Aug 6, 2007 - National City, Cerberus Halt New Mortgage Applications
National City Corp., the largest bank the Midwest U.S., announced that its home mortgage unit stopped taking mortgage applications today.
Separately, Aegis Mortgage Corp., a unit of Cerberus Capital Management announced that it too was no longer accepting new applications.
Both companies cited problems in the secondary mortgage market. Buyers for their mortgages had evaporated.
Nat City allowed that it might continue originating only mortgages that could be readily sold to FNMA or Freddie Mac.
It also said it would halt the origination of home equity loans sourced through mortgage brokers.
One month later, it laid off 1,300 employees in its mortgage unit.
On Oct 23, 2008, Nat City was acquired by PNC which eventually wrote off $12.6B of Nat City's loan portfolio.
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