Current news for this company:
Residential Capital, LLC - Subsidiary of GMAC
Update - 2008-06-03: Rescap's floundering becomes markedly more desperate. Today in Yahoo Business:
Update - 2008-05-06: Rescap has inched steadily closer to bankruptcy since our last update, as recent news suggests. Bloomberg reports today that GMAC "may keep the mortgage unit afloat long enough to find a buyer or break it up."
Yesterday, Rescap announced an offering to exchange $14 billion of notes to extend maturies between 2010 and 2015 for "as little as 80 cents on the dollar," Bloomberg reported. "To finance the debt restructuring, ResCap is seeking a new $3.5 billion credit line from its parent GMAC," the article notes.
Rescap admits even this may not be enough in it's Q1 8-K filing with the SEC:
"There is a significant risk that we will not be able to meet our debt service obligations, be unable to meet certain financial covenants in our credit facilities, and be in a negative liquidity position in June 2008."
Rescap (Residential Capital, LLC) is a wholly owned subsidiary of GMAC, LLC (which is owned by General Motors Corp. and Cerberus Capital Management L.P.). Rescap subsidiaries at risk of BK or being dumped include Ditech, GMAC Bank, GMAC Mortgage, and Homecomings Financial.
Update - 2008-04-24: In news we posted today, HousingWire reports Rescap "had borrowed $468 million ... against a $750 million credit facility" newly established with GMAC on 2008-04-18. Also of concern: $875 million in revolving credit and a $1.75 billion dollar loan, set to mature in June and July respectively.
On 2008-04-07 TheStreet reported that GMAC "bought ResCap debt with a face value of $1.2 billion in the open market for just $607 million" and "investors are questioning how long the company will continue to invest in ResCap to keep the second largest independent mortgage lender out of bankruptcy."
Update - 2008-02-22: In an article out today, S&P downgrades will put more pressure on GMAC to inject more money, or bail out:
Update - 2007-11-23: Rescap appears to be heading closer to the Imploded list per an article November 20, 2007:
Update (2007-10-26): Homecomings Financial is an indirect wholly owned subsidiary of GMAC LLC.
According to a Manager who is being laid off this week, Homecomings is closing all offices this year and will maintain one office in each of North Carolina, Texas, and Washington.
A Mortgage Broker in California received this from their AE:
"Homecomings Financial is going through a company wide restructuring due to the current market conditions. Unfortunately, we had to layoff 3,000 people today, which is 25% of our workforce. Our Newport Beach office will be closing as of December 31st, 2008 and migrating with the Bellevue, Washington office. In addition, in saddens me to say that every AE that has been with the company for less than 12 months has been layed off, which includes me..."
Another reader reports the following, which 'appears' to be an internal memo:
"Effective immediately, Homecomings Financial will be sharing customer information with its affiliate, GMAC Bank, which will evaluate qualified loan transactions for purchase. Before GMAC Bank can consider a loan for approval, Homecomings Financial must first obtain a complete and signed GMAC Bank Opt In Agreement from all borrowers listed on a loan application in order for the application to be reviewed, processed and underwritten by GMAC Bank. Homecomings Financial will return any loan applications that do not have a complete and signed GMAC Bank Opt In Agreement, which permits Homecomings Financial to share personal information with GMAC Bank. Brokers can obtain the GMAC Bank Opt In Agreement on our web site at www.hfwholesale.com. Nothing contained herein shall be considered a commitment to lend on the part of GMAC Bank. Homecomings Financial and GMAC Bank are Equal Housing Lenders. GMAC Bank is a Member FDIC."
Original Article (2007-01-16):
Will cut around 1,000 jobs.
Causing headaches for GM; even though they sold GMAC in Nov 2006:
A Lehman update has subsequently put the estimate of the write-downs and other related expenses at $950 million.
I guess GM was too slow.
*Note: Not to be confused with Residential Capital, LP, another Lender.
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Important: This company is on our list of lending operations that are apparently ailing or which we think are worth watching for any other reason. We make no representation or claim that any company on this list will or will not continue as a going concern, or change in any other way, adverse or beneficial. If you have concerns about this company, we suggest contacting them directly and/or checking with other reliable sources.