Novastar Reports $733M Loss, Warns Of Bankruptcy

Law360, New York (April 2, 2008, 12:00 AM EDT) -- One-time subprime mortgage lender Novastar Financial Inc. lost more than $733 million in 2007 and has said it could file for bankruptcy if adverse liquidity events cause the company to exhaust its existing cash reserves.

Kansas City, Mo.-based Novastar shut down its mortgage-lending operations in 2007 and early 2008.

It said in the Form-10K it filed with the U.S. Securities and Exchange Commission on Tuesday that there is a significant possibility that the company might not have enough cash available to operate its business, pay debts...
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