July 3, 2008

Welcome to the Mortgage Business

My son, the mortgage broker

By Alberto Marrero Salas

Congratulations!!! You are now a partner with the Bank of America and Countrywide Financial. Never mind that you were responsible and did not buy a home you could not afford. Never mind that you did not use your home as an ATM refinancing time and time again to finance such important things as quin-ceañeras, vacations, plasma tv’s etc.

You are now an investor. Yes you’ve joined the ranks of flippers and speculators. How did that happen? After all you did the right thing? How did you become an investor in the worst housing crash in the history of this nation?

That’s easy. If you are among the 138 million Americans that pay taxes you now have the privilege to pay for all of those persons who flipped homes, who speculated and who lost money in the real estate market.

How did this happen? The Bank of America is buying Countrywide Financial. The CEO of the BofA Kenneth Lewis has stated that he will use tax write offs to cover the losses generated by Countrywide.

The losses could be as high as $33 billion dollars. So you as a taxpayer get to pay for those losses.

This is the same Countrywide that is being sued by the state of California and Illinois. They are being sued for predatory lending, mortgage fraud, hidden fees and using false marketing promises.

In the state of Washington Governor Christine Gregoire will announce fines against Countrywide and will request that the their license be suspended on a permanent basis.

Countrywide’s Chairman, the permanently tanned Angelo Mozilo, should be indicted soon. He sold his stock in Countrywide at over $40 dollars a share. He authorized the corporation to buy back millions of shares of Countrywide at over $40 a share KNOWING that the company was in severe trouble. Today Countrywide stock trades below $5.00.

You are now along with Angelo a fellow investor in Countrywide the largest subprime lender in the United States.

No company in the history of this country has caused more losses in working households than Countrywide.

But it only gets better. Congress led by Democratic Senator Christopher Dodd (who got a sweetheart loan from Mozilo and Countrywide) will now have you pay not only for Countrywide’s sins but for ALL of the losses in the subprime market.

You will get to pay for the worst of the worst subprime loans. These loser loans, liar loans, will be submitted to the government in order to prevent the delinquent homeowners from being foreclosed.

Yes now you, too, can participate by investing in loans from WAMU. The same WAMU who fired appraisers for refusing to submit inflated appraisals. The same WAMU who cut their dividend. The same WAMU that is now trading at $5 per share after having been over $50 a year ago.

Hey and if you are retired or poor you don’t get a pass. No, our friends in Congress, the banks, the brokerage houses and the Realtors want to make sure you also get a piece of the action.

If retired and living from the interest your hard earned savings provide you will get to participate by receiving lower and lower rates on your time deposits. You see in order to help the flippers, the bankers and the entire motley crew the FEDERAL RESERVE cannot increase interest rates. An interest increase would cause the prices of existing home to go even lower.

Therefore oil will continue to rise as will food products because the FED has to keep rates low, therefore causing a decline in the US dollar vs. other currencies.

So in essence all of us will get to participate in the housing crash whether or not we were responsible or not.

Oh well, there is a bright side to all of this. You are now a partner with major banks, mortgage companies, real estate flippers and speculators, realtors and the big houses on Wall Street that put together the horrific collateralized mortgage obligations.

And to think only yesterday you thought you’d never be an investor! Today you are a partner with Merrill Lynch, WAMU and all of the other banks that lent to people who had no business borrowing.

Are you bullish on America? Or at least on the housing market?

Gulp...I hope so.

About Alberto Marrero Salas: Alberto Marrero Salas partner, Nacara 2000 Immigration Law Firm. Los Angeles. email inslaw4u@aol.com. Repinted from LatinoLA (www. latinola.com)

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