Lehman/Aurora Loan Services - Wholesale & Correspondent

Wholesale and Correspondent divisions of industry giant Lehman Brothers / Aurora Loan Services have been eliminated effective today January 17th with last day to fund loans February 17th, 2008. This information was delivered to AE's and staff in a 12 noon (EST) conference call. We are expecting an official announcement later today (see update below).

"NEW YORK (AP) - Lehman Brothers Holdings Inc. (NYSE:LEH), the nation's fourth-largest investment bank, on Thursday said it will 'substantially' reduce its U.S. residential-mortgage lending business and cut 1,300 jobs.

The investment house said the move will mostly affect its Aurora Loan Services business, which acts as its primary mortgage unit. Lehman will take a $40 million charge as part of the plan."

In an email to an AE's Broker:

Dear brokers and loan officers,

It is with great regret to announce that Aurora Loan Services decided to close its doors effective immediately. The reasons behind this decision is more than evident considering the market situation.

Any files that have been submitted and locked with Aurora will be finalized. For those who want to submit a file, you will have until end of business day tomorrow to submit and lock the file for no more than 30 days.

In a mid-day announcement from their web site, this may be as official a statement as anyone would need:

"Aurora Loan Services' parent company, Lehman Brothers, announced today that it will substantially reduce its resources and capacity in the U.S. residential mortgage origination space in light of the dislocation in the mortgage markets.

As a result, Lehman Brothers is suspending all Wholesale and Correspondent mortgage originations at Aurora.

Aurora will continue to originate loans through its direct lending channel, and will maintain its servicing business."

MSNBC is reporting 1300 jobs will be lost. We have seen in the past Lenders not counting outside Acccount Executives, so we will be looking for numbers we can confirm.

This page will be updated throughout the day. We are working on the layoff and volume figures.

Hundreds of posts are available on our forum (click here), and another one entitled "Aurora is Toast." Contact us with more information please.