Loan Credit

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A few quick hits:

--American Home Morgage shares finally opened today on Wall Street. When we checked they were down 88%, to $1.20 (yes, down 88% in a single day; this is what happens when a business collapses). The stock has traded above $36 in the past year. As part of his ‘housing is doomed’ rant, Jim Cramer predicted worthlessness (bankruptcy) for this stock.

From Bloomberg: ‘American Home Mortgage Investment Corp. shares plunged 89% after the lender said it doesn’t have cash to fund new loans and may have to sell off assets. ... Investment banks cut off credit lines, leaving American Home without money yesterday for $300 million of mortgages it had already agreed to provide, the Melville, New York-based company said in a statement today. It anticipates $450 million to $500 million of loans probably won’t get funded today.’

--From Reuters: IndyMac, the Pasadena-based lender that cut 400 jobs last week, said profit declined as more borrowers fell behind on payments and it made less from selling loans to investors. The shares rose as much as 20 percent as the company said credit losses weren’t as steep as its competitors. Second-quarter net income slid 57%, while revenue fell 21%.

--From Inman News: Lending Tree, a division of the internet company IAC, lost $1.3 million in the second quarter, after making a $9.8 million profit a year earlier. Revenue declined 9%, to $98.6 million.

Thoughts? Comments? Insights?