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SEC Filings

424B1
DITECH HOLDING CORP filed this Form 424B1 on 09/16/1997
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  Commercial Mortgage Loans and Multifamily Mortgage Loans
 
     Since its inception in 1992 through December 31, 1996, HCMC has originated
approximately $500 million in Multifamily Mortgage Loans for delivery to "Wall
Street" conduits (including Daiwa Finance Corp., Paine Webber, Nomura Securities
International, Inc., Donaldson Lufkin & Jenrette, Inc., Chemical Bank, LaSalle
National Bank, Piper Capital Management Inc., J.P. Morgan Securities, Inc. and
General Electric Mortgage Corporation), private investors and the Department of
Housing and Urban Development, for which HCMC received origination and servicing
fee income. These Multifamily Mortgage Loans were table-funded by the investors
(i.e., the investors paid the face amount of such loans at closing); HCMC did
not use its own capital for such loans and did not have a profit or a loss for
any such loans. HCMC did not acquire loans that it could not sell or only sell
at a discount. The origination and servicing fee income received from such loans
represented substantially all of HCMC's income for such period, which resulted
in cumulative after tax net income for HCMC of $903,059 for such period. HCMC
has not originated or securitized Commercial Mortgage Loans. The Principals
believe HCMC was one of the first commercial mortgage banking operations to
originate Multifamily Mortgage Loans for sale to conduits and, from direct
borrower originations and its network of third party brokers, can provide
Multifamily Mortgage Loans and Commercial Mortgage Loans of sufficient credit
quality to meet the requirements for securitization and sales to third party
investors and into the Investment Portfolio. Subsequent to the closing of the
Offering, the Company will primarily originate Multifamily Mortgage Loans and
Commercial Mortgage Loans, including Mortgage Loans secured by income-producing
commercial properties such as office, retail, warehouse and mini-storage
facilities, through HCMC and subsequently either sell the Mortgage Loans to
investors or hold them in the Investment Portfolio. The Principals believe that
the Company will have certain competitive advantages over other entities in the
commercial mortgage market due to the speed, consistency and flexibility which
it will seek to obtain by being a vertically integrated company (acting as
originator, servicer, and owner of Commercial Mortgage Loans).
 
     Commercial Production Process.  The commercial process differs from the
Single-Family Mortgage Loan acquisition process because the Company will operate
as a direct originator of new Commercial Mortgage Loans. The Company has been
engaged in this process since 1992 and has been an active supplier to the Wall
Street conduit/securitization firms, which are Wall Street dealer firms that
have set up a conduit to purchase Multifamily Mortgage Loans and Commercial
Mortgage Loans from national brokers for the purpose of issuing commercial
mortgage-backed securities. HCMC has the ability to source new Commercial
Mortgage Loans both directly and through brokers, to process and underwrite the
Commercial Mortgage Loans to the Company's standards and to service the
Commercial Mortgage Loans. The Company will be integrated from origination to
underwriting, warehousing, servicing and securitization. The Company will also
have the ability to hold subordinated or residual pieces of the securitizations,
enabling the Company to seek to obtain a profit in each area of the process.
 
     Commercial and Multifamily Loans Acquisition/Production Strategies.  The
Company will adhere to specified underwriting and due diligence requirements for
the origination of Multifamily Mortgage Loans and Commercial Mortgage Loans,
such that they will qualify either for sale to third party conduits or for
inclusion by the Company in commercial and multifamily securitizations. The
Company will continually monitor the underwriting criteria by contacting rating
agencies and the third party conduit purchasers. In addition to the underwriting
and due diligence completed at the origination level, a separate credit
committee will approve all Multifamily Mortgage Loans and Commercial Mortgage
Loans purchased. The Company intends that, with prudent underwriting and due
diligence, combined with the securitization process, it will achieve a
satisfactory reward/risk ratio; however, there are no assurances that it will be
able to do so.
 
     While the sales force that the Company will maintain in Illinois,
Minnesota, California, Massachusetts and New York will concentrate primarily on
sourcing pools of Single-Family Mortgage Loans and selling the resultant
securities and whole loan pools, they will also find leads for the Multifamily
Mortgage Loan and Commercial Mortgage Loan origination business of HCMC and the
Due Diligence Operations of HCP. HCMC will originate new Multifamily Mortgage
Loans and Commercial Mortgage Loans through originators that will call on
brokers as well as real estate developers and owners. These originators have
been a part of the
 
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