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Jonathan Bow…, Real Estate Pro in Dorchester, MA

What do you think of Bank of America's acquisition of Countrywide?

Asked by Jonathan Bowen, Dorchester, MA Fri Jan 11, 2008

It seems as though Wall Street doesn't initially lke the deal. Do you think Main Street will like the deal? Personally, I think Angelo Mozilo is a snake. He knew Countrywide was in serious trouble when he made that financing deal with Bank of America a few months back and denied the acusations on CNBC. Basicly, Bank of America was forced to buy Countrywide today. So, what do you think? I'm looking forward to your answers. Take care, Jon

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I think Countrywide started to renegotiate loans with borrowers who were in trouble. I heard about several borrowers who were contacted by Countrywide to work out a plan to avoid foreclosure. I think they were on the right course. I have not heard good things when it comes to negotiating short sales with BofA and I am concerned that BofA's takeover will be a step backwards. I hope I am wrong.
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2 votes Thank Flag Link Fri Jan 11, 2008
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
The regulators and the Bush Administration are desperately, desperately trying to avert a collapse of the entire financial system. This buys them some breathing room, but I don't know that, long-term, this is the best thing. How many other major banks can be strong-armed into buying failing lenders? And what effect will this have on those major lenders? It won't be good. The argument, of course, is that the alternative was worse...having Countrywide fail.

But, you know, I'm pretty tired of that argument. Without getting into politics, where have we heard the argument before: "Well, getting in was a mistake. But now that we're in, there's really no alternative but to stay. There'd be chaos if we withdrew now." Yes, there would be.

But I wonder: Why aren't people who make such incredibly bad decisions (OK, I'm back to the mortgage mess, unless someone wants to read more into this answer) held accountable? And is it always best to say, "Well, now that we're in this quagmire, we have to stay in it"?

That's what I think.
2 votes Thank Flag Link Fri Jan 11, 2008
Don Tepper, Real Estate Pro in Fairfax, VA
I would have to agree with Ute, if BOFA uses some of the same business practices and transfers them over to countrywide we might all be affected. At least me do to Countrywide's huge market share of California mortgages. Countrywide is an understanding bank and are working well with borrowers. BOFA is opposite. Both good banks for what they do, but on to sides of the spectrum. If we lose a lender like countrywide it would be a big deal for alot of people.
1 vote Thank Flag Link Fri Jan 11, 2008
This is an excellent topic and that is a very astute remark on your part about Mozilo ...

2 years ago Countrywide was in big trouble ...

Remember, they were pounding millions into those branches that were failing the day after they opened ...

Did they really think they would get 65% of the local neighborhood mortgage business.? put that aside, did they really think they would acquire $5 million in savings and checking accounts per branch per month.? ... and they were getting ready to open up another 55 branches .... they didn't make enough money to support any singular branch and they were losing $255,000 a store per month.

I guess my question would be, how are they going to handle all of the Full Spectrum flack ....
1 vote Thank Flag Link Fri Jan 11, 2008
Well like this or not it has the potential to make these two players a Super Power if they can right each others ship. The Countrywide Brand Name was a good one and their customer service and Product line was very rich. I hope it keep them in the business because all CEO's are Snakes but the People are the best resource.

For my part I hope this works out because if they go under we are all in HUGE trouble.

Bets wishes to Countrywide and B of A.

Dirk Knudsen
"The Real Estate Doctor"
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1 vote Thank Flag Link Fri Jan 11, 2008
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