American Home Mortgage/ From Wikipedia, the free
encyclopedia

American Home Mortgage American Home logo.png

Type      Defunct
Corporation

Industry               Finance

Founded              New
York, NY (1987)

Headquarters    Melville,
NY

Key people         Michael
Strauss, CEO & President

Products              Financial
Services

Revenue              Decrease$1.1
BillionUSD (2006)

Net income        Decrease$426.5
Million USD (2006)

Website               www.americanhm.com

American Home Mortgage Investment Corporation (OTC Pink:
AHMIQ) was the 10th largest retail mortgage lender in the United States and was
structured as a real estate investment trust (REIT).

It has filed for bankruptcy.[1] The company stated that it
was focused on earning net interest income from self-originated loans and
mortgage-backed securities, and through its taxable subsidiaries, from
originating and servicing mortgage loans for institutional investors.

Mortgages were originated through the company’s employees as
well as through mortgage brokers and purchased from correspondent lenders and
were serviced at the company’s servicing center in Irving, Texas.

The company filed for Chapter 11 bankruptcy protection in
Wilmington Delaware federal court, on August 6, 2007. The week before the
filing, the company said that many of its lenders had demanded their money
back, and that AHM was also unable to deliver on about US$ 800 million in
commitments for housing loans, and had laid off nearly ninety percent of its
7,000 employees.[2]

Contents:        1
History         2 Financial
difficulties       3 External links      4 References   History

Founded in 1987 in New York City, the company became a
publicly traded on NASDAQ in September 1999. The company moved its corporate
headquarters to Melville, NY in 2000. Since its beginning as American Home
Mortgage Holdings, Inc., it was engaged only in the origination and servicing
of mortgages. Following its acquisition of Apex Mortgage Capital in December
2003, the Company became a REIT and changed its name to American Home Mortgage
Investment Corp., the new parent company of American Home Mortgage and moved
from NASDAQ to NYSE. The company has made numerous acquisitions since 1999
including Marina Mortgage of Irvine, CA, First Home Mortgage of Mt Prospect,
IL, Columbia National of Columbia, MD, and retail branches from Principal Residential
Mortgage, Waterfield Financial, Irwin Mortgage, and 86 Washington Mutual
offices. In December 2004, the company moved its listing from NASDAQ to NYSE,
under the new ticker symbol, AHM.[3]

On July 31, 2007, the company announced that it can no longer
fund home loans and may liquidate assets, putting its survival in doubt. The
Melville, New York-based real estate investment trust retained Milestone
Advisors and Lazard to help it evaluate options and advise “with respect
to the sourcing of additional liquidity including the orderly liquidation of
its assets.” [4] American Home’s announcement shows how concerns about
credit quality and homeowner defaults have spread beyond subprime lenders,
which lend to people with weaker credit, to lenders that make higher-quality
loans. This announcement caused its stock price to plunge 90% that day to $1.04
on the NYSE. “The chances are pretty high that the company either goes
bankrupt or materially restructures, leaving little value for
shareholders,” said Bose George, an analyst at Keefe, Bruyette & Woods
Inc. in New York. American Home has specialized in prime and near-prime loans.
It has, however, made many loans that allow borrowers to produce little
documentation of income or assets. It recently commanded about 2.5 percent of
the U.S. mortgage market.

Financial difficulties: 
On August 2, 2007, Michael Strauss sent an email to the entire company
announcing company’s serious financial difficulties.

    It is with great
sadness I announce today that American Home Mortgage has been forced to close.
Unfortunately, the market conditions in both the secondary mortgage market as
well as the national real estate market have deteriorated to the point that our
business is no longer viable. What this means for most of our employees is that
Friday, August 3, 2007 will be your last day of employment. Detailed
information regarding payroll, benefits and other human resource related matter
will be available Friday morning for distribution in the office. I would like
to personally thank every single individual working for the company for their
efforts. It has been my privilege to be associated with such a wonderful
team.[citation needed]

Following Strauss’s email, at least one employee of AHM has
stated that the western division of AHM had been purchased by IndyMac Bank,
saving those employees’ jobs.[citation needed] In 2008, IndyMac also failed—one
of the largest bank failures in American history. On July 11, 2008, IndyMac
Bank was placed into conservatorship by the FDIC and on August 6, 2008, the
bank filed for Chapter 11 bankruptcy protection. American Home Mortgage
Servicing Inc. was sold to Wilbur Ross & Co. LLC, as part of the bankruptcy
liquidation, in November 2007.

External links:     
MoneyCentral American Home Mortgage Investment Corporation

    Official
site.    Facing liquidity crunch,
American Home Mortgage suspends dividend payment (July 28, 2007)

    [1] Wilbur L. Ross
buys American Home Mortgage Servicing Unit (November 2007)] is this company in
busenss??