Countrywide September Loan Funding Down 44 Percent

October 11, 2007 No Comments »

It would appear the situation at Countrywide Financial is deteriorating rapidly despite recent media reports speculating that the worst of the mortgage crisis was behind us.

This morning, Countrywide reported that loan originations fell 44 percent in September, while delinquent loans rose to 5.85% in September, up from 4.04% a year ago.

Delinquencies rose 0.8 percent from August to September, but the lender attributed half of the increase to the fact that there were four fewer business days than in August.

The ailing mortgage lender also mentioned that foreclosures increased from 0.51 percent to 1.27 percent.

“The company is continuing to take the necessary steps to assist borrowers with foreclosure avoidance and investors with loss mitigation,” Countrywide President David Sambol said

Countrywide said it funded $21 billion in mortgages in September, with roughly 89 percent of those funded backed by deposits at its savings bank, signaling a move away from the secondary mortgage market.

The lender also noted that its loan pipeline is carrying a lighter load, a meager $42 billion of in-process loans, down 19% from the previous month, and 35% from a year earlier.

Sambol attributed the drop in volume to “…current market conditions and more restrictive underwriting.”

Countrywide currently holds a servicing portfolio worth $1.46 trillion, or roughly 15 percent of the total U.S. home-loan debt, a 17% increase from a year ago.

Meanwhile, Countrywide continues to shed employees throughout its vast operations, with its Full Spectrum Lending feeling the brunt of the layoffs.

It is believed that Countrywide has shuttered 66 FSL branches since July, including 28 branches just yesterday.

The largest U.S. mortgage lender said it eliminated 4,935 jobs last month, leaving it with 55,932, though many more are expected to be lost between now and December.

See the latest list of mortgage layoffs, lender closures, and mergers.

Shares of Countrywide were largely unchanged in midday trading on Wall Street.

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