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CW-THE WAY I SEE IT!

Okay, the naysayers should be out in full force today. They'll say Countrywide's DEAD. See we told you, you better get ready to duck when the sun reaches the earth. You know it's falling out of the sky don't you? We've been telling you this for a month or more.

Well, news as reported in the national press has it's own spin with the sole purpose, in my opinion, to sell papers and /or advertising.

"Countrywide taps $11.5B line of credit." CNNMoney.com 08/16/07

The article doesn't disclose who CW has their line of credit with, but I'm going to go out on a limb and believe it's not Guido and the money didn't arrive in an extremely large brown paper bag.

So what we have is a very large and stable financial institution, who has evaluated and continues to evaluate CW's financial position, who has granted CW a line of credit for $11.5B. They are both aware of today's current market situation and the negative news being generated by the national press.They could have closed the line, as many others have, but instead allowed CW to pull the trigger on the $11.5B dispersement. It's not likely that they were unaware or didn't notice what was going on.

That looks to me like a fairly strong endorsement of the CW position by an institution that has had and still has the ability to evaluate CW's records.

Talk about putting your money where your mouth is.

Okay, if CW files Chapter 11 this afternoon before the close of business my phone number is on the right. Please feel free to call me and tell me how wrong I was, but I won't be expecting any calls anytime soon.

ps; the title of the article is the way I see it. This is just one man's opinion, and the 30 years of experience in the mortgage business doesn't really have any value at all.

Posted by Jay Beckingham on 08/16/2007 08:24 AM

Comments (26)

florida, southwest florida, mortgages, cape coral, ft myers, estero, lehigh acres, bonita springs, naples, port charlotte, loans

26 Comments on CW-THE WAY I SEE IT!

AUG

2007

I hope you are right...I have a listing that is closing next Friday and the buyer is financed through CW. (not my buyer)

I'm sure you're phone will not be bombarded this afternoon. Unless you're getting client calls!

"Well, news as reported in the national press has it's own spin with the sole purpose, in my opinion, to sell papers and /or advertising."

We wish more people would realize this. Newspapers are not non-profit organizations... when will the public realize this?

Jay you are right on the money on this one. The media is making the "credit crunch" out to be much worse than it actually is. If you were to believe everything that is said on CNBC it would appear that unless you have a 20% downpayment and stellar credit you are unable to qualify for a mortgage and we know that this is just not the case. Yes there is a problem and yes some of the more "agressive" mortgage products have dissappeared but last time I checked the sky was still above me.

I'm in the same boat here. I don't believe that a company with as strong a track record as CW is going to go down in a day, but then nobody thought the Titanic'd sink either. This is just the next gloom and doom story from the media and CW has the target on it's forehead. I like your thought process. The company will weather the storm and might, as has been said before, come out stronger than ever with fewer competitors.
BTW...I have 0 years experience in the mortgage industry.

Kelley,

personally, i don't think you have a problem. in the future if you feel uncomfortable use someone else.

Jim & Maria,

the markets are so dead that the battery on my cell died yesterday also (oops that was from customer calls)

Paul & Michelle,

the media likes whatever sells, we'll keep fighting this.

Rob,

some of the programs were bad programs. their gone now. okay.

Andrew,

i don't know how cw feels, but i'd be pretty cocky if i had $11.5B in my pocket.

thanks to all

jay

CW used the entire 11.5 Bil. i one day to stay afloat. It stayed in their pocket for one day. It keep the wolf out the door though

realty is the mortgage market is in trouble, some sort of centralized bailout is on the way. SWFL is having a huge foreclosure problem. The ARM resets are starting to kick in.

Companies are buying whats out there paperwise at a discount, a big discount, new paper is not being bought

FHA is the new way to sell houses, I guess the old-new way.

one more note on CW

The feds will not let 10 percent of the mortgage market go south. CW is swimming in all the option arm and 80/20 defaults

I understand that the line of credit was a little more expensive than their usual source. Profitablility may still be a hurdle.

i don't see a bailout, what would your source be for stating that some sort of centralized bailout is on the way. i haven't read about that anywhere.

if you work with a lot of investors in southwest florida, yes, many are in trouble. they invested, took the risk, and for many lost. i don't think they should be bailed out.

but of course you're entitled to your opinion.

jay

Tom,

when you see a report that says it was a little more expensive it's inconclusive. considering the availability of funds at this time, and the risk level, i would expect that there would be a slight premium.

jay

True Investors are not in trouble in SWFL, Speculators who were preyed upon by the RE industry are

Jay, look at history, these types of crashes always are followed by 2 things a Govermental bailout and restricitve laws. The market tends to rebound when the laws go away.

while you are still playing the sunny day message. this is a major problem. If it was not why has the fed pumped about 70 Billion in so far to keep things afloat? That in and of itself is a bailout. They are just getting started

this whole meltdown has been a pain, as I was really excited about reading the sec docs on the Blackstone IPO. Now I spend my days reading sec reports to see who is worth doing business with

I do see this as a problem, but not to the degree that it is being reported in the media.

i don't believe that cw is going bk, and if they did companies even large ones fail all the time.

the real estate defaults are such a tiny portion of the total economy that the fed may do some tweaking but no bailout is on the way. the happen to be more concerned with the continued economic growth in spite of the real estate situation.

this is "the way i see it." you could be right but i don't think so.

jay

Jay

not try to confront you at all just have a discusion

ill bet you a nice lunch we end with some sort of a trust resolution type deal here before its over. Banks are holding paper on 60 percent of these pre-con homes. FDIC insured!

the media is a bit shrill on this one but. How many subprime lenders are left? Not very many. Most will not be back. The old days are back. 80 percent loan, full doc, 550 credit score, 10 percent. Like the old conti mortgage days

I think its great you are maintaining a positive attitude

no problem with the discussion part. there's certainly nothing boring about what we are going through and opinions are all over the place. i've been at this forever so i've lived through worse.

i still think it will play itself out without much intervention, but some parts could get worse before they get better.

for me it looks like a return to normalcy as far as guidelines go and i'm okay with that.

i mean what investor really thought that the 100% stated investor buyer was a good risk? we got a little out of control.

jay

Hi Jay...I'm trying to keep the faith but as I posted tonight....It's getting very hard!

hi Joan,

i read your post. i think loan officers need to place a premium on investor quality when placing a loan. a large part of this should be in regards to stability.

as a lender i still have plenty of choices of investors offering strong product lines with ample program selections., that offer the level of stability that makes me feel comfortable.

jay

AUG

2007

Jay- I called one of my buddies with Countrywide yesterday and he said he's still making loans and moving forward. Like Joan, I am getting worried, but I do know that in most cases if the media has the choice between chaos and well thought out research, chaos will win. This is a great discussion. Thanks for putting things into perspective.

Jennifer,

the media is out of control. they are acting irresponsibly. actually i'm not a big cw fan as i don't feel i can trust my account exec, but that doesn't change the fact that as W. C. Fields said, "the rumors of my (their) demise are greatly exaggerated."

they won't fail, but someone could make a run at them and try to purchase them.

Jay

Jay, you are absolutely correct - the media is out for a cover story. I received a call from Channel 3 News on Thursday - they actually wanted me to give them the names of some clients whom I brokered to Countrywide...Of course I told him I could not help out - he was looking to do a negative story on Countrywide.

John,

hats off to you! we've got to stop helping the media fuel the fire.

congratulations!

jay

AUG

2007

Jay,

Thanks for making an intellegent post as to CW's financial position. I'm sick and tired of all the vultures circling, not only CW, but all the major mortgage lenders out there.

Jennifer,

we all had it pretty easy in the mortgage business for the last few years. so now we're experiencing some bumps in the road. we'll be okay.

jay

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