Best of the Week
Most Popular
1.Oil Wars 2016 - US vs Russia vs Saudi Arabia vs Iran - Nadeem_Walayat
2.Crude Oil Price Crash Triggering Global Instability, Trend Forecast 2016 - Nadeem_Walayat
3.Stock Market Crash - Last Week was The 2nd and Final Warning... - Clive_Maund
4.Stock Market Crash Apocalypse or Bull Market Severe Correction? - Nadeem_Walayat
5.TShipping Said to Have Ceased… Is the Worldwide Economy Grinding to a Halt? - Jeff_Berwick
6.Crude Oil Price Crash Catastrophe, Independant Scotland Literally Begging to Rejoin the UK - Nadeem_Walayat
7.Summers: Global Economy Can't Withstand Four 2016 Fed Hikes - Bloomberg
8.Gold And Silver: New World Order: Public Be Damned, Preferably Dead - Michael_Noonan
9.Rigged U.S. Ttreasury Bond Market Double Barreled Hidden Q.E. To Infinity - Jim_Willie_CB
10.Major Stocks Bear Market Awakening - Zeal_LLC
Last 5 days
The War on Cash is About to Go into Hyperdrive - 11th Feb 16
More Bankruptcy For Your Retirement Portfolio - 11th Feb 16
2016 - Gold & Silver Rising: A Gold And Silver Bottom May Be In - 11th Feb 16
Gain Trading Confidence by Improving Your Elliott Wave Analysis Skills - Video - 11th Feb 16
With A Gloomy Start To 2016, A Bust Seems Just Around The Corner - 11th Feb 16
UK Interest Rates, Economy Forecasts 2016 and 2017 - Video - 10th Feb 16
World Markets Are in Sync - 10th Feb 16
If You Miss Buying Gold – You Will Regret, it Later - 10th Feb 16
The Fed Doesn't have a Clue! - 10th Feb 16
How Far Can Gold Price Go? - 10th Feb 16
It's Stock Market Panic Time! - 9th Feb 16
Gold Stocks Picks for Patient Pickers - 9th Feb 16
Oil Price Collapse U.S. Recession Odds 2016 - 9th Feb 16
Preparing for Crisis - It's About Risk Mitigation and Capital Preservation - 9th Feb 16
Top Silver Mining CEO: Don't Laugh, We Could See Silver $100+ - 8th Feb 16
Gold, Investment Leadership Changes Permanent? - 8th Feb 16
Stock Market Panic Decline Begins... - 8th Feb 16
How to Save Money By Growing Your Own Homegrown Tomatoes Indoors From Seeds - 8th Feb 16
US Economy Slides One Step Further Towards A Recession - 8th Feb 16
Gold Bear Market Bottom : Mr. Bear has left the PM Sector for Greener Pastures - 8th Feb 16
Stock Market At Important Support - 8th Feb 16
David Cameron Humiliated in Poland Over Refusal to Stop Taking UK Benefits, BrExit or Super State? - 8th Feb 16
Why Crude Oil Prices Could Continue FALLING From Here - 7th Feb 16
Stock Market S&P, NAS Best, Most Reliable Answers Come From The Market And You - 7th Feb 16
Stocks Bear Market Continues - 7th Feb 16
Silver COT Paving Way for Sustained Upside Breakout Sharp Rally - 7th Feb 16
US Dollar Double Top, Gold Prospects Brightening Rapidly - 7th Feb 16
Gold And Silver - Is A Bottom In? Nothing Confirmed - 7th Feb 16
Gold Stocks Something has Changed - 6th Feb 16
UK Interest Rates, Economy GDP Forecasts 2016 and 2017 - 6th Feb 16
Gold Price, Mining Stocks Rocket Higher - 5th Feb 16
Crude Oil Price Bottoms and Blues - 5th Feb 16
Gold and Silver: Ripe for a Recovery! China May well Change the Game - 5th Feb 16
How Pension Plans are Responding to Financial Repression - 5th Feb 16
Senior Gold Producer Goldcorp Takes Large Stake in Nevada's Gold Standard Ventures - 5th Feb 16
Tips for Smart Oil and Natural Gas Investing 2016 - 5th Feb 16

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Global Financial Crisis 2016

US Mortgage Lenders Implode

Housing-Market / Credit Crisis 2008 Jul 21, 2008 - 07:21 PM GMT

By: Mike_Shedlock

Housing-Market There are two important financial headlines this evening and the futures are solidly red. Let's take a look at news regarding Wachovia and Bank of America starting with the former.

Wachovia Halts Wholesale Mortgages



Wachovia mortgage unit halting loans via brokers . Wachovia Corp (WB), the fourth-largest U.S. bank, on Monday said its main mortgage unit will stop offering home loans through brokers this week, joining a growing number of lenders to curb wholesale lending.

"We thought it was important to focus on customers who have relationships with the bank, and in geographies where Wachovia has branches," spokesman Don Vecchiarello said. "Based on that, we've decided to discontinue doing business through our wholesale mortgage channel as of July 25."

Wachovia is assessing how many jobs will be affected by the decision, Vecchiarello said. The Mortgage Lender Implode-O-Meter had this news headline up, hours before mainstream media reports.

Earlier today Bloomberg reported Bank of America Earnings Drop Less Than Estimates .
Bank of America Corp., the biggest U.S. consumer bank and home lender, said second-quarter profit fell less than analysts estimated and predicted the purchase of Countrywide Financial Corp. will add to earnings this year.

The bank said Countrywide will add to profit this year, and that cost savings will be "significantly" more than the $670 million projected in January. Inquiring minds who have been pondering the question "How the hell can Countrywide add to Bank of America earnings?" now have their answer.

Bank of America Will Not Guarantee Countrywide Debt

Bank of America Corp., the second- biggest U.S. bank, said it may not guarantee $38.1 billion of Countrywide Financial Corp.'s debt after taking over the mortgage lender, increasing the likelihood of a default.

"There is no assurance that any such debt would be redeemed, assumed or guaranteed," the bank said in an April 30 regulatory filing, adding that no decision has been reached. Investors had grown more optimistic the bank would back Countrywide debt. Ratings firm Standard & Poor's cut the mortgage-lender's debt to junk today after saying it would raise the grade earlier this week.

The $4 billion purchase of Countrywide is scheduled to close in the third quarter. Investors have speculated Bank of America may seek a lower price or cancel the deal because U.S. home prices and sales have deteriorated.

"This confirms how tenuous this transaction is," said Christopher Whalen, managing director at Institutional Risk Analytics, a banking research firm in Torrance, California.

Fraudulent Conveyance

Naked Capitalism is talking about fraudulent conveyance in Bank of America's Scheme to Stiff Countrywide Bondholders .

I am wondering how much taxpayers will be asked to foot the bill for this fiasco. I am afraid we all know the answer.

By Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com

Click Here To Scroll Thru My Recent Post List

Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management . Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

Visit Sitka Pacific's Account Management Page to learn more about wealth management and capital preservation strategies of Sitka Pacific.

I do weekly podcasts every Thursday on HoweStreet and a brief 7 minute segment on Saturday on CKNW AM 980 in Vancouver.

When not writing about stocks or the economy I spends a great deal of time on photography and in the garden. I have over 80 magazine and book cover credits. Some of my Wisconsin and gardening images can be seen at MichaelShedlock.com .

© 2008 Mike Shedlock, All Rights Reserved

Mike Shedlock Archive

© 2005-2016 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Reinedeer
30 Jul 08, 14:20
Mortgage Brokers

The entire housing market is experiencing a correction. Do away with Mortgage Brokers and give it back to Mortgage Bankers. Get the Realtors out of lending. Regulate profitability on loans. Get it back to safe lending practices, integrity in lending and just plain “doing the right thing”. I love what I do. But I don’t take advantage of someone’s inexperience to make as much money as possible on them. Fair Lending, RESPA, TILA - what a force it has been. The gov should look at the BROKERS. Simple and true. Then take a look at the partnerships that have been created between realtors and brokers and see what they are building: channeling customers to mortgage brokers that have an interest in their real estate company. it’s a breeding pond for more abuse.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Biggest Debt Bomb in History