Servicing/Default
MH Specialist Origen to Sell Servicing Ops to Green Tree
By PAUL JACKSON
May 1, 2008 12:57 PM CST
Origen Financial, Inc. (ORGN: 0.68 0.00%), a manfuactured home lending and servicing specialist, said late Wednesday that it would sell its servicing platform to St. Paul, Minn.-based Green Tree Servicing LLC, which already serviced the nation’s largest portfolio of manufactured housing loans.
The deal involves approximately $1.6 billion of manufactured housing loans, Origen said in a press statement. Green Tree will also assume the lease for Origen’s Fort Worth, Texas-based servicing facility.
The sale comes as Southfield, Mich.-based Origen has been sent reeling by a frozen secondary market; the company announced on March 17 that it had suspended portfolio originations and sold loans held for sale at a substantial loss in an effort to pay off credit facilities. Origen CEO Ronald Klein said Wednesday that proceeds from the servicing sale would be used to retire a $15 million loan, and to partially repay a $46 million secured loan facility entered into in April 2008.
“With the agreement to sell our servicing platform, we are focused on trying to sell our origination platform assets and right size our employee and cost structure to accommodate the continued management of our $1 billion securitized loan portfolio,” Klein said.
“The servicing sale does not reflect on the credit performance or long-term realizable value of Origen’s loan portfolio, which in management’s opinion continues to remain very high. We are pleased that in Green Tree, we have a new servicer for our loans that enjoys a well-deserved reputation for excellence and expertise as a manufactured home loan servicer.”
Shares of Origen had risen sharply on the NASDAQ after the news, and were up nearly 8 percent in heavy trading on Thursday.
For more information, visit http://www.gtservicing.com and http://www.origenfinancial.com.
Disclosure: The author held no positions in ORGN when this story was originally published. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.
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