New Century Financial Files For Bankruptcy

Bankruptcy

Subprime mortgage lender New Century Financial has filed for bankruptcy protection.

Once one of the largest providers of subprime mortgages in the United States and now a casualty of the slumping housing market and aggressive lending practices, the company said it is immediately firing 3,200 workers -- more than half its workforce. Company officials hope the business can be sold.

New Century officials also said they will sell the company's loan servicing business to Carrington Capital Management and its affiliate for approximately $139 million, subject to the approval of bankruptcy court.

New Century, based in Irvine, Calif., filed the bankruptcy action in Delaware.

More than two dozen subprime lenders have shut down in recent months, and others are scrambling to stay in business.

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