Not only is HomeBanc closing up their mortgage lending business, they have filed for Chapter 11 bankruptcy protection.
HomeBanc Corp., the Atlanta-based mortgage lender that ceased new loan applications this week, has filed for Chapter 11 bankruptcy protection, the company’s investor relations director said Friday.
The filing was made late Thursday in Wilmington, Delaware, said Carol Knies, HomeBanc’s vice president of investor relations.
HomeBanc, which had been reorganizing operations amid stress in the housing market, said Monday it would sell its mortgage operations and related assets to Countrywide Financial Corp. because its no longer could access its credit lines to fund new loans.
HomeBanc has listed assets of $5.1 billion and debt of $4.9 billion according to the 22-page filing. Among its biggest creditors: JPMorgan Chase & Co., Fannie Mae, Freddie Mac, Wells Fargo Bank, Commerzbank AG, U.S. Bank, PriceWaterhouseCoopers and BNP Paribas.
Once the dust settles with all of these subprime lenders, we’re going to see a much bigger problem with the companies who financed them, you can bank on it.
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