Countrywide Says Late Payments on Subprime Loans Rose (Will Edwards and Jody Shenn)

Created by : Francis Goodwin View profile

Countrywide Financial Corp., the biggest U.S. mortgage lender, said payments were late at the end of last year on almost 20 percent of the subprime loans it tracks for other companies and investors who own them.

By Will Edwards and Jody Shenn

March 1 (Bloomberg) -- Countrywide Financial Corp., the biggest U.S. mortgage lender, said payments were late at the end of last year on almost 20 percent of the subprime loans it tracks for other companies and investors who own them.

Delinquencies of at least 30 days on ``nonprime'' loans, those made to borrowers whose credit rating fell short of the highest criteria, widened to 19 percent as of Dec. 31 from 15 percent a year earlier, the Calabasas, California-based lender said in an annual regulatory filing with the U.S. Securities and Exchange Commission. The rate stood at 17 percent at the end of September, according to the company's last quarterly filing.

Chief Executive Officer Angelo Mozilo has said the company holds only higher-quality prime loans at its bank and pulled back from subprime lending last year.

``If you look at our market share, we lost some for the first time in years, but it's all in the subprime area,'' he said in a Feb. 8 interview. ``We were a dominant player, and now subprime is a pretty small portion of our business.'' One reason was that rivals were paying salespeople in the business too much, and ``the other reason was we wouldn't take the toxic waste,'' he said.

Last month, Countrywide gave delinquency rates for the overall loan servicing portfolio that didn't break out each category. Servicing involves tasks such as billing, collections and record-keeping on behalf of other companies or investors who own the loans.