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Option One Mortgage Corp, which is a division of H&R Block, was sold to Wilbur Ross for about $1 billion. Mr. Ross is known as asset investor who has agreed to obtain $42 billion in mortgage servicing rights from American Home Mortgage Investment Corporation and made a $1 billion investment in Bermuda bond insurer Assured Guaranty.
Option One Mortgage is the fourth largest mortgage servicer in the country and services about $53 billion of subprime mortgages. These assets, together with the American Home Mortgage Investment acquisition will give Mr. Ross the second largest subprime servicing portfolio in the nation right after Countrywide Financial.
Option One Mortgage is among the first of the subprime participants to confess problems with their portfolio and ultimately loss millions of dollars. When the public fuound out about there troubles it became public and to be acquired by Cerberus Capital Management and both sides agreed to discontinue their deal with the if conditions continued to worsen. H&R Block had announced in December that it was shutting down Option One.
The Option One Mortgage that Mr. Ross had made is expected to close by May 30 and the sales proceeds will primarily be used to pay off some $700 million in Option One debt
Kirt Eure
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