ACC Capital Holdings has announced it will close its retail lending unit Ameriquest and sell its wholesale mortgage lending and payment collection unit to Citigroup.
Citigroup will acquire its wholesale loan origination operation, the mortgage servicing business for $45 billion in loans, 2,000 employees, and other miscellaneous loans and assets.
Citigroup had originally obtained an option to buy the assets back in February when it extended credit to keep the ailing mortgage lender in business.
It is expected that Citigroup will take over where ACC left off, though as a much cleaner and low-risk operation.
Citigroup said in a statement that it would work to improve its efforts to ensure distressed borrowers stay in their homes, via loss mitigation tools like loan modifications.
Additionally, ACC announced that former subprime lending giant Ameriquest stopped taking loan applications on August 1st.
The lender had been relatively dormant since it agreed to pay $325 million to settle federal and state regulators’ claims of deceptive lending practices back in 2006.
The deal is expected to close today, though the cost of the acquisition has not been disclosed.
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