Will Deal Leave Brokers Out in the Cold?

The Bank of America's acquisition of Countrywide could leave mortgage brokers out in the cold. Last fall, BoA said it was closing its wholesale operations in this channel, citing a desire to concentrate on its retail businesses. Yet Countrywide is the nation's largest wholesaler, with third-quarter volume of $15.27 billion. It is also the largest correspondent purchaser, with volume of $44.35 billion for the third quarter, according to the Quarterly Data Report. But once the acquisition is completed, will BoA keep the third-party channel open? That is the big question, said David Olson of Wholesale Access, Columbia, Md. BoA is not fond of the wholesale channel. But the deal was structured, possibly with the encouragement of the federal government, to provide an orderly transition for the marketplace, he said. Mr. Olson said his guess is that BoA will keep the Countrywide channel going for awhile. But will there still be a Countrywide wholesale channel a year from now? "Probably not," Mr. Olson said.