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Countrywide's Default Rate Doubled in January

Countrywide Financial Corp., the nation's largest residential servicer with a market share of almost 17%, said its foreclosure rate almost doubled in January from the same month a year ago, according to newly released figures.

At Jan. 31, 1.48% of the loans in its massive $1.48 trillion servicing portfolio ($21.8 billion) had entered the foreclosure process. Moreover, 7.47% of loans serviced by CFC are 30 days or more late.

A year ago, CFC's delinquency rate was 4.32%. CFC would not provide separate figures for subprime and lumped all its servicing into one number.

CFC, which is almost 40 years old, is slated for sale to Bank of America, Charlotte, N.C. The transaction is expected to close in the third quarter. (BoA does not service any subprime mortgages though it has taken large writedowns on subprime CDOs it invested in or underwrote.)

As far as originations go, CFC funded $21.8 billion in residential loans during January, a 41% decline from the same month a year ago.

CFC saw its wholesale fundings plunge by 65%. Retail production was off 26% with correspondent purchases falling 38%.

Retail originations totaled $9.4 billion, wholesale just $2.5 billion with correspondent coming in at $9.8 billion.

The company also saw its commercial production plunge to just $50 million, a stunning 92% decline from the same month last year.

Last month, CFC chairman and CEO Angelo Mozilo testified before Congress on the topic of the mortgage crisis and CEO compensation.

The hearing was held by the House Oversight and Government Reform Committee, chaired by Rep. Henry Waxman, D-Calif. (c) 2008 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com/ http://www.sourcemedia.com/