Aug 2, 2007
American Home Mortgage to close Friday-report
Thu Aug 2, 2007 9:11pm ET138
NEW YORK, Aug 2 (Reuters) - American Home Mortgage Investment Corp (AHM.N: Quote, Profile , Research) plans to close most operations on Friday and said nearly 7,000 employees will lose their jobs as the lender becomes one of the biggest casualties of the U.S. housing downturn.
Experts said it is likely the Melville, New York-based company will have to seek bankruptcy protection, and no later than Monday.
In a statement, American Home on Thursday night confirmed earlier reports that it was ceasing most operations. The company said its employee base will be reduced to about 750 workers, down from the 7,409 it reported at the end of last year. The terminations are effective Friday.
American Home originated $59 billion in loans last year, and mostly to people with better credit than risky subprime borrowers. About half of those mortgages were adjustable-rate loans, whose defining feature is an interest rate that can be adjusted upward.