GMAC Financial Services — which is considering selling its troubled residential division — said it will take $3.8 billion of mortgage-related charges in the fourth quarter.
Late Monday, the government-controlled GMAC specified that of the $19.7 billion in assets currently on the books of Residential Capital Corp. (ResCap), $4.3 billion have "greater economic exposure."
The company now plans to sell what it calls "higher risk mortgage loans" but at press time it was unclear how much. The company said it is now holding certain problem assets at "net realizable value." These assets include mortgage servicing rights, foreclosed homes, trading securities, and international receivables.
Investment banking sources say Berkshire Hathaway has expressed interest in buying part of ResCap but that its inquiries date back several months.
Last month, a unit of Berkshire bought the bankrupt Capmark Financial, a commercial mortgage banking firm. Berkshire officials declined to comment on reports about its interest in ResCap.
According to the Quarterly Data Report, ResCap ranks fifth among all residential servicers with $380 billion in servicing rights. To date, the government has pumped $15.1 billion of capital into GMAC through preferred stock and other maneuvers.