The largest mortgage lender in the nation, Countrywide, has been have trouble for quite sometime. Subprime mortgage writedowns have plagued the company, and as the foreclosure rate rises, so do delinquencies on Countrywide home loans. The Motley Fool reports on the bad news for Countrywide:

Last week, the California-based home lender reported a nine-fold jump in delinquencies of at least 90 days in the past year, now totaling 5.4% of its $28.4 billion adjustable-rate mortgage pool. Perhaps more alarming was that 71% of borrowers from that pool chose to make the absolute minimum payment necessary, which doesn’t even cover total interest accrued, thus pushing loan balances higher every month.

Additionally, Countrywide has sustained losses due to home equity lines of credit — to the tune of $704 million in 2007.

But all that will soon be water under the bridge, right? After all, Bank of America has offered to buy Countrywide. But until the deal actually happens, there’s always a chance it will be scuttled. And Bank of America may balk as more mortgage market news, especially concerning Countrywide, rolls in.

If the deal is broken, then it means a very long haul on the road to mortgage market recovery. And those with Countrywide stock could find themselves stuck with large losses. But if it does go through, those who buy Countrywide stock now may be handsomely rewarded.

Disclaimer: I am not an investment professional. Nothing in this piece should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional.

Tags: mortgage loan blog, mortgage market news, home mortgage loan, home equity lines of credit,
Bank of America Countrywide, subprime mortgage writedowns, Countrywide stock news

Tags: home equity line of credit, home mortgage loan, mortgage lenders, mortgage loan blog, private mortgage insurance, property tax credit, tax deductions mortgage