New Century Asks Court To Help Prevent Litigation

Law360, New York (May 17, 2007, 12:00 AM EDT) -- Subprime lender New Century Financial Corp. filed a motion Wednesday asking the court overseeing its bankruptcy to allow it to provide “adequate protection” to various counterparties of its master repurchase agreements in order to avoid possible adversary proceedings.

New Century funded its pre-petition operations mostly through these master repurchase loan agreements with various financial services companies, and now the bankrupt lender fears those parties will come after it through post-petition litigation.

Master repurchase agreements are common in the mortgage industry and involve the sale and repurchase...
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