Bloomberg News

Nationstar Ordered to Stop Auctioning Some Loans

March 08, 2013

Nationstar Mortgage Holdings Inc. (NSM:US), the mortgage servicer that collects payments on more than $300 billion of debt, was ordered to stop auctioning some home loans backing mortgage securities after an investor sued.

KIRP LLC sued Lewisville, Texas-based Nationstar in New York State Supreme Court in Manhattan yesterday, accusing the company of harming investors by auctioning the loans and abdicating its responsibilities as servicer. KIRP, based in New York, described itself as a “significant” investor in six residential mortgage-backed security trusts sponsored by Residential Accredit Loans Inc.

Justice Eileen Bransten yesterday granted KIRP’s request for a temporary restraining order blocking Nationstar from selling through or similar websites “non-performing mortgage notes” that collateralize certificates issued by the six trusts. The judge scheduled an April 9 hearing on KIRP’s request for a preliminary injunction.

John Sullivan, a spokesman for Nationstar at RLM Finsbury, didn’t immediately return a telephone message today seeking comment on the lawsuit.

Nationstar, which is majority-owned by Fortress Investment Group LLC, increased its servicing portfolio by 94 percent last year to $198 billion through a series of asset purchases from sellers including a unit of Lehman Brothers Holdings Inc.

Nationstar’s portfolio rose to more than $300 billion last month after it completed part of a deal for $215 billion of contracts from Bank of America Corp., according to a statement yesterday reporting earnings.

The case is KIRP LLC v. Nationstar Mortgage LLC, 650794- 2013, New York State Supreme Court (Manhattan).

To contact the reporters on this story: Chris Dolmetsch in New York State Supreme Court at; Jody Shenn in New York at

To contact the editors responsible for this story: Michael Hytha at; Alan Goldstein at

Toyota's Hydrogen Man

Companies Mentioned

  • NSM
    (Nationstar Mortgage Holdings Inc)
    • $32.23 USD
    • 0.20
    • 0.64%
Market data is delayed at least 15 minutes.
blog comments powered by Disqus