Countrywide Financial Corp. (NYSE: CFC) Angelo Mozilo sure comes across like a selfless champion of the underdog on his company's website, which points out that he founded the company in 1969 "on the principle that every family in America desiring to achieve the dream of home ownership should have the opportunity to do so." This year, that dream turned into a nightmare for many Countrywide borrowers and investors.
Shares of the Calabasas, Calif.-based company have slumped 77% this year as the subprime mortgage meltdown worsened. Many investors have been hurt, with the exception of Mozilo. The New York Times reported in October that SEC had opened an informal investigation into the timing of Mozilo's stock sales, "which allowed him to gain more than $132 million in the months before the price plummeted amid the deepening mortgage crisis."
The company threw its beleaguered borrowers a bone on October 23, allowing about 52,000 customers with subprime loans to refinance into prime or government-backed mortgages through next year, and gave more affordable terms to another 30,000 either behind or in danger of becoming behind in their mortgages. As Senator Chris Dodd (D-CT), a candidate for president, noted, the problem extends well beyond the people the company has agreed to help.
The next few months will be tough ones for Mozilo. He is the poster child for the mortgage crisis, in which countless borrowers wound up in homes that they never could afford without low-ball "teaser" rates offered by Countrywide and its competitors, creating the worst slump in real estate since the Great Depression. The crisis has already claimed the CEOs of Merrill Lynch & Co. (NYSE: MER) and Citigroup Inc. (NYSE: C). Will Mozilo be next?
The winner of the Alfred Schweitzer Award for his work with the youth of America isn't a humble guy. As the Times noted, the son of a Bronx butcher has a huge chip on his shoulder, telling the newspaper in 2005 that when he meets a stranger on the golf course, he explains that he is in the financial services business. "I don't know why," he told the Times. "It makes me feel better. I guess status."
The same could be said for the millions of people who became owners of homes they could not afford.
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Reader Comments (Page 1 of 1)
12-21-2007 @ 10:17AM
RW said...
Loser is not strong enuff self centered cretin covered in Armani makes him low life business man of the year ethics??what ethics??/ sell cars or aluminum siding It's in your league...what a loser
12-21-2007 @ 1:12PM
tony garcia said...
Why we allow these transparent tramps to continue to prosper is our own fault. How can we continue to not be alble to see through these crooks when it is obvious as his bottle tan and the bling he wears that serves as his identity. take away the two and you have another plain shyster, mafioso idot who abuses the power the foolish American public gives him to use as he pleases..and he does. Keep bending over America..and not educating our young properly (not programing them) and our America is doomed to fall.
12-21-2007 @ 1:12PM
LAWMANTOO said...
OLE ANGIE (DA MORTGAGE GUY) AINT GONNA TAKE THIS LYING DOWN. SOMEONE'S GONNA BE SLEEPIN WITH THE FISHES BEFORE THIS IS ALL OVER.
12-21-2007 @ 4:05PM
Jake Ryan said...
I think it's unfair to label Angelo Mozilo as the 'poster child for the mortgage crisis.' Countrywide has helped a lot more Amercian's than almost any other company in the past 20 years. Home ownership is the #1 wealth-builder for the average citizen, and in that regard, Angelo has fulfilled the American dream for many, many people.
As proof to the good job Countrywide is doing, one only needs to visit the wonderful websites they've built for consumers -- sites that contain videos, podcasts, calculators and lots of educational insights to help people make the right home loan decisions. Examples include:
http://www.countrywidehomeloans.com
http://www.countrywide-refinance.com
http://www.countrywidecredit.com
The sub-prime meltdown really has more to do with three factors: 1) unsavory mortgage brokers more interested in sellmaking money than in helping the consumer, 2) an asset-backed securities market more interested in packaging up loan portfolios to generate profits than in managing for long-term growth, and 3) irresponsible consumers who willingly signed loan documents.
12-22-2007 @ 10:43PM
rob roy said...
Jake, you are obviously Angelo's lapdog. Are you afraid that you will be unemployed after Christmas? How about irresponsible Countrywide that made bad loans? It takes two to tango. Nobody forced Countrywide to hand out liars loans and package them up and sell them to pension funds. What goes around comes around. Countrywide had massive layoffs and will continue to until the doors close.
12-21-2007 @ 2:12PM
Billy Bob said...
Stupid home buyers should have read the Adjustable Rate Mortgage rider in their closing papers where it clearly spells out that their rate might increase at a certain point. But these home buyers didn't care and bought what they couldn't afford anyway.
12-21-2007 @ 7:00PM
Bear said...
LOSER!!!, what else do you call a man who sends an email out company wide to his employees saying to buy stock while he sells his and makes a fourtune???, definetly not compasionate or kind. You cannot believe anything this man says. The words spoke are for self gain ONLY, history speaks for itself with this JERK.
12-24-2007 @ 1:30PM
Noel Painter said...
Does anyone not lay alot of this probelem on the Feds? Starting several years ago we were pushed head on into those types of loans (yes I am a mortgage broker). The Fed loosened the standards and required those in our field to do a certain % of those loans. Of course there were, and are, bad brokers. Just as in any other field. But when the regulators of your business push a requirement at you just to stay in business, and you comply with that requirement, that does not make you a bad or greedy person. Countrywide is breathing it's last gasp. Any time you borrow money (as the have twice) to lend money, you have a problem.
12-24-2007 @ 10:51PM
ray roy said...
Angelo takes credit for founding the company when it was not him at all. A man by the name of David Loeb was the brains behing this whole thing. Angelo just went along for the ride. Dave is dead now probably turning over in his grave as he would have never let this happen to the company. I wonder if Angelo will take credit for the companies demise.
12-26-2007 @ 4:47PM
Zakia said...
Don't deposit at Countrywide banks and financial centers. Learn more about the national mortgage crisis and Countrywide's role in it. Visit www.dontdepositatcountrywide.info
12-31-2007 @ 8:11AM
Lenny said...
With banks like ING direct out there. I think Countrywide and many others like them are going to go under. Check out their rates and closing costs. Countywide had my adjustable mortgage and I gave them first shot at refinance. I got a better rate with ING and paid $895 in closing costs. No game playing.
12-31-2007 @ 2:15PM
a.c said...
Some of my family members had great experience with countrywide I will give them a call as well, after all they are leader in the industry,like they say if no body can,countrywide could,they have the potencial, try them...
1-04-2008 @ 4:15PM
tina3219 said...
Countrywides ethics are more than suspect. Yes, homeowners (in my area investors) should not have signed a contract that they could not keep. They were betting on flipping. Well a lot of people are flipping now....flipping right over to the bank. I knew what I had on the contract, I refinanced with a 9,000 dollar prepayment penalty. Do you think I care if Countrywide makes it or not? I say let them eat cake! I suffered the consequences for my mistake, they should also...isnt that life. we pay for bad decisions. At least adults do.