Loan Think

We got the chance to conduct a brief interview with Countrywide Home Loans chief Angelo Moziloon Thursday. He seemed a bit perplexed about why the media was going ga-ga (late this past week) about his companylining up $12 billion in additional credit, noting that CFC had been working on beefing up its lines for the past30 days. He also tried to clarify misconceptions in the media about why consumers are going delinquent on theirmortgages. He blames a majority of the problem on job losses and sagging home prices -- not ARM resets. "Resetsare not the issue," he stressed. For the full story see the Monday edition of NMN. Don't subscribe?(The “paper” subscription to NMN includes the online premium daily content found on our website.) Call:(800) 221-1809…

Lost in the press release about Citigroup buying Ameriquest's servicing portfolio (and wholesaledivision, Argent) is the even bigger news that the sale effectively ends the mortgage career of RolandArnall. Mr. Arnall, as a technical matter, was no longer managing the day-to-day operations of Ameriquest/Argent.(He owned both lenders through a holding company.) Instead, he's been hosting state dinners, playing the role ofU.S. ambassador to the Netherlands. (It pays to donate money to President Bush.) Three or so decadesago, Mr. Arnall took his S&L charter at Long Beach Savings and told the Federal Home Loan Bank Boardthat it could “stick it” (my words). He converted Long Beach into a nonprime lender, sold part of the businessto Washington Mutual and then grew the remainder into Ameriquest and Argent. Back in 2005 the two(combined) reportedly earned $1 billion, but that was before the subprime meltdown. Arnall had hoped to take hismortgage empire public but bad publicity (and bad loan practices) hit him like a tsunami. Anyway, it's all historynow. (If you have any good Arnall stories send me an e-mail at Paul.Muolo@SourceMedia.com.)As for what the sale means for Adam Bass and other executives at Ameriquest/Argent, stay tuned. For thefull story on the sale see the Monday edition of National Mortgage News. Don't subscribe? Call: (800)221-1809…

As defaults and foreclosures rise, the need for servicers to adjust how they do business is important. Servicers will have to get closer to the borrower and have all the needed information at their fingertips to deliver to that borrower over the phone in five minutes or less. Time is money and a borrower in distress doesn't make for a positive call, which means you have to get it right fast and on the first call.

In its Monday edition, National Mortgage News is publishing its exclusive ranking of the nation'stop subprime lenders in 2Q -- and the news isn't pretty. Mortgage bankers originated a paltry $53.4 billion insubprime loans during the second quarter, the industry's worst showing in five years. Here's just one of many startlingfacts in the story: subprime accounted for just 6.3% of all home mortgages originated in the quarter, comparedto 20.4% for all of 2006. The complete rankings are available in NMN's Quarterly Data Report. (Formore information on the QDR e-mail Deartra.Todd@SourceMedia.com.)To subscribe to NMN call (800) 221-1809…

As volumes decline and the industry corrects, thinking about technology is also changing. Getting the newest software application isn't being viewed as the best decision anymore. And on the other side, investing in a vendor just because they have tenure in the space doesn't make for the best decision either.

So, what does Countrywide's Angelo Mozilo really think of the Merrill Lynch analyst (KenBruce) who recently put a “sell” rating on his company, invoking the “bankruptcy” word and setting off (moreor less) a financial panic in the world credit markets? My guess is that Mr. Bruce will not be attending the next“Investors Day” analysts meeting at Countrywide's HQ in Calabasas. For Mr. Mozilo's views on Mr. Bruce and othermatters see the Monday edition of National Mortgage News. Don't subscribe? Call: (800) 221-1809…

National Mortgage News Managing Editor Bonnie Sinnock reported that, "What many said was the severest liquidity crunch they remember seeing during their time in the industry largely closed the non-agency American mortgage market last week. Subprime and alternative-A credit production had come to a grinding halt, and the prime jumbo mortgage market had slowed to a trickle."

Before we get to this week's carnage I'm going to offer two pieces of good news. Why? Because the industry needsit. So, here goes: LendAmerica of Melville, N.Y., says it is doing a booming business in FHA lending.The privately held company said it saw the wreckage in subprime coming 18 months ago and re-engineered into FHA.Company VP Mike Ashley says the company is licensed in 30 states. And in one other piece of good news, QuatrroMortgage Solutions has purchased the ePower mortgage technology platform of California lender PreferredFinancial Group. Preferred will be Quatrro's first client. The sale was brokered by Classic Strategies,a New York advisory firm…

The debate over client server vs. Web technology is quickly becoming moot. Some version of Web-enabled technology is clearly the way the industry has decided to go. When top vendors and lenders embrace .NET architecture, it's clear that we're no longer talking about a fad.

On Friday morning the Federal Reserve added $19 billion in liquidity to the market, then another $16billion and for the heck of it threw in $3 billion at midafternoon. According to one report, the Fed was acceptingmortgage-backed securities as collateral. Meanwhile, Fannie made its portfolio cap request public, tellingthe world it wants a 10% increase so it can help solve the nonprime liquidity crisis. In case you're wondering,10% translates into $72 billion. Why does Fannie need an increase? Because some of its top seller/servicers (itwon't say which firms) are asking it for some breathing room, as in can you take these loans off our hands? Ifyou want to find out who the top sellers are to Fannie, order National Mortgage News' HMDA Database.For more info e-mail Deartra.Todd@SourceMedia.com...