Luminent Mortgage Announces Good News

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Luminent Mortgage Capital Inc. has had their share of bad news recently, with the mortgage industry being in the crapper for the most part. So now when they announce some good news, it tends to ease some investor’s minds.

The San Francisco-based mortgage investor, whose stock slid from more than $15 at the height of the housing boom to as low as 36 cents this year, in August reached a deal with financier Arco Capital Ltd. Arco Capital agreed to lend Luminent $60 million and buy $65 million of the company’s loans in exchange for the right to buy a majority stake in the company at a steep discount.

With that money, Luminent said Monday it repaid all its debt under “warehouse” credit lines, or lines investment banks extend lenders to issue home loans slated to be repackaged into bonds.

Although the company is in no imminent danger of folding, it’s hard to imagine any “go go” days coming for them soon. But bottom fishing value investors have to be interested in this one.

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