This is no surprise. These guys were horrible to deal with and they’ve treated customers terribly. TBW is going down… Colonial Bank looks to be next along with Guaranty Bank. We’ll be on top of it for you… Check back frequently for automatic updates.
From the Wall Street Journal
By JAMES R. HAGERTY and LINGLING WEI
The Federal Housing Administration Tuesday suspended Taylor, Bean & Whitaker Mortgage Corp. from making loans insured by the federal agency, knocking out one of the biggest FHA lenders at least temporarily.
The FHA said the Ocala, Fla.-based lender failed to submit a required annual financial report and to disclose to the FHA “certain irregular transactions that raised concerns of fraud.” Taylor Bean has 30 days to appeal the suspension.
Taylor Bean was the 12th largest U.S. mortgage lender in the first six months of this year, according to Inside Mortgage Finance, a trade publication. Among originators of FHA loans, Taylor Bean was the third largest in May, with a market share of 4%, according to the publication. Only Bank of America Corp. and Wells Fargo & Co. were larger.
Taylor Bean’s woes are a major blow for hundreds of brokers and smaller mortgage banks that sell the loans they originate to the privately owned company. Those small mortgage companies will have to scramble to find new partners if they are to remain in the booming FHA lending business.
FHA loans have surged in popularity over the past two years as other sources of mortgage funding have dried up.
Lee B. Farkas, chairman of Taylor Bean, said in response to questions that he was unaware of the FHA action.
Ginnie Mae, a government agency that guarantees payments to holders of securities backed by FHA loans, said Taylor Bean is also barred from issuing securities backed by Ginnie. Ginnie said it will take control of nearly $25 billion of mortgage securities issued by Taylor Bean.
The moves came a day after federal agents raided the Florida offices of Colonial BancGroup Inc. and Taylor Bean. Taylor had been leading a group of investors that proposed to shore up Colonial by taking a stake in the Alabama-based bank but that transaction fell through last week amid heavy losses at Colonial.
Write to James R. Hagerty at bob.hagerty@wsj.com and Lingling Wei at lingling.wei@dowjones.com
