Dropping like flies

That seems to be apt description of the demise of mortgage brokers in the US. Yesterday a few more developments:

Countrywide Financial Corp. (CFC), a mortgage lender, said it agreed to acquire certain assets of HomeBanc's (HMB) retail mortgage operations, including five retail branches. Under the deal, Countrywide would also hire a significant number of HomeBanc's retail loan originators.

Why are HomeBanc selling? According to HomeBanc's CEO Kevin Race,

"In light of the extraordinary difficulties existing in the mortgage market, we feel this agreement provides us with an attractive opportunity to transition a portion of our mortgage origination assets to a well-established and respected lender in this space."

Translation - we're screwed.

HMB said in a seperate release that they intend to exit the mortgage loan origination business as they are unable to borrow on their credit facilities and were unable to fund their mortgage loan funding obligations beginning August 6, 2007. The company will review operations to determine the best course of action for its remaining assets.

Suffice to say you can close the book on HMB. Also of note:

Shares of home-loan investment company, Luminent Mortgage Capital Inc. (LUM) plunged 75% yesterday after the company warned that it's been hit by lots of margin calls as the secondary mortgage market "seized up."

The company suspended payment of its second-quarter dividend. The board is also considering a "full range of strategic alternatives" to improve the company's liquidity and preserve shareholder value.

After the stock was halted on Monday Luminent shares fell $3.30 to close $1.08 on Tuesday.

"Effectively, the secondary market for mortgage loans and mortgage-backed securities has seized up." "As a result, Luminent is simultaneously experiencing a significant increase in margin calls on its highest-quality assets and a decrease on the financing advance rates provided by its lenders."

UBS downgraded Luminent to sell from neutral and cut its price target to $0, from $9, saying that while the company is considering strategic alternatives, it sees limited chance of success in light of the current environment.

Another one bites the dust.