Magazine article American Banker

Booming Business of Distressed Assets

Magazine article American Banker

Booming Business of Distressed Assets

Article excerpt

Byline: Lew Sichelman

The sale of distressed assets has become one of the largest segments of the mortgage business, panelists at the Mortgage Bankers Association's Secondary Market Conference in New York agreed.

John Daurio, chairman of Kondaur Capital in Orange, Calif., told a standing-room-only session Monday that since March 31 roughly $10 billion worth of nonperforming mortgages has been put up for sale - "more than we've seen cumulatively over the last couple of years."

Only 30% of that total has actually changed hands, because many sellers are simply "feeling" the market, Daurio said. "But even at that, far more has traded than in previous years."

A lot more sales can be expected in the future, said James Lockhart, the former director of the Federal Housing Finance Agency (the conservator for Fannie Mae and Freddie Mac) and now vice chairman at WL Ross& Co. …

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