Does anyone here have a handle on why many of the mortgage banks, esp Countrywide, would be at risk for bankruptcy? My understanding of the business model is the corporation takes capital, loans it out and secures it with real estate, then sells the mortgages to investors, gets the capital back and repeats the process. If they stop making loans, they should still have the capital and can do other things with it. Obviously, it is not so simple, and I am missing something. Just wondering if anyone can tell me what it is. Thanks
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