American Home Mortgage obtains court approval of agreement with ABN Amro

By Reshmi Basu

New York, Aug. 22 - American Home Mortgage Investment Corp. obtained court approval of a stipulation agreement with ABN Amro NV, which would resolve a dispute over the servicing rights of 430 mortgage loans, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

According to earlier court documents, ABN contended that it has a claim to $145 million of mortgage loans that is being serviced by American Home Mortgage. The Dutch bank said it ended its servicing agreement before the company declared bankruptcy.

Under the stipulation agreement, American Home Mortgage can request ABN Amro to fund additional mortgagor advances up to $32 million. The bank has the authority to make the servicing payments to American Home Mortgage for continued servicing of the mortgage loans.

All collections received by American Home Mortgage will be deposited into an account for ABN Amro.

American Home, a Melville, N.Y.-based real estate investment trust focused on residential mortgage loans, filed for bankruptcy on Aug. 6. Its Chapter 11 case number is 07-11047.

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