Countrywide going under?

[The Annoyed Man]

Just read on another forum that Countrywide is going belly up.  Any truth to this?  What happens to people that have mortgages with them and are they going to get farked on their escrow accounts?

[AZRedhawk44]

I heard about them going under about 2 years ago... are they going under AGAIN?

[Headless Thompson Gunner]

Countrywide is on the short list of companies that investors think could fail due to the mortgage mess .  But as of right now, I don't think there's any solid evidence that Countrywide is going under.

Bank of America had plans earlier in the year to buy out Countrywide.  BoA wanted to improve it's mortgage biz, and buying out the biggest mortgage company (Countrywide) would be a darned easy way to do that.  It wasn't intended to be a bailout. 

I don't know the current status of the buyout deal, but I suspect it has stalled somewhat in light of the mortgage blowup.  Having seen what happened to Bear Sterns, nobody wants to touch companies like Countrywide and Lehman. 

[The Annoyed Man]

That a 'subprime mortgage crisis' even exists is prima facie evidence that the lending industry needs oversight/regulation.  People lose their homes while lenders walk away with fees and interest.  Sounds more like some corrupt 3rd world dictatorship than the U.S.A.

[Manedwolf]

That a 'subprime mortgage crisis' even exists is prima facie evidence that the lending industry needs oversight/regulation.  People lose their homes while lenders walk away with fees and interest.  Sounds more like some corrupt 3rd world dictatorship than the U.S.A.

MORE BIG GOVERNMENT! MORE MORE MORE!

Yes. The solution to any problem is to create more bureaucracy, until it runs just as smoothly as the IRS.

People mostly lost their homes because they thought they were ENTITLED to a McMansion on a low salary. Guess what...they're not!

Stupid should hurt. Read the contract next time. Taxpayers should not have to pay for stupid.

[Brad Johnson]

People lose their homes while lenders walk away with fees and interest. 

Not really, the lenders take it in the shorts when the properties sell at a loss.

You think there is a mortgage mess now?  Let the fed get involved and see what happens.

Brad

[Manedwolf]

People lose their homes while lenders walk away with fees and interest.

Not really, the lenders take it in the shorts when the properties sell at a loss.

You think there is a mortgage mess now?  Let the fed get involved and see what happens.

Brad

Boston's solution to the problem was to propose mandating that lenders can no longer evict based on foreclosure, and must become a landlord, renting the property to the defaulted former owner, with all renter's rights laws in force. The lenders would be responsible for everything from the roof to appliances. Needless to say, large, well-known lenders have said they'll bail on the city entirely if that passes.

I'm sure Paddy would approve.

[cassandra and sara's daddy]

what i saw when the feds fixed the savings and loan industry does not inspire confidence

[ilbob]

Just read on another forum that Countrywide is going belly up.  Any truth to this?  What happens to people that have mortgages with them and are they going to get farked on their escrow accounts?

The mortgages are an asset. Maybe not worth as much as they are booked at, but someone will buy them because they have value. If worse comes to worse, the bankruptcy court will sell off the assets. Normally it does not get that far. usually some kind of deal is struck that the court approves as in the best interests of the debtors (that would be the people that countrywide owes money to).

The escrow accounts are not supposed to be commingled with the general corporate funds and are actually the property of the mortgagee, not the mortgage holder. They "should" be OK.

[ilbob]

That a 'subprime mortgage crisis' even exists is prima facie evidence that the lending industry needs oversight/regulation.  People lose their homes while lenders walk away with fees and interest.  Sounds more like some corrupt 3rd world dictatorship than the U.S.A.

people are losing their homes because they aren't making their mortgage payments. the reason is mostly the fault of the federal government for lowering lending standards for government insured mortgages. when you have almost no equity in your home, there is little incentive to pay your mortgage when times get a little tough.

admittedly there was a certain amount of shenanigans that went on with some of the home valuations, and mortgage standards, but most of that can be traced directly to the feds, for their stupid policies that encouraged upside down loans from day one.

the mortgage holders are the ones that will get hurt the most from the bad loans. no amount of fees will ever make up for the costs of foreclosing on these homes, or for writing down the loans to what they are really worth. in most cases loans that are upside down have zero value.

[Jamisjockey]

That a 'subprime mortgage crisis' even exists is prima facie evidence that the lending industry needs oversight/regulation.  People lose their homes while lenders walk away with fees and interest.  Sounds more like some corrupt 3rd world dictatorship than the U.S.A.

That's right....because the idiots that thought they could get something for money, and that the housing market was a free ride to riches.....yeah....they don't have anything to do with the housing market crisis. 
Lets give the government more power! yeah!
Hey, Paddy, the DU forums called, they miss you over there.

[cassandra and sara's daddy]

What do they mean by "bail"?  I don't live in Boston, but I'd LOVE it if they "bailed" on my mortgage.  I'm guessing all it means is no more new loans there...


yea?  you'd love it?  especially when you can't sell it cause no one can get it financed

you have a mortgage?  in real life?

[thebaldguy]

People bought houses they can no longer afford. Lenders gave loans to everyone with a pulse. I do not think either of these groups deserve my tax dollars, although financial institutions have been the beneficiaries of those "credit infusions" over the last several months.

[cassandra and sara's daddy]

nah i might have to adjust for comprehenson though  . aim a lil lower

[The Annoyed Man]

Not really, the lenders take it in the shorts when the properties sell at a loss.[/quote]

No, the people who purchased the paper experience any loss.  The loan packagers, who made the loan, walked with fees, points, and advance interest.  C'mon Brad, you're in the RE business.  Surely you know this.

You think there is a mortgage mess now?  Let the fed get involved and see what happens.

Corrupt/sloppy business practices inevitably bring more regulation.  If businesses can't police themselves, it needs to be done for them.

[Jamisjockey]

Not really, the lenders take it in the shorts when the properties sell at a loss.

No, the people who purchased the paper experience any loss.  The loan packagers, who made the loan, walked with fees, points, and advance interest.  C'mon Brad, you're in the RE business.  Surely you know this.

You think there is a mortgage mess now?  Let the fed get involved and see what happens.

Corrupt/sloppy business practices inevitably bring more regulation.  If businesses can't police themselves, it needs to be done for them.

[/quote]

Help!  Save us from big business!

Have you ever heard the phrase "there's no such thing as a free lunch?".  Listen here.  Greedy, pompus, idiot consumers are just as much to blame.  Assuming that the real estate market would only go up....how *expletive deleted*ing stupid can people be?  Have you heard the stories of neighborhoods in Florida that are 75% vacant?  Speculators and greedy homeowners only have themselves to blame. 
But yeah, the government needs to step in and save them from thier own stupidity.
 

[Sindawe]

People bought houses they can no longer afford.

Therein lies the problem IMAO.  Interest only/zero down loans on more house than one can afford, using an ARM is just plain folly, a fact I understood 12+ years ago when I bought my home.  I looked for a place that meet my needs and at a price where the monthly mortgage was equal too to the rent I was paying at the time.  Locked the interest rate for the life of the loan and houseing costs have never been a concern since, even during periods of unemployment.

Corrupt/sloppy business practices inevitably bring more regulation business failure, leaving those smart/wise enough to not be corrupt/sloppy still standing and doing business.

Fixed it for ya.

[41magsnub]

Echoing the folks who say stupid should hurt here.  Businesses made crappy decisions?  Deal with it, take the losses and maybe some folks will learn from it.  Otherwise this will happen again and again because Uncle Sugar will come in again and again and make it all right at the expense of the folks who did not make the mistake.

[wmenorr67]

Stupid is as stupid does.

Looking to buy a house at the first of the year.  But not going to do anything that will jepordize not being able to make my payments a year or so down the road.

[Brad Johnson]

Not really, the lenders take it in the shorts when the properties sell at a loss.

No, the people who purchased the paper experience any loss.  The loan packagers, who made the loan, walked with fees, points, and advance interest.  C'mon Brad, you're in the RE business.  Surely you know this.

For the purposes of this thread (and my reply)...

Person who holds paper (no matter who orginated, sold, or bought it) = Lender.

I used to obsess on technicalities, too.  But I learned that in some situations it's wasted time and effort.

Brad