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Citi Blacklists over 800 Brokers and Mortgage Originators

Some mortgage brokers and mortgage banking correspondents looking to do business with CitiMortgage, Inc. may have the door slammed in their face.

The lender has put 840 loan originators on its Ineligible Originators list, according to the industry newsletter service MortgageDaily.com.

In an corporate bulletin released last month and acquired by the online news service, the Missouri-based mortgage subsidiary of Citigroup Inc. noted that the files of the blacklisted brokers, correspondents, and originators would no longer be accepted after October 15.

“We will refuse for purchase and return to you any loan originated by an ineligible originator,” MortgageDaily.com quoted Citi as saying in its bulletin. “Our decision with respect to any such loan will be final; and no exceptions will be considered.”

Citi acknowledged that it regularly evaluates and adds company names to the list as it sees necessary, and will refuse purchase of a loan if the originator, not previously on the list, is added before the loan actually closes.

Earlier this summer, Citi put the brakes on its correspondent mortgage business because of what it called “quality control issues” with loans purchased through the channel. But in July, the lender resurrected its correspondent operations after instituting stronger quality control measures and selective purchase procedures.

A Citigroup spokesperson told a local business journal in New Jersey, where seven blacklisted third-party originators are located, “This [the Ineligible list] is an additional measure we have taken to continue to ensure superior quality loan production.”

According to MortgageDaily.com, nearly half of the rejected companies were concentrated in three states, all with more than 100 originators blacklisted. Florida has the most, with 147 companies making the list. California is home to 117 originators now banned by Citi, and 107 are headquartered in Georgia.


Author: Carrie Bay Date: 11/06/2009

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