The past few weeks of acquisitions and deals among REO asset managers shows more bets are being made that a long-awaited supply of these properties may finally be hitting the market.
At the end of June, Homeland Security Capital Corp. a government contractor for a variety of work including disaster relief, moved into the space by acquiring Default Servicing LLC, the former REO manager of the Law Offices of David J. Stern, which ceased foreclosure work in March. A week later, Stewart Lender Services acquired PMH Financial, which manages more than $2.5 billion in properties.
First American Financial Corp. (FAF: 15.44 +4.04%) is in the process of finalizing the development of an REO asset management firm based in Dallas that would replace the one spun off in the CoreLogic (CLGX: 15.8598 +0.38%) separation last year.
Then, on Monday, Default Resource's REO management branch, Executive Asset Management, signed a deal with Georgia-based United Bank. EAM will handle the entire REO process for the bank, which has approval from the Federal Deposit Insurance Corp. to acquire failed bank assets.
I also think some of the REO companies are preparing for more homes due more stragetic defaults as more home owners are seeing their equity slip away.
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