July 10, 2019 / 12:24 AM / 7 days ago

Mortgage lender Stearns files for Ch. 11 in reorganization deal with Blackstone

Stearns Holdings LLC, parent company of the 20th largest U.S. residential mortgage lender, filed for Chapter 11 bankruptcy protection on Tuesday, blaming rising interest rates from 2017 through 2018 that hurt the mortgage market and an unsuccessful attempt to restructure its debt.

Stearns, which operates Stearns Lending LLC, in papers filed in U.S. Bankruptcy Court for the Southern District of New York said private equity firm Blackstone had agreed to put $60 million behind a plan to restructure its debt securities and provide a $35 million debtor-in-possession loan.

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