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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

Government to Boost Ownership in Citigroup

I just read this report from the Associated Press that the US Government is about to close a deal that will increase it’s onwership in the beleaguered owners of Citimortgage, Citigroup. This will result in another large cash infusion in the bank while at the same time increasing government’s control on that financial institution. It will then demand changes on the board of directors, and other changes it has not yet disclosed.

Continue reading Government to Boost Ownership in Citigroup

Citigroup to Sell it’s Mortgage Rights to Wilbur Ross Unit

From Bloomberg dated February 5:

Citigroup Inc. has agreed to sell it’s billing and collections rights for 185,000 mortgages to the American Home Mortgage Servicing Inc of Wilbur Ross. In return, Citigorup will get $1.5 billion, this is according to an e-mailed statement of the Irving, Texas-basd American Home. This transaction includes rights to mortgage servicing fees and also the temporary advances that Citigroup had made on behalf of delinquent borrowers to mortgage investors.

Despite this, there will be no material impact on overall results.

This transaction helps the company towards closing out the Citi Residential Lending which was a unit that was created when the bank bought the mortgage-servicing rights of ACC Capital Holdings, which amounts to 45 billion dollars. Afterwards, the bank consolidated it’s mortgage operations and decided to wind down Citi Residential Lending.

Citigroup rose 4 cents to $3.53 at 4:15 p.m. in New York Stock Exchange composite trading. The shares are down 47 percent this year.

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Read the news carefully today. You never know what you're gonna get. For recommended reading materials on mortgages and refinance aspects and how to fix your deeds or just plain news on real estate, check out the new york times online. It's a very good source of information.