Wow! Countrywide Financial, nation's largest mortgage lender is seeing defaults from good risk mortgages. Due to loss of jobs or divorce, many home owners are struggling to make their mortgage payments and having to foreclose it looks like. With all the hype in the housing market I think a lot of people got in over their heads and now that home prices are falling, they're struggling to even sell their homes and recoup on second mortgages.
Does this mean the rental market is going to grow? I think so.
Countrywide Financial, the nation’s largest mortgage lender, said yesterday that more borrowers with good credit were falling behind on their loans and that the housing market might not begin recovering until 2009 because of a decline in house prices that goes beyond anything experienced in decades.
Executives at Countrywide had for some time been more skeptical than others but the bluntness of their comments yesterday surprised many on Wall Street. In a conference call with analysts that lasted three hours, Countrywide’s chairman and chief executive, Angelo R. Mozilo, said home prices were falling “almost like never before, with the exception of the Great Depression.”
Countrywide said its customers who are falling behind on payments appear to have lost jobs, had a divorce or fallen ill. Many are living in homes that are no longer worth what they were when the loan was made and cannot refinance because lenders have become stricter.