Ditech Financial LLC (rebranded from “ditech Mortgage” and "Green Tree Servicing" in 2015) was a provider of
home loan,
loan servicing and
refinance products to consumers and institutional partners in the U.S.
In May 2014, Ditech announced its re-entry to the national housing market after it “disappeared” from the marketplace for five years during the
subprime mortgage crisis
The United States subprime mortgage crisis was a multinational financial crisis that occurred between 2007 and 2010 that contributed to the Financial crisis of 2007–2008, 2007–2008 global financial crisis. It was triggered by a large decline ...
in the late 2000s.
It also announced a corporate re-branding with its servicing affiliate, Green Tree Servicing, which took place in 2015.
History
In 1995,
John Paul Reddam founded DiTech Funding Corporation (DiTech) in
Costa Mesa, California
Costa Mesa (; Spanish for "Table Coast") is a city in Orange County, California. Since its incorporation in 1953, the city has grown from a semi-rural farming community of 16,840 to an urban area including part of the South Coast Plaza–John Wa ...
.
The company's name was derived from the phrase “direct technology.”
[ DiTech became one of the first lenders to offer mortgages to the public online and via a toll-free number.][ In April 1995, Reddam began originating, selling, and servicing mortgage loans tied to the prime interest rate. Reddam's business model quickly extended DiTech's operating territory to seven states by the end of the 1995, and 46 states by the end of 1996.][ DiTech's rapid growth was fueled in part by an aggressive marketing campaign that included a national television commercial featuring a frustrated loan officer who would mutter, "Lost another loan to DiTech," after losing business to the company.][ DiTech became a household name as a result of the commercials.][
In 1999, DiTech was acquired by GMAC (now Ally Financial), then owned by ]General Motors
The General Motors Company (GM) is an American Multinational corporation, multinational Automotive industry, automotive manufacturing company headquartered in Detroit, Michigan, United States. It is the largest automaker in the United States and ...
.[ Reddam left the company in 2000.][
In 2005, DiTech was organized as a business unit of ]Residential Capital, LLC
GMAC ResCap, Inc. was a residential mortgage loan originator and servicer based in Minneapolis, United States. As a result of its exposure to subprime lending during the subprime mortgage crisis, the company filed for bankruptcy protection in 201 ...
(often referred to as "ResCap"), which controlled mortgage-related subsidiaries owned by General Motors Corporation.stated income loan
A stated income loan is a mortgage where the lender does not verify the borrower's income by looking at their pay stubs, W-2 (employee income) forms, income tax returns, or other records. Instead, borrowers are simply asked to state their income, ...
s, and many borrowers falsified their incomes. In 2006, ditech.com general manager Michael McCarthy resigned and was replaced by Richard D. Powers.[
Powers introduced "People Are Smart," an advertising campaign that leveraged GMAC's reputation as a responsible lender and stressed the importance of making prudent decisions based on expert advice provided by ditech.com loan consultants.
In February 2010, GMAC relocated ditech.com offices from Costa Mesa to ]Fort Washington, PA
Fort Washington is a census-designated place and suburb of Philadelphia in Montgomery County, Pennsylvania, United States. The population was 5,446 at the 2010 census.
History
Prior to the Revolutionary War
the Fort Washington area was settle ...
. In May 2010, GMAC changed its name to Ally Financial.
In 2012, during the mortgage crisis, Ally took its residential lending unit into bankruptcy in order to pay back the U.S. Treasury following its acceptance of bailout funds. In November 2012, Ditech was formed from assets of the estate of GMAC ResCap during the bankruptcy proceeding.[
]
Purchase by Walter Investment
In March 2013, Ditech was acquired by Walter Investment Management Co. from Ally Financial, the former GMAC ResCap.[ Following the acquisition, Ditech used the name of Walter's Green Tree Servicing subsidiary to originate loans for regulatory and licensing reasons.][ DT Holdings, Ditech's parent company, is a subsidiary of Walter Investment Management.
In March 2014, the company resumed originating loans using the Ditech name.][ The brand had effectively “disappeared” from the marketplace for five years during the mortgage crisis, and the company decided to bring Ditech name back after determining that consumers held largely positive views of the brand.][ In May 2014, Ditech announced its re-entry to the U.S. housing market.][
]
Corporate Re-brand
In March 2015, Ditech, along with Walter Investment affiliate Green Tree Servicing, announced the two would undergo a co-branding effort to become "Ditech Financial, A Walter Company," bringing Walter's origination and servicing entities together under one, recognizable brand name. The transition concluded in the second half of 2015.
Lending
Products
Ditech offers a range of home loan and refinance options. Home loan options include fixed rate, adjustable rate and FHA loans. Refinancing options include fixed rate, adjustable rate and FHA loans, as well as special financing programs such as HARP
The harp is a stringed musical instrument that has a number of individual strings running at an angle to its soundboard; the strings are plucked with the fingers. Harps can be made and played in various ways, standing or sitting, and in orche ...
with expanded loan-to-value limits for qualified applicants.[ The company will no longer provide ]nonprime mortgage
In finance, subprime lending (also referred to as near-prime, subpar, non-prime, and second-chance lending) is the provision of loans to people in the United States who may have difficulty maintaining the repayment schedule. Historically, subpri ...
s.[
]
Institutional partner strategy
In May 2014, Ditech launched a co-branding and joint-venture initiative with more than 600 institutional partners that provide mortgage and refinance loans to their customers.[ The strategy encompasses direct consumer lending and correspondent lending.][ Institutional partners can price, lock and deliver individual loans through the Ditech website.][ In June 2014, Ditech's correspondent lending division began focusing on services for community banks and credit unions, offering their customers access to Ditech's technology, underwriting, processing, servicing and marketing expertise.
]
Advertising
Ditech is well known for television commercials that aired during the 2000s. They featured a nefarious loan officer, played by actor Ron Michaelson, repeating the catchphrase "''Lost another loan to Ditech''" written by writer, producer and director Ken Roberts, who created the Ditech television and radio commercials from 1995 to 2007.[ In May 2007, the company introduced a new marketing campaign, adding the tagline "People Are Smart" and including the signature line ''Home financing by GMAC'' to further help distinguish the Ditech brand from direct-to-consumer lenders of questionable repute. Ditech had immensely high unaided brand awareness and customer satisfaction, but many people mistakenly thought Ditech was a subprime lender.]
Bankruptcy
In February 2019, Ditech filed for bankruptcy for the second time in as many years.
References
External links
Company Website
{{General Motors
Ally Financial
Mortgage lenders of the United States
American companies established in 1995
Financial services companies established in 1995
Companies based in Costa Mesa, California