Mortgage Bank Defined

A mortgage bank is a retail mortgage originator that sells loans directly to the public and funds those loans with their own money. Unlike a mortgage broker who also sells loans directly to the public but must use the funds of a wholesale lender to close, a mortgage bank uses its own money for closing.

It seems the smarminess of Countrywide Financial’s CEO, Angelo Mozilo, is now so far reaching as to smear the reputation of Democratic nominee, Barack Obama. According to the Wall Street Journal, many politicos got special treatment with loan approvals done by Mozilo himself. This group came to be known inside the company as “Friends of Mozilo”.

Angelo Mozilo, chief executive of Countrywide Financial, was called to give testimony as to the legitimacy of his stock sales and other CEO compensation shenanigans before the Committee on Oversight and Government Reform.

Mr. Mozilo’s statement is more rhetoric and excuses including everything from the woes of the subprime meltdown to an “unforeseen” housing market crash, and very little on his mega-million dollar payday.