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Mortgages were originated through the company's employees as well as through
mortgage brokers and purchased from correspondent lenders and were serviced
at the company's servicing center in Irving, Texas.
The company filed for
Chapter 11 bankruptcy protection in Wilmington Delaware federal court, on
August 6, 2007. The week before the filing, the company said that many of
its lenders had demanded their money back, and that AHM was also unable to
deliver on about US$ 800 million in commitments for housing loans, and had
laid off nearly ninety percent of its 7,000 employees
History
Founded in 1987 in New York City, the company became a publicly traded on
NASDAQ in September 1999. The company moved its corporate headquarters to
Melville, NY in 2000. Since its beginning as American Home Mortgage
Holdings, Inc., it was engaged only in the origination and servicing of
mortgages. Following its acquisition of Apex Mortgage Capital in December
2003, the Company became a REIT and changed its name to American Home
Mortgage Investment Corp., the new parent company of American Home Mortgage
and moved from NASDAQ to NYSE. The company has made numerous acquisitions
since 1999 including Marina Mortgage of Irvine, CA, First Home Mortgage of
Mt Prospect, IL, Columbia National of Columbia, MD, and retail branches from
Principal Residential Mortgage, Waterfield Financial, Irwin Mortgage, and 86
Washington Mutual offices. In December 2004, the company moved its listing
from NASDAQ to NYSE, under the new ticker symbol, AHM.
On July 31, 2007, the company announced that it can no longer fund home
loans and may liquidate assets, putting its survival in doubt. The Melville,
New York-based real estate investment trust retained Milestone Advisors and
Lazard to help it evaluate options and advise "with respect to the sourcing
of additional liquidity including the orderly liquidation of its assets."
American Home's announcement shows how concerns about credit quality and
homeowner defaults have spread beyond subprime lenders, which lend to people
with weaker credit, to lenders that make higher-quality loans. "The chances
are pretty high that the company either goes bankrupt or materially
restructures, leaving little value for shareholders," said Bose George, an
analyst at Keefe, Bruyette & Woods Inc. in New York. American Home has
specialized in prime and near-prime loans. It has, however, made many loans
that allow borrowers to produce little documentation of income or assets. It
recently commanded about 2.5 percent of the U.S. mortgage market.
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