AmeriFirst Financial files for bankruptcy

Another embattled mortgage lender has filed for bankruptcy, suggesting in court records that funds will be available for distribution to its unsecured creditors. 

Mesa, Arizona-based AmeriFirst Financial is seeking Chapter 11 protection, according to its filing Thursday in the U.S. Bankruptcy Court for the District of Delaware. The firm allegedly stopped funding loans in December, but briefly revived originations in June, according to media reports and social media posts.

The company and its listed chief restructuring officer didn't immediately respond to requests for comment Friday. 

CEO Eric Bowlby was removed from his position this week while a holding company, Phoenix 1040 LLC, was added as a shareholder, according to documents filed this week with the Arizona Corporation Commission. Bowlby also didn't immediately respond to a message Friday afternoon seeking comment. 

Phoenix 1040 is listed in bankruptcy filings as AmeriFirst's sole equity holder, and was incorporated in Delaware in late June, public records show.

AmeriFirst, unrelated to former Michigan lender AmeriFirst Home Mortgage, counts between 100-199 creditors, and both estimated assets and liabilities between $50 million to $100 million each, according to the filing. 

The lender's list of creditors includes major banks, mortgage vendors and attorneys. Reverence Capital Partners, a New York-based private equity firm, has two unsecured claims through separate funds totalling $23.8 million. Wells Fargo is owed $1 million, while servicer Lakeview Loan Servicing is listed with a $431,045 unsecured claim. 

Last year, the lender originated $2.4 billion in mortgage volume, according to S&P data. Through April, AmeriFirst originated $110 million in volume across 215 loans. The firm offered conventional, government-sponsored and reverse mortgages and had 109 sponsored mortgage loan officers, according to Nationwide Multistate Licensing System records. 

A hearing in the bankruptcy case is scheduled Tuesday in the Wilmington, Delaware federal bankruptcy court. 

AmeriFirst is the third lender to file for Chapter 11 protection in the past 14 months, with a fourth, Sprout Mortgage, targeted in a recent involuntary petition. Federal judges have meanwhile ordered bankruptcy financing for lenders First Guaranty Mortgage Corp. and Reverse Mortgage Funding, according to court documents and news reports.