Secondary market specialist Capital Markets Cooperative
acquired Cunningham & Co.
, a mortgage lender approved to sell and service loans backed by Fannie Mae
and Freddie Mac
Cunningham & Co. is also an approved issuer of Ginnie Mae
securities, which mostly contain Federal Housing Administration
and Veterans Affairs
mortgages. CMC is owned by a cooperative of investors, including WL Ross & Co
. The company funds a variety of banks, which combined originate more than $25 billion in mortgages each year.
If regulators approve the purchase, CMC will own 100% of Cunningham common stock. Financial terms weren't disclosed.
"While our current correspondent partners will continue to purchase the majority of loans originated by our customers, this acquisition will provide additional liquidity," said Tom Millon, CMC president and founder. "The Cunningham platform will enable loan sales directly from our customers to Fannie Mae and Freddie Mac, the issuance of Ginnie Mae securities, and the retention of mortgage servicing rights."
The GSEs and Ginnie Mae currently fund 95% of the mortgage market.
Hank Cunningham will remain the bank's CEO. His management team will transfer as part the sale, too.
"It creates opportunities for us to grow our production platform, to retain servicing when economically viable, and to capitalize on changes in our rapidly-evolving industry," Cunningham said.
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