On hearing that Washington Mutual is the next bank up in Wall Street's fire sale, I have to admit that my first thought was "Well, that's what they get for letting their customer service be handled by shady guys in Nigeria..."
I've gotten so much scam email over the years with Subject: headers like "Washington Mutual Account Access" that I was starting to wonder whether they were actually a real bank. Obviously, I was right to be concerned.
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From: sillyname@yahoo.com
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Yeah, the floods of spam gave many people the impression that WaMu might be owned by Nigerian scammers - and, who knows, by the end of the week that might become true.
The fiction/reality split seems to be catching up with Wall Street - up to now, they had it only on their balance sheets. If the current trend persists, by the end of October you'll be able to buy a place on Park Avenue with Monopoly money. And I just wish I was joking.
Washington Mutual is the mortgage holder for my 11-room home on its San Gabriell mountain foothill quarter acre of orange trees and rose gardens.
These rumors have been around since before another bank failed, headquartered in Pasadena, within 5 miles of my home.
I checked with Washington Mutual by phone and in person with one key question: you you actually hold the loan papers, or did you package them and sell them? They swear that they have the papers. So, if something weird happens, I at least know to whom I owe about $150,000.
When, on paper, just a couple of years ago, my home was worth $900,000 to $1,100,000, that looked like pretty good equity. My wife and I had something for all the work that we did in the 1960s, 1970s, 1980s, and 1990s. Then the home prices world wide began to fall. My home has been dropping in value approximately $1,000 per day for several months.
This is not some abstract arithmetic problem to me, or to millions of other Americans. Will I keep the home? Probably, it is worth much more than I owe, even if the slide in values continues for another year or more. To whom will I be paying for it? Washington Mutual, or some slightly different name if the Feds gobble it up. Plus, of course, I pay state taxes (roughly $3,000 per year) and homeowner insurance. Total? About $1,800 per month.
So long as my wife and I are both teaching university and high school classes, we have a home. Not everyone has that assurance.
So, tempted as I am to write more about Sarah Palin and her Titanium Eyeglasses and her Yahoo email account, I choose not to. Which Presidential candidate has a better understanding of the US Economy?
Chad, that's a standard phishing scam. The spammers send out a batch of messages threatening to cut off access to your account at [insert name of legitimate financial institution here] if you don't follow the instructions in the e-mail. I have received several such messages myself, even though I do not have an account at WaMu. I've also seen eBay and Bank of America listed, and probably some others I'm forgetting. They are hoping that some fraction of their recipients (1) actually have an account at the named institution and (2) are panicked into following the instructions.
WaMu is in danger of going under because, like too many other banks and mortgage lenders, they made a whole bunch of stooopid loans on overpriced real estate, and in many cases the loan balance far exceeds the market value of the property. But they aren't the people who are sending out these e-mails.
Wamu is associated with Providian, one of the worst predatory lenders around. SOME people might hope that Wamu and Providian get ground into dust..