Officials from Citigroup have been inspecting the offices of Ameriquest Mortgage in California, and may be preparing to make a bid on the subprime giant, industry sources have told MortgageWire.

One source said Citigroup sent a group of executives to Ameriquest’s corporate offices in Orange, Calif., and to another location in Rancho Cucamonga. The source — and another official — said Citigroup may be eyeing Ameriquest’s servicing unit, which has about $60 billion in receivables. Meanwhile, a hedge fund called Ellington Management out of Old Greenwich, Conn., has also expressed interested in Ameriquest, sources said, though it is unclear how serious it is about the company

National Mortgage News

Although on-line lending giant E-Loan’s website claims “Expect Fairness,” apparently that didn’t apply to 506 originators that settled a class action suit against the lender claiming they were not paid overtime.

According to the East Bay Business Times, U.S. District Judge Susan Illston granted preliminary approval of the settlement on Jan. 11. The suit claimed that E-Loan did not pay the workers overtime or provide them with meal and rest breaks. The employees sold loans, prequalified borrowers and processed applications.

Although, according to published reports the lender claims they did nothing wrong they have agreed to pay the plaintiffs $13.6 million dollars

Originator Times

Posted by TheLoanProfessor

Section 6050H of the Internal Revenue Code of 1986 (relating to mortgage interest) is amended by adding at the end the following new subsection:

In general.–Premiums paid or accrued for qualified mortgage insurance by a taxpayer during the taxable year in connection with acquisition indebtedness with respect to a qualified residence of the taxpayer shall be treated for purposes of this section as interest which is qualified residence interest.

The Act defines qualified mortgage insurance as that provided by the VA, the FHA, or the Rural Housing Administration or by private carriers and specifies that it be treated as interest on a qualified residence. This, however, is modified by the following "that premiums paid or accrued for qualified mortgage insurance by a taxpayer during the taxable year in connection with acquisition indebtedness." This is interpreted by BNA as meaning that the deduction is only available to homeowners who assume PMI payments during 2007. In other words, you may not qualify for the deduction if you bought a house subject to PMI in 2006 or earlier even though you are currently paying premiums.

Deductions seem to be further limited to 2007 by the following: no benefit will currently accrue to taxpayers for any amount paid or accrued beyond December 31 of this year "or properly allocable to any period after that date." We are not lawyers or tax authorities and we advise you, strongly, to consult your own tax professional, but it appears that this deduction is only available to taxpayers during the current calendar year and that paying premiums ahead as taxpayers are often advised to do with mortgage interest or property taxes at year end when deductions are needed will not work in this situation.

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