Countrywide delinquencies still climbing

Good morning, again. The sell-off of Countrywide Financial shares resumed this morning on news that foreclosures and delinquencies continued to mount in December.

The company's overall level of mortgage activity inched higher in December, though, prompting president David Sambol to remark, "Management is pleased with the progress we have made in positioning the company to navigate the current challenging environment."

The foreclosure and delinquency numbers are below. While I'm on the subject, I wanted to respond to the criticism yesterday that this blog sheepishly follows mainstream media reports (often written by the New York Times' Gretchen Morgenson) that call into question Countrywide's business practices, and that the blog ignores other commentary (often posted at Calculated Risk) that argues Countrywide is no better or worse than the rest of the mortgage industry.

Time, and quite possibly criminal juries, will settle that debate. My main interest in Countrywide is that I believe it's the best proxy available for the entire mortgage industry. Bad news at Countrywide reflects more than just the company's business ethics, practices and judgment -- it reflects what's going on in the entire mortgage industry, and by extension, the American economy.  Was Countrywide a leader or a follower? It doesn't really matter: it's the biggest player.

Month    Mortgage fundings   Delinquencies*  Foreclosures**
March    $43.2 B                        4.29%                  .69%
April       $40.5 B                       4.45%                  .69%
May        $44.4 B                       4.71%                  .71%
June      $45.3 B                        4.98%                  .74%
July        $39.1 B                       5.10%                  .79%
Aug.       $34.4 B                       5.05%                  .89%
Sept.      $21.2 B                       5.87%                  .92%
Oct.       $22.0 B                       5.89%                  .89%
Nov.      $23.1 B                       6.34%                    .94%
Dec.      $23.4 B                      6.96%                  1.04%

*Delinquencies, as a percentage of loans serviced
**Pending foreclosures, as a percentage of loans serviced

Thoughts? Comments?  E-mail story tips to peter.viles@latimes.com
Photo credit: Countrywide CEO Angelo Mozilo, from the L.A. Times

Comments

[Tombstone Realty]

OMG! look at his cuff links! Little Countrywide logos! Hot damn.

Wonder if they'll get sold as part of the bankruptcy filing. Maybe he can get some hot cash on Ebay - "Once worn by Mozilla, Destroyer of Tokyo and Diamond Bar...."

[GretchenMorgensonIsHumanToo]

For the last time, please stop excusing yourself:

Its just that type of "bubble blogger" criticism (only here is the complete data!) that makes most housing-related blogs unreadable.

No one in their right mind who has consistently read this blog, can quibble with the fact that it has a specific and firm point of view.

A perfect point of view? An all-inclusive point of view? An exhaustive point of view? An expert point of view? No such was ever asserted, even if there are such things.

I read this blog for PETER VILES' take on the LA real estate market and beyond. Not for anonymous bloggers, not the LA times and not Tanta from Calculated Risk.

[TakeFive]

"OMG! look at his cuff links! Little Countrywide logos"

Man, those would look great in a museum next to that giant E that was in front of the Enron HQ.

[Monkey Under The GPs Microscope]

Gee Whiz!! I can recall 20 years ago when I worked as a RE appraiser in Torrance for Great Western Bank the foreclosure rate was .04%. Or, in other words, slightly fewer than 1 out of 200 loans went back to the bank. The numbers for CW loans turning into turds are ridiculous. Sombody in the gap ain't flushing!!

[Inland Empire]

OMG! First he was Mr. Pumkin head. Now hes got the blues. Tell your graphic artist to reduce the cyan.

[San Diegan]

Countrywide won't survive the year and Mozilo doesn't care anyway, he's exercised $500m in options already. He's set.

[Robert in Palm Springs]

I just hope that GODZILLA has to pay in the end!

[bode]

I think we do have confusion over the purpose of the Los Angeles Times hosting blogs - an interesting experiment, no question. If I wanted to know what Peter Viles thought, I'd read his personal blog. There are plenty of journalists who run their own blogs, separate from their work. But this isn't Peter's personal blog, it's the Los Angeles Times' LA Land blog. No offense to Peter, who I think does a great job, but were he to leave, get suspended like Hiltzik, fired, whatever, I assume the blog would still be here. It doesn't exist for Peter to tell us what he thinks, but rather for the Los Angeles Times to provide its local readers with broader, more in-depth information about a topic of interest to many, with Peter as tour guide.

If I'm wrong, and the purpose of this blog is for the Los Angeles Times to give Peter a place to tell us what he thinks so they can make money on page views, I'll admit I'm wrong. But somehow I don't think I am. This isn't a celebrity blog acquired by the LAT (think about the NYT/Freakonomics collaboration). So I have to ask myself, if Peter isn't the star, who is? Why the topic! No one has explained why this Los Angeles Times blog is different than the traffic blog, or the UCLA sports blog, or the travel blog: collections of in-depth information about a subject designed to interest the readers, entertain the readers, and stimulate discussions amongst the readers. This site follows the basic Gawker media model: pick a topic, hire a great moderator, and have at it. Wonkette didn't go under because Anne Marie Cox left, or because David Lat left. It continues because it has a topic people care about and a decent moderator.

This is all a round-about way of saying sure, hate CFC with all your might. But really, what is it you actually want? How does this actually affect Los Angeles, land of non-conforming loans that CFC barely handles these days? It's interesting, I guess, that everyone is pulling for CFC to fail, so we can put 10,000 Angelenos out of work and charge even harder into recession. Or, maybe, we need some big-picture education to avoid falling into this trap again, and know what reforms we need to ask our elected officials to enact. You can't get that in a 1,000 word Morgenson article that takes 35% of CFC's stock price in a day but you can get it through the generosity of experts on the Internet. Have a well-informed tour guide who is a professional journalist, and it might not even take you all day to know more about this industry as your average congressman.

So, I agree, time will tell how much worse CFC is than all the others. In the interim, understanding, really understanding, I think is more valuable than unbridled jealousy and hate. That's why I asked Peter for a bit more balance, something I don't think Morgenson gives us but something a blog really shines at. It has nothing to do with my feelings about the crazy bubble we're in but rather my desire to "get the story right." I don't think that's asking too much, and I don't think it's a criticism of Peter. Most of all, I look forward to seeing how everything plays it out in this new year.

[1]

To GretchenMorgensonIsHumanToo who wrote:
"I read this blog for PETER VILES' take on the LA real estate market and beyond. Not for anonymous bloggers, not the LA times and not Tanta from Calculated Risk."

No one particularly cares if or why you read this blog. I like Peter’s commentary too, but this is a blog open to public opinion and statement, not a column. Get off your high horse.

[TakeFive]

bode wrote:

"[this blog] doesn't exist for Peter to tell us what he thinks, but rather for the Los Angeles Times to provide its local readers with broader, more in-depth information about a topic of interest to many, with Peter as tour guide."

Really? I looked all over the site for the Blog Mission Statement with its directives on how the host shall select and discourse on given topics. Couldn't find it. Help us out here with a link, bode.

Posting comments that you don't like a blog because it only writes about AB&C when you think it should cover XY&Z is silly. That's like going to a restaurant, complaining about the food, and then going back again and again when there are thousands of other restaurants on the same street.

I'd like to think of this blog as a Pot Luck. Everybody brings something and you’re welcome to leave anytime.

[BodeBeHumble]

In the interim, understanding, really understanding, I think is more valuable than unbridled jealousy and hate. That's why I asked Peter for a bit more balance, something I don't think Morgenson gives us but something a blog really shines at. It has nothing to do with my feelings about the crazy bubble we're in but rather my desire to "get the story right."

Posted by: bode |

You don't add to the discussion, by trying to assert there is a right way to do a newspaper housing blog and only you (and those you deem) know what that right way is.

For all your "wordswordswords," you go no further than simply saying, "I don’t like what I read on this blog."

You say, "I think we do have confusion over the purpose of the Los Angeles Times hosting blogs - "

But no one is confused but you. Please write the desk editors. Ask them for more guest bloggers. Start a letter writing campaign. Something. Regardless, though, you need to fully comprehend that subjective matters of taste and inclusion are The Bloggers, and his /her alone, to make. Why doesn't that compute?

If he is the "tour guide," shut the hell up pointing out attractions he "missed" and how it would be so much better if we took a different route, and let the rest of us enjoy the ride.

[pugtv]

Wow,

1. Sux to be Bank of America

2. I'm taking collections to fund Lefty's bankruptcy proceedings. Btw, if anyone has seen him on the streets, please direct him to the nearest homeless shelter. Thank you.

[Ace]

My wife spoke to a friend of hers that works for Countrywide in the Chicago area. Their office held 300 people a year ago. Now they are down to 20 people.

Her friend is one of the lucky 20... I guess. He is counting his days. He says that he cannot get hardly anyone approved for a mortgage these days.

[Monkey Under The GPs Microscope]

I agree with Bode to a certain extent in that ragging on CFC, in effect advocating throwing 10,000 Angelenos out of work, is counterproductive. Sure, it's a mess and not easily solved. I believe that alot of it isn't entities like CFC tossing around money but rather the mindset of the borrowers. Not long ago a Home was considered saunctuary but of late has evolved into an ATM. This contributes to a sense of impermanence that shouldn't apply to One's home. Thusly, this unhealthy ideation mememically flows into other aspects of life and society. Jobs, marriages and other such things that keep us sane and civilized suffer too as a result. The doomsday mentality pollutes the air in a palpable telekinetic bio-electrical and metaphysical sense. And then it's back to the cave as the exploitive barbarians of Human nature enter the saunctury. We are lost and enslaved and our Children sent into captivity.

[mike]

i think you get one to two sentences before people lose interest in your comment. maybe a paragraph is u have something good. i never read to the end of any of that extended rambling sh $%^#

mozillo is doing what americans do. he is making money at all costs.

[Keith]

Look at the subtitle "Pete Viles on the rapidly changing...."

Yes, it's Pete's blog, enough to make any blogger green with envy.

[Enlightenment]

For those who don't like this blog, don't read it, just don't read it. No one is forcing you to read it! People complain all the time about what they hear on radio or tv, just turn it to another flipping channel and shut the heck up you troll!

[Uncle Billy]

Found stuck in the thick wooden door, with a large knife, at the Blogger's Church of the Pious Assumption:

1) Thou shalt treat all fellow posters with respect.

2) Thous shalt rag on Countrywide with all thy might . We need scapegoats. It makes us feel better to burn effigies and stone the wicked.
Though, we really should be directing our anger more at the financial wizards and government lackies that play us like a cheap harmonica.

3) Thou shalt feel empathy for all of the innocent sheep at CW and other employers that were led to the slaughter.

4) Thou shalt never attack the Blogmaster. Period. Thou shalt be permitted to make constructive criticisms, but if thy post be mean spirited, and anger directed toward this blog, chillax.

5) Thou shalt jeer and poke at all those who have a net worth of $25M or more. All the rest are either poor or middle class.

[lefty]

hey guys if you really want a deal, now is the time to buy metro L.A.!! i submitted links direct to 6 banks' REO listings but for some reason they were not published here. that was for you die-hard 'pinch every dollar' people! don't wait to buy, if you are really tight with your money check out the REO's before that inventory level falls further!

[Jose Moreno]

What if CFC goes bankrupt?

Great article:
http://www.foxbusiness.com/markets/industries/
finance/article/mortgage-lenders-bankruptcy-severe-impact-
consumers_430776_9.html

Scary thoughts!

José

[Cal]

The Countrywide foreclosure/Delinquency data has been understating the foreclosure problem for some time. For one simple reason, they were aggressively increasing their servicing portfolio . So when looking at the foreclosure snapshot today but comparing it to the portfolio today you get a understated number. It is no coincidence that the foreclosures/delinquency spiked when CFC had to rein in growing the portfolio. With slowing portfolio growth the delinquency data is showing a truer picture of what is really going on at a moment in time. The fact that foreclosure/delinquencies were increasing in the face of such growth speaks to the trouble underlying the market.

The fact that the percentages are bigger compared to the unpaid balance versus the number of units possibly suggest that the larger mortgages are going bad faster.

[adrian]

If CFC goes BK, impact#4: home prices will sink.
That's what I wait for!

[Sean Burke]

I don’t root for 10,000 Angelenos (actually, if Countrywide is in Calabasas, aren’t they Venturans?) to lose their jobs, as I’m certain that those facing unemployment aren’t the management of Countrywide that embraced questionable business practices with such fervor.

There is a wealth of Schadenfreude towards Countrywide – you don’t have to go too far back to find glorious proclamations Countrywide trumpeted of how their revolutionary products were the envy of the industry and the key to their continued success. That these same revolutionary products have now led to the near-death of the institution that championed them is ironic.

That Mr. Mozillo is under investigation for his option redemption timing, while the firm is besieged by investigations from states’ Attorney Generals is poetic justice.