Letters to the Editor
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Deja Vu All Over Again
[Mozilo] assured his audience that Countrywide's "proprietary technology" would help it meet its goal "to avoid any foreclosure."
Sounds just like the crap that credit card outfit Providian was spewing, just before it imploded a few years ago.
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Don't forget...
Enron!
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Maybe with all this shakeup
They'll forget that I owe them $298,000. That would be sweet!
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I think you're off the mark, Andrew
And I believe you do them a disservice. It's pretty clear that the mortgage market is in the shit can but I don't believe you can lay the responsibility for that at Countrywide's doorstep. Countrywide's problems came not from loan defaults or excessive late payments (i.e. they didn't have an unexpected drop in income which would be indicative of poor lending practices), nor did they get in trouble with the point spread between their short term borrowing and their long term lending per se. They got in trouble because short term credit dried up thanks to what other lenders were doing.
As soon as I read your article, I went to the Countrywide website and found a rebuttal to the NYT article that so lambasted them. If you haven't read it, it's here http://about.countrywide.com/about/Docs/cfclendingpractices.pdf. What I found written up there struck me as a very fair set of lending practices and much of their process I can personally verify to be accurate and has been consistent over time. Full Disclosure here: In 1994 I found myself financially distressed as a result of a divorce and child support obligations and desperate to hang onto the house that my kids had been growing up in. I was prepared to sign up to any loan that would allow me to buy my ex out of her equity and keep the house. Countrywide told me that I qualified for a prime loan and they gave me one and they verified all my income and expense data - it wasn't taking my word for it as you hear so much of today. And the rest of their process as they describe it is pretty much as I remember it. It worked out fine for everybody involved. In that regard, I would also point out that making subprime loans is not always predatory. Stealing Monte Python's lesson in formal logic, A propositions may only be partially converted (the resulting proposition is called an I proposition). Thus while all of Alma Cogan is dead, only some of the class of subprime loans are predatory. And we want our bankers to make subprime loans. There is an excellent discussion of this in the book "Paper Money" by Adam Smith (a pseudonym, of course).
So they're going to lay off 12,000 people. I certainly feel sorry for the people involved but if their business is off, what do you expect? There is no company or industry that I know of that can experience a precipitate drop in business and stay the same size.
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This Guy Lazlo Mozzerella is a Rich Twit...
And Countrywide has been an arrogant creep of a giant company. Their customer service was worse than terrible. Their FAX machines did not work. If I had not been on top of my situation, Countrywide and Lassitudo Mortadella would have turned me into a tax delinquent.
And now the mega-don't-matter-no-more-I'm-so-rich Lackwit Mezzanino is going to lay off TWELVE THOUSAND HARD-WORKING EXPLOITED EMPLOYEES who mostly are Countrywide mortgagees to boot!
Deep doo-doo! And Lowrent Malfealso will just skate away. Such a disgrace. Take him to Guantanamo.
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Seems lending money to people that cant pay you back...
...turned out to be a poor business strategy in the long run. Shoving trillions of borrowed dollars into the housing market, driving prices up and up sure looked like a good way to keep Joe Sixpack making payments forever...until Joe became physically incapable of earning enough to make the payment.
If they've got you in their clutches, let them have the house back. In 7 years you will be back to normal. If you try to bull through it, in 7 years you will be a burned out husk, making payments on a loan that is still worth more than the house it bought.
Don't be a slave.
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If you're that much upside down
And you don't have any equity in your home, just mail the keys into the bank and leave. People in the Dallas area in the late 80's did this a LOT.
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the CEOs of these companies
should be brought up on charges of treason. these bloodsucking motherfuckers weren't just scamming these ignorant (and, yes, willfully so in all too many cases) homebuyers, the staggering scale of this fraud is bringing down the u.s. economy and causing a severe hit internationally. the more detail that surfaces about how these business operated, and it's beyond infuriating that pigs like mozilo are walking away with millions.
read that gretchen morgenstern article in the nyt about how countrywide did business. "proprietary technology" indeed.
http://select.nytimes.com/gst/abstract.html?res=F10C1EFB34590C758EDDA10894DF404482
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@Twiddles (~~~~~~)
...If you're that much upside down and you don't have any equity in your home, just mail the keys into the bank and leave. People in the Dallas area in the late 80's did this a LOT.
People in Dallas in the late 80's didn't have the all-compliant 109th Congress to make sure they couldn't get out of loans that easily.
Nowadays, you try that and they'll track you down and make you pay for the loan anyway. No more easy-bankruptcy laws in THIS democratic republic, Sir! Or Madam.
My mortgage is with Countrywide - fixed rate, 30-year, so I don't THINK they can find a way to jack with me...but I will note that they unilaterally decided to stop sending me paper statements and bills as of last month.
Sure, less paper waste, good for the environment, etc etc. But also, greater chance that the customer will forget, since the only notification one gets is via email. And then, late fees, maybe even defaults, ya never know.
They're already charging me $3 a month for the privilege of paying my mortgage online, ON TIME. That kind of stuff adds up. Though apparently it doesn't add up to the salaries of 12000 employees.
I don't begrudge corporations making a profit. I DO begrudge them making obscene profits, and then laying off massive numbers of employees when the profits drop from the obscene range to the merely reasonable.