Diabolical mustache-twirling, evidence-forging, subprime mortgage lender Countrywide reassured investors that it had no plans to go bankrupt, despite the fact that loan fundings dropped 45% from last December, says Marketwatch. There is a bright side, of course, for those of you who haven’t yet given your money to Countrywide:
Financial institutions that have run into difficulties and need consumer deposits to fund loans and build up their capital levels. Countrywide and E*Trade Financial Corp. (ETFC), both of which have been hit hard by the credit crunch are offering some of the industry’s highest rates on products like certificates of deposit.
Egan Jones, a ratings company, wrote in a report on Tuesday that Countrywide is “severely challenged and might falter if it does not receive an infusion of at least $4 billion within the next couple of weeks.” It said funding is needed because of a 40% decline in mortgage originations at the savings-bank company and a shift away from formerly profitable subprime-mortgage loans.
Reacting to the bankruptcy rumors, Countrywide spokesman Rick Simon said, “There is no substance” to them “and we are not aware of any basis for the rumor that any of the major rating agencies are contemplating negative action relative to the company.”
So, if you’re seeking better interest rates, and are morally flexible about who you give your money too, look for companies that are in dire need of an infusion of cash. Who’s the predatory lender now? Don’t you feel cool?
Countrywide December loan fundings down 45% [Marketwatch]
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and if countrywide does go bankrupt, what happens to the mortgage that consumerist told me to go out this week and get?
@snazz: It just gets sold to some other company. Nothing adverse to you inherent in that.
@snazz: it is doubled.
probably just bought by a stronger bank and you get to deal with the transition. weeeeeeeeeeeeeeeee
I can always tell when it’s Meg – mustache twirling abounds.
@snazz: maybe you should wait to see what the consumerist tell you to do next.
Who cares? Countrywide Bank is FDIC Insured, you will get your money and dealing with the FDIC is not a bad process…I had a friend who got his money within a few weeks of claim….I’m all about their rates.
If the money is insured by the FDIC then it takes any risk away from which bank you use. Go for the highest yield. It is up to the FDIC to manage the risk of the money it insures.
completely agree, as long as you stay below the FDIC limit, go to whatever bank has the highest rate. Etrade has a savings account with a 5.05% rate right now
Yeah… the FDIC limit used to seem unattainable to us, but it’s actually a concern now. $100k isn’t what it used to be, I suppose.
That said, it’s shockingly rare for banks to go out of business so spectacularly that the FDIC needs to pay up. Generally another bank will just buy up everything, and you’ll barely notice a difference until the “merger” is announced a few months later. It’s probably not a real concern yet.
Damn Countrywide to hell. These idiots decide to voluntarily take on some of the worst risk ARM-over extended-junk loans out of sheer greed and then when their pool of loans fails because they were destined too they cry and whine and complain and we get to read stupid asinine media types calling it a “loan crunch”, call it what it is, a poor business decision come home to roost.
I’ll stand up and do the Snoopy dance when Countrywide goes belly up
I wish Countrywide going bankrupt meant that I didn’t have to send my mortgage payment to them anymore.
They could save money by quit sending me refinancing letters 3 times a week. I think I am happy with my fixed rate.
@dave511:
That was my first thought when I read this.
If Countrywide does go belly up, please don’t let my mortgage go to Chase. We went through hell with them when we refinanced.
OMFG…I just opened a 3 month CD there last Dec.!!!!!! So that’s why their CD rates are so high. *shakes head*
I hear you Sleazell! If they’re still wondering how they got themselves into this mess, they need only receive their own mailers to understand.
“Now’s a great time to take out a home equity loan!”
“Lower your monthly payments by refinancing with an ARM!”
“Invest in your peace-of-mind with a new fixed rate loan!”
Uh…guys? If I want to saddle myself with more debt, I’ll let you know. Otherwise, please leave me alone while I dutifully pay my mortgage on time each month.
Banks don’t go bankrupt, they go insolvent.
I feel much better about not buying their 5.35% three month CD now.
What if someone has a mortgage with them? What about a CD or bank account? What will happen? FDIC insured?
5.45% on a 6mo CD as of this morning – I’m willing to risk the hassle of an FDIC claim for an extra couple of hundred dollars over the pathetic rates that Wells and BofA are giving these days.
If they belly up the government bails them out. Remember that politicians and business people believe welfare is only wrong for the individual, not for corporations…
@econobiker: They “bail out” the bank because of all the little people that lose their money. Have you ever seen “It’s a Wonderful Life”?