countrywide mortgageCountrywide Mortgage originates and services home loans, and has until recently enjoyed soaring profits as low interest rates spurred consumer demand. Money loaned to riskier accounts carry higher interest (and default) rates. Rolling the dice, Countrywide Mortgage increased its sub-prime funding.

The company was looking to capitalize on the downward trend in the mortgage industry by gobbling up smaller, down-and-out lenders when the going got tough. According to a BusinessWeek article posted on Countrywide’s website, the company was looking to double its 13% share of the mortgage market.

Countrywide had said its mortgage servicing business, which services loans by mailing out bills and collecting payments, would shield it from declining loan demand. But with record foreclosures, there have been no payments to collect. Rightly or wrongly, Countrywide shouldered a great deal of the blame when the economy tanked.

Financial contracts can be very confusing. Before signing yourself to a major long term Countrywide mortgage commitment have an attorney, familiar with financing and taxes, examine and explain the details (where the Devil is). A good tax finance attorney can save you many times his fee over the years, not to mention possible legal problems.

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