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As the ship went down I realized there was no raft..........

By Christopher Karalis

Mortgage and Lending with Orange County Capital Mortgage

September 13, 2007 04:14 AM

Countrywide as "ailing" right?

Okay on Aug 16 Countrywide drew on and MAXED an $11.5 billion "emergency" credit line to fund its operations.

Earlier in the week, it had announced liquidity problems, reversing the position of a week earlier that it had adequate access to capital. OK Countrywide is paying almost 10% interest on this credit line right??? And they are lending there money out at 6%-8% right? Mathematically this is a recipe for disaster!! Granted they are making a profit in the secondary market and servicing loans, but enough to make up the 4-6% needed just to cover this bill? Not including the other Billions in bills they have. Now my question is this, was this 11.5 billion line of credit to fix the problems or just keep the boat afloat for a little longer? And when it sinks then what?

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Bill Gillhespy

16 Sunview Blvd - Fort Myers Beach, FL

Fort Myers Beach Realtor, Fort Myers Beach Agent - Homes & Condos

Christopher, This is very scary stuff. Are you sure of the math involved or is there another side of the story allowing them to move forward ?

Sep 13, 2007 04:23 AM

Jeff Tumbarello

Steelbridge Realty LLC - North Fort Myers, FL

only time will tell

try not to trust people protecting their jobs

Sep 13, 2007 04:33 AM

Chris Bates

www.ePropertySites.com - Aliso Viejo, CA

I thought we had some positive information today. Thanks for assuring all of us that we are not out of the negativity woods. Are you sure about the 10%...could it be more like 9.87%?

Sep 13, 2007 04:38 AM

Gregory Corbett

Resource Mortgage - Virginia Beach, VA

Resource Bank

Keep in mind, there are inflated salaries to keep paying at the top. Why if you were a controller of a multi billion dollar company would you want to fold.Keep borrowing money keep paying your salary until its dry. Not a recipe for sucess just a recipe to keep gas in the yacht.... oh and the helicopter. reminds me of the movie dick and jane with jim carrey. I know its not to that extreme but its propbably not that far either.

Sep 13, 2007 04:41 AM

Terry Lynch

LAR Notary and Closing Services - Saint Clair Shores, MI

Christopher

I saw a headline on Inman today stating that Countrywide had received 17 billion in new capital. I didn't read it so I don't know where it came from, but hopefully they wont burn through that as fast as the amount you talked about.

Sep 13, 2007 07:43 AM

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Christopher Karalis

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