HomeBanc Corp. Announces Intention to Exit the Mortgage Loan Origination Business
ATLANTA, Aug 07, 2007 /PRNewswire-FirstCall via COMTEX News Network/ — HomeBanc Corp. (“HomeBanc” or “the Company”) today announced that it intends to exit the mortgage loan origination business. The Company at present is unable to borrow on its credit facilities and was unable to fund its mortgage loan funding obligations beginning August 6, 2007. Accordingly, the Company does not anticipate funding any future mortgage loans, and is no longer accepting any mortgage loan applications or funding any mortgage loans previously originated and not yet funded. The Company is seeking the most appropriate course of action to preserve the value of its remaining assets.
Kevin D. Race, HomeBanc’s President and Chief Executive Officer, stated, “In light of the extraordinary difficulties that HomeBanc continues to face in the mortgage loan origination market, we feel that it is in the best interests of the Company to exit this business so that we can focus on preserving the value of our investment portfolio assets and loan servicing operations.”
HomeBanc also announced that it has reached agreement with Countrywide Financial Corporation (NYSE: CFC) whereby Countrywide will acquire certain assets related to HomeBanc’s retail loan origination operations, including up to five branches located in Georgia, Florida and North Carolina, and will assume the leases related to those branches. In addition, Countrywide expects to make offers of employment to substantially all of HomeBanc’s retail loan originators. Countrywide will pay no cash premium in this transaction and will not acquire any other assets or assume any other liabilities related to HomeBanc. This transaction, which is subject to certain conditions, is expected to close by August 10, 2007.
Homebanc has maintained a strong presence in the Orlando market for years and their exit just personifies the state of the crashing real estate market here.