National Asset, PennyMac and their cousins deal only with whole loans held on bank or mortgage company books. They can't acquire some of the most troublesome mortgages, those that have been sliced and diced and sold in pools to bondholders. They also acknowledge that not every mortgage can be saved. At National Asset, roughly half the loans end up in foreclosure despite the firm's best efforts. But Amaya says the re-default rate on the loans that do get modified is a rock-bottom 3%.
Why should this activity be the least bit controversial?
It's certainly easy to demonize. The idea of someone profiting from a financial crisis doesn't sit well with many people; you have to think for a moment to understand the potential gains to the economy, and who wants to do that?
Some critics have made much of Kurland's former association with Countrywide, as if to suggest that he and Countrywide founder Angelo Mozilo cooked up the mortgage crisis all by themselves so they could reap profits both on the way up and the way down.
One newspaper editorialist recently described Kurland's business as "like Jeffrey Dahmer selling body parts to a clinic," a colorful, if inapposite, simile. And on the website of the United Steelworkers, International President Leo Gerard labeled Kurland a "malevolent, seriously . . . depraved subprime creep," which seems over the top given that Gerard probably never met the man and almost certainly doesn't understand his business.