(via Ocala Star-Banner; HT Robb Strupp)
Florida-based Taylor, Bean and Whittaker, formerly the nation's 12th-largest loan originator and servicer, has filed for bankruptcy reorganization amid new sanctions by the Florida Office of Financial Regulation, the Ocala [Florida] Star-Banner reports:

In a separate story, the

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says the state's financial regulator has issued a cease and desist order to the company, forbidding it from servicing any of its remaining 30,000 or so loans and freezing all foreclosure cases, in part because the company had only one bank account, meaning it commingled funds:

Worse than that, Taylor could not show a daily (or even a weekly) balance sheet, the

Star-Banner

says:

Here in Maryland (and despite

), Mark Kaufman of the state Department of Labor, Licensing and Regulation (DLLR) says the "cease and desist" orders are less important that the overall situation, which is a "winding down" of TBW. DLLR has been trying to help the 9,500 or so state residents whose mortgages TBW serviced locate their new services.

The key to that, he says, is knowing which big, non-TBW entity underwrote the mortgage. The two big ones are Ginnie Mae and Freddie Mac, he says, and both have helpful information on their web sites (

a pdf of Ginnie's and

is Freddie's). These are helpful only if you already know you have a Ginnie Mae or Freddie Mac loan, however.

"The system is great for getting people from first base to home plate," Kaufman says. "The problem is, a lot of people don't know how to get to first base."

Freddie's home page has a

too, but not everyone can be expected to know how to do this without help.

"I spent half an hour on the phone this morning with a woman who dutifully sent her check to Bank of America [which took over TBW's Ginnie-backed paper]" Kaufman says. "Only problem was, she had a Freddie Mac loan, so she should have sent to Cenlar."

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This sort of thing can be very stressful to borrowers, of course. The important thing to remember, Kaufman says, is that even if you send your check off to the wrong servicer, you will not be hit with late fees, adverse credit reports, etc. Though no one has officially come out and said it, there is a grace period here—similar to the one you got after you first closed your loan. Freddie spells it out:

This is good news indeed for TBW's many honest borrowers.

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