merican Home Mortgage Investment Corp. shares plunged 89 percent after the lender said it doesn't have cash to fund new loans and may have to sell off assets.
Investment banks cut off credit lines, leaving American Home without money yesterday for $300 million of mortgages it had already agreed to provide, the Melville, New York-based company said in a statement today. It anticipates $450 million to $500 million of loans probably won't get funded today.
``They can't function without access to capital,'' said Bose George, an analyst with KBW Inc. in New York. ``The company either has to file for bankruptcy or go through some type of rescue or restructuring, and either way will leave almost nothing for the common shareholders.''
Ballpark guess 1500 people are about to find out they aren't buying that house after all.