Resource Mortgage (Wholesale) - Wholesale

Virginia based Resource Mortgage, a division of Resource Bank, has shuttered its wholesale lending business. A tipster brought our attention to their web site, which displays the following announcement:

"We have made the decision to exit the Wholesale lending business. As of 5:30 PM EST on Friday, January 11, 2008, we will stop accepting any loans. We will honor previously granted approvals in our pipeline, and we will continue to have staff available to complete the underwriting and closing process of your approved loans. All loans must be fully approved and closed no later than February 12, 2008."

Calls to their Virginia Beach office have not been returned, so we do not know how many employees may have been affected. But in their Q4 2007 Earnings call (a transcript of which can be read here, executives of parent holding company Fulton Financial Corp. (NASDAQ: FULT) mentioned that "staff reductions at Resource Mortgage ... contributed $1.4 million" in reduced salary and benefit expenses.

Also mentioned was a $76 million dollar (or 53%) drop in loan volume for the quarter. Losses related to loan repurchases were highlighted as well:

"We took charges totaling $16 million in the third quarter related to the repurchase and potential repurchase issues at Resource Mortgage. During the fourth quarter total charges were $640,000."

"Outstanding repurchase requests increased 9.1 million during the fourth quarter from 10.7 million at September 30 to 19.8 million at December 31, 6.2 million of this increase relates to loans we had identified as of September as potentially having instances of misrepresentations of borrower information and were reserved for as of that date."

Resource Mortgage will continue to to originate loans through its Retail Lending Operations in VA and FL.

Please contact us if you can provide additional details on this company and it's product mix.