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Paul Kiesel
Paul Kiesel
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The Angelo Mozilo Reply

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Angelo Mozilo, the Chairman of Countrywide Financial Corportation, inadvertantly replied to an e-mail from a mortgagee (he meant to forward it on to other executives), Daniel Bailey Jr., who was looking to modify his loan in order to keep his home of 16 years, and described Daniel’s request as a “disgusting” example of form letters inudating Countrywide’s e-mail inboxes.

Mozilo’s e-mail said, “This is unbelievable. Most of these letters now have the same wording. Obviously they are being counseled by some other person or by the Internet. Disgusting.”

His last word, disgusting, is a perfect adjective to describe Mozilo’s compensation for 2007 ($10.7 million and $121.5 million from selling stock) when shareholders lost millions of dollars and Countrywide reported losing over $700 million. It is also a great word to describe Mozilo’s acrimonious response to a mortgagee’s e-mail who was likely told disinformation about his loan (particularly about his interest rate, interest rate reset date and when he could refinance again; TILA violations), and wanted to get into a better or modified mortgage, in order to prevent foreclosure on his home.

Yet, Mozilo’s disgusting antipathy towards mortgagees looking to correct an unfavorable mortgage situation shows how difficult it will be for borrowers to seek loan modifications if they are in underwater mortgages and/or facing foreclosure. Look at it like this, Countrywide is responsible for originating a fair amount of Option ARM loans and subprime loans that have helped precipitate the mortgage/foreclosure crisis and its CEO is “disgusted” by its customers trying to remedy the ramifications of the aforementioned loans. If Mozilo feels this way, wouldn’t that mentality trickle down to the cogs of Countrywide who actually deal with these customers on a daily basis?

The irony of this e-mail is that it could be a portent of revelations that we’ll hear about Mozilo (that he wouldn’t want the general public to know otherwise, much like his reply to Mr. Bailey) in the coming months and how he conducted business over the last few years. I’m sure the word “disgusting” will be a running theme of any new information we receive on Mozilo.