American Home servicing business buyer asks court to force sale closing

By Caroline Salls

Pittsburgh, April 8 - American Home Mortgage Investment Corp.'s servicing business buyer has asked the U.S. Bankruptcy Court for the District of Delaware to order the company to complete the final sale closing, according to a Tuesday court filing.

As previously reported, the court approved the sale of American Home's servicing business to AH Mortgage Acquisition Co., Inc. on Oct. 30.

Because the buyer was not yet licensed to service mortgage loans in some of the jurisdictions required to run the business at that time, the court approved a two-step closing, and the economic closing occurred on Nov. 16.

Although AH Mortgage obtained the necessary licenses by March 31, the buyer said American Home did not proceed with the final closing "because of a regulatory issue associated with two mortgage servicing agreements that are not included in the purchased assets."

AH Mortgage said the only condition required to be met for the final closing to take place was the buyer's licensing.

As a result, the buyer said it sent a letter to American Home on April 7 demanding that the final closing take place, but the company refused, saying that it was not willing to close until it had the consent of Calyon New York Branch in connection with a repurchase agreement issue.

AH Mortgage has requested an April 14 hearing on the motion.

American Home, a Melville, N.Y.-based real estate investment trust focused on residential mortgage loans, filed for bankruptcy on Aug. 6, 2007. Its Chapter 11 case number is 07-11047.

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