Citi blacklists 7 N.J. mortgage originators, document shows

Company takes action to avoid more delinquencies in future.Citigroup subsidiary CitiMortgage has blacklisted seven New Jersey-based mortgage originators, according to a document NJBIZ obtained from MortgageDaily, an online newsletter published in Dallas.

Citigroup spokesman Mark Rodgers confirmed that CitiMortgage has prepared a so-called “ineligible list” of mortgage originators, but he declined share the list or provide details, saying the list is privy only to CitiMortgage’s approved correspondent customers.

“We are instituting a list on our Web site identifying brokers, correspondents or other loan originators whose loan originations are not acceptable to CitiMortgage for purchase … beginning with loan registrations as of Oct. 15,” the bank said on its Web site.

“This is an additional measure we have taken to continue to ensure superior quality loan production,” Rodgers said of the decision to draw up the blacklist.

One of the companies in the list MortgageDaily supplied is NJ Affordable Homes Corp., in Woodbridge. The state’s acting U.S. Attorney’s office had in April stated that Wayne Puff, the firm’s founder and president, had pleaded guilty to operating a “massive Ponzi scheme” and defrauding investors and mortgage lenders of more than $80 million.

Citigroup has had its share of skirmishes with delinquencies in New Jersey. In this year’s second quarter, it had overall delinquencies of 5.1 percent, while those were 19.4 percent in the less-than-620 FICO band, according to Citigroup report. Those were higher than the bank’s nationwide delinquency averages of 4.7 percent of overall serviced loans, and 15.2 percent for loans below the FICO band of 620, the report said.

Rodgers declined to say “whether or not CitiMortgage has or plans to inform banking regulators” about this list; the state Department of Banking and Insurance said it has not heard on this matter from CitiMortgage. It also has not licensed the company as a mortgage lender, it added.

E-mail Shankar P. at [email protected]