IRVING, Texas--(BUSINESS WIRE)--American Home Mortgage Servicing, Inc. wishes to issue the following clarification to its release, NewsItemID 20090205005406, (TX-AHMSI) "American Home Mortgage Servicing, Inc. Acquires Servicing Rights for 185,000 Loans from Citi Residential Lending" issued earlier Thursday:
To clarify what assets are included in American Home Mortgage Servicing, Inc.’s (AHMSi’s) acquisition from Citi Residential Lending, AHMSI CEO David Friedman provided this further background: “No actual mortgage loans were part of the transaction. The acquired assets consisted principally of advances made on behalf of borrowers who are in arrears and of the Master Servicing Rights pursuant to which the loans are serviced. Mortgage servicing consists of collecting payments from homeowners, remitting them to appropriate parties and managing the default cycle. The transaction with Citi Residential Lending is similar to AHMSI’s earlier acquisitions from Option One and other sellers of servicing. In addition, while $1.5 billion has been described in a number of media reports as a “payment” in the transaction for the Master Servicing Rights, the vast portion of this amount is related to outstanding servicing advances.”
Following is the original release in its entirety:
AMERICAN HOME MORTGAGE SERVICING, INC. ACQUIRES SERVICING RIGHTS FOR 185,000 LOANS FROM CITI RESIDENTIAL LENDING
American Home Mortgage Servicing, Inc. (“AHMSI”) has signed an agreement with Citi Residential Lending to acquire a servicing rights portfolio on 185,000 loans. AHMSI will board the loans in early February. Customers were notified of the servicing change during the last week of January.
“With this acquisition, we have increased the number of loans we service to approximately 575,000, an increase of 45 percent,” said David Friedman, Chief Executive Officer. “The loans are a great fit with our existing portfolio, and we look forward to serving a new group of homeowners.”
Established in April, 2008 by WL Ross and Co. LLC., AHMSI is one of the country’s largest residential mortgage loan servicers of Alt-A and sub-prime loans. The company is headquartered in Irving, Texas, and operates as well through locations in Irvine, California; Jacksonville, Florida; and Pune, India. As of Dec. 31, 2008, it managed a portfolio of more than $85 billion. Fitch recently announced an upgrade of AHMSI’s residential servicer rating for prime, Alt A and home equity lines of credit to RPS3+ from RPS3-, a two-level increase. Fitch also upgraded AHMSI's special servicer rating to RSS3+ from RSS3.
WL Ross and Co. LLC. founded by Wilbur L. Ross Jr., is a private equity firm based in New York City and currently oversees in excess of $8.0 billion in private investments. AHMSI is owned by several funds that are ultimately controlled by WL Ross. For more information about AHMSI, please visit its website at www.ahmsi3.com.