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The growing credit crunch has slammed the country’s largest mortgage lender, Countrywide Financial Corp. Here’s an excellent piece in the L.A. Times describing the company’s woes — its decreasing ability to obtain funding for its operations, and some analysts’ worries of bankruptcy for the mortgage giant.
On Wednesday, the company was said to be having trouble borrowing money on a short-term basis, securities analysts discussed the possibility of a Countrywide bankruptcy and the firm’s stock price tumbled 13%, bringing its loss for the year to 50%.
“If enough financial pressure is placed on Countrywide or if the market loses confidence in its ability to function properly, then the model can break,” said Merrill Lynch analyst Kenneth Bruce, who warned investors to sell their Countrywide stock, saying the company could go bankrupt if the worsening liquidity crunch gets bad enough.
And here’s a timeline of Countrywide news, compiled by L.A. Times real estate blogger Peter Viles.
Since April 28, Countrywide has repossessed 3,186 homes, bringing its total inventory of foreclosed homes to 10,796, according to the Countrywide Foreclosure Blog. California’s portion of those foreclosures total 2,361, the blogger reported.