“Residential Capital Corp, Defaults on Payment”
This is not good news and it comes on the heels of GMAC’s announcement last week, they will no longer be offering government loans to its wholesale chain.
No matter what type of market there is, there are always going to be casualties, this just seems to be the one for this time period.
There is no shortage of lenders that will take up any gap.
Trouble Ahead: Ally's Mortgage Unit Misses Bond Payment
By: Paul Muolo
The residential mortgage division of Ally Financial Inc. missed a scheduled payment on its debt Tuesday, laying the ground work for an eventual default if the payment is not made up quickly.
According to a new filing with the Securities and Exchange Commission, Residential Capital Corp., an Ally subsidiary “did not make a semi-annual interest payment” on $1.75 billion of debt tied to notes yielding 6.5%.
The notes are due in 2013 with $473 million of principal currently outstanding.
The firm says in the filing: “The Indenture provides that a failure to pay interest on an interest payment date does not become an Event of Default (as defined in the Indenture) unless such failure continues for a period of 30 days.”
A spokeswoman for the bank holding company said Ally will not be commenting at this time.
ResCap/GMAC is the nation’s sixth largest home mortgage lender, and fifth largest servicer, according to figures compiled by National Mortgage News and the Quarterly Data Report.
Ally is 74% owned by the U.S. Treasury. ResCap has been undergoing costs cuts and recently shuttered its MBS trading desk and halted third-party GNMA lending.
The new SEC filing was signed by David J. DeBrunner, who is listed as the firm’s vice president, chief accounting officer and controller.
Joe Petrowsky, NMLS #6869
Right Trac Financial Group, Inc. NMLS #2709
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