomberg tally of company announcements. Credit Suisse rivals Merrill Lynch & Co., Morgan Stanley and Barclays Plc are swooping in, buying home lenders to produce more revenue from packaging the loans into bonds.
WOW -- I had not realized the number of SPM lenders to either be sold or closed was at 20. I've followed the big stories of the last few months, but I have obviously missed a few.
I was listened to the Biz radio network today, and they mentioned the next domino to fall would be the mortgage insurers. That makes a lot of sense.