Retail lender AmeriFirst Financial Inc. filed for Chapter 11 bankruptcy protection in Delaware, just two months after it got back into the forward mortgage origination business.
The Mesa, Arizona-based company listed estimated assets and liabilities as much as $100 million each, according to a filing in the U.S. Bankruptcy Court for Delaware.
RCP Credit Opportunities Fund is listed as the largest unsecured creditor in the AmeriFirst Chapter 11 case — with a claim of $17.9 million, court pleadings show.
Other creditors in the AmeriFirst bankruptcy with unsecured claims exceeding $500,000 include – RCP Customized Credit Fund ($5.97 million) and Wells Fargo Bank ($1.1 million).
The nature of the claims is listed as bond debt for RCP Credit Opportunities Fund and RCP Customized Credit Fund; and trade debt for Wells Fargo in the court pleadings.
The bankruptcy filing so far does not include a list of secured creditors, only a creditors matrix (which does not include financial figures).
AmeriFirst told Housingwire that the bankruptcy action has no impact on closed mortgages and the loans in the pipeline will be closed and funded. No further detail was provided.
The Arizona-based lender relaunched its forward mortgage origination business in June after ceasing it in December 2022 against the backdrop of rising interest rates.
Through its origination business, AmeriFirst kept its business purpose lending (BPL), providing four products, including debt-service coverage ratio (DSCR) loans, bridge financing, investor construction loans and residential transition loans (RTLs). Its BPL business originated about $30 million in volume every month, Eric Bowlby, CEO at AmeriFirst Financial told HousingWire in June.
Getting back into the forward mortgage origination business, Bowlby had shared plans of keeping physical branches in 20 states while getting rid of regional and branch margins to give competitive rates to homebuyers.
The goal was to eliminate about 100 to 125 basis points built into the rates and offer lower rates as mortgage brokers.
“When your branch margin is taking everything to begin with, how does corporate make any money? Because now what they have to do is they have to go in and charge points to get their loans done,” Bowlby said in a previous interview with HW.
Bowlby had aimed to close $100 million in origination volume a month but AmeriFirst’s origination volume came in way lower than expectations.
The Arizona lender logged a production volume of $3.6 million in June when it resumed forward mortgage originations, according to mortgage platform Modex. The following month, the lender posted $11.5 million.
In 2022, AmeriFirst closed $2.5 billion in loan origination, data from Modex showed.