Beazer to exit mortgage business, five markets
Beazer Homes USA Inc. said it will discontinue its mortgage origination business and exit five markets.
The Atlanta-based home builder (NYSE: BZH) said it will discontinue mortgage origination services through Beazer Mortgage Corp. effective immediately and has entered into a new marketing services arrangement with Countrywide Financial Corporation (NYSE: CFC), whereby Beazer Homes will market Countrywide as the preferred mortgage provider to Beazer Homes' customers.
The company also said that as part of a review of its business launched last July, it has decided that it will exit its homebuilding operations in Charlotte, N.C.; Cincinnati/Dayton and Columbus, Ohio; Columbia, S.C., and Lexington, KY. Beazer said it intends to complete all homes under construction. In addition, it said it is evaluating its current land holdings and inventory in these markets to determine the appropriate methods and timing for disposition.
The company said it will not be able to quantify the financial impact of these decisions until restated financial statements are finalized. At June 30, 2007, approximately 5 percent of its homebuilding assets were invested in the markets affected by the announcement.
Beazer said it continues to reduce its land position and unsold home inventories, and that it expects its results for the first quarter of fiscal 2008 to include large charges to abandon land option contracts and to recognize inventory impairments.
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