Bank of America announces Countrywide Buy Out
This is not a done deal.
For those participating in a short sale with either Countrywide or Bank of America expect some delays, currently I am on hold with countrywide to speak to my connections and report to active rain the inside scoop.
The acquisition looks as though it will be completed in the third quarter of 2008.
So why would B of A pick up Countrywide? As the saying goes, follow the money!
408 billion in mortgage originations in 2007 and has a servicing portfolio of about $1.5 trillion with 9 million loans.
Bank of America has been sniffing around the loan servicing of Countrywide for the best part of 2007. Good money in those servicing accounts
Along with the loans and servicing, Countrywide are also throwing in the pot. lender placed insurance and ‘other businesses'
Further, the loss that Countrywide has incurred will be used by Bank of America in future years to offset against profits.
Bank of America's most recent announcement to its investors can be seen here.
http://investor.bankofamerica.com/phoenix.zhtml?p=irol-eventDetails&c=71595&eventID=1740131
All this is subject to the shareholders vote and approval however from the $40+ a share to the current $4 a share, the B of A lifeboat will be full.
Chris Giddings http://shortsalesbychris.com
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