On August 18th, I wrote "It's my opinion that Countrywide's troubles aren't over yet, but I hope they are able to hang in the mortgage business as foreclosure continue to rise in many areas of the country.  The loss of jobs and stability in the market would be huge , should Countrywide fail.  There is talk and as always rumors flying around regarding a potential government bailout, should the situation worsen." 

Unfortunately, Business Week reports an announced bloodbath, as predicited.  According to Business Week "Countrywide, the nation's largest and recently most-embattled mortgage lender, announced it was laying off as many as 12,000 people today, roughly one-fifth of its 61,000-strong workforce. In a letter to employees company founder and ceo Angelo Mozilo called the current slump "the most severe in the contemporary history of our industry." He said home price appreciation had "stopped dead in its tracks," that there had been increased delinquencies in "far too many borrowers" and that the secondary market for jumbo loans and those that don't qualify for government-sponsored insurance "has become nearly illiquid."

In a Countrywide internal letter, it is predicted that 2008 origination volume will decrease by 25% for 2008 versus 2007.  It is another sad day in the industry with the loss of this many jobs, which further destabilizes the economy.

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Michelle@SuccessRealtyGa.com       Success Realty website