U.S. lenders Thornburg, Accredited file for Chapter 11

By Al Yoon

NEW YORK (Reuters) - Two large providers of U.S. home loans during the housing boom, Accredited Home Lenders Holding Corp and Thornburg Mortgage Inc, filed for Chapter 11 bankruptcy on Friday, according to court documents.

The San Diego, California-based Accredited is owned by U.S. private equity manager Lone Star Funds, which bought the provider of subprime mortgages in 2007 for $296 million.

The lender will wind down operations, and is looking for a buyer of assets including its servicing business and properties owned through foreclosure, according to a source close to the matter.

"Extremely challenging market conditions" led to the bankruptcy of Accredited, the source said.

Accredited last year tried to revive itself after halting offering loans in August 2007 as the subprime lending market began to unravel. The company resumed making loans after its purchase by Lone Star, and its executives expressed hope that funding from securitizing mortgages into bonds would bounce back.

Accredited listed between $100 million and $500 million in liabilities and between $10 million and $50 million in assets, according to court documents.

It listed HSBC USA NA as its largest unsecured creditor, which it owes $90.8 million. Other large unsecured creditors include Citigroup Global Markets Realty Corp, owed $33.1 million, Goldman Sachs Mortgage Co, owed $21.1 million and Morgan Stanley Mortgage Capital Inc with a $13.2 million unsecured claim.

Thornburg Mortgage THMR.PK was once one of the leading providers of "jumbo" home loans, or those for more than $417,000.