Wikinvest Wire

Countrywide: Not so easy anymore

Tuesday, May 06, 2008

After hearing the complaints coming out of Las Vegas after Countrywide shut down thousands more home equity lines of credit, you'd think that "tapping home equity" (whether the equity is there or not) was some sort of an inalienable right.Bloomberg reports on the distress that the nation's former number one mortgage lender is causing in Sin City:

Countrywide Financial Corp. has suspended the home equity credit lines of almost all its Las Vegas customers, including the $60,000 Christopher Whipple says he needed to expand his cell-phone accessories business.

``I hope this doesn't break me,'' the 35-year-old retailer said. His credit score was 790 out of a possible 850, putting him in the top 40 percent of borrowers. ``It's going to hurt more than I thought.''
...
Jerry Tao, a part-time lawyer and spokesman for Evofi One's parent company, lost access to his $50,000 Countrywide line despite earning more than $500,000 last year and having a credit score he says was between 750 and 770.

Though he never accessed the line, Tao, 40, said he'd hoped to redo his backyard and replace his 1995 Nissan Pathfinder.
...
``If you had anything on the ball, you could make it happen in Vegas,'' said real estate agent Donna Marie Gold, 62, who built a $4.5 million fortune buying and selling properties over six years.

After failing to complete a single sale last year, Gold said she fell $22,000 short each month on payments needed to maintain 14 properties. Now two to four months behind on some mortgage payments, she's lost access to a $250,000 Wells Fargo & Co. equity credit line.
...
John Simon, 42, borrowed $35,000 on low-interest credit cards in 2007 to pay down his $63,000 credit line and save on the 11.75 percent interest he says Countrywide charged. He expected to be able to access the credit line later. When Countrywide froze the line, he wasn't able to get money needed to pay his bills.

``They took away the last amount of cash I had to make all the payments on my father's retirement home,'' Simon said. ``From a business standpoint, this was the stupidest thing I ever did. But it was so easy.''
Geez. Does anyone feel sorry for any of these people?

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17 comments:

Recaito said...

And these are the people my tax dollars will be used to bail out. Disgusting.

baddriver said...

in a word, no.

how much do you want to bet the $4.5MM fortune controlled by the realtor is simply the "Value" of the 14 houses she owns. Minus her debt and mortgage liabilities her fortune is likely substantially less.

WaltBomb said...

Good point, BadDriver. If she had a multi-million dollar bankroll tucked somewhere safe and liquid, she wouldn't be skipping mortgage payments. Either that, or she'd sooner slaughter her credit and put to pasture her ailing herd of homes than she would tap into her cash pile to "save" her "investments".

Richard said...

As baddriver says, no.

Especially noteworthy is the gentleman who made half a million last year yet still seems to need his HELOC for a new car.

Hello...???

Anonymous said...

These people make me sick..we know someone like them..oh its about image and how people see you..well now everyone can see how far behind you are since you can't access the "fortune" in equity lines ..I don't feel sorry for any of them..How can you make over $500K a year and be FREAKED OUT about $35K...So you fell behind making monthly PAYMENTS OF $22K..YEAH...all millionaires in their own mind...well you want to be like the Joneses...find.. line up behind them at McDonalds..maybe they can put in a good word for you...

Tim said...

I was going to comment on the guy with the half million dollar income whining about his $35K HELOC but forgot. Remember that reporters don't really question this stuff, they just write it down, so a half mil in this guy's mind may translate to something completely different in the real world or maybe he was the star subprime mortgage sales guy back in 2005 and blew through his once in a lifetime income windfall. In either case, it's just sad.

Anonymous said...

Nope.


weinerdog43

Anonymous said...

$4.5M in a fortune she made??? Pa-leeeeese. Tragic? No. Typical? Yes. I once had $150,000 HELOC after paying it down to $130K, I was cut off due to late payments. And, with both my loans combined and the heloc maxed Im at 65LTV. Those bums at Chase cut off access which I needed to pay the mortgages. Unfortunately, HELOCs, I think were designed to put money into improving the EQUITY through improvement not run businesses or to pay mortgages. This is the personal ponzi scheme Ms. $4.5M fortune played.

Anonymous said...

do not mess with my heloc.

that's my cash.

duhhhhh.

bern2surf said...

anyone else making $500,000/ yr and driving a '95 Nissan Pathfinder????
What's that smell, oh yeah, B.S

Anonymous said...

I would nevr understand America. You make 500K. Why not just drive up and pay for your car?
"...Donna Marie Gold, 62, who built a $4.5 million fortune buying and selling properties over six years...."
- Do you really think this is real?
If you take away the mortgages, HELOCs, credit cards, car notes she would be in the red. Please help us STOP the bailout.
www.angryrenter.com

Anonymous said...

The people were certainly irresponsible, but one has only to look at the packages the wholesale lenders provided to brokers to push their products. They had intentional targets and very specific marketing to defined groups of people.

The problem is however the tighter the credit the worse it will get. To take down a house cards you must start from the top. Pull the bottom cards and it all crashes.

Mathlete said...

Why didn't they talk to me? I made $1.6 million last year, but after Countrywide shut down my $200,000 HELOC I had to sell my 1994 Mercury Topaz to pay my barber and now I ride a bike to work! Also, I can't afford my daughter's insulin!

Anonymous said...

I just fell out of my chair laughing at "mathlete"s comment....so true so true..what a bunch of retards....so Tao is a "part-time attorney who made $500k? guess its a good time to leave the mortgage biz and pursue my next career.. he was probably a money manager at his other job..

Anonymous said...

You are all heartless SOBs! I feel their pain. After Countrywide cut my HELOC, I lost the fund to pay my mortgage with. Now I have to work to make a living. It is not fair!!! I am 34 days behind on mortgage and they made me so.

Just came back from the blood station, now I have pay per view cable for the week. Had 6 donuts after the sale. A full belly and pay per view cable here, life is good for the rest of the evening.

W.C. Varones said...

Donna Marie Gold's contact info is here.

Anonymous said...

I just tapped out my HELOC and got myself a HUMMER! That car rocks! No worries here, I'm just waiting for my government bailout. I wish I earned more, but what the heck, on the plus side I don't pay much in taxes.

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