The rumors were seeping out earlier this week that big changes are afoot for Countrywide and Bank of America. They are also afoot for Chase and Washington Mutual, but those rumors are yet to be confirmed.
Today, Countrywide and Bank of America both gave their respective Press Release confirming the rumors. As with many events in life, this one comes with good and bad news.
The Good:
- The resources of a mega-bank will shore up a floundering machine
- The "save" did not originate from the government with taxpayer dollars
The Bad:
- The mortgage industry which has already lost so many jobs will likely lose many more
- Countrywide, who has set a blazing trail for homeowners will now fade away under the Bank of America umbrella
The Ugly:
- Bank of America decided not to support the mortgage brokers who originate more than 60% of real estate loans, shutting down their wholesale operations. The Press Release from Countrywide today makes reference to continuing their wholesale channel. We'll see if this is still the case in 2009.
As in previous downturns in the real estate market, we're seeing many companies in the mortgage industry either close their doors or merge with others. Let's keep an eye out that this process does not eliminate competition! As with the "Mortgage Reform Act of 2007" and the proposed S2452 "Home Ownership Preservation and Protection Act" (hope you all have contacted your Senators, because this is up for vote Monday), some of these upcoming changes may bring unwanted results, eliminating market segments unnecessarily to the detriment of the people. Only time will tell...
See you at the closing table!
Karen Cooper - OR/CA Mortgage Consultant - www.Quality4Loans.com
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