Countrywide Cuts 500 Jobs

Fallout from subprime crisis continues
By Heather McPherson,  Newser User
Posted Aug 21, 2007 10:54 AM CDT
Countrywide customer Ruben Krakauer, 68, jokingly shows an empty wallet and pockets outside a Los Angeles branch, Monday, August 20, 2007. Countrywide Financial Corp. tries to reassure customers that...   (Associated Press)
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(Newser) – The nation's top home lender is cutting 500 jobs in its subprime mortgage units in response to the high-risk-lending mess. Before the cuts announced yesterday, Countrywide was actively hiring workers who had been fired from other companies, the LA Times reports. Meanwhile, Capital One said it will close the unit that made jumbo loans to borrowers without fully documented assets.

Capital One's decision to shutter its GreenPoint unit throws 1,900 people out of work. Bucking the trend is Washington Mutual, which is holding on to its subprime mortgages. The company, which does less business on the secondary markets than its competitors, says those loans can be very profitable because no other lenders are willing to issue them.