Wilmington Finance to Halt Wholesale Mortgage Lending

June 17, 2008 No Comments »

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Wilmington Finance announced today that it will halt wholesale mortgage lending effective immediately, but noted that it will honor existing commitments in the loan pipeline.

As a result of the closure, roughly 355 jobs will be eliminated, although the company said it will provide outplacement services to assist affected employees.

The non-conforming residential mortgage lender said it will continue to offer loans via its direct, retail channel, but at a reduced scale.

A slew of mortgage lenders have attempted to scale down operations and stick around in the event that the mortgage industry outlook brightens, though it appears that more are beginning to cut their losses entirely.

According to the company’s website, the Philadelphia-based lender offered home loans up to 95 percent loan-to-value, reduced documentation loans (stated income loans), and loans for borrowers with less-than-perfect credit.

The company has/had 11 wholesale regional offices in places like Livermore, CA, Charlotte, NC, and Tampa, FL, along with three retail offices in Plymouth Meeting, PA, Greenwood Village, CO, and Newark, DE.

Wilmington Finance is a unit of American International Group (AIG), which provides an array of insurance and financial services worldwide.

AIG has been hit hard by the mortgage crisis, both through its mortgage lending unit and mortgage insurance business AIG United Guaranty.

Shares of the financial giant hit a fresh 52-week low after today’s news, falling $1.80, or 5.29%, to $32.21.

(photo: imuttoo)

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