Most of you have heard that Bank of American came to the rescue of Countrywide Mortgage. Is is really a mixed bag. The good news is stability. It would be devastating to the market if the largest originator in home loans was to file for protection in a Bankruptcy. it would also create a stronger lack of confidence in all financial markets. Countrywide has alsway been a very well run company, albeit, run by salespeople with need to fund loans on a daily basis.
There is enough blame to go all the way around a couple times between Lenders, Brokers, Homeowners and don’t forget the investors.
Here’s the bad news. This has all the trappings of loosing FREE MARKET. B of A may use this to squuese the mortgage broker out of the business. BofA has already suspended a major part of their own business to licensed mortgage brokers. Now that they own Countrywide, I would suspect they will probably to something very similar with the Countywide offices.
Free markets are one of the foundations of competition in the US. The creed factor is certainly a byproduct of this, but the thought of a hand full of banks controlling the retail mortgage market hs me wondering if fair trade will exist. Only time will tell, but I have my doubts whether in the long run this is good for the consumer.