I am having a tough time dealing with news that the former president of Countrywide Financial, the mortgage company that did so much to dig the hole in which we all now reside, is making a killing buying up delinquent mortgage loans from the government at bargain basement rates.
“It’s like Jeffrey Dahmer selling body parts to a clinic,” sniped one of my friends.
As Eric Lipton reported in The Times, Stanford Kurland, who was president of Countrywide during the years when it was selling mortgages with temporary low “teaser” rates that later turned into permanent unaffordable ones, now leads Private National Mortgage Acceptance Company, known to its friends as PennyMac.
In what one company official said was “off-the-charts good” business, PennyMac buys troubled mortgages from the government (which got them from failed banks) at rates like 38 cents on the dollar. Then it offers the beleaguered homeowners a chance to refinance at far more favorable terms. PennyMac makes money, the homeowner gets an affordable mortgage and the government gets a share of the profit.
Everybody’s happy! Except, of course, those of us who helped come up with the other 62 cents on the dollar.
Once again, we are reminded that life is not fair. Lately these unfairness bulletins have been coming so fast and furious that there isn’t time to get upset about all of them. Prioritization is essential.
Given the competition, I can’t get all that worked up about defaulting homeowners who are looking to the government for a rescue. True, a lot of them got in over their heads betting that housing prices would rise forever. But when it comes to stupid financial decisions to vent about, I’m sticking with Alan Greenspan.