Mozilo on distressed borrower's appeal for help: "disgusting"

[Moe Bedard]

From the LATIMES.

Mozilo on distressed borrower's appeal for help: "disgusting"

In an e-mail inadvertently sent to a distressed homeowner trying to avoid foreclosure, embattled Countrywide Financial Chairman Angelo Mozilo lashed out at an online counseling service for distressed borrowers, calling the website's efforts "unbelievable" and "disgusting."

"This is unbelievable," Mozilo wrote in the e-mail, which was posted on a forum on the website LoanSafe.org. "Most of these letters now have the same wording. Obviously they are being counseled by some other person or by the internet. Disgusting."

Read full coverage of the e-mail flap from the LATimes here.


Mozillo was responding to an e-mail from Daniel Bailey, who wrote a "hardship letter" to Mozilo and 16 other Countrywide employees. Bailey acknowledged he wrote the letter using a format provided by the website LoanSafe.org.

In his original e-mail, Bailey requested a loan modification, saying he was unable to make rising payments on his adjustable rate mortgage. "The main reason that caused me to have a hardship and to be late is my misunderstanding of the original loan," Daniel wrote in his e-mail to Countrywide. "I was told that after the first year of payments, I would be able to refinance to a better fixed rate- then the bottom fell out of the industry. My payments for that first year were on time. I also lost my second income due to physical conditions in a very physically demanding industry."

At least two other housing blogs wrote about the exchange Tuesday. On Tuesday evening, Countrywide issued the following statement: "Countrywide and Mr. Mozilo regret any misunderstanding caused by his inadvertent response to an e-mail by Mr. Bailey. Countrywide is actively working to help borrowers, like Mr. Bailey, keep their homes."

After receiving the "disgusting" e-mail comment from Mozilo, Bailey wrote a second e-mail to Countrywide, acknowledging he had consulted an online forum for advice in drafting a hardship letter to Countrywide: "In attempting to come to some way to save my home, I took the advice on forming my hardship letter from a forum. Why? Not all of us have been to a university to study business and we need some help in dealing with these matters. (perhaps, if we had, we would not have fallen for what we did, to start with).

"To have recieved the e-mail that I did, stating by one of your employees, that what I did was 'disgusting' and 'unbelievable' has been just about the final straw. I am trying to do the right thing, I am trying with every ounce of what I have left in me not to blow my brains out ovewr losing the home I have been in for 16 years. The only hope I had left was that perhaps the countrywide company did want to help the people it is servicing….then I receive that responce to my letter. Just great. Now I know, that it is all a nice fat laughing matter to those who are supposed to help."

Mozilo has been heavily criticized for reaping huge gains by selling Countrywide stock while the company's value was collapsing, and the mortgage industry was in crisis. The Los Angeles Times reported he was paid $48 million in compensation in 2006, and cashed in stock options worth $140 million in 2006 and 2007.

Loan Safe founder Moe Bedard said he founded the website to help homeowners find information about working with their lenders to avoid foreclosure. "I knew there was nothing on the internet to help people work out their mortgage loans," he told LA Land. Among other resources, the website gives borrowers e-mail addresses and phone numbers for bank executives who handle loan modifications. It also provides sample "hardship letters" to help borrowers make a written appeal for a loan modification. Bedard says his advice has helped 80 homeowners avoid foreclosure.

Bedard's sample loan letter begins: "I am writing this letter to explain my unfortunate set of circumstances that have caused us to become delinquent on our mortgage. We have done everything in our power to make ends meet but unfortunately we have fallen short and would like you to consider working with us to modify our loan. Our number one goal is to keep our home and we would really appreciate the opportunity to do that."

Bedard said he encourages distressed borrowers to use the format of the letter and then to "make it your own, and don't be too lengthy."
Bailey's e-mailed hardship letter to Countrywide, which he posted online, begins: "I am writing this letter to explain my unfortunate set of circumstances that have caused me to become delinquent on my mortgage. I have done everything in my power to make ends meet but unfortunately I have fallen short and would like you to consider working with me to modify my loan. My number one goal is to keep my home that I have lived in for sixteen years, remodeled with my own sweat equity and I would really appreciate the opportunity to do that. My home is not large or in an upscale neighborhood, it is a “shotgun” bungalow style of only 900 sq. ft. built in 1921. I moved into this home in May of 1992…this was the same year I got clean and sober from drugs and alcohol, and have been ever since, this home means the world to me."

Your thoughts? Comments? E-mail story tips to peter.viles@latimes.com
Photo Credit: Getty Images

[Moe Bedard]

Countrywide Financial Chairman Angelo Mozilo's e-mail sets off a furor

He calls a borrower's plea for help a "disgusting" example of form letters inundating the Calabasas mortgage lender.

By E. Scott Reckard, Los Angeles Times Staff Writer
8:05 PM PDT, May 20, 2008

Apparently clicking "reply" when he meant to hit "forward," Countrywide Financial Corp. Chairman Angelo Mozilo ignited an online furor Tuesday by describing a mortgage customer's plea for help as a "disgusting" example of form letters inundating the Calabasas home lender.

Mozilo's e-mail rocketed back to the customer, Daniel Bailey Jr., who had asked Countrywide to modify the terms of his loan so he wouldn't lose his home of 16 years.

• Angelo Mozilo

• Countrywide's Mozilo reaped $132 million as mortgage lender got hammered
• Mozilo's stock trades questioned

Bailey said he took out the adjustable-rate mortgage without realizing how it worked and had been told incorrectly that he could refinance after a year. Instead, he wrote, "the bottom fell out" of the home-loan industry, and he was stuck with unaffordable payments.

Much of the language in Bailey's message to Countrywide was borrowed from a form letter available at the website LoanSafe.org, a coaching service for troubled borrowers. Bailey, who says he operates a photo studio, posted his e-mailed exchange with the lender on a LoanSafe forum.

His original e-mail was sent to 20 Countrywide addresses, including Mozilo's. Such mass e-mails have overwhelmed e-mail boxes at Countrywide, disrupting its operations and prompting Mozilo's heated response, the company said.

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

The reply touched off debate on housing websites.

At loanworkout.org, a self-described notary public called Mozilo's e-mail "a perfect example of the 'help' they can expect to receive when contacting their lenders."

Another correspondent countered: "I am tired of hearing borrowers complain that they didn't understand what they were signing. . . . If borrowers want the freedom to take out credit for hundreds of thousands of dollars, they are equally responsible to not sign something they don't understand."

Bailey and Mozilo couldn't be reached for comment. Late in the day, the lender issued this statement: "Countrywide and Mr. Mozilo regret any misunderstanding caused by his inadvertent response to an e-mail by Mr. Bailey. Countrywide is actively working to help borrowers, like Mr. Bailey, keep their homes."

scott.reckard@latimes.com

[dmyers1166]

Final, note before I go quiet again, but I sure hope our email line to the head office doesn't die out. The only reason I succeeded (in thread below) was this site and those emails. Only the presidents office emails seem to work for anyone so that is why they are getting filled with the pleas. I hope this source doesn't die out. It isn't the email that was replied to but what was the next email that worries me ...

[Moe Bedard]

D,

They communicate through emails there........and at most of the lenders.....not all, but most and I have been able to crack most of the email codes for the other lenders....just got some good WAMU ones posted...........Andrew cracked the code to CW and I am sure if they changed it up a bit..........we could crack the code again.....

The words of Countrywide's CEO speak volumes about why this company needs to be put out of business. I recognize that there are good people working for this company, but its leadership needs to be replaced. My personal hope is that by the time government investigations end Mr. Mozilo truly regrets the harm he has caused to borrowers and this Country through the policies he is responsible for instituting that ignored prudent lending practices. The only way I think to do this is to separate Mr. Mozilo from his wealth and perhaps provide him with the opportunity to spend some time wearing an orange suit picking up trash by the side of the road.

Daniel

[mjkestes]

I am DISGUSTED at Mozilo. Even if he is never brought to justice in our system in America...he will be brought to justice by the Ultimate Judge. I too hope this doesn't effect the others still working on getting mods.

How nice to see a big wig get zinged, but it seems like Countrywide could care less and just gave him a minute slap on the wrist. But maybe it is opening people's eye to see that homeowners are not deadbeats but are doing a lot of research to save their homes fromt eh corporate giants out there. Real David and Goliath stories are posted here and of the hundres of thousands of people foreclosing right now only a handful are educated enough to fight back and it is mostly thanks to this website. Thansk Moe for all your hard work and late nights helping the little guys, you are like the stone in our slingshots!!

[Andrew]

I wonder what type of damage control they will try and do now.

Well the article is all over the place. It was even on the wall street journal. I hope this gets Washington's attention as well.

[vinson4379]

OMG I just got a call from the prez office last thursday about my loan mod request. They said if I don't hear from the negotiator betweeb 3-4 days give her a call to a DIRECT number. Someone should send that letter to President Bush and maybe he could give him a GOOD tongue lashing.

Does this mean that the prez office is gonna go hard core on us i.e. not responding. I hope not. I've been fighting for 6 months and have finally gotten somewhere thanks to this website.

[Moe Bedard]

Look everyone................this incident is already in the news that quickly...........this is a good thing for everyone here.........CW isn't going to want to make this mistake again and they are certainly not going to want to have more bad press over it.........if anything it will be better for everyone here because they will be bending over backwards to help..... if you get my drift...good mods all around.. .................so relax.......chill........breathe..........it will all work out in the end.

It would be a bad thing if Mozilo is able to inhibit the efforts of CW to provide flexible workout solutions, but he obviously doesn't care and that characteristic should serve as a basis for his removal. I find interesting a quote from a LA Times article that is identified below. We can hope that as the Countrywide story continues, Mozilo will suffer for the consequences of his actions.

Daniel

"U.S. District Judge Mariana Pfaelzer in Los Angeles this week denied a request by Countrywide to dismiss the claims, filed last year by a group of public pension funds, ruling that the shareholders had provided evidence showing 'a rampant disregard' for the risk that borrowers would default."

"'Plaintiffs' numerous confidential witnesses support a strong inference of a companywide culture that, at every level, emphasized increased loan origination volume in derogation of underwriting standards,' Pfaelzer wrote in the ruling."
(see Countrywide executives, directors must defend shareholder suit - Los Angeles Times )

[Carrie]

Moe, ***, Andrew and the rest of you

THANK YOUUUUUU for working day in and day out to help us little guys against this tyrant MOZILLO & CountryWide ....

I still have had no success but I will not stop fighting, I feel that I have the loansafe community behind me everytime I pick up the phone to call or write an email...

What is "disgusting" is Mozillo's attitude and business practices !
I hope that with this it will help the rest of us out....

Thanks again for all of your work !
Carrie
Miami, FL

[penniandmondo]

CountryWide is still targeting minorities.
Just the other day, a letter in spanish asking us to refi with them.
Nice preditory lending letter.
Mr. Mozilo, we are Pacific Asian.
You and all your pals need to be sitting in a state penn somewhere.

[kenneth]

he needs to lay out in the SUN all he can and get use to the HEAT COUSE YOU WILL BURN IN THE HOTTES PLACE IN HELL .

[ccsint]

Although there is little that I would defend Angelo Mozillo on, I would point out to everything that simply copying the same letter and changing the values and dates will eventually cause it to lose it’s effectiveness.

There are a lot of people copying the examples on LoanSafe’s forums almost verbatim. While I wouldn’t have added the word “disgusting”, I can understand his frustrutation at everyone being “coached”. Using your own words to tell your situation and story will make your situation seem more believable, IMO.

Best of luck,

ccsint

[OverpaidSlacker]

i am fortunate not to have to worry about making my house payments. i make plenty of money, and i was smart not to over-indulge when my wife and i bought our first house in 2004 (bank pre-approved us for about $1 million; we spent about $432,000).

i am also, apparently, fortunate to be a customer of the "banking" side of countrywide, and not a loan/mortgage customer of theirs.

as of the other day, i had $110,000 sitting in various savings and cd accounts with countrywide bank. however, i am so appalled by the apparent contempt that countrywide's chief has for his customers and the general public that i am withdrawing all my funds as soon as possible. my savings account will be zeroed out as soon as this month's interest has been credited (may 31), and i will not renew either cd (maturity dates 06/20/08 and 11/01/08).

i have long known that banks (and insurance companies) are the enemy. but such a public affront is so distasteful that i no longer wish to be associated with this company. i hope the present sec inquiry lands your ass in prison, mr. mozilo. you, sir, are disgusting.

theo

[Moe Bedard]

Good for you Theo...........

I wish all of CW good banking customers felt the same way.......... I bet that would sting.........

[Carrie]

way to go THEO !!!!

I back you up on your decision !
If everyone who is a countrywide banking customer would do that - it would sure send a message to MR. Mozillo and his crew....

[lecia11]

I'm still amazed at how many people are putting this whole crisis squarely on the shoulders of the borrowers. I Googled the Mozilo article and have read just pages and pages of comments where people are saying that we got what we deserved because we signed the documents. That is complete and total crap. What layperson understands the legal language?

I depended on my broker to be upfront with me and explain the loan to me. What she did was gloss over it and say it was a great loan (I had an option ARM before I got a modification) that she even had (which I doubt!). She never pointed out in my documents the loan to value aspect, nor did she explain to me what negative amortization was. Sure, people can say that I should have asked, but I didn't even know I had that until I looked at my online statements with Countrywide. And that's wrong.

People who are saying that we should have understood what we were signing are completely missing the point. You expect the professional to point out the good and bad of any situation. When you're in a doctor's office and he's explaining your upcoming surgery, he can't say to you, "You'll be fine" and send you home. You expect him/her to tell you the benefits and risks of that surgery. If you don't get that information, then you can file a malpractice suit against the doctor. A mortgage broker or lender is supposed to be an expert in the field, and they should have to take some sort of hippocratic oath like doctors, stating they'll work ethically.

So how is this our fault? They knew to tell us just enough to get us to sign. Most of us heard the same lines: We can refinance or sell in a few years is probably the most common. What they did should be illegal.

[Honest_fox]

No seriously.

I've got problems too. It's none of your business what mine are but pull yourself up and join the 90+% of americans that can pay their mortgage every month. It's DISGUSTING to see a grown man begging to another grown man.

Mozilo runs a business. That's not good or bad. You don't sue McDonald's if you can't afford a burger. If that guy had that much equity there is no reason he couldn't refinance or *gasp* sell the house.

I just put in to refinance with countrywide for a lower interest rate because the one I had from two years ago was higher than what they are now. I have had no problems with them, EVER!

I don't hear complaints about service, if anything they were "too nice". I don't hear complaints about the system because it's as old as money and banking. I don't hear that the company is worthless, because it's not.

The only complaints I hear are "my word is worthless because I agreed to something and can't keep it" and "Whaa! life's not fair!".

Go tell it to a starving african.

p.s. poll on CNBC shows 55% of respondents think what he said was "not so bad" and that's probably only because they didn't have a choice in the poll of "I DON'T CARE"

[schwefls]

Thank you Theo, from the bottom of all of our hearts.

[schwefls]

Honest Fox try walking a mile in our shoes.

[RudyJay]

Honest Fox hopefully you will never be in a position that some are here. Good to hear that your life has been full of good things and not hardship... Good luck to you.

[RudyJay]

Originally Posted by RudyJay

Honest Fox hopefully you will never be in a position that some are here. Good to hear that your life has been full of good things and not hardship... Good luck to you.

hopefully you will never be in a position that some are here

Correction.. that we are here. You apparently you are one of the lucky ones who have it all together..Best of luck