Citi Mortgage’s Home Mortgage Review

CitiGroup’s home mortgage subsidiary is Citi Mortgage. This banking group was one of the institutions most hurt by the subprime lending crisis and has subsequently lost billions in stock value and has had to retrench several thousand of its employees. CitiGroup’s new CEO, Vikram Pandit had taken all of the group’s mortgage activities and merged them into one entity, Citi Mortgage. In doing so, Mr. Pandit seeked to improve the control over the group’s mortgage practice as well as reduce the confusion brought about by maintaining several subsidiaries.

Citi Mortgage, which advertises their mortgage as Pay Less Now, Get More Now,  offers VA and FHA mortgages, as well as fixed rate conventional mortgages that are available at fixed rates for 15 or 30 years. They also offer several variable rate mortgages that start with an introductory fixed rate and then switch to a variable rate that depends on the prime for the rest of the loan.

Citi Mortgage is a part of Citigroup, one of the major issuers of subprime loans, and one of the most heavily damaged by the housing downturn and the subprime lending crisis. In November of 2007 Citigroup took a $7.5 billion loan from Abu Dhabi on poor terms just to stay afloat after suffering staggering losses. Shortly thereafter, Citigroup replaced its CEO.

Citibank planns to reduce it’s holdings by 20% in residential mortgages. This equates to about 45 billions dollars, to reduce their holdings in riskier assets and reduce their subprime losses. It plans to sell about 90% of it’s home loans and only allowing new home loans which they plan to hold on to.

All this increased toxic attitude towards new mortgages makes Citi Mortgage a hard place to get a new loan and it might not be the best place for homebuyers to go to in trying to get a home mortgage.

Visit their website at http://www.mortgage.com

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