Yesterday, it made a disclosure to SEC that it failed to meet a $28 million margin call from JPMorgan Chase & Co & that the bank may like exercise its rights under a $320 million loan. Margin calls force borrowers to pay back loans or post more collateral.
Unfortunately, the case for mortgage lenders is worst. Since they may or may not have reserve money for paying up for the mortgage calls, it become difficult for them to keep up the margin requirements. The result is that they end up raising their hands and declare foreclosures and bankruptcies.
The shares of Thornburg Mortgage yesterday tanked by more than 51 percent, all on the fears that Thornburg Mortgage may declare bankruptcy. Thornburg said the JPMorgan notification triggered defaults under its other reverse repurchase and secured loan agreements, and its obligations under those agreements were "material."
| No official comment has been communicated from Thornburg Mortgage, but if you believe the rumors and the foreclosure that Thornburg has made to SEC, then this company may file for bankruptcy. | Table of Contents |
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