Letting it all hang out now…

images-11.jpegOn Friday, Bank of America (BAC) announced that it was acquiring Countrywide Financial (CFC) in what is either a fire-sale price of $4 billion, or still too much, based on the problems Countrywide faces. My bet is on the latter and that this will prove to be ADD — another dumb deal.

As footnoted regulars know, I’ve been following Countrywide’s REO problems in Florida, a state that I know pretty well based on my past experience covering the S&L crisis there. Just before the deal was announced, Countrywide owned 999 properties in the Sunshine State, including the now-famous sex party house that we footnoted in November. (That house, by the way, which went into foreclosure at $1.1 million and was originally listed at $904K has come down a second time to $864.9K, so get your checkbooks ready). But sometime over the past few days, the number of properties owned in Florida according to the Countrywide REO site surged to 1,126.

Just to put that into perspective, Bank of America, which has a fairly extensive branch network in Florida, only lists 76 properties on its REO site. Also interesting is that while Countrywide used to list the total number of properties owned in each state, that number is no longer available other than by counting them manually. Dimitris, who runs the Countrywide Foreclosure blog says it’s probably just a programming glitch. But it seems more than coincidental, at least to me, especially since the press release that Countrywide put out last week noted “a number of positive operational trends”, but failed to talk about the growing REO problem. It will be interesting to see what else comes out in the next few weeks and months as this deal moves forward.

Thanks to Wendy and Patrick for filling in last week while I was on vacation. If you haven’t already taken the reader survey, please take a few minutes to help me make the site even better in 2008.