Invited to promote company efforts to create an all-electronic mortgage transaction, executives of Countrywide Financial veered into some controversial, socio-political issues at an industry conference in Miami last week.
Richard Jones, senior managing director, declared that it was the company’s goal for “everyone (in America) to own their own home” and he boasted of Countrywide’s continuing commitment to fund loans for minority borrowers – a pledge that recently increased to $1 trillion by 2010.
Jones was asked about positions taken by groups like Center for Economic and Policy Research, which recently issued a policy paper stating that “home ownership should not always be viewed as the primary housing option for low-income families.”
In the paper, Dean Baker, CEPR co-director, noted that “the recent run-up in home prices in many parts of the country makes it unlikely that home buyers (including low-income home buyers) will experience capital gains when they sell their homes. In fact,” Baker stated, “it is likely that in many bubble-affected regions, low-income home buyers will actually sell their homes for less than what they paid, after adjusting for inflation.”
According to the CEPR, “affordable rentals may make more sense given the economic realities confronting low-income families.”
Conceding some rhetorical ground, Countrywide’s Jones said: “Yes, I’m sure, there are people that should not be owning a home, but there are plenty of people that should. Home ownership,” he maintained, “brings a sense of security, responsibility and commitment to the community, strengthening the whole society. It brings people to maturity and involvement.”
But perhaps piqued by the challenge to his full-ownership position, Jones asked the audience if the next question would be about “global warming.”
Colleague Omer Simeon, executive vice president of Countrywide, threw in a personal anecdote on home ownership, reporting that he had had “two difficult children who now own several homes and they are pillars of the community. It has been an amazing transformation,” he said proudly.
Later, while advocating for the company at the 8th Annual Mortgage Technology Conference in Miami, Simeon bragged that Countrywide recently had become number one again in total mortgage originations and servicing volume. But the company is not satisfied with that top ranking, said Simeon. “We no longer talk about being number one, we talk about dominating the mortgage industry,” he proclaimed.
That ear-catching stand brought a critical retort the following day from conference participant Amy Brandt, president and chief executive officer of WMC Mortgage, who took issue with the bravado. “My GE counsel would not allow me to use the word ‘dominate,’ because it implies antitrust,” Brandt said with a slight smile, suggesting a touché moment. General Electric is WMC’s parent company. “I would say we plan to be a ‘market leader’ and ‘highly regarded’ in our space,” she said with a verbal wink.
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