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It is time to end the Rumors . .

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Education & Training

Putting an end to all of the rumors that has been flying around Wall Street, Bank of America Corp. announced today that it's purchasing Countrywide Financial Corp. for $4 billion, effectively doubling down on a previous investment in the troubled firm and catapulting the buyer into the top spot among mortgage lenders and loan services in the U.S. 

The stock-swap deal will put an end to the independence of the troubled California lender headed by Angelo Mozilo, and represents an increase from the Charlotte, N.C., bank's August investment of about $2 billion. "We believe this is the right decision for our shareholders, customers and employees," said Mozilo, chairman and chief executive of Calabasas, Calif.-based Countrywide.

I think, this is positive news to the mortgage industry as it may add stability and confidence back into the highly volatile mortgage market and may help to re-establish the all but non-existent secondary market.  Only time will tell, but broker's for Bank of America and Countrywide welcome the combination of Bank of America's strength and product lines with Countrywide's network and local presence. 

This will add stability back into the mortgage market combined with the abnormally low rates we are experiencing such as 5.75 Fixed for 30 years, may give a boost back into the slow real estate market.  

I feel this is not only important for the real estate market but perhaps just as important to the overall economy which is reportedly on the verge of recession.

What are your feelings on todays news?

Expect Success,

Wallace Hobbs

www.RealEstateWins.com

Comments (27)

Josette Skilling
Keller Williams Capital Properties - Bethesda, MD
I don't really know what will come of it either other than they are one awfully big bank.
Jan 15, 2008 11:35 AM
Chelle Gassan
RE/MAX Regency and Staged Homes VA - Bristow, VA
NOVA Realtor and Stager
So far my experience with Bank of America loans has not been great for my clients.  I'll be curious to see if this makes things better or worse for them.
Jan 15, 2008 11:41 AM
Amy Broghamer
The AmyBSells Team - Keller Williams Advisors - Cincinnati, OH

I have a Countrywide loan and called to check on the sale, and they are already suggesting Bank of America on their phone systems. 

My issue with Countrywide is that they often misfigure the tax escrows.  I think that BOA will allow more stability and create a better cross promotion with customers, doing more than just mortgages with them. 

I have enjoyed banking with Bank of America in the past out of Georgia.

I recently had my PNC Credit card bought by BOA and it has been completely seamless. 

 

 

 

 

Jan 15, 2008 11:52 AM
Conrad Clarke
MortgageCircle.com - Weston, FL

I think this move is nothing more than a wise business decision by Bank of America to take advantage of a branded name. Countrywide has spent millions in advertising and it's a household name. Bank of America is simply trying to corner their stake in the mortgage market. I bet the name Countrywide stays!

Conrad

Jan 15, 2008 12:11 PM
Debe Maxwell, CRS
Savvy + Company (704) 491-3310 - Charlotte, NC
The RIGHT CHARLOTTE REALTOR!

Wallace:  Although our market here is not nearly as volatile as others across America, this news was especially good for Charlotte, NC as we house Bank of America's headquarters.  The Buyers with stable jobs and good credit should feel a bit of a boost in confidence with this news. 

We heard the news on Friday and I was going to post it but, thought that it had probably already been done---I'm very glad to see this post on AR!  Thanks.

 

Jan 15, 2008 01:13 PM
Rosemary Brooks
BMC Real Estate - 209-910-3706 - Stockton, CA
The Mother & Daughter Realty Team
Well, I agree that this is nothing more than a business deal.  B/A is not here to save the world. I am sure of that.  They might end up buying more than just Countrywide before it is over.  The goal is to make this a Bankers world instead of a Lenders world.   They are on their way.  Nothing much will change probably, but my prayers are that it does help the situation.  Prayer is power.
Jan 15, 2008 01:16 PM
Richard Lecinski
Long Realty Company - Oro Valley, AZ
I think the buy out of Countrywide is a good thing. I am not sure they would have made it otherwise. Loog at NFI. Down to the last 24 employees.
Jan 15, 2008 01:45 PM
Vicky Poe
Good Ole Rocky Top - Crossville, TN
Realtor/ Auctioneer
Maybe this will be a stabilizing thing in the market.
Jan 15, 2008 02:02 PM
Rebecca Levinson, Real Estate Marketing and Online Advertising Consultant
Real Skillz-Clear Marketing for Your Real Estate Vision - Lake Geneva, WI

I wonder if the program to help Countrywide's borrowers who are nearing pre-foreclosure that they had announced about a month ago willl be taken over and revived by Bank of America.

Jan 15, 2008 02:07 PM
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services
Hmm looks like this lets a lot of the Countrywide folks off the hook for some practices that are very questionable.
Jan 15, 2008 02:42 PM
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Curious... weren't these rumors ceased on last Friday?  And question....with curiosity....... you said, "This will add stability back into the mortgage market combined with the abnormally low rates we are experiencing such as 5.75 Fixed for 30 years, may give a boost back into the slow real estate market. " 

stability?  Or would it just curb fears amongst the novice investor?   And just be a band aide for now?   Me personally?  I think it helps fear now....  this has nothing to do with lower rates. Those on Wall Street are trying ti shuffle money around, while at the same time, trying to make everyone happy and feel safe at the same time. I hope you don't mind, but I wrote about this Friday. if you want me to take this link out, let me know. I will. thanks... Countrywide sold to BofA -- A Rumor closed

jeff belonger
Jan 15, 2008 02:58 PM
Bob & Carolin Benjamin
Benjamin Realty LLC - Gold Canyon, AZ
East Phoenix Arizona Homes
It will be interesting to watch and see what transpires.
Jan 15, 2008 03:52 PM
Diane Bell, Hilton Head Real Estate, Bluffton
Charter 1 Real Estate, Hilton Head, Bluffton, SC - Hilton Head Island, SC
I've been watching this closely as I've used Countrywide in the past.  There are so many rumors floating.  It will be interesting to see how this plays out
Jan 15, 2008 11:42 PM
Jeff Belonger
Social Media - Infinity Home Mortgage Company, Inc - Cherry Hill, NJ
The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans

Here is a good article floating around....  http://blog.inman.com/inmanblog/2008/01/countrywide-ori.html

Just thought I would share this. Some good insight.... 

Jan 16, 2008 03:39 AM
Emily Lowe
RE/MAX Homes and Estates, Lipman Group - Nashville, TN
Nashville TN Realtor

We had our Countrywide Regional Manager (Prudential is partners with Countrywide) come in and explain to us exactly what is going on.

Countrywide will continue to operate under the brand name until at least 2009.  Then BoA will start to join forces with them. 

Because Countrywide and BoA hold the top two places in loan originations this will make one strong company! 

I just hope that doing business with BoA will not continue to be so difficult.  Countrywide is so easy to work with!

Jan 16, 2008 04:02 AM
Toby Lorenc
Rocky Mountain Realtors® - Colorado Springs, CO
Make your next move your BEST move
anything that could boost consumer confidence right now would be good! I hope this will help -
Jan 16, 2008 04:54 AM
Evan Little
Surterre Properties - Santa Ana, CA
Eco, Live/Work, Sales and Management

Once the market became flooded with short sales and foreclosures, I wondered why banks weren't more motivated to get rid of them.  People would say, "they're just waiting to get bailed out".  Well... It seems this is basically how it works.  The bank of banks, those who own a share in the private Federal Reserve control the flow of money.  In the last ten years they were able to convince hard working Americans to put their savings into real estate they couldn't afford, knowing that all along it would lead to a massive recession.  Whether you believe it or are in denial, this is the same thing that caused our great depressions.  The buzzards have been circling the mortgage mess for long enough and Bank of America swooping in to snatch up Countrywide is just the begging.  I also believe that the banks at the top of the food chain wish to streamline the industry by cutting out companies like Countrywide.  This is the same thing that the federal reserve banks did with their banking competition during our previous depression.  They have their eyes on the real estate sales market too!  WATCH FIAT EMPIRE!  LINK TO WATCH IT FREE ON GOOGLE VIDEO NOW.

Jan 16, 2008 05:45 AM
Christina Strommen Stevens
Southwest Realty Advisors LLC - Galveston, TX
Galveston Texas Realtor, Vacation home expert
We are not on the verge. We are in a recession now its time to make some changes.  See my post regarding the signs and facts of a recession dated just yesterday.  We must be reading each others mind.  Great post. 
Jan 16, 2008 09:09 AM
Christy Powers
Keller Williams Coastal Area Partners - Pooler, GA
Pooler, Savannah Real Estate Agent
Hopefully it's positive. Only time will tell!
Jan 17, 2008 04:04 AM
Gita Bantwal
RE/MAX Centre Realtors - Warwick, PA
REALTOR,ABR,CRS,SRES,GRI - Bucks County & Philadel

Great post. I know buyers are looking to buy but are waiting thinking the prices will come down further.

Feb 04, 2008 09:40 PM