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C » Topics » First Mortgages: December 31, 2008

These excerpts taken from the C 10-K filed Feb 27, 2009.

First Mortgages: December 31, 2008

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held-for-sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

As of December 31, 2008, approximately 43% of the first mortgage portfolio was originated through the correspondent channel, a reduction from approximately 47% as of the end of 2007. Given that loans originated through correspondents have exhibited higher 90+DPD delinquency rates than retail originated mortgages, the Company terminated business with a number of correspondent sellers in 2007 and 2008. During 2008, over 96% of the loans originated through this channel were eligible to be sold to the GSEs. During 2008, the Company has severed relationships with a number of brokers, only maintaining those who have produced strong, high-quality and profitable volume.

First Mortgages: December 31, 2008

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held-for-sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

As of December 31, 2008, approximately 43% of the first mortgage portfolio was originated through the correspondent channel, a reduction from approximately 47% as of the end of 2007. Given that loans originated through correspondents have exhibited higher 90+DPD delinquency rates than retail originated mortgages, the Company terminated business with a number of correspondent sellers in 2007 and 2008. During 2008, over 96% of the loans originated through this channel were eligible to be sold to the GSEs. During 2008, the Company has severed relationships with a number of brokers, only maintaining those who have produced strong, high-quality and profitable volume.

Second Mortgages: December 31, 2008

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.

For second mortgages, approximately 54% of the loans were originated through third-party channels. As these mortgages have demonstrated a higher incidence of delinquencies, the Company no longer originates second mortgages through third-party channels, which represented 59% of the portfolio as of the end of 2007.


 

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By State

Approximately half of the Company’s U.S. Consumer mortgage portfolio remains concentrated in five states: California, New York, Florida, Illinois, and Texas. Those states represent 49% of first mortgages and 57% of second mortgages.

During 2008, unemployment was the key driver of delinquencies: despite sharp differences in the quality of their portfolio, California and Florida experienced above average rises in 90+DPD. California, which has only 3% of its first mortgage portfolio originated in the FICO<620 band, experienced a 2.7 times rise in delinquencies, to 4.13%. Florida, which has 21% of its loans in that FICO band, also suffered a similar rise in delinquencies, albeit to a much higher rate of 12.24%. Texas, despite having 34% of its portfolio originated with FICO<620, experienced a relatively mild rise in delinquencies, a consequence of its below average increase in unemployment rate.

Second Mortgages: December 31, 2008

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.

For second mortgages, approximately 54% of the loans were originated through third-party channels. As these mortgages have demonstrated a higher incidence of delinquencies, the Company no longer originates second mortgages through third-party channels, which represented 59% of the portfolio as of the end of 2007.


 

63

Table of Contents

 

By State

Approximately half of the Company’s U.S. Consumer mortgage portfolio remains concentrated in five states: California, New York, Florida, Illinois, and Texas. Those states represent 49% of first mortgages and 57% of second mortgages.

During 2008, unemployment was the key driver of delinquencies: despite sharp differences in the quality of their portfolio, California and Florida experienced above average rises in 90+DPD. California, which has only 3% of its first mortgage portfolio originated in the FICO<620 band, experienced a 2.7 times rise in delinquencies, to 4.13%. Florida, which has 21% of its loans in that FICO band, also suffered a similar rise in delinquencies, albeit to a much higher rate of 12.24%. Texas, despite having 34% of its portfolio originated with FICO<620, experienced a relatively mild rise in delinquencies, a consequence of its below average increase in unemployment rate.

First Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held for sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

In the second mortgage portfolio, Florida and California maintained above-average delinquencies, with approximately 18% and 22% of their loans originated in the LTV ³90% band.

First Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held for sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

In the second mortgage portfolio, Florida and California maintained above-average delinquencies, with approximately 18% and 22% of their loans originated in the LTV ³90% band.

Second Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.

 

By Vintage

Approximately half of the Company’s U.S. Consumer mortgage portfolio consisted of 2006 and 2007 vintages, which demonstrated above average delinquencies. In first mortgages, approximately 45% of the portfolio is of 2006 and 2007 vintages, which on aggregate have a 90+DPD of 8.15%, well above the 5.66% of the overall portfolio. Approximately 43% is pre-2005 vintage, with an aggregated delinquency of 4.28%. In second mortgages, slightly over 61% of the portfolio is of 2006 and 2007 vintages and approximately 33% is pre-2005 vintage.

Second Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.

 

By Vintage

Approximately half of the Company’s U.S. Consumer mortgage portfolio consisted of 2006 and 2007 vintages, which demonstrated above average delinquencies. In first mortgages, approximately 45% of the portfolio is of 2006 and 2007 vintages, which on aggregate have a 90+DPD of 8.15%, well above the 5.66% of the overall portfolio. Approximately 43% is pre-2005 vintage, with an aggregated delinquency of 4.28%. In second mortgages, slightly over 61% of the portfolio is of 2006 and 2007 vintages and approximately 33% is pre-2005 vintage.

First Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held for sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

First Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. $134 billion portfolio excludes Canada and Puerto Rico, First Collateral Services (commercial portfolio), deferred fees/costs, loans held for sale and loans sold with recourse. Excluding Government insured loans, 90+DPD for the first mortgage portfolio is 5.13%.

Second Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.


 

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Table of Contents

 

Second Mortgages: December 31, 2008

 

LOGO

Note: Data at origination. Second mortgage 90+DPD rate calculated by OTS methodology.


 

64

Table of Contents

 

EXCERPTS ON THIS PAGE:

10-K (12 sections)
Feb 27, 2009

RELATED TOPICS for C:

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