Skyline Cos. badly shaken by default of mortgage firm
The Skyline Cos, the Falls Church firm formed two years ago to handle the $1.4 billion bankruptcy workout of the Equity Programs Investment Corp. (EPIC), itself is threatened with financial collapse.
Skyline's future, which only two months ago was described as bright by its president, Stuart A. McFarland, took a decided turn for the worse when an actuarial review of Los-Angeles-based TMIC Mortgage Insurance Co. showed a potential $100 million gap between the insurer's reserves and its claims.
That started a chain reaction in which the commissioner of Insurance for California suspended all claim payments by TMIC. Included were payments on mortgages for 6,600 houses previously held by EPIC and currently on Skyline's books. TMIC missed its January payment to Skyline, and the $485 million in mortgages went into default.
With the mortgages in default and lenders foreclosing on the properties, Skyline stands to lose part or all of the income it …