First Mariner Bank May Sell Reverse Mortgage Division
November 20th, 2009 | by admin Published in News, Reverse Mortgage | 4 Comments
First Mariner Bank entered into a profit sharing agreement with a private company related to its reverse mortgage division Next Generation Financial Services (NGFS) and may result in the acquisition of NGFS if certain requirements are satisfied within the next 18 months.
According to a filing with the Securities and Exchange Commission:
The closing of the transaction is subject to numerous conditions, including, without limitation, that the parties obtain consents and approvals from certain lenders and governmental agencies that license and supervise the Bank. Accordingly, there can be no assurance that the closing will occur when expected, if at all. The Bank does not anticipate any benefit that results from the sale to be material.
While the 10-Q doesn’t state who the private company is, RMD learned earlier this month that LTC Global increased its investment to a majority share in NGFS.
Also, Robert Cannon was named as NGFS’s Chief Executive Officer earlier this week.
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November 20th, 2009 at 11:22 am (#)
Here is the answer to my question from the post on they yesterday. They now have a “Profit Sharing Agreement” aka referral fee, while they get licensed for the next 18 months.
November 21st, 2009 at 8:29 pm (#)
JS,
Are you implying there is something wrong with this arrangement? It sure looks that way.
November 23rd, 2009 at 8:41 am (#)
As I stated in another post, as far as I know if a subsidiary is not majority owned and controlled by the licensed parent company they are not able to put themselves out there as a mortgage lender/broker and they are not able to receive profits from the origination of reverse mortgages. If I am wrong then please let me know. If I am correct then they are marketing themselves (NGFS) as a mortgage lender but they are unlicensed which is clearly illegal. I do not see much of a difference between this and me going to my referral partners and setting up a joint venture that allows a profit sharing arrangement.
November 23rd, 2009 at 3:41 pm (#)
As I stated in another post, as far as I know if a subsidiary is not majority owned and controlled by the licensed parent company they are not able to put themselves out there as a mortgage lender/broker and they are not able to receive profits from the origination of reverse mortgages. If I am wrong then please let me know. If I am correct then they are marketing themselves (NGFS) as a mortgage lender but they are unlicensed which is clearly illegal. I do not see much of a difference between this and me going to my referral partners and setting up a joint venture that allows a profit sharing arrangement.rnrn