Mozilo Speaks, Part Two: Buyers “Put a Lot of Presssure On Us”

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

Countrywide CEO Angelo Mozilo is officially LA Land’s Favorite Real Estate personality. Why? Because while the official party line of the industry is that ‘it’s now a normal market,’ and ‘home prices are holding up,’ Angelo sees and says something very different: there are no buyers, and price depreciation is causing problems.

More of Angelo’s greatest hits, as reported here by Reuters:

‘The cause of the problem that we have today is decreasing values. That’s the cause of the problem, because we didn’t have delinquencies and foreclosures when values were going up,’ he said at a Mortgage Bankers Association conference in Manhattan.

‘First-time home buyers were begging us to make them loans because they thought home values were going up significantly, and so they put a lot of pressure on us to make them loans,’ he said.

The second quote pretty much summarizes the modern lending business. A major lender is talking about pressure from borrowers. Huh? Isn’t that kind of backwards? Of course borrowers want money, but how exactly do they exert pressure? By storming into a mortgage broker’s office and demanding 100% financing and a low teaser rate?

Help me out with this one. Comments?