NEW YORK Feb 5 Mortgage Lenders Network USA
Inc. on Monday filed for Chapter 11 bankruptcy protection,
becoming one of the largest casualties among "subprime" lenders
as the U.S. housing market slows.
The Middletown, Connecticut-based company, which had been
the 15th-largest U.S. subprime lender, filed for protection
from creditors with the U.S. Bankruptcy Court in Wilmington,
It listed more than $100 million of assets and debts, and
in excess of 5,000 creditors, court papers show.
Subprime lenders make loans to borrowers with imperfect or
poor credit histories. They are suffering as home sales and
prices slump, while delinquencies and other defaults rise.
The filing suggests that Mortgage Lenders' attempts to find
a suitor had broken down.
On Jan. 2, Mortgage Lenders had said it was in "strategic
negotiations" with several Wall Street firms about its loan
Mortgage Lenders at the time also said it had stopped
funding loans and accepting loan applications, and temporarily
laid off about 80 percent of its 1,800 employees.
In December, Ownit Mortgage Solutions Inc., the
16th-largest mortgage lender, also filed for Chapter 11
protection. That company is based in Agoura Hills, California.
Mortgage Lenders made $3.31 billion of subprime loans in
the third quarter of 2006, according to National Mortgage