Bank of America stops offering mortgage lender through independent brokers

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(Free-Press-Release.com) October 15, 2010 -- "Bank of America stops offering mortgage lender through independent brokers"

Bank of America, currently the third-biggest U.S. mortgage lender through independent brokers, said it would focus its resources on direct lending and acquiring loans from other originators.

“By exiting the first mortgage wholesale channel, we can redirect critical operational resources to further enhance our capabilities in direct-to-consumer channels,” According to Barbara Desoer, president of Bank of America Home Loans. “This is an investment in strengthening our competitive position by delivering on the services our mortgage customers expect from Bank of America.”

“We tend to prefer business where we have scale. We love the direct-to-consumer business because it’s very closely aligned with the consumer franchise that Bank of America has”, Barbara said. She also emphasized that the bank will phase out the business following an orderly transition of loans currently in process.

Charlotte, North Carolina-based Bank of America holds a prominent share in U.S. retail mortgage market, with 22% of the retail market in 2009, compared with 8% of the wholesale channel, according to Inside Mortgage Finance (IMF). The industry publication also revealed that the bank acquired a U.S. market share of about 8% of the first mortgage wholesale channel in 2009.

Like other large mortgage lenders, such as JPMorgan Chase & Co., Bank of America has stopped offering mortgages through brokers after lax practices among people signing up borrowers helped create bad loans after it has been battling to rein in losses on these loans as unemployment remains high and house prices are still low.

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