Borrowers Angry as Former Countrywide Execs Back in Business
Ex-Countrywide officials back in business making money on bad loans.
March 5, 2009— -- When Luis Macedo's home went into foreclosure last year after months of what he called getting the run around from his lenders at Countrywide Financial Corp., he was frustrated and worried.
When he learned Wednesday that some of the same Countrywide executives who oversaw the writing of the bad loans were buying up delinquent mortgages from the government at low prices and then making millions off potential mortgage payments, he was outraged.
"It's absolutely criminal that these guys are still in business," said Macedo, a Dallas native who said Countrywide misled him about how to pay back his loan, foreclosed on his house and forced him to vacate.
"The upper echelon guys perpetrated a fraud because they allowed loans to be written with no oversight. The same way they ban guys from trading on Wall Street, these guys should be banned from the banking and mortgage industry for life," he said. "It's preposterous that these guys are still allowed be in the mortgage business."
Like AIG and Bear Stearns, the name Countrywide -- once the nation's largest mortgage lender -- has become shorthand for a notorious moment in the recession and its logo a veritable symbol of the burst housing bubble.
Now, several former Countrywide executives, including former president Stanford Kurland, 56, have started a company to take advantage of government programs, buying up delinquent mortgages for pennies on the dollar. By collecting what they can from the tenants, the company is making hundreds of millions of dollars even as other businesses continue to crater.
While the new company, PennyMac, insisted that it is providing a public service by buying mortgages from the government and helping homeowners in need, some former Countrywide borrowers became outraged that the individuals they believe , were behind the predatory-lending policies that led to housing bubble are now back in business.
"I am surprised these fat cats are back in business making loans again," said Edward Jordan, an 80-year-old retired postal worker from Brooklyn, N.Y., who claimed he was duped into taking out a loan that quickly grew to unreasonable levels.
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