That was Fast: AHM Issues Death Rattle Press Release

by Alex Stenback on July 31, 2007

A press release, or "Illiquidity" update from American Home Mortgage:

Based on the foregoing, the Company at present is unable to borrow
on its credit facilities and was unable to fund its lending
obligations yesterday of approximately $300 million. It does not
anticipate funding approximately $450 to $500 million today….The Company has retained Milestone
Advisors and Lazard to assist in evaluating its strategic options and
advising with respect to the sourcing of additional liquidity
including the orderly liquidation of its assets.

In English: They cannot fund the many thousands of loans scheduled to close today, and did not fund them yesterday, leaving their buyers and refinancers in a pickle, to say the least.

Choose your lender carefully – this is a very different event from a mom-and-pop broker going out of business.  AHM was a publicly traded company with a market capitalization in excess of 1 Billion just a few short months ago.
AHM Liquidity Update []

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