by Calculated Risk on 8/21/2007 08:41:00 PM

From AP: First Magnus Files for Bankruptcy (hat tip Gary)

First Magnus Financial Corp. filed for bankruptcy Tuesday ...

The lender's total assets were estimated at more than $942 million and its total liabilities at nearly $813 million in the company's bankruptcy petition ...
...
First Magnus, which originated home loans and then sold bundled loans into the secondary loan market, stopped taking mortgage loan applications and fired 99 percent of its 6,000 employees Thursday.
...
''The company went out of business overnight,'' [company spokesman Gary] Baraff said . ''Three weeks ago we were at the apex of the company's history. Everything was falling into place for us, and we had remarkable momentum across the country. It was shocking to everyone that essentially the secondary market collapsed.''

First Magnus was caught in the credit liquidity crunch now causing a meltdown in the mortgage industry, even though it was not engaged in selling ''sub-prime'' mortgages that sparked the crisis in recent months.