[American Home Mortgage] The lender slashed Q1 profit targets to 40-60 cents a share, below views of $1.01. It struggled to sell mortgages and will stop making some "alt-A" loans due to losses. M&T Bank, which also makes many "liar loans," cut views last week, citing trouble selling mortgages. These warnings raise concerns that lending woes are spreading beyond subprime. American Home fell 15%.
That's two more companies that are having problems thanks to the mortgage market. Interest rate roundup had a nice take on the M&T Bank situation in a post titled, "So much for the lack of Alt-A spillover ..."