Countrywide Mortgage making me nervous

16 years ago

I dont know if this is an appropriate place to ask, or even an appropriate question- as Im not sure there is an answer!

Our mortgage was sold to Countrywide in late 2006. We havent had any problems. We have the same fixed rate, we always pay on time and generally pay extra applied to principle. No issues with billing, payments being credited, etc. We have no escrow (we pay our own property taxes) and pay no PMI.

Im nervous with all this talk lately about their stability has me wondering what will happen to my mortgage!! I know that Countrywide was recently aquired by Bank of America. We still send our payments to Countrywide as billed. Any thoughts on what could happen if this company goes under? Will our mortgage just get sold again, or could something worse happen?

We really arent interested in refinancing with another institution at this point since our fixed rate is at a great rate (in our opinion!) and we have no financial reason to need to refinance. Additionally, even with a refinance there is no guarantee that our mortgage wont change hands again

Any thoughts or experiences welcome! Thank you.

Comments (4)

dave_donhoff
16 years ago
last modified: 9 years ago
Hi pharmer,

Im nervous with all this talk lately about their stability has me wondering what will happen to my mortgage!! I know that Countrywide was recently aquired by Bank of America. We still send our payments to Countrywide as billed. Any thoughts on what could happen if this company goes under?

Countrywide can no longer "go under" since they've been consumed by BofA.

BofA *could* theoretically "go under"... but in reality they're a huge depository bank with a very broad cross-hedged business base (which means when one area of the economy weakens, they have a division (or several) that experience offsetting benefits.) In order for BofA to go completely titsup we would have significantly more to be worried about than our mortgages.

STILL... this question could be asked by someone who has a mortgage held & serviced by a weaker company... so I will answer to THAT possibility;

Your mortgage contract is a very valuable asset. It is a time-based cashflow document that is worth the stability of payments (sweetened by your accelerated voluntary surrender of principal, in Pharmer's case,) to the noteholder.

Whenever a company goes bankrupt, other "strong hand" competitors show up to pick the remaining meat (the valuable assets) off of the bones of the old carcass.

Other servicing operations would "bid" to buy the rights to assume the ongoing cashflow stream from your mortgage contract.

Will our mortgage just get sold again, or could something worse happen?

The only "worse thing that could happen" that I can imagine is your Note getting temporarily "stuck in a crack" and thus you stopping the receipt ofmonthly payment coupons/invoices... and when you send off your monthly payments to the last address you are familiar with they are returned "addressee no longer here."

Now, I have never heard of this ever actually occuring... but if it DID, what I would recommend doing is asking your local escrow company (the same one that closed your transaction, probably,) to set up a "mortgage payment escrow account" that you can make your regular monthly payments into, as though you actually still had a counterparty to your mortgage contract as always. In this manner you would have an undeniable papertrail of "good faith payments" made to an arm's length party outside your control.

I'm not sure that this level of diligence would be absolutely necessary... but it certainly could never hurt... *IF* such a freak situation ever happened.

ULTIMATELY, remember that even if the other party temporarily "disappears"... you are STILL bound and legally responsible for perfomring on YOUR side of the contractual obligation (i.e. you are still technically responsible for making the payments on time... even if it seems there is nobody to actually pay.)

SO....
A) I really really wouldn't lose any sleep over this extremely unlikely scenario,
B) If it ever did happen, here (above) is a solid plan to follow.

Luck!
Dave Donhoff
Strategic Equity & Leverage Planner
dreamgarden
16 years ago
last modified: 9 years ago
dave_donhoff wrote: "The only "worse thing that could happen" that I can imagine is your Note getting temporarily "stuck in a crack" and thus you stopping the receipt of monthly payment coupons/invoices... and when you send off your monthly payments to the last address you are familiar with they are returned "addressee no longer here.Now, I have never heard of this ever actually occuring... "

I have heard of this occurring. The Nov. 02' issue of Smart Money Mag had a cover story about this.

I don't think pharmer25 has anything to worry about, but I think its useful to know how to deal with something like this if it does come up.

Dave_donhoff, Thanks for commenting. You answered some questions I had too!

A link that might be useful:

SmartMoney magazine (Cover) calls WaMu "THE BANK FROM HELL"
in a Nov. 02 article: "I Can't Believe They Treat People Like This"
www.wamufraud.com/
Related Discussions
Identity Theft-Countrywide Home Loan
Q
Comments (10)
Was the notice sent through U.S. Mail, or was it an email? My first concern would be that this is a scam designed to get you to click on some link and input your credit card data supposedly to "protect" it, but what you'd really be doing is putting it into a thief's website. If you have not done so yet, call Countrywide and verify that this is actually something which has occurred. Do not click on any links in email messages you may have received, and do not call the numbers written on the notice you got. Call Countrywide at a customer service number printed on your statement or somewhere else that you can be sure that you're really calling them and not someone else. My concern arises from the fact that, if this did occur, I would think they would suggest a very definite course of action, and would assign someone to work with you on it. I do not think an acceptable solution would be to offer you free "credit watch" protection when one of their own employees has stolen your personal data. If you find that this really did occur, go to Annualcreditreport.com (link below) and pull your three credit reports right away. Contact your credit card issuers and advise them of what has happened; they will probably cancel your current cards and issue new ones with new numbers. In addition, save all correspondence related to this in case legal action is required later. Here is a link that might be useful: AnnualCreditReport.com
...See More
Countrywide Cancels Ski Trip
Q
Comments (21)
The 'players' who stuck us our country in this situation KNEW BETTER. They were not 'uneducated buyers' who believed the lies of certain mortgage loan sharks who stuck them in loans that even a JUDGES are having difficulty figuring out who actually owns these properties. THEY are the ones who ought to be in JAIL, NOT munching lobster at a fancy ski resort. If we were really a nation of laws rather than nincompoops, federal agents would be busy rounding up every investment banker and hedge fund sharpie on Wall Street so they could get to the bottom of the subprime boondoggle. Regulators still haven't even decided whether it was a case of overzealous marketing of dodgy securities or downright fraud. That should be "job one" for the SEC. Bank of America is proposing is that the US government guarantee the shoddy mortgages that the banks issued to Ã¢ÂÂunemployed shoe-clerks with bad creditÃ¢ÂÂ so they could peddle them as Triple A Ã¢ÂÂsecuritiesÃ¢ÂÂ to unsuspecting investors. Now that subprimes are blowing up at a record pace, the banks need a government bailout before their balance sheets are reduced to cinders. But what does the poor taxpayer get out of the deal besides soaring inflation, bulging fiscal deficits, and the Ã¢ÂÂwarm and fuzzyÃ¢ÂÂ feeling that he's helped some tasseled-shoed charlatan keep his larder in the Hamptons full of Dom Perignon and crab cakes? The reason we're in this mess is because financial innovation and deregulation have driven the markets off a cliff. And that started with the bankers. Financial innovation has nothing to do with the efficient deployment of capital for productive activity. No way. In fact, it is the exact opposite. The financial innovations of the last decade have primarily focused on transforming the liabilities of dubious mortgage applicants into complex debt-instruments which are enhanced with massive amounts of leverage and exotically-named derivatives. The investments banks and brokerage houses fought hard to establish the present system which they call Ã¢ÂÂstructured financeÃ¢ÂÂ. They spent over $100,000 million lobbying congress to remove the legislative firewall which kept investment and commercial banks separate. Those laws, particularly Glass Steagall, made sure that the public was protected from the Ponzi-scams which proliferated just prior to the Great Depression. But, now, 30 years later, the same scams are back with a vengeance.
...See More
Need advice, neighbors make me nervous
Q
Comments (27)
You poor thing. You do need to move. But keep your head about it. I was in a similar situation, only worse. The stress was so bad, I'm surprised I'm still alive. Just to be clear, it was not the last house I sold, but the one before that. You can do a search for "Neighbors from hell"--I'm sure I shared the story. But long story short, it involved me getting assaulted with a hammer, robbery, the poisoning of my dogs, vandalism, harassment, guns, fires... Oh, I could go on and on. Sometimes, no matter how careful you are, you can't tell that you are buying next door to the neighbors from hell. I actually purchased that house FROM the neighbors from hell; they were my only neighbors; and at first I thought we were going to be great friends. I liked them! That lasted about a month before they started in on me because the woman was... can I say "psycho?" Anyway, I loved the house and endured all that for two years until the assault and the poisoning of the dogs and then I wished I would have left when I was first considering it, about a year into it. But how was I going to sell that place when the market crashed and without the neighbors knowing because they would have sabotaged the deal? As it was, they were piling up junk on their land (this was in the country) to annoy me because I'm a clean freak and then setting it on fire to scare me. Cinders would float over to my 100-year-old wooden farmhouse. Every day the pile was getting higher and higher. Not only was it dangerous, but it was a real eyesore--truck tires, tractor parts, animal cages, household trash. I knew I had to get out of there lickity split before it got worse and I couldn't GIVE the house away. I priced it right. Luckily I didn't owe more than it was worth and I priced it to sell. I had to think, was my sanity, or maybe even my life, worth X amount of dollars? That was crucial. I did NOT put a for-sale sign on the lawn. I didn't even put advertisements in any of the local publications (I was a FSBO) because I was afraid the Evils (that's what they were known as) would see it and find out I was selling. I leaned my for-sale sign against the house in the back yard so that when potential buyers came around, I pretended like I was getting ready to put it up. I also scheduled my buyers to look at the house when I knew the Evils would be unlikely to be around because whenever I had company, they'd start yelling things--obscenities, etc. I felt bad for a long time selling that house to the buyers but in my defense, it was priced to sell and they got a deal. (It sold in about two months to maybe the fifth person who looked at it.) Also, they were meant to be there. They were instrumental in getting the Evils arrested and the Evils' house eventually went into foreclosure and my buyers are very happy there. We've become friends and we talk about the Evils often and enjoy sharing the stuff we hear about them through the grapevine. Lots of karma going on. So get out of there. Price it right. Don't put up a for-sale sign. And in the meantime, keep your enemy close. Try to get along with those neighbors. In fact, if I was you, I'd try to befriend them. You don't want them to know you're selling. They will know why and it will get them mad at you and make things worse. Later, if they find out, by that time you will be friends and you can make up some sad excuse about a death in the family or something. You have to do what you have to do to save your sanity and get out of there. Personally, I don't rent. I just go and buy another one because I have a child in school and I can't keep changing her schools, plus I have horses. I always ask for some time after closing before I have to move out. I buy the next one "contingent upon the successful closing" of the one I'm selling. It's hairy but I'd rather do it that way then move another time. The worst part about doing it this way is if you find a house you want to get and then the buyer of the house you're selling can't get a mortgage. It's very hard getting mortgages nowadays and the last house I sold, I think I lost three people I was in contract with because the banks rejected them--one of them two days before closing. I hope this was helpful. Very long. I guess I am making up for lost time because I haven't been on here a while--busy fixing up my new place.
...See More
Countrywide Home Retention Program
Q
Comments (1)
So far no regulatory agency has done more than 'suggest' lenders rework loans, so most aren't doing it, or aren't doing it in time. Sometimes buyers don't even ascertain for sure who owns the loan in time. Bof A bought Countrywide and though there have been some loans worked out and some lawsuits, etc, many others are left wondering how to get thru to this company (or other lender). In the meantime many lose their houses. Many feel no sympathy toward buyers and see them all as people who got in over their heads and deserve to lose their house. However, the real estate and mortgage industries were engaged in a great deal of predatory and outright illegal lending practices over the last few years, facts borne out in reports from the FBI, and findings from lawyers who deal in loan fraud, former employee whistleblowers, etc. Not all buyers were deadbeats, and many buyers were flippers who walked away from a loan on a house that was no longer an investment but a liability. A person trying to get a bad loan reworked has a lot of hard work and reserach to do, to figure out how best to represent themselves. Sadly most in this situation cannot afford real legal help, if they could find a lawyer who knew what to do and was interested. Countrywide has been in the news as one of the worst lenders, doing quite a bit of funky lending. They also had a significant relationship with homebuilders who steered buyers into toxic loans w/them. After being investigated and fined by the govt for their lending violations, KB Home and Beazer both shut down their in-house mortgage co's and sent their buyers to Countrywide. Tales of continued predatory lending have continued. A lot of houses are going to go vacant, deteriorate and attract criminals and vandals. Had the industry not gone mad, and the public not misplaced its trust, we would not be in this mess. IMO this industry can't be trusted to ever regulate itself again. I'm not in favor of big govt but clearly this whole catastrophe was preventable if the crimes had been nipped in the bud instead of encouraged by the govt looking the other way, and even encouraging homeownership at any price.
...See More
triciae
16 years ago
last modified: 9 years ago
Dave,

Remember our dream house over on the real estate forum & the discussion of adverse possession? That sorrid tale brings to mind a 'possible' scenario for average homeowners that would seem to fit the general profile of your "Plan B". The American Home Mortgage BK has been a nightmare for lots of folks. If I remember correctly, the trustee nabbed escrow payments for creditors & taxes/insurance became delinquent. Eventually, the monies were returned & properly distributed to the various taxing authorities & insurance companies but not before several thousand homeowners had been quite worried.

It's now been over a year & we remain unable to identify the owner of our 'dream house'. There's a Trustee Deed on file covering the foreclosure but that Trustee denies owning the property. The house has been sitting unlocked & unmaintained since Feb. '07. What a tangled web they weave...

/tricia
pharmer25
Original Author
16 years ago
last modified: 9 years ago
Thank you for your expertise, Dave. It does help me sleep knowing they wont (or cant?) come and ask me to pay off the balance in one shot- which we (and most people!) cannot afford to do.

Hopefully our mortgage doesnt get lost in transition, but we are hopeful for another sell out to another company that doesnt have such a bad name currently. We shall see.

Thank you!

Countrywide Mortgage making me nervous

Comments (4)

dave_donhoff

dreamgarden

Related Discussions

triciae

pharmer25
Original Author

COMPANY

BUSINESS SERVICES

GET HELP

CONNECT WITH US

Countrywide Mortgage making me nervous

Comments (4)

dave_donhoff

dreamgarden

Related Discussions

triciae

pharmer25Original Author

COMPANY

BUSINESS SERVICES

GET HELP

CONNECT WITH US

pharmer25
Original Author