Bankruptcy & Countrywide

Mar. 5.08 | About: Countrywide Financial (CFC)

Two NYT articles caught my eye Wednesday morning on the theme of consumer bankruptcy:

Filings for Bankruptcy Up 18% in February

Americans filed for bankruptcy in growing numbers in February, buckling under the combined weight of rising energy prices, a weakening housing market and sky-high personal debts.

An average of 3,960 bankruptcy petitions were filed per day nationwide last month, up 18 percent from January and up 28 percent from a year earlier, according to Automated Access to Court Electronic Records, a bankruptcy data and management company.

That piece must be combined with the following:

Countrywide Is Sued Again by U.S. Overseer

The United States Trustee has filed a second lawsuit against the mortgage lender Countrywide Financial (CFC), accusing the company of abusing the bankruptcy process.

In a complaint filed Saturday with the Federal Bankruptcy Court in Miami, the United States Trustee for the Southwest region, Donald Walton, accused Countrywide Home Loans, a unit of the mortgage lender, of wrongly asserting claims related to the property of two Miami borrowers, Jose and Fanny Sanchez, who reorganized their finances in bankruptcy.

The Miami suit comes on the heels of a separate lawsuit in the bankruptcy court in Atlanta also accusing Countrywide of abusing the bankruptcy process.

That new bankruptcy law turned out to be quite a clever stroke of social engineering in ways never envisioned by its drafters...

Filings for Bankruptcy Up 18% in February
NYT, March 5, 2008

Countrywide Is Sued Again by U.S. Overseer
REUTERS, March 5, 2008