I went into my branch of Countrywide in Ca yesterday and everyone was taking out their money because they said that the mortgage dept part of the bank was about to go into bankruptcy and the assets may be frozen. Cops were everywhere and alot of men in suits around. I was caught up in the moment and also took all of my money out...even though the bank is FDIC insured, I thought it may be a long time before I actually got it back so I got it now....Is the Banking system about to experience a crisis because of the bad mortgages? I was wondering where all of my deposits were being invested and it sounds like the banks used it to back mortgages...thoughts?
2007-08-18 02:55:01 · 7 answers · asked by -* 4 in Business & Finance ➔ Personal Finance
Regardless of FDIC insurance, the funny thing is this.
Have you ever met anyone that has filled a claim with FDIC to get their returned funds? As I understand the history behind the FDIC was started because the last time there was a run at the bank during the great depression.
Since 1920 when is the last time anyone heard of a run at the banks?
Yeah, it's not a bad idea to grab your cash and run.
2007-08-18 03:26:24 · answer #1 · answered by SpankyTClown 4 · 0⤊ 1⤋
From a news article on the web a day or two ago:
However, the turmoil could spook depositors at Countrywide Bank, an Alexandria, Va.-based savings and loan that has grown dramatically since Countrywide Financial bought it in 2000. Nearly 40% of the bank's $57.7 billion in deposits were not insured by the Federal Deposit Insurance Corp. as of March 31, according to the FDIC website.
"If something happens to the parent company, the bank should be able to stand alone," said FDIC spokesman David Barr, who advised worried depositors to talk to the bank about structuring their accounts so they are completely insured. The FDIC insures individual accounts up to $100,000, but a married couple can insure up to $1 million in deposits at a single institution by setting up multiple accounts, Barr said.
2007-08-18 03:06:38 · answer #2 · answered by ssmesq 5 · 1⤊ 0⤋
congratulations on joining the crowd. 8-[
no, the financial system isn't going to implode. The Federal Reserve lowered the discount rate [loan rate to banks] Friday dawn precisely as a symbol to the markets that they aren't going to let this sort of thing happen.
Even if an FDIC insured bank fails, the likely worst outcome is that some much stronger bank takes over during the middle of the night and the next day it is business as usual for everyone who has less than 100k deposited [the FDIC insurance limit].
Only in the most dire of circumstances would an ordinary person's deposits not be covered and available the next day.
oops ... your fears got you again
2007-08-18 03:09:52 · answer #3 · answered by Spock (rhp) 7 · 1⤊ 0⤋
Your money was FDIC insured. Yes sir, you panicked.
The stock exchange has suffered this week because of such panic. The feds checked in and dropped the interest rate 1/4 point to calm the Dow down.
I should be panicking, because >60% of my equity (including the house) is in the stock exchange. But I am not.
I think the mortgage deflation may lead to a bear market, but it certainly isn't doomsday.
2007-08-18 03:08:44 · answer #4 · answered by jjudijo 6 · 0⤊ 1⤋
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2016-10-16 00:53:38 · answer #5 · answered by marolf 4 · 0⤊ 0⤋
Countrywide will go bankrupt. You could have had a long wait to get your $. I would have done the same thing. You are lucky to have done it Friday.
2007-08-19 06:22:14 · answer #6 · answered by LiquidCrash 1 · 0⤊ 0⤋
Ha...Ha.. you wasted half a day trying to get money that is insured.
2007-08-18 04:20:56 · answer #7 · answered by Grandpa Shark 7 · 0⤊ 1⤋