Market Watch - "Higher inflation, weaker spending in February" (3-30-07)
"The Fed's dilemma is getting tougher. Core consumer prices increased at the fastest pace in six months during February, even as consumer spending slowed to the weakest in six months, according to government data released Friday."
CNN - "For mortgage market, it's prime's time" (3-30-07)
"The subprime mortgage mess means fewer loans for people with bad credit. What about top-flight borrowers?"
Bloomberg - "Bank of America Warns of New `Correlation Crisis' (Update1)" (3-30-07)
"U.S. homebuilders may trigger a 'correlation crisis' similar to the credit sell off in 2005 when Ford Motor Co. and General Motors Corp. lost their investment-grade credit ratings, according to Bank of America Corp.'s securities unit."
NAR - "NAR Forsees Short-Term Impact on Housing Market From Subprime Reforms" (3-30-07)
"Current market problems and reforms in the underwriting and pricing of subprime loans, including the tightening of underwriting standards by regulators, will have a short- term impact on housing markets. That will be lessened if Congress enacts legislation to expand the roles of Fannie Mae, Freddie Mac and the Federal Housing Administration to provide more housing opportunities to lower-income homeowners and those living in high cost metropolitan areas, the National Association of Realtors® said today. NAR Senior Vice President and Chief Economist David Lereah predicted that tighter underwriting practices may cause total home sales to fall by about 100,000 to 250,000 nationally, or no more than 3 percent a year over the next two years. Many of these households will probably, over time, purchase a home when they have attained the financial capacity to do so by saving for a down payment or growing their income."
News 10 - "Housing's Dark Side: Mortgage Mayhem Up" (3-30-07)
"The California Association of Mortgage Brokers is holding workshops across the state to educate homeowners on their loans. The goal is to help families protect their credit, avoid defaults and foreclosures."
Bloomberg - "M&T, Buffett Holding, Says Alt-A Loans Hurt Profits (Update1)" (3-30-07)
"M&T Bank Corp., the western New York bank partly owned by Warren Buffett's Berkshire Hathaway Inc., said low bids for the Alt-A mortgages it planned to sell will cut first-quarter profit by $7 million."
Bloomberg - "Fed Risks Moral Hazard as Housing Market Melts: Mark Gilbert" (3-30-07)
"The hangover from that borrowing binge is beginning to hurt. Evidence is building that the U.S. economy is slowing sufficiently to warrant a soothing reduction in interest rates from the Federal Reserve. That poses an interesting dilemma for Fed Chairman Ben Bernanke."
Real Estate Journal - "After Financing the Housing Boom, Wall Street Shuts Off the Spigot" (3-30-07)
"By extending generous credit to subprime lenders, Wall Street firms financed the borrowing binge that helped fuel the housing boom. Those firms now are turning off the money spigot. They see more borrowers having trouble paying off those mortgages in a slowing economy, which has made investors less willing to pour money into the sector. More than two dozen subprime mortgage lenders have closed shop, and there is concern that the defaults could spread to other types of risky loans and to less-risky mortgages, exacerbating the housing market's slowdown and possibly weighing on the economy. Accredited Home Lenders Holding Co., a subprime lender, recently was forced to sell $2.7 billion of loans at a big discount to meet lenders' demands for more collateral."
Friday, March 30, 2007
Yahoo! - "Mapping the Subprime Mess" (3-29-07)
"In parts of California, the rate of increase in default activity is now growing rapidly, appearing ready to eclipse the 1996 highs that preceded the technology boom. According to this report in the San Diego Union Tribune, default notices are up four times from year ago levels and foreclosures have tripled."
Business Week - "Beazer Fallout Hits Homebuilders" (3-29-07)
"Homebuilders came under fire in the market again on Mar. 28 after news that the North Carolina field offices of the Federal Bureau of Investigation, the Internal Revenue Service, Inspector General of Housing & Urban Development, and the Justice Dept. have opened a criminal probe into lending practices, some financial transactions, and other dealings at Beazer Homes USA (BZH) (see BusinessWeek.com, 3/27/07, "Feds Are Investigating Homebuilder Beazer"). The headline reignited investor fears during recent weeks about industries that are feeling the pain from the housing slowdown."
NY Post - "Freddie Fights Back" (3-30-07)
"Broke and bruised mortgage packager New Century Financial Corp. got booted from the banking system yesterday as a new legal quagmire swelled around its exit. The federally backed underwriter Freddie Mac severed ties with the company and won't accept any of the mortgages it's signed with homebuyers. "
MSNBC - "Credit Suisse sues subprime lenders" (3-29-07)
"Credit Suissehas filed lawsuits against at least three US subprime mortgage lenders, marking an escalation of efforts by Wall Street banks to use legal action to purge themselves of bad housing loans. DLJ Mortgage Capital, a unit of Credit Suisse, is separately suing the three mortgage companies for more than $30m, claiming the lenders failed to honour obligations relating to loans that it purchased from them. EMC Mortgage Corp, a unit of Bear Stearns, has filed at least one $70m lawsuit against a lender. Other suits are expected."
Yahoo! - "Forecast for Foreclosures" (3-29-07)
"Michele Johnson is no stranger to desperate phone calls, but lately they've become an even more regular occurrence. Johnson, who is chief executive of the Consumer Credit Counseling Service of Southern Nevada & Utah, says that these days, homeowners facing foreclosure are seeking out the agency's help in droves."
Bloomberg - "California Investigates Subprime Mortgage Industry (Update2)" (3-29-07)
"California Attorney General Jerry Brown is investigating the collapsing subprime mortgage industry in the state, the largest U.S. market for high-risk home loans. Gareth Lacy, Brown's spokesman, said yesterday that the attorney general has an 'active and open investigation' that's a continuation of probes into predatory lending practices that began a couple of years ago. Lacy wouldn't say which companies may be targeted or how far the probe has progressed."
Sign On San Diego - "Home loan defaults skyrocket in county" (3-29-07)
"Homeowners throughout San Diego County are defaulting on their loans and losing their properties to foreclosure at an increasingly rapid pace, a shattering event that nevertheless remains far less extensive here than the mortgage problems arising elsewhere in the nation."
"San Diego County placed 17th among the state's 58 counties, with a default rate of 3.3 per 1,000 homes, compared with 6.9 in top-ranked San Joaquin County."
Bloomberg - "California Investigates Subprime Mortgage Industry (Update2)" (3-29-07)
"Half of the 20 biggest U.S. subprime lenders, including No. 2 New Century Financial Corp., which is trying to avoid bankruptcy, are located in California, according to the newsletter Inside Mortgage Finance. The industry is under scrutiny by regulators after delinquencies on subprime mortgages rose to 13.3 percent last quarter, the highest since September 2002. About 13 percent of the U.S.'s subprime loans are in California, according to the Washington-based Mortgage Bankers Association. Mortgage industry analyst Bob Visini of First American Loan Performance said that 13 percent accounts for 22 percent of the subprime mortgage debt in the U.S. because California is the nation's most expensive real estate market."
Market Watch - "A mortgage crisis of their own" (3-29-07)
"The subprime credit crisis has been in swing for a few weeks now. As part of the cycle, we've all heard the stories about people drowning in debt. Maybe you know the fellow with the adjustable-rate mortgage who's slapped toward bankruptcy with every reset."
Boston.com - "Mortgage crisis hits million-dollar homes" (3-29-07)
"Sheriff Leo McGuire presides over foreclosure auctions in Bergen County, New Jersey, where the bidding for a home reached $1.2 million last June -- a record for one of the wealthiest counties in the nation."
NAR - "Realtors® Commend House Panel's Approval of GSE Reform" (3-29-07)
"NAR President Pat Vredevoogd Combs praised the efforts of House Financial Services Chairman Barney Frank (D-Mass.), Rep. Spencer Bachus (R-Ala.) and members of the committee for passing the reform bill, long-supported by NAR, that would overhaul the regulatory structure for the nation’s housing finance GSEs that include Fannie Mae, Freddie Mac and the Federal Home Loan Banks. H.R. 1427, the Federal Housing Finance Reform Act of 2007, focuses on safety and soundness regulation of GSEs while preserving Fannie Mae’s and Freddie Mac’s ability to accomplish their key housing mission, a long-standing concern of NAR. "
Bloomberg - "Wal-Mart May Suffer as Mortgage Woes Hit Customers (Update2)" (3-29-07)
"Ynigues is one of about 800,000 U.S. homeowners who took out so-called subprime mortgages and now are struggling to make monthly payments. As these consumers spend less on products including home furnishings and clothing, sales of retailers such as Home Depot Inc. and Wal-Mart Stores Inc. may suffer."
"In parts of California, the rate of increase in default activity is now growing rapidly, appearing ready to eclipse the 1996 highs that preceded the technology boom. According to this report in the San Diego Union Tribune, default notices are up four times from year ago levels and foreclosures have tripled."
Business Week - "Beazer Fallout Hits Homebuilders" (3-29-07)
"Homebuilders came under fire in the market again on Mar. 28 after news that the North Carolina field offices of the Federal Bureau of Investigation, the Internal Revenue Service, Inspector General of Housing & Urban Development, and the Justice Dept. have opened a criminal probe into lending practices, some financial transactions, and other dealings at Beazer Homes USA (BZH) (see BusinessWeek.com, 3/27/07, "Feds Are Investigating Homebuilder Beazer"). The headline reignited investor fears during recent weeks about industries that are feeling the pain from the housing slowdown."
NY Post - "Freddie Fights Back" (3-30-07)
"Broke and bruised mortgage packager New Century Financial Corp. got booted from the banking system yesterday as a new legal quagmire swelled around its exit. The federally backed underwriter Freddie Mac severed ties with the company and won't accept any of the mortgages it's signed with homebuyers. "
MSNBC - "Credit Suisse sues subprime lenders" (3-29-07)
"Credit Suissehas filed lawsuits against at least three US subprime mortgage lenders, marking an escalation of efforts by Wall Street banks to use legal action to purge themselves of bad housing loans. DLJ Mortgage Capital, a unit of Credit Suisse, is separately suing the three mortgage companies for more than $30m, claiming the lenders failed to honour obligations relating to loans that it purchased from them. EMC Mortgage Corp, a unit of Bear Stearns, has filed at least one $70m lawsuit against a lender. Other suits are expected."
Yahoo! - "Forecast for Foreclosures" (3-29-07)
"Michele Johnson is no stranger to desperate phone calls, but lately they've become an even more regular occurrence. Johnson, who is chief executive of the Consumer Credit Counseling Service of Southern Nevada & Utah, says that these days, homeowners facing foreclosure are seeking out the agency's help in droves."
Bloomberg - "California Investigates Subprime Mortgage Industry (Update2)" (3-29-07)
"California Attorney General Jerry Brown is investigating the collapsing subprime mortgage industry in the state, the largest U.S. market for high-risk home loans. Gareth Lacy, Brown's spokesman, said yesterday that the attorney general has an 'active and open investigation' that's a continuation of probes into predatory lending practices that began a couple of years ago. Lacy wouldn't say which companies may be targeted or how far the probe has progressed."
Sign On San Diego - "Home loan defaults skyrocket in county" (3-29-07)
"Homeowners throughout San Diego County are defaulting on their loans and losing their properties to foreclosure at an increasingly rapid pace, a shattering event that nevertheless remains far less extensive here than the mortgage problems arising elsewhere in the nation."
"San Diego County placed 17th among the state's 58 counties, with a default rate of 3.3 per 1,000 homes, compared with 6.9 in top-ranked San Joaquin County."
Bloomberg - "California Investigates Subprime Mortgage Industry (Update2)" (3-29-07)
"Half of the 20 biggest U.S. subprime lenders, including No. 2 New Century Financial Corp., which is trying to avoid bankruptcy, are located in California, according to the newsletter Inside Mortgage Finance. The industry is under scrutiny by regulators after delinquencies on subprime mortgages rose to 13.3 percent last quarter, the highest since September 2002. About 13 percent of the U.S.'s subprime loans are in California, according to the Washington-based Mortgage Bankers Association. Mortgage industry analyst Bob Visini of First American Loan Performance said that 13 percent accounts for 22 percent of the subprime mortgage debt in the U.S. because California is the nation's most expensive real estate market."
Market Watch - "A mortgage crisis of their own" (3-29-07)
"The subprime credit crisis has been in swing for a few weeks now. As part of the cycle, we've all heard the stories about people drowning in debt. Maybe you know the fellow with the adjustable-rate mortgage who's slapped toward bankruptcy with every reset."
Boston.com - "Mortgage crisis hits million-dollar homes" (3-29-07)
"Sheriff Leo McGuire presides over foreclosure auctions in Bergen County, New Jersey, where the bidding for a home reached $1.2 million last June -- a record for one of the wealthiest counties in the nation."
NAR - "Realtors® Commend House Panel's Approval of GSE Reform" (3-29-07)
"NAR President Pat Vredevoogd Combs praised the efforts of House Financial Services Chairman Barney Frank (D-Mass.), Rep. Spencer Bachus (R-Ala.) and members of the committee for passing the reform bill, long-supported by NAR, that would overhaul the regulatory structure for the nation’s housing finance GSEs that include Fannie Mae, Freddie Mac and the Federal Home Loan Banks. H.R. 1427, the Federal Housing Finance Reform Act of 2007, focuses on safety and soundness regulation of GSEs while preserving Fannie Mae’s and Freddie Mac’s ability to accomplish their key housing mission, a long-standing concern of NAR. "
Bloomberg - "Wal-Mart May Suffer as Mortgage Woes Hit Customers (Update2)" (3-29-07)
"Ynigues is one of about 800,000 U.S. homeowners who took out so-called subprime mortgages and now are struggling to make monthly payments. As these consumers spend less on products including home furnishings and clothing, sales of retailers such as Home Depot Inc. and Wal-Mart Stores Inc. may suffer."
Wednesday, March 28, 2007
Bloomberg - "Subprime Mortgage Bonds From 2006 May Be Worst Ever (Update1)" (3-28-07)
"About 13 percent of mortgages made last year to people who have poor or bad credit are delinquent, S&P analysts Michael Stock and Scott Mason said in a report yesterday, with 6.65 percent of the total classified as ``seriously delinquent,'' or more than 90 days late. Losses on bonds backed by the loans will be between 5.25 percent and 7.75 percent, compared with 5.5 percent in 2000, S&P forecasted."
ABC - "Merced Leads Way in Dropping Median Home Prices" (3-28-07)
"Local realtors say the housing market is simply coming back down to reality after a period of inflation in Merced. But that may not be enough to console homeowners who are having trouble selling their houses."
Market Watch - "Bernanke sees moderate growth, slower inflation" (3-28-07)
"Despite heightened risks from the contraction in housing and the slump in manufacturing, the U.S. economy will most likely achieve moderate growth this year with gradually slowing inflation, Federal Reserve Chairman Ben Bernanke said Wednesday."
North County Times - "Pay your share of subprime debt" (3-28-07)
"Even if you don't own a home, or have never taken out one of these high-interest mortgages geared for borrowers with poor credit, you might need to think again. You could own a piece of the multibillion-dollar market in risky mortgages ---- through your pension plan or a mutual fund. As the bull market in housing rampaged between 2001 and 2006, Wall Street did not sit idly on the sidelines. It jumped in to enjoy the spoils."
CNN - "Paulson: Housing damage 'contained'" (3-28-07)
"U.S. Treasury Secretary Henry Paulson said Wednesday damage to the American economy from the housing market downturn and subprime mortgage foreclosures 'appears to be contained'. Paulson, testifying before a House Appropriations subcommittee, said the Treasury was monitoring housing market developments closely but was encouraged by signs that the housing downturn was at or near a bottom."
Yahoo! - "Contrarian advice: Invest in real estate now" (3-28-07)
"Real estate has its market cycles like any type of investment, and lately it's been getting bad press. Investors may have second thoughts about putting money in this asset class right now, what with all the talk about a bursting housing bubble, the glut of unsold condominiums and homes, declining property values and the growing number of foreclosures."
CNN - "Homebuilders: The wild ride isn't over" (3-28-07)
"Shares of the top 5 builders have tumbled since the housing market peaked. But it still may be too soon to buy."
Market Watch - "New Century bankruptcy looms, report says" (3-28-07)
"New Century Financial Corp. reportedly could file for bankruptcy protection from creditors by Saturday in a move that's grown more likely since the subprime mortgage company's delisting from the New York Stock Exchange two weeks ago."
CBIA - "Total Housing Starts Drop 6 Percent in February" (3-28-07)
"Total housing starts in California fell back once again in February, showing a modest 6 percent decrease from January, but a 42 percent drop when compared to February 2006, the California Building Industry Association announced today. In February, permits were pulled for 6,214 single-family homes statewide, down 9 percent from the previous month and 35 percent from February 2006, while multifamily housing starts — condos and apartments — totaled 3,111, down almost 1 percent from the previous month but down 53 percent from February 2006. Both February and March 2006 saw unusually large numbers of multifamily permits, however."
OC Register - "Pimco's Gross says 'tighter credit' threatens economic growth" (3-28-07)
"Bill Gross, manager of the world's biggest bond fund, said mortgage lenders will tighten credit requirements to forestall the threat of predatory lending legislation, increasing the risk of recession."
Bloomberg - "Subprime Mortgage Collapse Eviscerates California Headquarters" (3-28-07)
"Hometown lenders including New Century and Ameriquest Mortgage Co. already have fired more than 3,000 people, house and condominium prices are down 17 percent since June and office vacancy rates are poised to double this year, said John McDermott, regional manager for Orange County at commercial real estate broker Sperry Van Ness."
CNN - "Mortgages fall amid slowing market" (3-28-07)
"Mortgage applications declined last week as refinancing dipped while purchase activity barely budged, an industry group said Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications dipped 0.2 percent to 671.0 in the week ended March 23."
OC Register - "A new tool for understanding mortgages" (3-28-07)
"Homeowners and homebuyers who have been in the dark about how mortgages work have a new tool to help them decide what loan is best for them – the Mortgage Payment Index. The quarterly index, created by Susan Wachter, a real estate professor at the Wharton School in Pennsylvania working with Genworth Financial, gives consumers information about current trends in mortgages. Wachter discusses below why the index was developed and how consumers can use it. "
Real Estate Jounral - "Real-Estate Commissions Fall; McMansions Face Declining Demand" (3-28-07)
"The 6% real-estate commission is becoming a thing of the past, a Miami Herald article reports. According to the newspaper, which draws upon a Realogy Corp. (which owns Coldwell Banker and franchises Century 21 and others) annual report, the average commission earned in 2006 was less than 5%, or 2.5% per agent, the Herald says."
LA Times - "Metro home price index down 0.7%" (3-28-07)
"Prices of single-family homes across the nation depreciated in January compared with the same month last year, the worst results in more than 13 years, a housing index released Tuesday by Standard & Poor's showed. The S&P/Case-Shiller composite index showed a drop of 0.7% from a year earlier in the price of a single-family home based on existing homes tracked over time in 10 metropolitan markets. In January 1994 the index dropped by 0.9%, compared with a year earlier, S&P said."
LA Times - "Bernanke: Economy on upswing despite housing slump" (3-28-07)
"Federal Reserve chairman Ben S. Bernanke reassured Congress today that economic growth was on the upswing despite a housing slump worsened by the collapse of the market for high-risk sub-prime mortgages. In testimony before the Joint Economic Committee, Bernanke said the sub-prime market turmoil had created financial crises for many families. But with other types of mortgages remaining stable, he said, 'the impact on the broader economy and financial markets seems likely to be contained.'"
CNN - "Bernanke: Focus still on inflation" (3-27-07)
"The Federal Reserve has not shifted away from fighting inflation but is looking for more room to maneuver in an environment of heightened risk, posed in part by risky mortgage loans, Chairman Ben Bernanke said Wednesday. 'We are looking for a bit more flexibility given the uncertainties that we are facing and the risks that are occurring on both sides of our outlook,' Bernanke testified before the Joint Economic Committee of Congress."
CNN - "Why Iran matters to oil markets" (3-28-07)
"Tehran is ensnared in a growing dispute with the West. Traders are nervous it might pull its oil off the market."
"About 13 percent of mortgages made last year to people who have poor or bad credit are delinquent, S&P analysts Michael Stock and Scott Mason said in a report yesterday, with 6.65 percent of the total classified as ``seriously delinquent,'' or more than 90 days late. Losses on bonds backed by the loans will be between 5.25 percent and 7.75 percent, compared with 5.5 percent in 2000, S&P forecasted."
ABC - "Merced Leads Way in Dropping Median Home Prices" (3-28-07)
"Local realtors say the housing market is simply coming back down to reality after a period of inflation in Merced. But that may not be enough to console homeowners who are having trouble selling their houses."
Market Watch - "Bernanke sees moderate growth, slower inflation" (3-28-07)
"Despite heightened risks from the contraction in housing and the slump in manufacturing, the U.S. economy will most likely achieve moderate growth this year with gradually slowing inflation, Federal Reserve Chairman Ben Bernanke said Wednesday."
North County Times - "Pay your share of subprime debt" (3-28-07)
"Even if you don't own a home, or have never taken out one of these high-interest mortgages geared for borrowers with poor credit, you might need to think again. You could own a piece of the multibillion-dollar market in risky mortgages ---- through your pension plan or a mutual fund. As the bull market in housing rampaged between 2001 and 2006, Wall Street did not sit idly on the sidelines. It jumped in to enjoy the spoils."
CNN - "Paulson: Housing damage 'contained'" (3-28-07)
"U.S. Treasury Secretary Henry Paulson said Wednesday damage to the American economy from the housing market downturn and subprime mortgage foreclosures 'appears to be contained'. Paulson, testifying before a House Appropriations subcommittee, said the Treasury was monitoring housing market developments closely but was encouraged by signs that the housing downturn was at or near a bottom."
Yahoo! - "Contrarian advice: Invest in real estate now" (3-28-07)
"Real estate has its market cycles like any type of investment, and lately it's been getting bad press. Investors may have second thoughts about putting money in this asset class right now, what with all the talk about a bursting housing bubble, the glut of unsold condominiums and homes, declining property values and the growing number of foreclosures."
CNN - "Homebuilders: The wild ride isn't over" (3-28-07)
"Shares of the top 5 builders have tumbled since the housing market peaked. But it still may be too soon to buy."
Market Watch - "New Century bankruptcy looms, report says" (3-28-07)
"New Century Financial Corp. reportedly could file for bankruptcy protection from creditors by Saturday in a move that's grown more likely since the subprime mortgage company's delisting from the New York Stock Exchange two weeks ago."
CBIA - "Total Housing Starts Drop 6 Percent in February" (3-28-07)
"Total housing starts in California fell back once again in February, showing a modest 6 percent decrease from January, but a 42 percent drop when compared to February 2006, the California Building Industry Association announced today. In February, permits were pulled for 6,214 single-family homes statewide, down 9 percent from the previous month and 35 percent from February 2006, while multifamily housing starts — condos and apartments — totaled 3,111, down almost 1 percent from the previous month but down 53 percent from February 2006. Both February and March 2006 saw unusually large numbers of multifamily permits, however."
OC Register - "Pimco's Gross says 'tighter credit' threatens economic growth" (3-28-07)
"Bill Gross, manager of the world's biggest bond fund, said mortgage lenders will tighten credit requirements to forestall the threat of predatory lending legislation, increasing the risk of recession."
Bloomberg - "Subprime Mortgage Collapse Eviscerates California Headquarters" (3-28-07)
"Hometown lenders including New Century and Ameriquest Mortgage Co. already have fired more than 3,000 people, house and condominium prices are down 17 percent since June and office vacancy rates are poised to double this year, said John McDermott, regional manager for Orange County at commercial real estate broker Sperry Van Ness."
CNN - "Mortgages fall amid slowing market" (3-28-07)
"Mortgage applications declined last week as refinancing dipped while purchase activity barely budged, an industry group said Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications dipped 0.2 percent to 671.0 in the week ended March 23."
OC Register - "A new tool for understanding mortgages" (3-28-07)
"Homeowners and homebuyers who have been in the dark about how mortgages work have a new tool to help them decide what loan is best for them – the Mortgage Payment Index. The quarterly index, created by Susan Wachter, a real estate professor at the Wharton School in Pennsylvania working with Genworth Financial, gives consumers information about current trends in mortgages. Wachter discusses below why the index was developed and how consumers can use it. "
Real Estate Jounral - "Real-Estate Commissions Fall; McMansions Face Declining Demand" (3-28-07)
"The 6% real-estate commission is becoming a thing of the past, a Miami Herald article reports. According to the newspaper, which draws upon a Realogy Corp. (which owns Coldwell Banker and franchises Century 21 and others) annual report, the average commission earned in 2006 was less than 5%, or 2.5% per agent, the Herald says."
LA Times - "Metro home price index down 0.7%" (3-28-07)
"Prices of single-family homes across the nation depreciated in January compared with the same month last year, the worst results in more than 13 years, a housing index released Tuesday by Standard & Poor's showed. The S&P/Case-Shiller composite index showed a drop of 0.7% from a year earlier in the price of a single-family home based on existing homes tracked over time in 10 metropolitan markets. In January 1994 the index dropped by 0.9%, compared with a year earlier, S&P said."
LA Times - "Bernanke: Economy on upswing despite housing slump" (3-28-07)
"Federal Reserve chairman Ben S. Bernanke reassured Congress today that economic growth was on the upswing despite a housing slump worsened by the collapse of the market for high-risk sub-prime mortgages. In testimony before the Joint Economic Committee, Bernanke said the sub-prime market turmoil had created financial crises for many families. But with other types of mortgages remaining stable, he said, 'the impact on the broader economy and financial markets seems likely to be contained.'"
CNN - "Bernanke: Focus still on inflation" (3-27-07)
"The Federal Reserve has not shifted away from fighting inflation but is looking for more room to maneuver in an environment of heightened risk, posed in part by risky mortgage loans, Chairman Ben Bernanke said Wednesday. 'We are looking for a bit more flexibility given the uncertainties that we are facing and the risks that are occurring on both sides of our outlook,' Bernanke testified before the Joint Economic Committee of Congress."
CNN - "Why Iran matters to oil markets" (3-28-07)
"Tehran is ensnared in a growing dispute with the West. Traders are nervous it might pull its oil off the market."
Tuesday, March 27, 2007
MBA - "House Subcommittee Conducts Hearing on Subprime and Predatory Mortgage Lending" (3-27-07)
"Subprime and Predatory Mortgage Lending: New Regulatory Guidance, Current Market Conditions and Effects on Regulated Financial Institutions"
Yahoo! - "FBI Investigating Beazer Homes" (3-27-07)
"Shares of Beazer Homes USA Inc. plunged in Tuesday's aftermarket trading session following a report from BusinessWeek magazine that federal investigators have opened a broad criminal probe of the homebuilder's lending practices, a number of financial transactions, and other matters."
Asbury Park - "Bank hit by mortgage defaults" (3-27-07)
"OceanFirst Financial Corp. said Monday it could be forced to buy back as much as $47 million in delinquent subprime real estate loans made last year by a mortgage subsidiary. Problems at the subsidiary, Columbia Home Loans LLC of Valhalla, N.Y., have already caused OceanFirst, which operates the largest bank based in Ocean County, to restate its fourth-quarter earnings. Instead of a $4.6 million profit, the bank said late Friday it lost $1.6 million."
CNN - "Subprime losses lead to drop in home ownership" (3-27-07)
"About 2.4 million holders of subprime mortgage loans made between 1998 and 2006 will lose their properties to foreclosure, according to a report from the Center for Responsible Lending, a non-profit policy and advocacy organization for home owners. Worse, that will result in a net home ownership loss of one million households."
Banking, Housing, and Urban Affairs - OPENING STATEMENT OF CHAIRMAN CHRIS DODD - HEARING ON "MORTGAGE MARKET TURMOIL: CAUSES AND CONSEQUENCES" (3-27-07)
Opening Statements
Bloomberg - "FDIC's Bair Urges Congress to Pass U.S. Mortgage Law (Update1)" (3-27-07)
"Congress should pass legislation setting a national anti-predatory lending standard that would apply to all mortgage lenders, a top U.S. bank regulator said."
Yahoo! - "34 percent of homeowners are clueless about their mortgage" (3-27-07)
"Stocks stumbled Tuesday as investors grew wary when new data raised the possibility that the nation's weak housing market would seep into the broader economy and crimp consumer spending."
Bloomberg - "Fed's Braunstein Says Mortgage Delinquencies `Great Concern'" (3-27-07)
The Federal Reserve has "great concern" about the surge in mortgage delinquencies and foreclosures, said Sandra Braunstein, director of the Fed's Division of Consumer and Community Affairs.
"The impact of mortgage delinquency and foreclosure on consumers and communities is one of great concern," Braunstein said in testimony to a House Financial Services subcommittee hearing on subprime mortgages in Washington. "We have much work ahead of us, as there is no one sure and easy fix."
Market Watch - "Fed sees subprime market woes for one to two years" (3-27-07)
"The Federal Reserve is concerned that borrowers of subprime mortgage loans may face 'more difficulty' in the next one to two years, a Fed official said Tuesday. In particular, those borrowers with recently originated adjustable-rate mortgages are likely to experience more delinquencies and foreclosures, said Sandra Braunstein, the director of the Fed's division of consumer and community affairs. In testimony before a House Financial Services subcommittee, Braunstein also said incentives for responsible subprime lenders need to be preserved so that access to credit can be maintained. However, facing close questioning by lawmakers, regulators largely dismissed the need for new legislation to combat problems in the subprime market."
Bloomberg - "Lennar's Profit Falls 73% as U.S. Home Demand Wanes (Update7)" (3-27-07)
"Lennar Corp., the largest U.S. homebuilder by revenue, said earnings plummeted 73 percent during the fiscal first-quarter as the worst housing slump in more than a decade scared away potential buyers. Lennar Chief Executive Officer Stuart Miller said the spring selling season, when homebuilders usually get the bulk of their orders, failed to materialize, just two months after telling investors this year would be as good or better than 2006. "
Market Watch - "Home prices fall for first time in 11 years" (3-27-07)
"U.S. home prices continued to fall in January, with prices in 10 major cities now down 0.7% year-over-year, according to Standard & Poor's and MacroMarkets LLC, which released the January Case-Shiller price indexes on Tuesday."
CNN - "Many homeowners blind to their mortgage terms" (3-27-07)
"More than three in 10 U.S. homeowners have no idea what type of loan they own, according to a poll released by Bankrate.com Monday that suggested how confusion may be contributing to problems in the subprime mortgage sector. Another troubling finding in the Bankrate.com survey was that 34 percent of homeowners who hold adjustable-rate mortgages (ARM) do not know what they will do when their loan resets to higher interest rates. "
Bloomberg - "Subprime Defaults May Spread to Auto Bonds, S&P Says (Update1)" (3-27-07)
"Bonds backed by automobile loans may be hurt by rising subprime mortgage defaults as people with poor credit struggle with their household debt, according to Standard & Poor's. Capital One Financial Corp., Wachovia Corp., Wells Fargo & Co., and other lenders have lent more funds to people with bad credit scores in the past few years to sustain growth, S&P said today in a report by analysts led by Mark Risi. The loans are also for longer terms, increasing the probability of default, the analysts said. About 68 percent of 2006 subprime auto loans were due in five years or more, Risi said. "
Market Watch - "Bad weather rains on new-home sales" (3-27-07)
"The news that new-home sales fell to a seven-year low in February could be panicking homeowners hoping to sell in the near future, but economists say poor weather in the Northeast and Midwest may have skewed February's sale numbers."
Real Estate Journal - "Will 'Lemming Loans' Drive The Economy Off the Cliff?" (3-27-07)
" For the first time in the nation's history, a significant number of Americans are being threatened with the loss of their home even though they still have a steady, good-paying job. It's not just an issue for people with poor credit, those with subprime loans. It also affects people with good enough credit to qualify for a prime loan. Known as Alt-A mortgages, these loans were written for 1 in 5 U.S. mortgages and could have a big impact on the economy and on credit markets -- bigger, perhaps, than the effects of the recent shockwaves buffeting the subprime-lender market, economists say."
LA Times - "State regulator calling for ban on stated-income loans" (3-27-07)
"With as many as 460,000 California homeowners reportedly at risk of losing homes bought with sub-prime mortgages, a top California business regulator called Monday for a ban on certain risky and controversial lending practices. At issue for Department of Corporations Commissioner Preston DuFauchard were home loans being issued without lenders fully verifying the prospective buyer's income and employment status. These so-called stated- income loans have contributed to the collapse of the sub-prime mortgage market, he said."
LA Times - "U.S. new-home sales slide further" (3-27-07)
"The pace of transactions last month is the slowest in seven years and is off 18% from a year earlier. California and the West show relative strength."
"Subprime and Predatory Mortgage Lending: New Regulatory Guidance, Current Market Conditions and Effects on Regulated Financial Institutions"
Yahoo! - "FBI Investigating Beazer Homes" (3-27-07)
"Shares of Beazer Homes USA Inc. plunged in Tuesday's aftermarket trading session following a report from BusinessWeek magazine that federal investigators have opened a broad criminal probe of the homebuilder's lending practices, a number of financial transactions, and other matters."
Asbury Park - "Bank hit by mortgage defaults" (3-27-07)
"OceanFirst Financial Corp. said Monday it could be forced to buy back as much as $47 million in delinquent subprime real estate loans made last year by a mortgage subsidiary. Problems at the subsidiary, Columbia Home Loans LLC of Valhalla, N.Y., have already caused OceanFirst, which operates the largest bank based in Ocean County, to restate its fourth-quarter earnings. Instead of a $4.6 million profit, the bank said late Friday it lost $1.6 million."
CNN - "Subprime losses lead to drop in home ownership" (3-27-07)
"About 2.4 million holders of subprime mortgage loans made between 1998 and 2006 will lose their properties to foreclosure, according to a report from the Center for Responsible Lending, a non-profit policy and advocacy organization for home owners. Worse, that will result in a net home ownership loss of one million households."
Banking, Housing, and Urban Affairs - OPENING STATEMENT OF CHAIRMAN CHRIS DODD - HEARING ON "MORTGAGE MARKET TURMOIL: CAUSES AND CONSEQUENCES" (3-27-07)
Opening Statements
Bloomberg - "FDIC's Bair Urges Congress to Pass U.S. Mortgage Law (Update1)" (3-27-07)
"Congress should pass legislation setting a national anti-predatory lending standard that would apply to all mortgage lenders, a top U.S. bank regulator said."
Yahoo! - "34 percent of homeowners are clueless about their mortgage" (3-27-07)
"Stocks stumbled Tuesday as investors grew wary when new data raised the possibility that the nation's weak housing market would seep into the broader economy and crimp consumer spending."
Bloomberg - "Fed's Braunstein Says Mortgage Delinquencies `Great Concern'" (3-27-07)
The Federal Reserve has "great concern" about the surge in mortgage delinquencies and foreclosures, said Sandra Braunstein, director of the Fed's Division of Consumer and Community Affairs.
"The impact of mortgage delinquency and foreclosure on consumers and communities is one of great concern," Braunstein said in testimony to a House Financial Services subcommittee hearing on subprime mortgages in Washington. "We have much work ahead of us, as there is no one sure and easy fix."
Market Watch - "Fed sees subprime market woes for one to two years" (3-27-07)
"The Federal Reserve is concerned that borrowers of subprime mortgage loans may face 'more difficulty' in the next one to two years, a Fed official said Tuesday. In particular, those borrowers with recently originated adjustable-rate mortgages are likely to experience more delinquencies and foreclosures, said Sandra Braunstein, the director of the Fed's division of consumer and community affairs. In testimony before a House Financial Services subcommittee, Braunstein also said incentives for responsible subprime lenders need to be preserved so that access to credit can be maintained. However, facing close questioning by lawmakers, regulators largely dismissed the need for new legislation to combat problems in the subprime market."
Bloomberg - "Lennar's Profit Falls 73% as U.S. Home Demand Wanes (Update7)" (3-27-07)
"Lennar Corp., the largest U.S. homebuilder by revenue, said earnings plummeted 73 percent during the fiscal first-quarter as the worst housing slump in more than a decade scared away potential buyers. Lennar Chief Executive Officer Stuart Miller said the spring selling season, when homebuilders usually get the bulk of their orders, failed to materialize, just two months after telling investors this year would be as good or better than 2006. "
Market Watch - "Home prices fall for first time in 11 years" (3-27-07)
"U.S. home prices continued to fall in January, with prices in 10 major cities now down 0.7% year-over-year, according to Standard & Poor's and MacroMarkets LLC, which released the January Case-Shiller price indexes on Tuesday."
CNN - "Many homeowners blind to their mortgage terms" (3-27-07)
"More than three in 10 U.S. homeowners have no idea what type of loan they own, according to a poll released by Bankrate.com Monday that suggested how confusion may be contributing to problems in the subprime mortgage sector. Another troubling finding in the Bankrate.com survey was that 34 percent of homeowners who hold adjustable-rate mortgages (ARM) do not know what they will do when their loan resets to higher interest rates. "
Bloomberg - "Subprime Defaults May Spread to Auto Bonds, S&P Says (Update1)" (3-27-07)
"Bonds backed by automobile loans may be hurt by rising subprime mortgage defaults as people with poor credit struggle with their household debt, according to Standard & Poor's. Capital One Financial Corp., Wachovia Corp., Wells Fargo & Co., and other lenders have lent more funds to people with bad credit scores in the past few years to sustain growth, S&P said today in a report by analysts led by Mark Risi. The loans are also for longer terms, increasing the probability of default, the analysts said. About 68 percent of 2006 subprime auto loans were due in five years or more, Risi said. "
Market Watch - "Bad weather rains on new-home sales" (3-27-07)
"The news that new-home sales fell to a seven-year low in February could be panicking homeowners hoping to sell in the near future, but economists say poor weather in the Northeast and Midwest may have skewed February's sale numbers."
Real Estate Journal - "Will 'Lemming Loans' Drive The Economy Off the Cliff?" (3-27-07)
" For the first time in the nation's history, a significant number of Americans are being threatened with the loss of their home even though they still have a steady, good-paying job. It's not just an issue for people with poor credit, those with subprime loans. It also affects people with good enough credit to qualify for a prime loan. Known as Alt-A mortgages, these loans were written for 1 in 5 U.S. mortgages and could have a big impact on the economy and on credit markets -- bigger, perhaps, than the effects of the recent shockwaves buffeting the subprime-lender market, economists say."
LA Times - "State regulator calling for ban on stated-income loans" (3-27-07)
"With as many as 460,000 California homeowners reportedly at risk of losing homes bought with sub-prime mortgages, a top California business regulator called Monday for a ban on certain risky and controversial lending practices. At issue for Department of Corporations Commissioner Preston DuFauchard were home loans being issued without lenders fully verifying the prospective buyer's income and employment status. These so-called stated- income loans have contributed to the collapse of the sub-prime mortgage market, he said."
LA Times - "U.S. new-home sales slide further" (3-27-07)
"The pace of transactions last month is the slowest in seven years and is off 18% from a year earlier. California and the West show relative strength."
NAHB - "New-Home Sales Down 3.9 Percent In February" (3-26-07)
"Sales of new single-family homes fell 3.9 percent in February to a seasonally adjusted annual rate of 848,000, the lowest level since August of 2000, according to figures released today by the U.S. Commerce Department. The February fall-off followed downward revisions to the sales rates for the three previous months."
Redding.com - "Borrowing trouble" (3-25-07)
From 2001 to 2006, home values in the Redding area more than doubled, an unprecedented run-up in appreciation. The rise in real estate was buoyed by a bevy of alternative loan products, including the subprime market, which has been struggling financially in recent months."
San Diego Business Journal - "Notices of Defaults on Home Loans Skyrocketing in County" (3-26-07)
" In the fourth quarter of 2006, San Diego County experienced a 169 percent increase in homes receiving notices of loan default from a year ago. Default notices — the first step in the foreclosure process — were up to 3,150 from 1,173 for the like quarter 2005, according to DataQuick Information Systems , which compiles home property data. Throughout California, there were 37,273 default notices — notifying homeowners 90 days behind on payments — sent from October to December 2006, marking the most foreclosure activity since the third quarter of 1998, when the number of default notices hit 38,053."
MSN - "What realty agents won't tell you" (3-25-07)
"Fair-housing laws prevent agents from talking about neighborhood demographics, and they often don't want to discuss other details, such as crime stats. Luckily, the Web picks up where agents leave off."
CNN - "New home sales: Slowest in 6 years" (3-26-07)
"Pace of new home sales slumps 4% to lowest since August 2000 as glut of homes on the market rises, hurting prices."
Yahoo! - "Sales of New Homes Fall Sharply" (3-26-07)
"Sales of New Homes Fall Sharply for 2nd Consecutive Month in February"
Business Week - "The Forecast for Foreclosures" (3-26-07)
"Don't be fooled by falling foreclosure rates and rising home sales—many parts of the U.S. are still hurting from the housing slowdown"
Bloomberg - "U.S. Foreclosure Filings Rise 12 Percent in February (Update3)" (3-26-07)
"U.S. foreclosure filings last month jumped 12 percent compared with a year ago as owners struggled with declining home values and higher adjustable mortgage rates. More than 130,000 homes entered foreclosure last month, according to a report from RealtyTrac, an online listing of foreclosed properties. That's the second-highest since RealtyTrac began collecting data in January 2005. "
Market Watch - "New-home sales fall to seven-year low" (3-26-07)
"Sales of new homes unexpectedly dropped in February to the lowest level seen in nearly seven years, while inventories of unsold homes rose to a 16-year high, suggesting that the nation's housing market was softening heading into the vital spring buying season. Sales of newly constructed single-family houses unexpectedly slowed again in February, falling 3.9% to a seasonally adjusted annual rate of 848,000, the lowest level since June 2000, the Commerce Department reported Monday. Sales were down 18.3% compared with February 2006."
OC Register - "California: Root of western states' evil?" (3-26-07)
"Neighboring states often blame former Californians – sometimes with cause – for changes they don't like in their communities."
"Sales of new single-family homes fell 3.9 percent in February to a seasonally adjusted annual rate of 848,000, the lowest level since August of 2000, according to figures released today by the U.S. Commerce Department. The February fall-off followed downward revisions to the sales rates for the three previous months."
Redding.com - "Borrowing trouble" (3-25-07)
From 2001 to 2006, home values in the Redding area more than doubled, an unprecedented run-up in appreciation. The rise in real estate was buoyed by a bevy of alternative loan products, including the subprime market, which has been struggling financially in recent months."
San Diego Business Journal - "Notices of Defaults on Home Loans Skyrocketing in County" (3-26-07)
" In the fourth quarter of 2006, San Diego County experienced a 169 percent increase in homes receiving notices of loan default from a year ago. Default notices — the first step in the foreclosure process — were up to 3,150 from 1,173 for the like quarter 2005, according to DataQuick Information Systems , which compiles home property data. Throughout California, there were 37,273 default notices — notifying homeowners 90 days behind on payments — sent from October to December 2006, marking the most foreclosure activity since the third quarter of 1998, when the number of default notices hit 38,053."
MSN - "What realty agents won't tell you" (3-25-07)
"Fair-housing laws prevent agents from talking about neighborhood demographics, and they often don't want to discuss other details, such as crime stats. Luckily, the Web picks up where agents leave off."
CNN - "New home sales: Slowest in 6 years" (3-26-07)
"Pace of new home sales slumps 4% to lowest since August 2000 as glut of homes on the market rises, hurting prices."
Yahoo! - "Sales of New Homes Fall Sharply" (3-26-07)
"Sales of New Homes Fall Sharply for 2nd Consecutive Month in February"
Business Week - "The Forecast for Foreclosures" (3-26-07)
"Don't be fooled by falling foreclosure rates and rising home sales—many parts of the U.S. are still hurting from the housing slowdown"
Bloomberg - "U.S. Foreclosure Filings Rise 12 Percent in February (Update3)" (3-26-07)
"U.S. foreclosure filings last month jumped 12 percent compared with a year ago as owners struggled with declining home values and higher adjustable mortgage rates. More than 130,000 homes entered foreclosure last month, according to a report from RealtyTrac, an online listing of foreclosed properties. That's the second-highest since RealtyTrac began collecting data in January 2005. "
Market Watch - "New-home sales fall to seven-year low" (3-26-07)
"Sales of new homes unexpectedly dropped in February to the lowest level seen in nearly seven years, while inventories of unsold homes rose to a 16-year high, suggesting that the nation's housing market was softening heading into the vital spring buying season. Sales of newly constructed single-family houses unexpectedly slowed again in February, falling 3.9% to a seasonally adjusted annual rate of 848,000, the lowest level since June 2000, the Commerce Department reported Monday. Sales were down 18.3% compared with February 2006."
OC Register - "California: Root of western states' evil?" (3-26-07)
"Neighboring states often blame former Californians – sometimes with cause – for changes they don't like in their communities."
Recordnet - "KB Home plans food tasting as incentive" (3-24-07)
"Many homebuilders have been offering buyer incentives over the past year that include backyard landscaping or upgrades at no additional costs or help with financing. KB Home, which in October boosted its home sales with American Express gift cards - $10 to any lookers and $5,000 to buyers at five San Joaquin County projects - is trying another promotion to boost traffic at a Stockton project. From noon to 3 p.m. Sunday, those coming out to look at models at KB Home's Riverbend Community will get more than a taste of the Los Angeles-based company's development. They'll get free participation in a gourmet food-tasting event featuring local restaurants: 856 Inc., Alder Market Bistro, Angelina's Spaghetti House, Creperie Taste of Brittany and Garlic Brothers."
"Many homebuilders have been offering buyer incentives over the past year that include backyard landscaping or upgrades at no additional costs or help with financing. KB Home, which in October boosted its home sales with American Express gift cards - $10 to any lookers and $5,000 to buyers at five San Joaquin County projects - is trying another promotion to boost traffic at a Stockton project. From noon to 3 p.m. Sunday, those coming out to look at models at KB Home's Riverbend Community will get more than a taste of the Los Angeles-based company's development. They'll get free participation in a gourmet food-tasting event featuring local restaurants: 856 Inc., Alder Market Bistro, Angelina's Spaghetti House, Creperie Taste of Brittany and Garlic Brothers."
NAR - "Existing-Home Sales Rise Again in February" (3-23-07)
"Existing-home sales rose strongly in February following a healthy gain in January, reaching the highest level since last April, according to the National Association of Realtors®.
C.A.R. - "C.A.R. reports sales decrease 9.6 percent in February, median price of a home in California at $564,700, up 5.7 percent from year ago" (3-23-07)
"Home sales decreased 9.6 percent in February in California compared with the same period a year ago, while the median price of an existing home increased 5.7 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today."
CNN - "Freddie Mac books $480M loss" (3-23-07)
"Freddie Mac, the No. 2 U.S. mortgage finance company, reported a fourth-quarter net loss on Friday as a decline in long-term interest rates affected the value of its loan assets. For full-year 2006, net income increased to $2.2 billion, or $2.84 per share. from $2.1 billion, or $2.75 a share, but the company took a $1.03 billion charge during the second half of 2006."
Yahoo! - "Existing Home Sales Rise 3.9 Percent" (3-23-07)
"Sales of existing homes rose in February by the largest amount in nearly three years, but worsening troubles in subprime mortgages were viewed as a roadblock to a full-fledged rebound. The National Association of Realtors reported Friday that existing home sales climbed 3.9 percent last month, pushed up by a milder-than-normal winter that boosted sales in areas of the country such as the Northeast."
CNN - "Countrywide not getting proper 'credit'" (3-23-07)
"Outside of people swinging hammers for a living, few fortunes are more closely tied to the housing market than Countrywide Financial's. And for years, that was just the way investors liked it. The nation's biggest mortgage lender rode low interest rates and soaring housing prices to annual revenue growth of some 40 percent over the last five years, sending its stock soaring 240 percent over that period."
CNN - "Home price slump helps spur sales" (3-23-07)
"Home sales jumped 3.9% last month, best gain since '04, but the gains came as sellers cut prices, even before subprime woes hit."
OC Register - "Teetering homeowners need to consider options" (3-23-07)
"Taking a loss on a sale before foreclosure can at least protect your credit and potentially save you money."
OC Register - "O.C. house prices down again" (3-23-07)
"Single-family home prices fell in Orange County last month, marking the sixth time since August that prices showed year-over-year declines, the California Association of Realtors reported today."
Money Week - "Is subprime today's dot-com?" (3-23-07)
"From bubble to bubble – it’s a painfully familiar saga. First equities, now housing. First denial, then grudging acceptance. It’s the pattern and its repetitive character that is so striking. For the second time in seven years, asset-dependent America has gone to excess. And once again, twin bubbles in a particular asset class and the real economy are in the process of bursting – most likely with greater-than-expected consequences for the US economy, a US-centric global economy, and world financial markets. "
E Finance Directory - "90 Percent of Appraisers Feel Pressure to Inflate Home Values" (3-23-07)
"Inflated home appraisals helped drive up home prices across the country to levels that couldn't be sustained. A new study finds that 90 percent of appraisers now feel pressure to inflate home values. Some are even being asked to turn in appraisals without looking for a home. Those who don't cooperate face negative ramifications from clients and employers alike."
Bloomberg - "Investors Absorb Worst of Subprime Rout, Markets Show (Update4)" (3-23-07)
"While everyone from Alan Greenspan, the former chairman of the Federal Reserve, to Bill Gross, manager of the world's largest bond fund, have acknowledged that mortgage defaults may slow the economy, Wall Street's biggest securities firms aren't fretting. The ``subprime risk flare'' will likely subside by early April, said Jack Malvey, global head of fixed-income strategy at Lehman Brothers Holdings Inc."
"Existing-home sales rose strongly in February following a healthy gain in January, reaching the highest level since last April, according to the National Association of Realtors®.
Total existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 3.9 percent to a seasonally adjusted annual rate1 of 6.69 million units in February from a downwardly revised level of 6.44 million in January, but are 3.6 percent below the 6.94 million-unit pace in February 2006. Last month’s increase was the biggest monthly rise in three years – sales also rose 3.9 percent in March 2004."
C.A.R. - "C.A.R. reports sales decrease 9.6 percent in February, median price of a home in California at $564,700, up 5.7 percent from year ago" (3-23-07)
"Home sales decreased 9.6 percent in February in California compared with the same period a year ago, while the median price of an existing home increased 5.7 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today."
CNN - "Freddie Mac books $480M loss" (3-23-07)
"Freddie Mac, the No. 2 U.S. mortgage finance company, reported a fourth-quarter net loss on Friday as a decline in long-term interest rates affected the value of its loan assets. For full-year 2006, net income increased to $2.2 billion, or $2.84 per share. from $2.1 billion, or $2.75 a share, but the company took a $1.03 billion charge during the second half of 2006."
Yahoo! - "Existing Home Sales Rise 3.9 Percent" (3-23-07)
"Sales of existing homes rose in February by the largest amount in nearly three years, but worsening troubles in subprime mortgages were viewed as a roadblock to a full-fledged rebound. The National Association of Realtors reported Friday that existing home sales climbed 3.9 percent last month, pushed up by a milder-than-normal winter that boosted sales in areas of the country such as the Northeast."
CNN - "Countrywide not getting proper 'credit'" (3-23-07)
"Outside of people swinging hammers for a living, few fortunes are more closely tied to the housing market than Countrywide Financial's. And for years, that was just the way investors liked it. The nation's biggest mortgage lender rode low interest rates and soaring housing prices to annual revenue growth of some 40 percent over the last five years, sending its stock soaring 240 percent over that period."
CNN - "Home price slump helps spur sales" (3-23-07)
"Home sales jumped 3.9% last month, best gain since '04, but the gains came as sellers cut prices, even before subprime woes hit."
OC Register - "Teetering homeowners need to consider options" (3-23-07)
"Taking a loss on a sale before foreclosure can at least protect your credit and potentially save you money."
OC Register - "O.C. house prices down again" (3-23-07)
"Single-family home prices fell in Orange County last month, marking the sixth time since August that prices showed year-over-year declines, the California Association of Realtors reported today."
Money Week - "Is subprime today's dot-com?" (3-23-07)
"From bubble to bubble – it’s a painfully familiar saga. First equities, now housing. First denial, then grudging acceptance. It’s the pattern and its repetitive character that is so striking. For the second time in seven years, asset-dependent America has gone to excess. And once again, twin bubbles in a particular asset class and the real economy are in the process of bursting – most likely with greater-than-expected consequences for the US economy, a US-centric global economy, and world financial markets. "
E Finance Directory - "90 Percent of Appraisers Feel Pressure to Inflate Home Values" (3-23-07)
"Inflated home appraisals helped drive up home prices across the country to levels that couldn't be sustained. A new study finds that 90 percent of appraisers now feel pressure to inflate home values. Some are even being asked to turn in appraisals without looking for a home. Those who don't cooperate face negative ramifications from clients and employers alike."
Bloomberg - "Investors Absorb Worst of Subprime Rout, Markets Show (Update4)" (3-23-07)
"While everyone from Alan Greenspan, the former chairman of the Federal Reserve, to Bill Gross, manager of the world's largest bond fund, have acknowledged that mortgage defaults may slow the economy, Wall Street's biggest securities firms aren't fretting. The ``subprime risk flare'' will likely subside by early April, said Jack Malvey, global head of fixed-income strategy at Lehman Brothers Holdings Inc."
CNN - "Senator: Fed to blame for subprime crisis" (3-22-07)
"The lawmaker says a pattern of neglect by federal bank regulators contributed to the subprime mortgage crisis."
CNN - "Subprime risk: Most vulnerable markets" (3-22-07)
"2.2 million homeowners are endangered by the subprime crisis. Which markets may be hardest hit?"
Look Out News - "Santa Monica Lender Lays Off 2,400 Workers After Making Shaky Loans" (3-22-07)
"Fremont General confirmed Tuesday that nearly 2,400 employees nationwide could lose their jobs by May after the company reported it was withdrawing from the sub-prime lending market, which offers adjustable interest rates on home loans to those with shaky credit."
Yahoo! - "KB Home Shares Down on Outlook" (3-22-07)
"Shares in Los Angeles homebuilder KB Home fell Thursday after the company warned that excess inventory will likely force lower selling prices at least through the end of the year. The housing sector is beleaguered by a supply overhang built up during a five-year boom that ended 18 months ago. Builders have used heavy incentives and discounts to try to sell through the housing glut, but prices continue to fall as home buyers shy from purchasing any property that might continue to lose value."
Reuters - "Bill may not solve foreclosures woe: key senator" (3-22-07)
"The chairman of the U.S. Senate Banking Committee said on Thursday that he plans legislation on predatory lending, but that the solution to the problem of Americans facing foreclosure on their mortgages may not be legislative."
Market Watch - "Regulators grilled over subprime mortgage woes" (3-22-07)
"Members of the Senate Banking Committee took regulators to task on Thursday for their oversight of the subprime mortgage market, which has imploded in recent months and left behind cash-strapped borrowers and cratered the profits of lenders."
Bloomberg - "Comptroller Says Abusive Loans Fueled Subprime Crisis (Update4)" (3-22-07)
"The OCC and Federal Reserve are among regulators chastised by Congress for enforcement lapses as delinquencies climb and threaten to worsen a housing recession that's weakening the economy. The deteriorating subprime mortgage market -- loans to people with poor or limited credit histories -- has pushed some lenders out of business and forced firms such as Countrywide Financial Corp. to tighten standards."
"Some economists also speculated that the meltdown in subprime mortgages helped persuade the Fed to drop its tilt toward higher interest rates. For the first time since the Fed ended a two-year run of rate increases in August, the central bank yesterday signaled that its next move might be either to lower or raise borrowing costs, instead of just the latter."
Yahoo! - "Countrywide Sees Record Foreclosures" (3-22-07)
"A top executive at Countrywide Financial Corp. said Thursday that dropping home prices could produce record-high levels of foreclosures on loans made in 2006 to people with poor credit histories."
Bloomberg - "Fed Says It Could Have Acted Sooner on Subprime Rout (Update3)" (3-22-07)
"The Federal Reserve could have acted faster to prevent a meltdown in the subprime-mortgage market by curbing the lax lending standards that contributed to the crisis, the Fed's chief bank supervisor said."
MSN - "Countrywide failed subrime loans could be worst" (3-22-07)
"Countrywide's subprime mortgage defaults for 2006 loans may exceed the company's highest on record, a company executive told a government panel examining mortgage lending. Countrywide's "worst single origination year was 2000, for which the cumulative foreclosure rate was 9.89 percent," Sandor Samuels, the company's executive managing director, said in prepared remarks."
Reuters - "California alert for mortgage rescue scams" (3-22-07)
"California prosecutors are on guard for mortgage rescue scams in which lenders target borrowers who may foreclose on failing home loans amid the subprime mortgage meltdown, an official said on Thursday. Defaults of subprime mortgages -- home financing for the riskiest borrowers -- have increased across the United States in recent months, pushing some lenders out of business, forcing others to discontinue the loans and triggering fears of damage to the broader economy. "
Bloomberg - "U.S. Economy: Leading Indicators Index Fell 0.5% (Update2)" (3-22-07)
"Weakening consumer confidence and scaled-back construction plans drove down a measure of the U.S. economy's future course by the most in a year."
CNN - "Subprime lenders push back" (3-22-07)
"Leading lenders tell Senate Committee that loan resets have not led to big jump in defaults. Consumer advocates charge lenders steer clients into unaffordable deals."
Globe and Mail - "Greenspan blamed for subprime crisis" (3-22-07)
"U.S. bank regulators were advocates of exotic mortgages, senator Dodd says"
"The lawmaker says a pattern of neglect by federal bank regulators contributed to the subprime mortgage crisis."
CNN - "Subprime risk: Most vulnerable markets" (3-22-07)
"2.2 million homeowners are endangered by the subprime crisis. Which markets may be hardest hit?"
Look Out News - "Santa Monica Lender Lays Off 2,400 Workers After Making Shaky Loans" (3-22-07)
"Fremont General confirmed Tuesday that nearly 2,400 employees nationwide could lose their jobs by May after the company reported it was withdrawing from the sub-prime lending market, which offers adjustable interest rates on home loans to those with shaky credit."
Yahoo! - "KB Home Shares Down on Outlook" (3-22-07)
"Shares in Los Angeles homebuilder KB Home fell Thursday after the company warned that excess inventory will likely force lower selling prices at least through the end of the year. The housing sector is beleaguered by a supply overhang built up during a five-year boom that ended 18 months ago. Builders have used heavy incentives and discounts to try to sell through the housing glut, but prices continue to fall as home buyers shy from purchasing any property that might continue to lose value."
Reuters - "Bill may not solve foreclosures woe: key senator" (3-22-07)
"The chairman of the U.S. Senate Banking Committee said on Thursday that he plans legislation on predatory lending, but that the solution to the problem of Americans facing foreclosure on their mortgages may not be legislative."
Market Watch - "Regulators grilled over subprime mortgage woes" (3-22-07)
"Members of the Senate Banking Committee took regulators to task on Thursday for their oversight of the subprime mortgage market, which has imploded in recent months and left behind cash-strapped borrowers and cratered the profits of lenders."
Bloomberg - "Comptroller Says Abusive Loans Fueled Subprime Crisis (Update4)" (3-22-07)
"The OCC and Federal Reserve are among regulators chastised by Congress for enforcement lapses as delinquencies climb and threaten to worsen a housing recession that's weakening the economy. The deteriorating subprime mortgage market -- loans to people with poor or limited credit histories -- has pushed some lenders out of business and forced firms such as Countrywide Financial Corp. to tighten standards."
"Some economists also speculated that the meltdown in subprime mortgages helped persuade the Fed to drop its tilt toward higher interest rates. For the first time since the Fed ended a two-year run of rate increases in August, the central bank yesterday signaled that its next move might be either to lower or raise borrowing costs, instead of just the latter."
Yahoo! - "Countrywide Sees Record Foreclosures" (3-22-07)
"A top executive at Countrywide Financial Corp. said Thursday that dropping home prices could produce record-high levels of foreclosures on loans made in 2006 to people with poor credit histories."
Bloomberg - "Fed Says It Could Have Acted Sooner on Subprime Rout (Update3)" (3-22-07)
"The Federal Reserve could have acted faster to prevent a meltdown in the subprime-mortgage market by curbing the lax lending standards that contributed to the crisis, the Fed's chief bank supervisor said."
MSN - "Countrywide failed subrime loans could be worst" (3-22-07)
"Countrywide's subprime mortgage defaults for 2006 loans may exceed the company's highest on record, a company executive told a government panel examining mortgage lending. Countrywide's "worst single origination year was 2000, for which the cumulative foreclosure rate was 9.89 percent," Sandor Samuels, the company's executive managing director, said in prepared remarks."
Reuters - "California alert for mortgage rescue scams" (3-22-07)
"California prosecutors are on guard for mortgage rescue scams in which lenders target borrowers who may foreclose on failing home loans amid the subprime mortgage meltdown, an official said on Thursday. Defaults of subprime mortgages -- home financing for the riskiest borrowers -- have increased across the United States in recent months, pushing some lenders out of business, forcing others to discontinue the loans and triggering fears of damage to the broader economy. "
Bloomberg - "U.S. Economy: Leading Indicators Index Fell 0.5% (Update2)" (3-22-07)
"Weakening consumer confidence and scaled-back construction plans drove down a measure of the U.S. economy's future course by the most in a year."
CNN - "Subprime lenders push back" (3-22-07)
"Leading lenders tell Senate Committee that loan resets have not led to big jump in defaults. Consumer advocates charge lenders steer clients into unaffordable deals."
Globe and Mail - "Greenspan blamed for subprime crisis" (3-22-07)
"U.S. bank regulators were advocates of exotic mortgages, senator Dodd says"
Market Watch - "What goes boom must go bust" (3-21-07)
"Mortgage marketing campaigns have been changed from "Money? Free!" to "Last four years of W2's - notarized!", font sizes have been reduced in print ads, get-rich-on-real-estate infomercials have been moved from prime time to 2am, your brother in law has finally clammed up. Indications, all, that something has changed - really changed - in the housing market."
CNN - "Despite low rates, mortgage demand falls" (3-21-07)
"Application activity drops for the first time in four weeks, Mortgage Bankers Association's seasonally adjusted index says."
CNN - "Fed holds rates steady again" (3-21-07)
"Bernanke & Co. keep key rate at 5.25%, say economy expanding despite housing woes; market jumps on rate cut hopes."
Bloomberg - "Homeowners, Lenders Skirt Default, May Curb U.S. Housing Slump" (3-21-07)
"Almost 5 percent of U.S. mortgages had payments overdue by 30 days or more at the end of last year, the highest since 2003, Duncan said. No one tracks or estimates the number of borrowers who avoid foreclosure with a short sale, according to Duncan and David Berson, chief economist of Washington-based Fannie Mae, the largest buyer of mortgages. There's ample evidence that the number is increasing, they said."
Bloomberg - "Fremont Sale Clears Out $4 Billion of Subprime Loans (Update4)" (3-21-07)
"Fremont General Corp., one of two companies ordered to stop offering subprime mortgages, will sell $4 billion of loans to stem losses from homeowner defaults. The sale will result in a pretax loss of $140 million, Santa Monica, California-based Fremont said in a statement. The buyer wasn't identified. The loss shows the loans will be sold for 96 cents on the dollar, more than most analysts expected, said Theodore Kovaleff at Sky Capital LLC in New York. "
Reuters - "Adjustable loans endanger homes for many in U.S" (3-21-07)
"An estimated 1.1 million U.S. mortgage holders are at risk of losing their homes as rates reset on adjustable-rate mortgages originated between 2004 and last year, according to First American CoreLogic, a Santa Ana, California, firm that tracks property financing trends."
Forbes - "Fremont General Finds Subprime Buyer" (3-21-07)
"Shares of Fremont General jumped $1.18, or 13.4%, to $9.95 in Wednesday afternoon trading after announcing the sale of $4 billion of its loans, boosting chances the company can successfully extricate itself from the crumbling subprime mortgage business."
Bloomberg - "`Short Sellers' Who Predicted Subprime Rout See More Declines" (3-21-07)
"The collapse in shares of subprime- mortgage companies over the past month rewarded so-called short sellers who bet that rising defaults among the riskiest borrowers would curb lenders' profits. Some traders who predicted declines in shares of New Century Financial Corp., NovaStar Financial Inc. and Accredited Home Lenders Holding Co. say such stocks may fall further as loan delinquencies increase and demand for mortgage-backed securities wanes. New Century sank 90 percent last month, while NovaStar lost 73 percent. Accredited slid 54 percent. "
Yahoo! - "'Liar Loans': Mortgage Woes Beyond Subprime" (3-21-07)
"Some experts in the field are now concerned about the so-called Alt. A mortgage loan market, which has grown even faster than the market for subprime mortgage loans to borrowers with less than top credit. Alt. A refers to people with better credit scores (A-rated) who borrow with little or no verification of income, or so-called alternative documentation."
Bloomberg - "Treasuries Gain as Fed Softens Reference to Interest-Rate Boost" (3-21-07)
"U.S. Treasury notes maturing in two years rose the most in more than a week after the Federal Reserve left borrowing costs unchanged and unexpectedly softened a reference on the need for higher interest rates."
Business Week - "Why the Fed Didn't Raise Interest Rates" (3-21-07)
"Inflation is running above the levels that Bernanke has targeted, but he's holding off on hiking rates because of the risks"
Bloomberg - "Subprime Meltdown Snares Borrowers With Better Credit (Update3)" (3-21-07)
"The subprime credit crunch is beginning to ensnare even borrowers with better credit. Lenders are increasingly refusing to lend to homebuyers who can't make a down payment of more than 5 percent, especially if they won't document their income. Until recently such borrowers qualified for so-called Alt A mortgages, which rank between prime and subprime in terms of risk. Last year the category accounted for about 20 percent of the $3 trillion of U.S. mortgages, about the same as subprime loans, according to Credit Suisse Group. "
Bloomberg - "Government Is `Here to Help' Subprime Borrowers: Caroline Baum" (3-21-07)
"Congress is making noises about doing something to help homeowners who can't meet their mortgage payments hold on to their slice of the American Dream. Democratic presidential frontrunner Hillary Clinton, senator from New York, wants even lower mortgage rates for homeowners facing foreclosure. Senate Banking Committee Chairman Chris Dodd, Democrat of Connecticut, and House Financial Services Chairman Barney Frank, Democrat of Massachusetts, are holding hearings to determine Congress's legislative options. "
"Mortgage marketing campaigns have been changed from "Money? Free!" to "Last four years of W2's - notarized!", font sizes have been reduced in print ads, get-rich-on-real-estate infomercials have been moved from prime time to 2am, your brother in law has finally clammed up. Indications, all, that something has changed - really changed - in the housing market."
CNN - "Despite low rates, mortgage demand falls" (3-21-07)
"Application activity drops for the first time in four weeks, Mortgage Bankers Association's seasonally adjusted index says."
CNN - "Fed holds rates steady again" (3-21-07)
"Bernanke & Co. keep key rate at 5.25%, say economy expanding despite housing woes; market jumps on rate cut hopes."
Bloomberg - "Homeowners, Lenders Skirt Default, May Curb U.S. Housing Slump" (3-21-07)
"Almost 5 percent of U.S. mortgages had payments overdue by 30 days or more at the end of last year, the highest since 2003, Duncan said. No one tracks or estimates the number of borrowers who avoid foreclosure with a short sale, according to Duncan and David Berson, chief economist of Washington-based Fannie Mae, the largest buyer of mortgages. There's ample evidence that the number is increasing, they said."
Bloomberg - "Fremont Sale Clears Out $4 Billion of Subprime Loans (Update4)" (3-21-07)
"Fremont General Corp., one of two companies ordered to stop offering subprime mortgages, will sell $4 billion of loans to stem losses from homeowner defaults. The sale will result in a pretax loss of $140 million, Santa Monica, California-based Fremont said in a statement. The buyer wasn't identified. The loss shows the loans will be sold for 96 cents on the dollar, more than most analysts expected, said Theodore Kovaleff at Sky Capital LLC in New York. "
Reuters - "Adjustable loans endanger homes for many in U.S" (3-21-07)
"An estimated 1.1 million U.S. mortgage holders are at risk of losing their homes as rates reset on adjustable-rate mortgages originated between 2004 and last year, according to First American CoreLogic, a Santa Ana, California, firm that tracks property financing trends."
Forbes - "Fremont General Finds Subprime Buyer" (3-21-07)
"Shares of Fremont General jumped $1.18, or 13.4%, to $9.95 in Wednesday afternoon trading after announcing the sale of $4 billion of its loans, boosting chances the company can successfully extricate itself from the crumbling subprime mortgage business."
Bloomberg - "`Short Sellers' Who Predicted Subprime Rout See More Declines" (3-21-07)
"The collapse in shares of subprime- mortgage companies over the past month rewarded so-called short sellers who bet that rising defaults among the riskiest borrowers would curb lenders' profits. Some traders who predicted declines in shares of New Century Financial Corp., NovaStar Financial Inc. and Accredited Home Lenders Holding Co. say such stocks may fall further as loan delinquencies increase and demand for mortgage-backed securities wanes. New Century sank 90 percent last month, while NovaStar lost 73 percent. Accredited slid 54 percent. "
Yahoo! - "'Liar Loans': Mortgage Woes Beyond Subprime" (3-21-07)
"Some experts in the field are now concerned about the so-called Alt. A mortgage loan market, which has grown even faster than the market for subprime mortgage loans to borrowers with less than top credit. Alt. A refers to people with better credit scores (A-rated) who borrow with little or no verification of income, or so-called alternative documentation."
Bloomberg - "Treasuries Gain as Fed Softens Reference to Interest-Rate Boost" (3-21-07)
"U.S. Treasury notes maturing in two years rose the most in more than a week after the Federal Reserve left borrowing costs unchanged and unexpectedly softened a reference on the need for higher interest rates."
Business Week - "Why the Fed Didn't Raise Interest Rates" (3-21-07)
"Inflation is running above the levels that Bernanke has targeted, but he's holding off on hiking rates because of the risks"
Bloomberg - "Subprime Meltdown Snares Borrowers With Better Credit (Update3)" (3-21-07)
"The subprime credit crunch is beginning to ensnare even borrowers with better credit. Lenders are increasingly refusing to lend to homebuyers who can't make a down payment of more than 5 percent, especially if they won't document their income. Until recently such borrowers qualified for so-called Alt A mortgages, which rank between prime and subprime in terms of risk. Last year the category accounted for about 20 percent of the $3 trillion of U.S. mortgages, about the same as subprime loans, according to Credit Suisse Group. "
Bloomberg - "Government Is `Here to Help' Subprime Borrowers: Caroline Baum" (3-21-07)
"Congress is making noises about doing something to help homeowners who can't meet their mortgage payments hold on to their slice of the American Dream. Democratic presidential frontrunner Hillary Clinton, senator from New York, wants even lower mortgage rates for homeowners facing foreclosure. Senate Banking Committee Chairman Chris Dodd, Democrat of Connecticut, and House Financial Services Chairman Barney Frank, Democrat of Massachusetts, are holding hearings to determine Congress's legislative options. "
Tuesday, March 20, 2007
OC Register - "Fremont gives workers two-month layoff notice" (3-20-07)
"The subprime mortgage industry saw two key developments Monday, both of which touch Orange County. Fremont Investment & Loan told many workers currently on leave from its Brea-based lending unit, Fremont General Corp., that their employment will end May 18. And regulators said the chief of New Century Financial in Irvine is one of several industry leaders being asked to testify before Congress. "
Sign On San Diego - "New Century says cut off by Fannie Mae" (3-20-07)
"New Century Financial Corp., a struggling mortgage lender to people with poor credit histories, said Tuesday it can no longer sell mortgage loans to Fannie Mae or act as the mortgage financier's primary servicer of mortgage loans."
Sign On San Diego - "People's Choice Home Loan files for Chapter 11" (3-20-07)
"People's Choice Home Loan Inc., a California-based mortgage lender to people with poor credit histories, filed for Chapter 11 bankruptcy protection Tuesday, according to court papers. The Irvine, California-based unit of People's Choice Financial Corp. became at least the fourth large U.S. subprime lender to seek protection from creditors in the last three months. Its parent, a real estate investment trust, also filed for Chapter 11. "
CNN - "Your Home: 5 tips if you're in too deep" (3-20-07)
"Feeling stretched by housing costs? Then it's time to give yourself a helping hand."
MSN - "Homes picture mixed after starts data" (3-20-07)
"The pace of U.S. home construction rose a sharp 9 percent in February but permits for future building slid, according to data on Tuesday that shed little light on whether the housing market was stabilizing. The cloudy home construction data and recent woes in the subprime mortgage market are sure to be on the minds of Federal Reserve members as they weigh monetary policy when they meet Tuesday and Wednesday."
CNN - "Housing starts rebound but permits fall" (3-20-07)
"Starts bounce back from 9-year low, but builders pull back on plans amid worries about real estate market and subprime mortgages."
Bloomberg - "Banks Pick Up Where Fed Left Off, Tightening Credit (Update1)" (3-20-07)
"Banks are picking up the baton from the Federal Reserve, restricting access to credit months after Chairman Ben S. Bernanke stopped raising interest rates. Fed officials may discuss the tightening in mortgage lending and its impact on the economy, already slowed by a housing recession, at their two-day meeting that began today in Washington. Countrywide Financial Corp., the biggest U.S. mortgage provider, last week stopped taking applications for no- money-down loans from risky borrowers without proof of income. "
Market Watch - "Stricter loans seen draining new-home demand" (3-20-07)
"The trouble in the mortgage market could spread beyond the subprime sector with tighter lending standards cutting demand for new homes by as much as 15% and further squeezing home-builder profits, according to an analyst following the industry."
NAHB - "Housing Starts Rebound 9.0 Percent In February, Permits Drop 2.5 Percent" (3-20-07)
"Housing starts rebounded 9.0 percent in February following a 14.3 percent drop the month before, according to figures released by the Commerce Department today. The pace of construction increased to a seasonally adjusted annual rate of 1.525 million units for the month, but was down 28.5 percent from a year earlier."
Real Estate Jounral - "Six Tips for Selling Your Home Without a Real-Estate Agent" (3-20-07)
" With all the online real-estate information available to home sellers nowadays, it's not surprising that some of them consider selling without the help of a real estate agent. The biggest advantage of the for-sale-by-owner strategy is that a commission won't need to be paid to a listing agent. But those taking on the job themselves need to roll up their sleeves and prepare for a little work to get the home sold, understanding that they will be the ones taking care of tasks ranging from marketing to showing the property to interested buyers. Those interested in trying their hand at selling a house might also consider the following tips: "
"The subprime mortgage industry saw two key developments Monday, both of which touch Orange County. Fremont Investment & Loan told many workers currently on leave from its Brea-based lending unit, Fremont General Corp., that their employment will end May 18. And regulators said the chief of New Century Financial in Irvine is one of several industry leaders being asked to testify before Congress. "
Sign On San Diego - "New Century says cut off by Fannie Mae" (3-20-07)
"New Century Financial Corp., a struggling mortgage lender to people with poor credit histories, said Tuesday it can no longer sell mortgage loans to Fannie Mae or act as the mortgage financier's primary servicer of mortgage loans."
Sign On San Diego - "People's Choice Home Loan files for Chapter 11" (3-20-07)
"People's Choice Home Loan Inc., a California-based mortgage lender to people with poor credit histories, filed for Chapter 11 bankruptcy protection Tuesday, according to court papers. The Irvine, California-based unit of People's Choice Financial Corp. became at least the fourth large U.S. subprime lender to seek protection from creditors in the last three months. Its parent, a real estate investment trust, also filed for Chapter 11. "
CNN - "Your Home: 5 tips if you're in too deep" (3-20-07)
"Feeling stretched by housing costs? Then it's time to give yourself a helping hand."
MSN - "Homes picture mixed after starts data" (3-20-07)
"The pace of U.S. home construction rose a sharp 9 percent in February but permits for future building slid, according to data on Tuesday that shed little light on whether the housing market was stabilizing. The cloudy home construction data and recent woes in the subprime mortgage market are sure to be on the minds of Federal Reserve members as they weigh monetary policy when they meet Tuesday and Wednesday."
CNN - "Housing starts rebound but permits fall" (3-20-07)
"Starts bounce back from 9-year low, but builders pull back on plans amid worries about real estate market and subprime mortgages."
Bloomberg - "Banks Pick Up Where Fed Left Off, Tightening Credit (Update1)" (3-20-07)
"Banks are picking up the baton from the Federal Reserve, restricting access to credit months after Chairman Ben S. Bernanke stopped raising interest rates. Fed officials may discuss the tightening in mortgage lending and its impact on the economy, already slowed by a housing recession, at their two-day meeting that began today in Washington. Countrywide Financial Corp., the biggest U.S. mortgage provider, last week stopped taking applications for no- money-down loans from risky borrowers without proof of income. "
Market Watch - "Stricter loans seen draining new-home demand" (3-20-07)
"The trouble in the mortgage market could spread beyond the subprime sector with tighter lending standards cutting demand for new homes by as much as 15% and further squeezing home-builder profits, according to an analyst following the industry."
NAHB - "Housing Starts Rebound 9.0 Percent In February, Permits Drop 2.5 Percent" (3-20-07)
"Housing starts rebounded 9.0 percent in February following a 14.3 percent drop the month before, according to figures released by the Commerce Department today. The pace of construction increased to a seasonally adjusted annual rate of 1.525 million units for the month, but was down 28.5 percent from a year earlier."
Real Estate Jounral - "Six Tips for Selling Your Home Without a Real-Estate Agent" (3-20-07)
" With all the online real-estate information available to home sellers nowadays, it's not surprising that some of them consider selling without the help of a real estate agent. The biggest advantage of the for-sale-by-owner strategy is that a commission won't need to be paid to a listing agent. But those taking on the job themselves need to roll up their sleeves and prepare for a little work to get the home sold, understanding that they will be the ones taking care of tasks ranging from marketing to showing the property to interested buyers. Those interested in trying their hand at selling a house might also consider the following tips: "
CNN - "Foreclosures to spike as new rates kick in" (3-19-07)
"About 1.1 million additional home foreclosures are expected over the next six years as adjustable-rate mortgages - which made home buying more affordable to U.S. buyers in recent years - reset to higher payments, according to a study by research firm First American CoreLogic."
Business Week - "More states restrict New Century" (3-19-07)
"New Century Financial Corp., the beleaguered home lender to people with weak credit, said Monday it has received cease-and-desist orders from more states, restraining the company from taking new applications for mortgage loans."
Bloomberg - "Company Bond Risk Premiums Surge on Subprime Fallout (Update3)" (3-19-07)
"Risk premiums on investment-grade corporate bonds are at their highest level in more than three months on concern rising delinquencies by subprime borrowers will slow the U.S. economy."
Bloomberg - "Fremont General Gives Mortgage Staff Two-Month Dismissal Notice" (3-19-07)
"Fremont General Corp., the California thrift trying to sell its home-lending business, told the unit's staff they may be dismissed in two months. Employees will receive pay and benefits through May 18 unless they take other jobs, Kyle Walker, chief executive officer of the Fremont Investment & Loan subsidiary, told employees on a March 16 conference call. Fremont posted a recording of the call on a toll-free playback line. Walker cited the 'uncertainty of this situation' at Santa Monica, California-based Fremont."
CNN - "The dangers of investing in subprime debt" (3-19-07)
"Amid the chaos of the escalating subprime mortgage crisis, the three major credit-rating agencies - Fitch, Moody's and Standard & Poor's - have been voices of calm. They've downgraded only a sliver of the debt backed by such mortgages, and they say they expect the mess to stay safely confined to the subprime sector. But what if they're wrong? It's not just their reputations, already tarnished by their failure to give investors timely warning of the Enron or WorldCom implosions, that are at stake, but possibly the housing market itself. "
Bloomberg - "U.S. Homebuilder Confidence Index Falls This Month (Update2)" (3-19-07)
"U.S. homebuilders turned more pessimistic this month on concern that buyers will find it harder to obtain loans after a wave of defaults in the subprime mortgage market. The National Association of Home Builders/Wells Fargo index of sentiment fell to 36 this month from February's revised 39, the first decline since September, the Washington-based association said today. A reading below 50 means most respondents view conditions as poor. "
CNN - "Dodd: Top 5 subprime lenders may testify" (3-19-07)
"U.S. Senate Banking Committee Chairman Chris Dodd said on Monday he asked executives at five big subprime mortgage companies to testify at a Thursday hearing and explain their lending practices. Executives from HSBC Holdings Plc (Charts), New Century Mortgage Corporation (Charts), Countrywide Financial Corp. (Charts), General Electric Co.'s (Charts) WMC Mortgage unit and First Franklin Mortgage (Charts) were invited to testify, Dodd, a Connecticut Democrat, said in a statement."
Yahoo! - "Broader Investigation of Lenders by SEC" (3-19-07)
"It has been known that the SEC was examining accounting practices at New Century Financial Corp., the nation's second-largest maker of subprime mortgages -- higher-priced home loans for people with tarnished credit or low incomes. But comments by SEC Enforcement Director Linda Thomsen on Monday were the first public acknowledgment that the agency was involved in a broad examination of the subprime sector within the mortgage industry."
"About 1.1 million additional home foreclosures are expected over the next six years as adjustable-rate mortgages - which made home buying more affordable to U.S. buyers in recent years - reset to higher payments, according to a study by research firm First American CoreLogic."
Business Week - "More states restrict New Century" (3-19-07)
"New Century Financial Corp., the beleaguered home lender to people with weak credit, said Monday it has received cease-and-desist orders from more states, restraining the company from taking new applications for mortgage loans."
Bloomberg - "Company Bond Risk Premiums Surge on Subprime Fallout (Update3)" (3-19-07)
"Risk premiums on investment-grade corporate bonds are at their highest level in more than three months on concern rising delinquencies by subprime borrowers will slow the U.S. economy."
Bloomberg - "Fremont General Gives Mortgage Staff Two-Month Dismissal Notice" (3-19-07)
"Fremont General Corp., the California thrift trying to sell its home-lending business, told the unit's staff they may be dismissed in two months. Employees will receive pay and benefits through May 18 unless they take other jobs, Kyle Walker, chief executive officer of the Fremont Investment & Loan subsidiary, told employees on a March 16 conference call. Fremont posted a recording of the call on a toll-free playback line. Walker cited the 'uncertainty of this situation' at Santa Monica, California-based Fremont."
CNN - "The dangers of investing in subprime debt" (3-19-07)
"Amid the chaos of the escalating subprime mortgage crisis, the three major credit-rating agencies - Fitch, Moody's and Standard & Poor's - have been voices of calm. They've downgraded only a sliver of the debt backed by such mortgages, and they say they expect the mess to stay safely confined to the subprime sector. But what if they're wrong? It's not just their reputations, already tarnished by their failure to give investors timely warning of the Enron or WorldCom implosions, that are at stake, but possibly the housing market itself. "
Bloomberg - "U.S. Homebuilder Confidence Index Falls This Month (Update2)" (3-19-07)
"U.S. homebuilders turned more pessimistic this month on concern that buyers will find it harder to obtain loans after a wave of defaults in the subprime mortgage market. The National Association of Home Builders/Wells Fargo index of sentiment fell to 36 this month from February's revised 39, the first decline since September, the Washington-based association said today. A reading below 50 means most respondents view conditions as poor. "
CNN - "Dodd: Top 5 subprime lenders may testify" (3-19-07)
"U.S. Senate Banking Committee Chairman Chris Dodd said on Monday he asked executives at five big subprime mortgage companies to testify at a Thursday hearing and explain their lending practices. Executives from HSBC Holdings Plc (Charts), New Century Mortgage Corporation (Charts), Countrywide Financial Corp. (Charts), General Electric Co.'s (Charts) WMC Mortgage unit and First Franklin Mortgage (Charts) were invited to testify, Dodd, a Connecticut Democrat, said in a statement."
Yahoo! - "Broader Investigation of Lenders by SEC" (3-19-07)
"It has been known that the SEC was examining accounting practices at New Century Financial Corp., the nation's second-largest maker of subprime mortgages -- higher-priced home loans for people with tarnished credit or low incomes. But comments by SEC Enforcement Director Linda Thomsen on Monday were the first public acknowledgment that the agency was involved in a broad examination of the subprime sector within the mortgage industry."
Sunday, March 18, 2007
OC Register - "How to make housing woes worse" (3-18-07)
"Pop. That was the sound of the housing bubble bursting, as the subprime mortgage market began to collapse. Irvine-based lender New Century announced March 13 that it is under investigation by the federal government. Wall Street earlier cut off funding to the company, and now the nation's second-largest subprime lender can't make any new loans, according to Register reports. On March 15, the parent of another subprime lender, Ameriquest Mortgage Co., cut 3,000 jobs nationwide."
Sign On San Diego - "FHA picks up the slack in subprime mortgages" (3-18-07)
"With the subprime mortgage industry in virtual free fall, where do home buyers with less than perfect credit turn for financing? The news reports are grim: Not only have dozens of subprime lenders closed their doors or cut back sharply on new mortgage offerings, but they're also severely tightening the loose underwriting standards that got them into trouble. As a result, many people who would have been approved for a loan months ago now find all the doors suddenly closed."
"But here's some potentially helpful news: There is a mortgage source that is actually expanding its business nationwide for credit-impaired and first-time home purchasers. That source is the golden oldie of the mortgage arena – the Federal Housing Administration (FHA), which recently has seen a doubling of customers refinancing out of private, subprime loans into its insured mortgage programs. "
Market Watch - "Housing under intense scrutiny" (3-18-07)
"Nervous markets will be watching the monthly housing numbers with even more intensity after the troubles in the subprime mortgage market of the past month. The monthly housing data will dribble out over the next two weeks, beginning with the home builders' index this Monday and concluding with new-home sales next week. "
LA Times - "L.A. housing market holds its ground" (3-18-07)
"Whom do you believe? Last week came the gloomy news that the number of U.S. homes entering foreclosure is rising, and with it, more experts are predicting a meltdown of the sub-prime lending market. But that stares in the face of median home prices in Southern California still climbing the first two months of 2007, compared with 2006. In L.A. County, the median rose 8.2% in the two-month period, to $525,000. Yes, fewer houses were sold, but the number remains well above the mid-'90s slump."
LA Times - "Seller financing can jump-start a home sale" (3-18-07)
"Need to close that deal? Consider offering terms yourself -- for a limited period, and only with a sizable down payment."
San Francisco Chronicle - "FHA steps in to emerging subprime lending void" (3-18-07)
"But here's some potentially helpful news: There is a mortgage source that is actually expanding its business nationwide for credit-impaired and first-time home purchasers. That source is the golden oldie of the mortgage arena -- the Federal Housing Administration, which recently has seen a doubling of customers refinancing out of private, subprime loans into its insured mortgage programs. There's good reason: The FHA doesn't have problems with Wall Street investors who now see subprime mortgage bonds as toxic. FHA's bonds, by contrast, are gilt-edged and backed by the federal government, so there's no shortage of mortgage money. Equally important: FHA-insured loans are more consumer-friendly than subprime offerings and come with interest costs roughly three percentage points below directly comparable subprime mortgages. "
"Pop. That was the sound of the housing bubble bursting, as the subprime mortgage market began to collapse. Irvine-based lender New Century announced March 13 that it is under investigation by the federal government. Wall Street earlier cut off funding to the company, and now the nation's second-largest subprime lender can't make any new loans, according to Register reports. On March 15, the parent of another subprime lender, Ameriquest Mortgage Co., cut 3,000 jobs nationwide."
Sign On San Diego - "FHA picks up the slack in subprime mortgages" (3-18-07)
"With the subprime mortgage industry in virtual free fall, where do home buyers with less than perfect credit turn for financing? The news reports are grim: Not only have dozens of subprime lenders closed their doors or cut back sharply on new mortgage offerings, but they're also severely tightening the loose underwriting standards that got them into trouble. As a result, many people who would have been approved for a loan months ago now find all the doors suddenly closed."
"But here's some potentially helpful news: There is a mortgage source that is actually expanding its business nationwide for credit-impaired and first-time home purchasers. That source is the golden oldie of the mortgage arena – the Federal Housing Administration (FHA), which recently has seen a doubling of customers refinancing out of private, subprime loans into its insured mortgage programs. "
Market Watch - "Housing under intense scrutiny" (3-18-07)
"Nervous markets will be watching the monthly housing numbers with even more intensity after the troubles in the subprime mortgage market of the past month. The monthly housing data will dribble out over the next two weeks, beginning with the home builders' index this Monday and concluding with new-home sales next week. "
LA Times - "L.A. housing market holds its ground" (3-18-07)
"Whom do you believe? Last week came the gloomy news that the number of U.S. homes entering foreclosure is rising, and with it, more experts are predicting a meltdown of the sub-prime lending market. But that stares in the face of median home prices in Southern California still climbing the first two months of 2007, compared with 2006. In L.A. County, the median rose 8.2% in the two-month period, to $525,000. Yes, fewer houses were sold, but the number remains well above the mid-'90s slump."
LA Times - "Seller financing can jump-start a home sale" (3-18-07)
"Need to close that deal? Consider offering terms yourself -- for a limited period, and only with a sizable down payment."
San Francisco Chronicle - "FHA steps in to emerging subprime lending void" (3-18-07)
"But here's some potentially helpful news: There is a mortgage source that is actually expanding its business nationwide for credit-impaired and first-time home purchasers. That source is the golden oldie of the mortgage arena -- the Federal Housing Administration, which recently has seen a doubling of customers refinancing out of private, subprime loans into its insured mortgage programs. There's good reason: The FHA doesn't have problems with Wall Street investors who now see subprime mortgage bonds as toxic. FHA's bonds, by contrast, are gilt-edged and backed by the federal government, so there's no shortage of mortgage money. Equally important: FHA-insured loans are more consumer-friendly than subprime offerings and come with interest costs roughly three percentage points below directly comparable subprime mortgages. "
Friday, March 16, 2007
Washington Post - "Fannie, Freddie Wary of Controls" (3-16-07)
"Executives of Fannie Mae and Freddie Mac invoked the upheaval in the mortgage market yesterday as a reason for lawmakers to be cautious about subjecting them to stricter regulation. The recent meltdown in unconventional home loans provided political ammunition for Fannie Mae and Freddie Mac just as House members are poised to move ahead on long-delayed legislation aimed at tightening controls on the federally chartered mortgage-funding companies."
Yahoo! - "NovaStar Financial, Inc. Announces Reduction in Workforce" (3-16-07)
"NovaStar Financial, Inc. (NYSE:NFI - News), a residential mortgage lender and portfolio investor, today announced a reduction in workforce to align its organization with changing conditions in the mortgage market. The workforce reductions affect about 350 persons, approximately 17 percent of the Company's workforce. The actions focus on the Company's wholesale loan origination group and related functions, including employees at the Company's headquarters in Kansas City and at operation centers in California and Ohio. Subject to completion of the necessary legal notices and requirements, implementation of the reductions will begin immediately and conclude during the second quarter of 2007. NovaStar's loan servicing organization is not affected by the reduction."
Real Estate Jounral - "Congress Primed to Act On Risky Home Loans" (3-16-07)
"Yesterday, Mr. Dodd said federal banking regulators had been too slow to address these concerns. 'I'm determined to do everything we can to allow people to stay in their homes,' he said, but he stressed that details of any legislation remain to be worked out. At issue are so-called subprime mortgages, home loans made to consumers with weak or sketchy credit histories. Subprime mortgages have helped millions of Americans become homeowners, but critics contend that aggressive lenders have pressed some borrowers into mortgages they can't afford. The mortgages carry high fees and often have escalating interest rates. A recent surge in defaults in the sector has roiled financial markets."
Bloomberg - "Toll Calls Spring `A Bust,' Can't Predict Recovery (Update4)" (3-16-07)
"Toll Brothers Inc. Chief Executive Officer Robert Toll said the spring selling season has been 'pretty much a bust' and he can't predict when the housing recovery will begin."
Business Week - "Inside The Mortgage Crisis" (3-17-07)
"How exposed is Countrywide to the subprime mess? In 2006 subprime loans were about 9% of our total business, now down to 7%. We're a prime lender...but we also have been on a mission...to try to increase home ownership opportunities for minorities and low-income borrowers. So it's distressful to me personally to see the piling on that's taking place by the media and regulators. This was a system that was working very well, providing an opportunity for people to get over that barrier of entry to owning a home. Now what you've had is panic setting in, and [the subprime story] is leading every newspaper. It's like there's no war going on in Iraq."
North County Times - "Lenders: Visions of profit fueled risky loans" (3-16-07)
"For years now, many people caught up in California's biggest housing boom have wondered what possessed lenders to make so many risky mortgages ---- such as loans to homeowners with bad credit histories and "liar loans" that require no income verification. At a conference held this week at the La Costa Resort, some mortgage industry leaders revealed what had been on their minds during the frenzy: They knew there was risk, but did it anyway because there was so much money to be made."
Sun Sentinel - "Falling home prices causing crisis with risky mortgages, Greenspan says" (3-16-07)
"Retired Federal Reserve Chairman Alan Greenspan, speaking at a Futures Industry Association annual conference here on Thursday, said the problems of the subprime mortgage market had more to do with home prices than easy credit."
Review Journal - "MORTGAGE LENDING: Subprime woes hit Las Vegas" (3-16-07)
"Listen closely and you'll hear the croaking sound of nearly 40 subprime mortgage lenders nationwide, including Las Vegas-based Silver State Mortgage, that have either shut down operations, filed for bankruptcy or have been acquired through last-ditch mergers since late last year."
USA Today - "Subprime mortgage troubles could still spread pain but probably not recession" (3-16-07)
"The subprime mortgage meltdown, while dramatic, isn't likely to push the U.S. economy into recession. Still, bankruptcies at dozens of lenders and rising default rates among borrowers could reduce growth, hurt home prices, crimp consumer spending and affect the financial fortunes of millions, from first-time home buyers to timber workers, truckers and lenders."
Sign On San Diego - "Ailing Accredited to sell $2.7 billion of its home loans" (3-17-07)
"Beleaguered San Diego mortgage firm Accredited Home Lenders gave itself some breathing room yesterday when it said it had agreed to sell $2.7 billion in mortgages to undisclosed buyers."
Bloomerberg - "Greenspan's Subprime Comment Fizzles as Lenders Climb (Update2)" (3-16-07)
"Alan Greenspan, whose comments on recession helped send stock prices reeling two weeks ago, predicted the subprime-mortgage debacle in the U.S. will worsen."
Business Week - "Inflation, Factory Data Squeeze Fed" (3-16-07)
"Despite the Street's concern about a faltering economy, the Fed likely will leave interest rates alone after jumps in the latest reports"
Fresno Bee - "Real estate outlook improves" (3-16-07)
"Low interest rates, a growing population, relatively low prices and an abundance of land will help make the central San Joaquin Valley a desirable real estate market in 2007, a panel of forecasters said Thursday."
Real Estate Journal - "Subprime Mortgage Woes Spread; Forecasts for Home Prices Cut" (3-16-07)
"Most economic forecasters in a new WSJ.com survey believe recent turmoil in the subprime mortgage market is likely to spread to the broader mortgage market and they expect a widely followed index of home prices to fall this year. But they still think the U.S. will avoid a recession and even a significant rise in unemployment."
DQ News - "California February 2007 Home Sales" (3-16-07)
"A total of 31,228 new and resale houses and condos were sold statewide last month. That's down 3.7 percent from 32,425 in January, and down 21.3 percent from 39,676 in February 2006. A sales decline between January and February is not unusual. The year-over-year sales decline peaked last September at 34.5 percent."
Los Angeles - "Outside the sub-prime loan box" (3-16-07)
"Don't let the name fool you. Although it calls itself an 'association,' HNMA is a privately held, profit-making enterprise. And though it's focused primarily on the Latino community, the company's aim is to provide home loans — at rates much closer to prime than sub-prime — to a range of immigrants and others historically locked out of the market."
"Executives of Fannie Mae and Freddie Mac invoked the upheaval in the mortgage market yesterday as a reason for lawmakers to be cautious about subjecting them to stricter regulation. The recent meltdown in unconventional home loans provided political ammunition for Fannie Mae and Freddie Mac just as House members are poised to move ahead on long-delayed legislation aimed at tightening controls on the federally chartered mortgage-funding companies."
Yahoo! - "NovaStar Financial, Inc. Announces Reduction in Workforce" (3-16-07)
"NovaStar Financial, Inc. (NYSE:NFI - News), a residential mortgage lender and portfolio investor, today announced a reduction in workforce to align its organization with changing conditions in the mortgage market. The workforce reductions affect about 350 persons, approximately 17 percent of the Company's workforce. The actions focus on the Company's wholesale loan origination group and related functions, including employees at the Company's headquarters in Kansas City and at operation centers in California and Ohio. Subject to completion of the necessary legal notices and requirements, implementation of the reductions will begin immediately and conclude during the second quarter of 2007. NovaStar's loan servicing organization is not affected by the reduction."
Real Estate Jounral - "Congress Primed to Act On Risky Home Loans" (3-16-07)
"Yesterday, Mr. Dodd said federal banking regulators had been too slow to address these concerns. 'I'm determined to do everything we can to allow people to stay in their homes,' he said, but he stressed that details of any legislation remain to be worked out. At issue are so-called subprime mortgages, home loans made to consumers with weak or sketchy credit histories. Subprime mortgages have helped millions of Americans become homeowners, but critics contend that aggressive lenders have pressed some borrowers into mortgages they can't afford. The mortgages carry high fees and often have escalating interest rates. A recent surge in defaults in the sector has roiled financial markets."
Bloomberg - "Toll Calls Spring `A Bust,' Can't Predict Recovery (Update4)" (3-16-07)
"Toll Brothers Inc. Chief Executive Officer Robert Toll said the spring selling season has been 'pretty much a bust' and he can't predict when the housing recovery will begin."
Business Week - "Inside The Mortgage Crisis" (3-17-07)
"How exposed is Countrywide to the subprime mess? In 2006 subprime loans were about 9% of our total business, now down to 7%. We're a prime lender...but we also have been on a mission...to try to increase home ownership opportunities for minorities and low-income borrowers. So it's distressful to me personally to see the piling on that's taking place by the media and regulators. This was a system that was working very well, providing an opportunity for people to get over that barrier of entry to owning a home. Now what you've had is panic setting in, and [the subprime story] is leading every newspaper. It's like there's no war going on in Iraq."
North County Times - "Lenders: Visions of profit fueled risky loans" (3-16-07)
"For years now, many people caught up in California's biggest housing boom have wondered what possessed lenders to make so many risky mortgages ---- such as loans to homeowners with bad credit histories and "liar loans" that require no income verification. At a conference held this week at the La Costa Resort, some mortgage industry leaders revealed what had been on their minds during the frenzy: They knew there was risk, but did it anyway because there was so much money to be made."
Sun Sentinel - "Falling home prices causing crisis with risky mortgages, Greenspan says" (3-16-07)
"Retired Federal Reserve Chairman Alan Greenspan, speaking at a Futures Industry Association annual conference here on Thursday, said the problems of the subprime mortgage market had more to do with home prices than easy credit."
Review Journal - "MORTGAGE LENDING: Subprime woes hit Las Vegas" (3-16-07)
"Listen closely and you'll hear the croaking sound of nearly 40 subprime mortgage lenders nationwide, including Las Vegas-based Silver State Mortgage, that have either shut down operations, filed for bankruptcy or have been acquired through last-ditch mergers since late last year."
USA Today - "Subprime mortgage troubles could still spread pain but probably not recession" (3-16-07)
"The subprime mortgage meltdown, while dramatic, isn't likely to push the U.S. economy into recession. Still, bankruptcies at dozens of lenders and rising default rates among borrowers could reduce growth, hurt home prices, crimp consumer spending and affect the financial fortunes of millions, from first-time home buyers to timber workers, truckers and lenders."
Sign On San Diego - "Ailing Accredited to sell $2.7 billion of its home loans" (3-17-07)
"Beleaguered San Diego mortgage firm Accredited Home Lenders gave itself some breathing room yesterday when it said it had agreed to sell $2.7 billion in mortgages to undisclosed buyers."
Bloomerberg - "Greenspan's Subprime Comment Fizzles as Lenders Climb (Update2)" (3-16-07)
"Alan Greenspan, whose comments on recession helped send stock prices reeling two weeks ago, predicted the subprime-mortgage debacle in the U.S. will worsen."
Business Week - "Inflation, Factory Data Squeeze Fed" (3-16-07)
"Despite the Street's concern about a faltering economy, the Fed likely will leave interest rates alone after jumps in the latest reports"
Fresno Bee - "Real estate outlook improves" (3-16-07)
"Low interest rates, a growing population, relatively low prices and an abundance of land will help make the central San Joaquin Valley a desirable real estate market in 2007, a panel of forecasters said Thursday."
Real Estate Journal - "Subprime Mortgage Woes Spread; Forecasts for Home Prices Cut" (3-16-07)
"Most economic forecasters in a new WSJ.com survey believe recent turmoil in the subprime mortgage market is likely to spread to the broader mortgage market and they expect a widely followed index of home prices to fall this year. But they still think the U.S. will avoid a recession and even a significant rise in unemployment."
DQ News - "California February 2007 Home Sales" (3-16-07)
"A total of 31,228 new and resale houses and condos were sold statewide last month. That's down 3.7 percent from 32,425 in January, and down 21.3 percent from 39,676 in February 2006. A sales decline between January and February is not unusual. The year-over-year sales decline peaked last September at 34.5 percent."
Los Angeles - "Outside the sub-prime loan box" (3-16-07)
"Don't let the name fool you. Although it calls itself an 'association,' HNMA is a privately held, profit-making enterprise. And though it's focused primarily on the Latino community, the company's aim is to provide home loans — at rates much closer to prime than sub-prime — to a range of immigrants and others historically locked out of the market."
DQ News - "Bay Area home sales lowest since 1996, prices still flat" (3-15-07)
"Bay Area homes continued selling at an 11-year low in February as the region logged its seventh month without significant price appreciation, a real estate information service reported. A total of 6,305 new and resale houses and condos sold in the nine-county Bay Area last month. That was up 2.2 percent from 6,168 in January, and down 7.9 percent from 6,844 in February last year, according to DataQuick Information Systems. "
NAHB - "Builders Testify On Housing Finance System Reform" (3-15-07)
"The National Association of Home Builders (NAHB) testified before the Congress today on several solutions to enhance H.R. 1427, the Federal Housing Finance Reform Act of 2007, legislation that would strengthen the regulation of the housing government-sponsored enterprises (GSEs) Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The proposals would ensure the ongoing financial safety and soundness of the GSEs, while preserving the vitality of their government-sponsored status for the fulfillment of their vital housing mission. "
NAR - "FHA Reform Could Provide Borrowers With Safer Mortgage Alternative" (3-15-07)
"The country needs a strong, viable Federal Housing Administration that delivers housing policies that ensure federal housing programs meet their mission responsibly and efficiently, the National Association of Realtors® stated today to a Senate subcommittee on housing. NAR has called on Congress to enact legislation that will allow FHA to conform to today’s mortgage environment and reflect consumers’ needs and demands. Changes that FHA has proposed and that are supported by NAR include eliminating the statutory 3 percent minimum cash down payment and offering down payment flexibility; allowing the FHA to offer risk-based pricing; and increasing the loan limits for FHA loans."
Yahoo! - "Why Your Home Is Not the Investment You Think It Is" (3-15-07)
"Too many people rely on their home as their primary savings strategy. That's a mistake."
Bloomberg - "Pulte Says Housing Market Unlikely to Recover Quickly (Update2)" (3-15-07)
"Pulte Homes Inc., the fourth- largest U.S. homebuilder, said the housing market is unlikely to have a quick recovery as buyers wait out the drop in prices."
"We're not projecting anything to bounce off the bottom at this point," Chief Financial Officer Roger Cregg said at a UBS conference in London. "There's been a lot of buyers that have moved to the sidelines."
Reuters - "Nervous neighbors eye California subprime lender" (3-15-07)
"There was no sign of financial meltdown on Wednesday at the Southern California office park surrounding New Century Financial Corp., but neighbors walking by one of the starting points of the mortgage industry crisis shivered at the thought of what could be next."
CNN - "New Century may be shut down in Ohio" (3-15-07)
"State attorney general gets temporary restraining order against the troubled mortgage lender, claiming 'predatory' lending practices."
Reuters - "Senator says regulators accountable on subprime" (3-15-07)
"U.S. Senate Banking Committee Chairman Christopher Dodd said on Wednesday regulators bear some responsibility for problems in the subprime mortgage sector and he plans to call them before the committee for questioning."
Forbes - "From Subprime To The Ridiculous" (3-15-07)
"With the meltdown in the subprime mortgage sector now laid bare, many on Wall Street desperately cling to the notion that the pain will be localized. The prevalent delusion is that the overall mortgage, housing and stock markets will be little affected by the carnage ravaging the subprime sector. As such, the renewed stock market weakness is seen as an overreaction and a great buying opportunity. These assumptions represent wishful thinking in the extreme."
Market Watch - "In subprime mess, another dumb theory falls" (3-15-07)
"Questions have been asked about risky mortgage loans going back to 2003. What would happen to all the leverage taken on by home buyers when interest rates started to rise and the market turned around. But the answer was always the same. It's different this time. The banks and lenders have sold the loans. They don't hold them. "
OC Register - "Home prices hit record" (3-15-07)
"February housing numbers give mixed signals, with the overall price up, driven primarily by a robust Los Angeles housing market. But sales still are down from a year ago, and prices either were flat or down in four of the region's six counties."
MBA - "MBA Chairman Robbins Testifies in Support of Reform to Reinvigorate FHA" (3-15-07)
John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA), testified today before the U.S. Senate Appropriations Committee’s Subcommittee on Transportation, Housing and Urban Development and Related Agencies. The topic of the hearing was “Solvency and Reform Proposals for the Federal Housing Authority.”
"Bay Area homes continued selling at an 11-year low in February as the region logged its seventh month without significant price appreciation, a real estate information service reported. A total of 6,305 new and resale houses and condos sold in the nine-county Bay Area last month. That was up 2.2 percent from 6,168 in January, and down 7.9 percent from 6,844 in February last year, according to DataQuick Information Systems. "
NAHB - "Builders Testify On Housing Finance System Reform" (3-15-07)
"The National Association of Home Builders (NAHB) testified before the Congress today on several solutions to enhance H.R. 1427, the Federal Housing Finance Reform Act of 2007, legislation that would strengthen the regulation of the housing government-sponsored enterprises (GSEs) Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The proposals would ensure the ongoing financial safety and soundness of the GSEs, while preserving the vitality of their government-sponsored status for the fulfillment of their vital housing mission. "
NAR - "FHA Reform Could Provide Borrowers With Safer Mortgage Alternative" (3-15-07)
"The country needs a strong, viable Federal Housing Administration that delivers housing policies that ensure federal housing programs meet their mission responsibly and efficiently, the National Association of Realtors® stated today to a Senate subcommittee on housing. NAR has called on Congress to enact legislation that will allow FHA to conform to today’s mortgage environment and reflect consumers’ needs and demands. Changes that FHA has proposed and that are supported by NAR include eliminating the statutory 3 percent minimum cash down payment and offering down payment flexibility; allowing the FHA to offer risk-based pricing; and increasing the loan limits for FHA loans."
Yahoo! - "Why Your Home Is Not the Investment You Think It Is" (3-15-07)
"Too many people rely on their home as their primary savings strategy. That's a mistake."
Bloomberg - "Pulte Says Housing Market Unlikely to Recover Quickly (Update2)" (3-15-07)
"Pulte Homes Inc., the fourth- largest U.S. homebuilder, said the housing market is unlikely to have a quick recovery as buyers wait out the drop in prices."
"We're not projecting anything to bounce off the bottom at this point," Chief Financial Officer Roger Cregg said at a UBS conference in London. "There's been a lot of buyers that have moved to the sidelines."
Reuters - "Nervous neighbors eye California subprime lender" (3-15-07)
"There was no sign of financial meltdown on Wednesday at the Southern California office park surrounding New Century Financial Corp., but neighbors walking by one of the starting points of the mortgage industry crisis shivered at the thought of what could be next."
CNN - "New Century may be shut down in Ohio" (3-15-07)
"State attorney general gets temporary restraining order against the troubled mortgage lender, claiming 'predatory' lending practices."
Reuters - "Senator says regulators accountable on subprime" (3-15-07)
"U.S. Senate Banking Committee Chairman Christopher Dodd said on Wednesday regulators bear some responsibility for problems in the subprime mortgage sector and he plans to call them before the committee for questioning."
Forbes - "From Subprime To The Ridiculous" (3-15-07)
"With the meltdown in the subprime mortgage sector now laid bare, many on Wall Street desperately cling to the notion that the pain will be localized. The prevalent delusion is that the overall mortgage, housing and stock markets will be little affected by the carnage ravaging the subprime sector. As such, the renewed stock market weakness is seen as an overreaction and a great buying opportunity. These assumptions represent wishful thinking in the extreme."
Market Watch - "In subprime mess, another dumb theory falls" (3-15-07)
"Questions have been asked about risky mortgage loans going back to 2003. What would happen to all the leverage taken on by home buyers when interest rates started to rise and the market turned around. But the answer was always the same. It's different this time. The banks and lenders have sold the loans. They don't hold them. "
OC Register - "Home prices hit record" (3-15-07)
"February housing numbers give mixed signals, with the overall price up, driven primarily by a robust Los Angeles housing market. But sales still are down from a year ago, and prices either were flat or down in four of the region's six counties."
MBA - "MBA Chairman Robbins Testifies in Support of Reform to Reinvigorate FHA" (3-15-07)
John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA), testified today before the U.S. Senate Appropriations Committee’s Subcommittee on Transportation, Housing and Urban Development and Related Agencies. The topic of the hearing was “Solvency and Reform Proposals for the Federal Housing Authority.”
Wednesday, March 14, 2007
Sign On San Diego - "Government moving toward actions against some subprime lenders" (3-14-07)
"The government is preparing to punish some subprime mortgage lenders under investigation for discriminatory practices, the Bush administration's housing secretary said Wednesday. The Housing and Urban Development Department also has suggested that the largest mortgage companies, Fannie Mae and Freddie Mac, consider giving strapped homeowners more time to make their payments, Alphonso Jackson said at a House hearing. "
Santa Cruz Sentinel - "Foreclosures on upswing" (3-14-07)
"As of March 6 this year, trustee deeds, which transfer ownership of property in default, total 105 for Santa Cruz, Monterey and San Benito counties, an exponential increase from this time last year, when nine such deeds were recorded. Notices of default and properties in foreclosure have doubled in the three counties overall, with rates in Santa Cruz lower than in Monterey. A default notice is filed after homeowners are delinquent on mortgage payments."
Daily News - "Mortgage checks come in on time" (3-13-07)
"Nearly 4.95 percent of all home mortgages in the annual survey were delinquent - 30 or more days past due - in the fourth quarter. This, in part, has been fueled by lending to high-risk borrowers with weak, or subprime, credit. When compared with other states, California ranked 43rd in delinquencies with a rate of 0.43 percent, and 40th in foreclosures with a rate of 0.58 percent, the association said. "
Los Angeles - "FEMA to sell hurricane trailers" (3-8-07)
"A year and a half after hurricanes Katrina and Rita, the Federal Emergency Management Agency is auctioning off — at fire-sale prices — thousands of trailers used by storm victims, raising fears among mobile home dealers that the government will flood the market and depress prices. FEMA spent $2.7 billion to buy 145,000 mobile homes and trailers after Katrina and Rita hit the Gulf Coast in August and September 2005, paying a bulk-rate price of about $19,000 per trailer, on average. FEMA has 60,000 trailers in storage nationwide; several thousand of them were never used."
Victor Valley Daily Press - "February home sales, prices decline in Victor Valley" (3-14-07)
"The volume of February home sales swooned in the Victor Valley, falling 12.4 percent from the previous month and down 36 percent compared to the same period a year ago. Residential sale prices also declined slightly last month, falling 0.45 percent from January and 5.5 percent lower than February 2006, according to the Victor Valley Multiple Listing Service. "
Reuters - "Hispanics feel subprime home lending pain" (3-14-07)
"Only a few weeks ago, a borrower in Southern California could qualify for 100 percent financing for a house, with no proof of income or assets. Now, the lending spigot is dry."
DQNews.com - "Southland home sales slowest in a decade; new price peak" (3-14-07)
"Southern California's housing market sent out more mixed signals last month: Sales fell to a decade low while prices inched up to a new record, a real estate information service reported. A total of 17,680 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in February. That was down 2.5 percent from 18,128 in January, and down 19.8 percent from 22,046 in February last year, according to DataQuick Information Systems. "
LA Times - "Lending crisis ignites broad economic fears" (3-14-07)
"Stocks dive as data show more home loans in delinquency and new foreclosures at a record."
Yahoo! - "Congress must aid subprime victims: consumer group" (3-14-07)
"As many as 1.5 million Americans could lose their homes as the subprime market shakes out, the National Community Reinvestment Coalition (NCRC) said, and so Congress should step in to protect those troubled homeowners. The group, which represents hundreds of low-income housing advocates across the country, said Congress should immediately step in to aid subprime borrowers."
CNN - "$1,300...$2,000...there goes your mortgage" (3-14-07)
"When they bought their home in 2004, the Sanons had a feeling they were getting in over their heads - they were right."
Business Week - "The Mounting Uncertainty over Subprime" (3-14-07)
"Torrents of bad news from the sector leave Wall Street wondering how far the financial fallout will spread"
Bloomberg - "Subprime Market -- Isolated or a Tipping Point?" (3-14-07)
"Federal Reserve Governor Susan Bies argues that subprime ARMs make up only 7 percent to 8 percent of the $10 trillion dollar mortgage market. Doug Duncan, chief economist of the Mortgage Bankers Association, says that only 6 percent of homeowners hold subprime ARMs. By their logic, even if we saw a 20 percent default rate among subprime ARM holders -- a rate twice as high as the foreclosure peak after the 2001 recession - -that is still just over 1 percent of the full national mortgage market."
Bloomberg - "Fed, OCC Publicly Chastised Few Lenders During Boom (Update1)" (3-14-07)
"The Federal Reserve and the Office of the Comptroller of the Currency took little action in public to police the $2.8 trillion boom in the U.S. mortgage market -- whose bust now risks worsening the housing recession. The Fed, which is responsible for the stability of the banking system, didn't publicly rebuke any firm for failing to follow up warnings on home-lending practices between 2004 and 2006. The OCC, which supervises 1,793 national banks, took only three public mortgage-related consumer-protection enforcement actions over the same period. "
Forbes - "Mortgage Woes Weigh On GM" (3-14-07)
"After dramatically overhauling its North American division, General Motors pulled itself out of the red in the fourth quarter, posting a $950 million profit. But subprime mortgage exposure at its former finance subsidiary, GMAC, pushed the company’s results far below Wall Street estimates. The world's biggest automaker -- for now -- said continued cost-cutting measures and gains in emerging markets drove its net income to $950 million, or $1.68 a share,a turnaround from a $6.6 billion deficit, or $11.63 a share, in the corresponding period a year earlier, in a statement on Wednesay. "
Business Week - "Goldman's Verdict: No Contagion Yet" (3-14-07)
"The Wall Street investment bank does not see a crisis in the credit markets, despite subprime woes—as long as other banks' earnings don't tank"
Market Watch - "Subprime shakeout could hurt CDOs" (3-14-07)
"After a mortgage is sold, it's usually packaged up with other home loans into a mortgage-backed security, or MBS. But who buys the riskier parts of these derivatives -- the bits backed by subprime mortgages offered to poorer borrowers with lower credit scores? The answer may be collateralized debt obligations, or CDOs. "
Real Estate Journal - "Bulletproofing Your Mortgage: How to Spot Risks in Your Loan" (3-14-07)
"First, a set of old-fashioned financial-planning queries: Are you spending more than 28% of your pretax income on mortgage principal and interest payments, plus property taxes and homeowners insurance? Or do these four items, plus all your other debts, add up to more than 36% of your gross income? Mortgage bankers used to deploy these benchmarks religiously. In their zest to issue new loans, however, some have decided it's just fine if the figures are up into the 40s or 50s."
MBA - "Q4 2006 Commercial/Multifamily Mortgage Debt Outstanding" (3-14-07)
"At the end of 2006, $2.95 trillion in commercial/multifamily mortgage debt outstanding was recorded by the Federal Reserve, an increase of $333 billion or 12.7 percent from the end of 2005. In the fourth quarter alone, commercial and multifamily mortgage debt outstanding increased by $99 billion, or 3.5 percent. At the end of 2006, multifamily mortgage debt outstanding stood at $731 billion - an increase of $51 billion or 7.5 percent over the year, and $15 billion or 2.1 percent in the fourth quarter alone."
SacBee.com - "Subprime woes may hit capital" (3-14-07)
"A meltdown in the subprime mortgage lending market might mean trouble for a Sacramento-area market many believe is slowly coming out of its housing slump. Last year an estimated 27 percent of area buyers took out subprime loans, which have higher interest rates reflecting the risks of lending to people with blemished credit histories. Now, many here and across the country are having trouble making payments, threatening the companies that issued the loans."
"The government is preparing to punish some subprime mortgage lenders under investigation for discriminatory practices, the Bush administration's housing secretary said Wednesday. The Housing and Urban Development Department also has suggested that the largest mortgage companies, Fannie Mae and Freddie Mac, consider giving strapped homeowners more time to make their payments, Alphonso Jackson said at a House hearing. "
Santa Cruz Sentinel - "Foreclosures on upswing" (3-14-07)
"As of March 6 this year, trustee deeds, which transfer ownership of property in default, total 105 for Santa Cruz, Monterey and San Benito counties, an exponential increase from this time last year, when nine such deeds were recorded. Notices of default and properties in foreclosure have doubled in the three counties overall, with rates in Santa Cruz lower than in Monterey. A default notice is filed after homeowners are delinquent on mortgage payments."
Daily News - "Mortgage checks come in on time" (3-13-07)
"Nearly 4.95 percent of all home mortgages in the annual survey were delinquent - 30 or more days past due - in the fourth quarter. This, in part, has been fueled by lending to high-risk borrowers with weak, or subprime, credit. When compared with other states, California ranked 43rd in delinquencies with a rate of 0.43 percent, and 40th in foreclosures with a rate of 0.58 percent, the association said. "
Los Angeles - "FEMA to sell hurricane trailers" (3-8-07)
"A year and a half after hurricanes Katrina and Rita, the Federal Emergency Management Agency is auctioning off — at fire-sale prices — thousands of trailers used by storm victims, raising fears among mobile home dealers that the government will flood the market and depress prices. FEMA spent $2.7 billion to buy 145,000 mobile homes and trailers after Katrina and Rita hit the Gulf Coast in August and September 2005, paying a bulk-rate price of about $19,000 per trailer, on average. FEMA has 60,000 trailers in storage nationwide; several thousand of them were never used."
Victor Valley Daily Press - "February home sales, prices decline in Victor Valley" (3-14-07)
"The volume of February home sales swooned in the Victor Valley, falling 12.4 percent from the previous month and down 36 percent compared to the same period a year ago. Residential sale prices also declined slightly last month, falling 0.45 percent from January and 5.5 percent lower than February 2006, according to the Victor Valley Multiple Listing Service. "
Reuters - "Hispanics feel subprime home lending pain" (3-14-07)
"Only a few weeks ago, a borrower in Southern California could qualify for 100 percent financing for a house, with no proof of income or assets. Now, the lending spigot is dry."
DQNews.com - "Southland home sales slowest in a decade; new price peak" (3-14-07)
"Southern California's housing market sent out more mixed signals last month: Sales fell to a decade low while prices inched up to a new record, a real estate information service reported. A total of 17,680 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in February. That was down 2.5 percent from 18,128 in January, and down 19.8 percent from 22,046 in February last year, according to DataQuick Information Systems. "
LA Times - "Lending crisis ignites broad economic fears" (3-14-07)
"Stocks dive as data show more home loans in delinquency and new foreclosures at a record."
Yahoo! - "Congress must aid subprime victims: consumer group" (3-14-07)
"As many as 1.5 million Americans could lose their homes as the subprime market shakes out, the National Community Reinvestment Coalition (NCRC) said, and so Congress should step in to protect those troubled homeowners. The group, which represents hundreds of low-income housing advocates across the country, said Congress should immediately step in to aid subprime borrowers."
CNN - "$1,300...$2,000...there goes your mortgage" (3-14-07)
"When they bought their home in 2004, the Sanons had a feeling they were getting in over their heads - they were right."
Business Week - "The Mounting Uncertainty over Subprime" (3-14-07)
"Torrents of bad news from the sector leave Wall Street wondering how far the financial fallout will spread"
Bloomberg - "Subprime Market -- Isolated or a Tipping Point?" (3-14-07)
"Federal Reserve Governor Susan Bies argues that subprime ARMs make up only 7 percent to 8 percent of the $10 trillion dollar mortgage market. Doug Duncan, chief economist of the Mortgage Bankers Association, says that only 6 percent of homeowners hold subprime ARMs. By their logic, even if we saw a 20 percent default rate among subprime ARM holders -- a rate twice as high as the foreclosure peak after the 2001 recession - -that is still just over 1 percent of the full national mortgage market."
Bloomberg - "Fed, OCC Publicly Chastised Few Lenders During Boom (Update1)" (3-14-07)
"The Federal Reserve and the Office of the Comptroller of the Currency took little action in public to police the $2.8 trillion boom in the U.S. mortgage market -- whose bust now risks worsening the housing recession. The Fed, which is responsible for the stability of the banking system, didn't publicly rebuke any firm for failing to follow up warnings on home-lending practices between 2004 and 2006. The OCC, which supervises 1,793 national banks, took only three public mortgage-related consumer-protection enforcement actions over the same period. "
Forbes - "Mortgage Woes Weigh On GM" (3-14-07)
"After dramatically overhauling its North American division, General Motors pulled itself out of the red in the fourth quarter, posting a $950 million profit. But subprime mortgage exposure at its former finance subsidiary, GMAC, pushed the company’s results far below Wall Street estimates. The world's biggest automaker -- for now -- said continued cost-cutting measures and gains in emerging markets drove its net income to $950 million, or $1.68 a share,a turnaround from a $6.6 billion deficit, or $11.63 a share, in the corresponding period a year earlier, in a statement on Wednesay. "
Business Week - "Goldman's Verdict: No Contagion Yet" (3-14-07)
"The Wall Street investment bank does not see a crisis in the credit markets, despite subprime woes—as long as other banks' earnings don't tank"
Market Watch - "Subprime shakeout could hurt CDOs" (3-14-07)
"After a mortgage is sold, it's usually packaged up with other home loans into a mortgage-backed security, or MBS. But who buys the riskier parts of these derivatives -- the bits backed by subprime mortgages offered to poorer borrowers with lower credit scores? The answer may be collateralized debt obligations, or CDOs. "
Real Estate Journal - "Bulletproofing Your Mortgage: How to Spot Risks in Your Loan" (3-14-07)
"First, a set of old-fashioned financial-planning queries: Are you spending more than 28% of your pretax income on mortgage principal and interest payments, plus property taxes and homeowners insurance? Or do these four items, plus all your other debts, add up to more than 36% of your gross income? Mortgage bankers used to deploy these benchmarks religiously. In their zest to issue new loans, however, some have decided it's just fine if the figures are up into the 40s or 50s."
MBA - "Q4 2006 Commercial/Multifamily Mortgage Debt Outstanding" (3-14-07)
"At the end of 2006, $2.95 trillion in commercial/multifamily mortgage debt outstanding was recorded by the Federal Reserve, an increase of $333 billion or 12.7 percent from the end of 2005. In the fourth quarter alone, commercial and multifamily mortgage debt outstanding increased by $99 billion, or 3.5 percent. At the end of 2006, multifamily mortgage debt outstanding stood at $731 billion - an increase of $51 billion or 7.5 percent over the year, and $15 billion or 2.1 percent in the fourth quarter alone."
SacBee.com - "Subprime woes may hit capital" (3-14-07)
"A meltdown in the subprime mortgage lending market might mean trouble for a Sacramento-area market many believe is slowly coming out of its housing slump. Last year an estimated 27 percent of area buyers took out subprime loans, which have higher interest rates reflecting the risks of lending to people with blemished credit histories. Now, many here and across the country are having trouble making payments, threatening the companies that issued the loans."
Tuesday, March 13, 2007
MBA - "Delinquencies and Foreclosures Increase in Latest MBA National Delinquency Survey" (3-13-07)
"The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 4.95 percent of all loans outstanding in the fourth quarter of 2006 on a seasonally adjusted (SA) basis, up 28 basis points from the third quarter, and up 25 basis points from one year ago, according to MBA's National Delinquency Survey. The increase was driven by increases in delinquencies for all major loan types, most notably for subprime and FHA loans. Delinquency rates for prime, subprime, FHA, and VA loans increased on a seasonally adjusted basis relative to the third quarter. The delinquency rate for FHA loans reached a new record in the fourth quarter. "
NAR - "Housing Recovery Likely This Year, But Timing Isn't Clear" (3-13-07)
"Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions, but a recovery is likely this year, according to the latest forecast by the National Association of Realtors®. David Lereah, NAR’s chief economist, said there is some ambiguity about the current housing market. 'Our goal each month is to fine-tune the forecast based on the latest housing data and a variety of economic indicators, but extraordinary weather variations are skewing home sales and clouding the picture,' he said. 'Underlying trends point to a housing recovery in 2007, but it will take a couple months for us to get a better handle on it. Existing-home sales are expected to slowly improve from what appears to be the cyclical low last fall, but we think there will be some additional pain in the new home market, which hopefully will start to rise later in the year.'"
Yahoo! - "Late Mortgage Payments Reach High" (3-13-07)
"Late Mortgage Payments Jump to 3 1/2 Year High, New Foreclosures Hit All-Time High"
Market Watch - "Alt-A mortgage losses accelerate, study says" (3-13-07)
"Delinquencies have jumped on Alt-A mortgages originated last year with adjustable interest rates that let borrowers pay only the interest for a time.
These loans, known as Alt-A ARM IOs, have seen a four-fold increase delinquencies of at least 60 days, four times the level of similar loans originated in 2003 and 2004, according to the study by David Liu, head of mortgage credit research at UBS, and LoanPerformance, a division of real estate data firm First American."
Bloomberg - "Senate Weighs Aid to 2.2 Million Subprime Borrowers (Update4)" (3-13-07)
"U.S. lawmakers will have to consider providing aid to about 2.2 million subprime mortgage borrowers who are at risk of defaulting and losing their homes, Senate Banking Committee Chairman Christopher Dodd said today."
OC Register - "New Century can't meet creditor demands" (3-13-07)
"New Century Financial of Irvine said Monday that it doesn't have enough money to buy back up to $8.4 billion in loans it provided to homebuyers with spotty credit and later sold to other creditors, many of which are now demanding repayment. The company's creditors, including global banks such as Bank of America, Barclays, Citigroup, Credit Suisse, Goldman Sachs, and Morgan Stanley, also cut off new financing, essentially shutting down the business and leaving an uncertain future for the 1,800 employees in Orange County and almost 7,000 across the U.S. "
Market Watch - "Lenders fall again on more New Century worries" (3-12-07)
"Shares of mortgage lenders fell again Monday as more bad news from subprime firm New Century Financial rippled through the industry."
"Countrywide, one of the nation's largest mortgage lenders, said Monday that the volume of subprime loans it made in February fell as the company tightens lending standards in response to rising defaults. It said subprime loan fundings in February fell to $2.6 billion from $2.8 billion a year ago. Total loan fundings climbed 10% to $35 billion, Countrywide said. Countrywide added that subprime applications have fallen as the company has tightened its lending criteria. It plans to tighten criteria further, and expects short-term earnings volatility as the changes are made. "
Bloomberg - "Foreclosures May Hit 1.5 Million in U.S. Housing Bust (Update3)" (3-12-07)
"Hold on to your assets. The deepest housing decline in 16 years is about to get worse. As many as 1.5 million more Americans may lose their homes, another 100,000 people in housing-related industries could be fired, and an estimated 100 additional subprime mortgage companies that lend money to people with bad or limited credit may go under, according to realtors, economists, analysts and a Federal Reserve governor. Financial stocks also could extend their declines over mortgage default worries. "
Press Enterprise - "Foreclosure protection sought for low-income homeowners" (3-12-07)
"The Center for American Progress said the government should consider grants to expand mortgage aid and foreclosure prevention programs for families falling behind on their monthly payments. Up to 2.2 million families around the country could lose their homes to foreclosure in the coming years, according to a 2006 report by the Durham, N.C-based Center for Responsible Lending."
Please see our archived radio show as Rick Sharga from RealtyTrac speaks with Bruce in our March 3rd and March 10th show and the Center for Responisble Lending joins us for our March 17th and March 24th show. The Norris Group Real Estate Radio Show
Yahoo! - "New Century Subpoenaed, Faces Delisting" (3-13-07)
"New Century Says Feds Seek Documents, New York Stock Exchange Plans to Delist Shares"
Bloomberg - "U.S. Mortgage Delinquency Rates Likely Rose in Fourth Quarter" (3-13-07)
"Home loan delinquency rates released today by the Mortgage Bankers Association may show an increase for a fourth straight quarter as subprime defaults ripple through the real estate market. Past-due payments on 43 million loans tracked by the survey have climbed since a five-year boom in U.S. housing prices ended a year ago. In the third quarter of 2006, about 4.6 percent of mortgage holders were at least 30 days late, including about 2.4 percent of prime borrowers and 12.6 percent of subprime customers with poor or limited credit histories. "
NAR - "Housing Recovery Likely This Year, But Timing Isn't Clear" (3-13-07)
"Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions, but a recovery is likely this year, according to the latest forecast by the National Association of Realtors®."
Yahoo! - "Accredited, New Century lead subprime meltdown" (3-13-07)
"The meltdown among U.S. subprime mortgage lenders including New Century Financial Corp. broadened on Tuesday, as Accredited Home Lenders Holding Co. shares fell more than 60 percent, and investors worried that more lenders might restructure or seek bankruptcy protection."
Bloomberg - "U.S. Subprime Mortgage Delinquencies at 4-Year High (Update1)" (3-13-07)
"Subprime borrowers fell behind on their mortgages at the highest rate in four years in the fourth quarter and delinquencies rose on all types of U.S. home loans, the Mortgage Bankers Association said. U.S. mortgages entering foreclosure rose to an all-time high of 0.54 percent, the Washington-based bankers' group said in a report today. Subprime delinquencies rose to 13.33 percent from 12.56 percent in the third quarter. Overdue payments on all types of loans rose to 4.95 percent from 4.67 percent in 2006's third quarter. That was the highest since the second quarter of 2003. "
CNN - "Scary math: More homes, fewer buyers" (3-13-07)
"The problem with subprime lenders means there will be more homes in an over-supplied market and not as many people who can step in to make purchases."
Market Watch - "Housing recovery 'likely' this year: NAR" (3-13-07)
"A recovery in the nation's housing market is "likely" this year, though problems in the subprime lending marketplace and unusual weather have posed challenges in assessing conditions, according to a Tuesday forecast from the National Association of Realtors."
LA Times - "Upside in L.A. housing market" (3-13-07)
"Condo sales downtown, where prices start in the mid-$300,000 range, are still relatively strong."
LA Times - "As sub-prime lender implodes, housing shudders" (3-13-07)
"In some parts of the state — including the Central Valley, the Inland Empire and San Diego — foreclosures have gone from rare to plentiful in a little more than a year. Real estate appraisers say home values are beginning to be affected."
"The delinquency rate for mortgage loans on one-to-four-unit residential properties stood at 4.95 percent of all loans outstanding in the fourth quarter of 2006 on a seasonally adjusted (SA) basis, up 28 basis points from the third quarter, and up 25 basis points from one year ago, according to MBA's National Delinquency Survey. The increase was driven by increases in delinquencies for all major loan types, most notably for subprime and FHA loans. Delinquency rates for prime, subprime, FHA, and VA loans increased on a seasonally adjusted basis relative to the third quarter. The delinquency rate for FHA loans reached a new record in the fourth quarter. "
NAR - "Housing Recovery Likely This Year, But Timing Isn't Clear" (3-13-07)
"Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions, but a recovery is likely this year, according to the latest forecast by the National Association of Realtors®. David Lereah, NAR’s chief economist, said there is some ambiguity about the current housing market. 'Our goal each month is to fine-tune the forecast based on the latest housing data and a variety of economic indicators, but extraordinary weather variations are skewing home sales and clouding the picture,' he said. 'Underlying trends point to a housing recovery in 2007, but it will take a couple months for us to get a better handle on it. Existing-home sales are expected to slowly improve from what appears to be the cyclical low last fall, but we think there will be some additional pain in the new home market, which hopefully will start to rise later in the year.'"
Yahoo! - "Late Mortgage Payments Reach High" (3-13-07)
"Late Mortgage Payments Jump to 3 1/2 Year High, New Foreclosures Hit All-Time High"
Market Watch - "Alt-A mortgage losses accelerate, study says" (3-13-07)
"Delinquencies have jumped on Alt-A mortgages originated last year with adjustable interest rates that let borrowers pay only the interest for a time.
These loans, known as Alt-A ARM IOs, have seen a four-fold increase delinquencies of at least 60 days, four times the level of similar loans originated in 2003 and 2004, according to the study by David Liu, head of mortgage credit research at UBS, and LoanPerformance, a division of real estate data firm First American."
Bloomberg - "Senate Weighs Aid to 2.2 Million Subprime Borrowers (Update4)" (3-13-07)
"U.S. lawmakers will have to consider providing aid to about 2.2 million subprime mortgage borrowers who are at risk of defaulting and losing their homes, Senate Banking Committee Chairman Christopher Dodd said today."
OC Register - "New Century can't meet creditor demands" (3-13-07)
"New Century Financial of Irvine said Monday that it doesn't have enough money to buy back up to $8.4 billion in loans it provided to homebuyers with spotty credit and later sold to other creditors, many of which are now demanding repayment. The company's creditors, including global banks such as Bank of America, Barclays, Citigroup, Credit Suisse, Goldman Sachs, and Morgan Stanley, also cut off new financing, essentially shutting down the business and leaving an uncertain future for the 1,800 employees in Orange County and almost 7,000 across the U.S. "
Market Watch - "Lenders fall again on more New Century worries" (3-12-07)
"Shares of mortgage lenders fell again Monday as more bad news from subprime firm New Century Financial rippled through the industry."
"Countrywide, one of the nation's largest mortgage lenders, said Monday that the volume of subprime loans it made in February fell as the company tightens lending standards in response to rising defaults. It said subprime loan fundings in February fell to $2.6 billion from $2.8 billion a year ago. Total loan fundings climbed 10% to $35 billion, Countrywide said. Countrywide added that subprime applications have fallen as the company has tightened its lending criteria. It plans to tighten criteria further, and expects short-term earnings volatility as the changes are made. "
Bloomberg - "Foreclosures May Hit 1.5 Million in U.S. Housing Bust (Update3)" (3-12-07)
"Hold on to your assets. The deepest housing decline in 16 years is about to get worse. As many as 1.5 million more Americans may lose their homes, another 100,000 people in housing-related industries could be fired, and an estimated 100 additional subprime mortgage companies that lend money to people with bad or limited credit may go under, according to realtors, economists, analysts and a Federal Reserve governor. Financial stocks also could extend their declines over mortgage default worries. "
Press Enterprise - "Foreclosure protection sought for low-income homeowners" (3-12-07)
"The Center for American Progress said the government should consider grants to expand mortgage aid and foreclosure prevention programs for families falling behind on their monthly payments. Up to 2.2 million families around the country could lose their homes to foreclosure in the coming years, according to a 2006 report by the Durham, N.C-based Center for Responsible Lending."
Please see our archived radio show as Rick Sharga from RealtyTrac speaks with Bruce in our March 3rd and March 10th show and the Center for Responisble Lending joins us for our March 17th and March 24th show. The Norris Group Real Estate Radio Show
Yahoo! - "New Century Subpoenaed, Faces Delisting" (3-13-07)
"New Century Says Feds Seek Documents, New York Stock Exchange Plans to Delist Shares"
Bloomberg - "U.S. Mortgage Delinquency Rates Likely Rose in Fourth Quarter" (3-13-07)
"Home loan delinquency rates released today by the Mortgage Bankers Association may show an increase for a fourth straight quarter as subprime defaults ripple through the real estate market. Past-due payments on 43 million loans tracked by the survey have climbed since a five-year boom in U.S. housing prices ended a year ago. In the third quarter of 2006, about 4.6 percent of mortgage holders were at least 30 days late, including about 2.4 percent of prime borrowers and 12.6 percent of subprime customers with poor or limited credit histories. "
NAR - "Housing Recovery Likely This Year, But Timing Isn't Clear" (3-13-07)
"Unusual weather patterns and problems in the subprime lending marketplace are creating challenges in assessing housing market conditions, but a recovery is likely this year, according to the latest forecast by the National Association of Realtors®."
Yahoo! - "Accredited, New Century lead subprime meltdown" (3-13-07)
"The meltdown among U.S. subprime mortgage lenders including New Century Financial Corp. broadened on Tuesday, as Accredited Home Lenders Holding Co. shares fell more than 60 percent, and investors worried that more lenders might restructure or seek bankruptcy protection."
Bloomberg - "U.S. Subprime Mortgage Delinquencies at 4-Year High (Update1)" (3-13-07)
"Subprime borrowers fell behind on their mortgages at the highest rate in four years in the fourth quarter and delinquencies rose on all types of U.S. home loans, the Mortgage Bankers Association said. U.S. mortgages entering foreclosure rose to an all-time high of 0.54 percent, the Washington-based bankers' group said in a report today. Subprime delinquencies rose to 13.33 percent from 12.56 percent in the third quarter. Overdue payments on all types of loans rose to 4.95 percent from 4.67 percent in 2006's third quarter. That was the highest since the second quarter of 2003. "
CNN - "Scary math: More homes, fewer buyers" (3-13-07)
"The problem with subprime lenders means there will be more homes in an over-supplied market and not as many people who can step in to make purchases."
Market Watch - "Housing recovery 'likely' this year: NAR" (3-13-07)
"A recovery in the nation's housing market is "likely" this year, though problems in the subprime lending marketplace and unusual weather have posed challenges in assessing conditions, according to a Tuesday forecast from the National Association of Realtors."
LA Times - "Upside in L.A. housing market" (3-13-07)
"Condo sales downtown, where prices start in the mid-$300,000 range, are still relatively strong."
LA Times - "As sub-prime lender implodes, housing shudders" (3-13-07)
"In some parts of the state — including the Central Valley, the Inland Empire and San Diego — foreclosures have gone from rare to plentiful in a little more than a year. Real estate appraisers say home values are beginning to be affected."
Monday, March 12, 2007
CNN - "New Century's woes deepen, spread" (3-12-07)
"Troubled mortgage lender on the hook for $8.4 billion as financing vanishes. Top Wall Street firms, home prices could take hit."
Market Watch - "New Century's creditors pull out; bankruptcy looms" (3-12-07)
"At this point, termination of all lending lines means either they find a sale in the very short term or it's probably bankruptcy," said Zack Gast, an analyst at the Center for Financial Research and Analysis. "They might pull a magic buyer out of the hat, but I'm not sure anyone would want to step in at this point."
NAR - "NAR Supports Strengthening Financial Soundness of Government-Sponsored Enterprises Through Independent Regulatory Agency" (3-12-07)
"The National Association of Realtors® testified today that creating a strong regulatory regime that preserves the housing mission of the government-sponsored enterprises (GSEs) will strengthen the housing finance system and emphasize the important role housing plays in the nation’s economy."
Business Week - "Subprime Lending's Next Act" (3-12-07)
"What the market will look like for borrowers after the shakeup—which players are likely to suffer and which are positioned to weather the storm"
CBIA - "New Home Sales Rise by 9% in January, CBIA/Hanley Wood Survey Finds" (3-12-07)
"In another sign the state’s housing market may be firming up, sales at the state’s major new-home communities rose in January by 9.4 percent compared to December while median asking prices remained unchanged at $463,900, according to the monthly CBIA/Hanley Wood Market Intelligence report."
Inman - "GSE reform bill wouldn't set cap on Fannie, Freddie portfolios" (3-12-07)
"The government shouldn't impose arbitrary caps on Fannie Mae and Freddie Mac's lending portfolios, but should distance itself from some of the government-sponsored mortgage repurchasers' debt obligations should they get into financial trouble. That's the view of a bipartisan bill introduced Friday to overhaul regulatory oversight of Fannie and Freddie and prevent a repeat of the management and accounting scandals of 2004. The bill, HR 1427, is expected to generate about $500 million a year for an affordable-housing fund to address concerns that the government-sponsored entities have neglected the mission they were chartered by Congress to perform. Backers of the bill from both parties hope it will resolve the long-running GSE reform debate. Although there has been general agreement about the need to create an independent oversight agency with powers similar to those of a bank regulator to oversee Fannie and Freddie, Democrats have opposed a Bush administration proposal to set limits on the GSE's lending portfolios. The House passed a GSE reform bill last year that would have created an independent regulator, the Federal Housing Finance Agency, a companion bill stalled in the Senate over the issue of portfolio caps. The new compromise legislation, HR 1427, would not establish an arbitrary cap on Fannie and Freddie's debt. But it would strengthen the GSE's minimum capital provisions, and allow the Federal Housing Finance Agency to establish rules for safety and soundness and revise product approval standards. That means Fannie and Freddie will have to convince the newly created FHFA that it is not taking on more debt than it can handle. As a further crimp on Fannie and Freddie's borrowing power, the legislation allows the GSEs to be placed into receivership if they are unable to pay their debts. "
OC Register - "New Century moves closer to bankruptcy" (3-12-07)
"Irvine mortgage lender New Century edged closer to bankruptcy this morning, as it announced that all of its lenders have cut funding or announced their intent to halt financing, because New Century failed to make payments. The company received letters from Wall Street lenders including Bank of America, Goldman Sachs, Morgan Stanley and Citigroup, among others, alleging events of default. New Century's early-morning filing with the Securities and Exchange Commission could shake the entire financial sector, because so many major firms are involved, said CNN/Money.com."
CA Real Estate Journal - "Winter Slowed Construction Employment in February" (3-12-07)
"Construction employment dropped by 62,000 jobs in February, according to The Associated General Contractors of America, because of the housing slowdown and the winter weather across much of the country. However, Ken Simonson, chief economist for AGC, said he expects nonresidential construction to correct much of that downturn in March. "
OC Register - "Subprime loans lured legions" (3-11-07)
"High-risk mortgages funded about 1-in-5 O.C. home purchases last year."
Contra Costa Times - "Home buyers, particularly those with limited English skills, vulnerable to deals that end in foreclosure or ruined credit: Pitfalls of housing boom uncovered" (3-11-07)
"Their stories reflect a national problem that is particularly acute in California, where thousands of lower-income families became first-time homeowners during the housing boom by getting nontraditional 'subprime' loans. Those loans, which carry higher interest rates, have typically been given to borrowers who are higher credit risks or have income that is difficult to verify. But as lenders face a wave of defaults, they're getting stricter about who receives money just as borrowers are trying to refinance their way out of mortgages they can't afford."
Sign On San Diego - "Subprime mortgage troubles raise fears" (3-11-07)
"In just a few short months, mortgage lenders who specialize in loans to borrowers with tarnished credit records have been in turmoil. Default rates among borrowers have surged. Share prices of many mortgage companies have plunged. A handful are in bankruptcy. Several others are working to exit the business. One of the largest, New Century of Irvine, said last week that creditors had forced it to stop making loans. The company's stock, which traded for about $50 a share in the middle of last year, closed Friday at $3.22. "
La Times - "Activity in Riverside and Ventura counties" (3-11-07)
Data from DataQuick
"High-risk mortgages funded about 1-in-5 O.C. home purchases last year."
Contra Costa Times - "Home buyers, particularly those with limited English skills, vulnerable to deals that end in foreclosure or ruined credit: Pitfalls of housing boom uncovered" (3-11-07)
"Their stories reflect a national problem that is particularly acute in California, where thousands of lower-income families became first-time homeowners during the housing boom by getting nontraditional 'subprime' loans. Those loans, which carry higher interest rates, have typically been given to borrowers who are higher credit risks or have income that is difficult to verify. But as lenders face a wave of defaults, they're getting stricter about who receives money just as borrowers are trying to refinance their way out of mortgages they can't afford."
Sign On San Diego - "Subprime mortgage troubles raise fears" (3-11-07)
"In just a few short months, mortgage lenders who specialize in loans to borrowers with tarnished credit records have been in turmoil. Default rates among borrowers have surged. Share prices of many mortgage companies have plunged. A handful are in bankruptcy. Several others are working to exit the business. One of the largest, New Century of Irvine, said last week that creditors had forced it to stop making loans. The company's stock, which traded for about $50 a share in the middle of last year, closed Friday at $3.22. "
La Times - "Activity in Riverside and Ventura counties" (3-11-07)
Data from DataQuick
Friday, March 09, 2007
Business Week - "Under The Fed's Hammer " (3-9-07)
"How Fed rate hikes have turned into a regressive tax on weak borrowers "
Bloomberg - "Rising Subprime Mortgage Defaults Add to Unsold Homes Inventory" (3-8-07)
"Rising mortgage defaults by subprime borrowers may add more than 500,000 homes to a residential real estate market already beset by slumping prices, according to CreditSights Inc."
MBA.org - "MBA Signs Memorandum of Agreement with FBI to Promote Use of FBI’s Mortgage Fraud Warning Notice" (3-8-07)
"John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA), today joined Karen E. Spangenberg, Financial Crimes Section Chief for the Federal Bureau of Investigation (FBI) to announce and sign a memorandum of agreement for the two organizations to work together to promote the FBI’s Mortgage Fraud Warning Notice."
CNN - "Home prices: Don't expect quick rebound" (3-9-07)
"I expect prices and sales to be modestly growing by June in most of the country," said David Lereah, the chief economist for the National Association of Realtors and perhaps the most bullish housing economist. "But we'll have to go into 2008, maybe even 2009 before we get even close to the peaks we saw in late 2005 or early 2006."
Forbes - "New Century On Verge Of Bankruptcy" (3-9-07)
"In company news, there's more trouble brewing in the subprime lending market. Shares of New Century Financial (nyse: NEW - news - people ) fell more than 18% after it said it would stop accepting loan applications. New Century has had a tough time securing financing to stay afloat, and some analysts think the company may be on the edge of declaring bankruptcy."
Bloomberg - "General Electric's WMC Mortgage Cuts Subprime Jobs (Update4)" (3-9-07)
"General Electric Co.'s U.S. mortgage unit will curtail lending and fire 460 workers, or 20 percent of staff, amid a rise in defaults by people with poor credit."
"How Fed rate hikes have turned into a regressive tax on weak borrowers "
Bloomberg - "Rising Subprime Mortgage Defaults Add to Unsold Homes Inventory" (3-8-07)
"Rising mortgage defaults by subprime borrowers may add more than 500,000 homes to a residential real estate market already beset by slumping prices, according to CreditSights Inc."
MBA.org - "MBA Signs Memorandum of Agreement with FBI to Promote Use of FBI’s Mortgage Fraud Warning Notice" (3-8-07)
"John M. Robbins, CMB, Chairman of the Mortgage Bankers Association (MBA), today joined Karen E. Spangenberg, Financial Crimes Section Chief for the Federal Bureau of Investigation (FBI) to announce and sign a memorandum of agreement for the two organizations to work together to promote the FBI’s Mortgage Fraud Warning Notice."
CNN - "Home prices: Don't expect quick rebound" (3-9-07)
"I expect prices and sales to be modestly growing by June in most of the country," said David Lereah, the chief economist for the National Association of Realtors and perhaps the most bullish housing economist. "But we'll have to go into 2008, maybe even 2009 before we get even close to the peaks we saw in late 2005 or early 2006."
Forbes - "New Century On Verge Of Bankruptcy" (3-9-07)
"In company news, there's more trouble brewing in the subprime lending market. Shares of New Century Financial (nyse: NEW - news - people ) fell more than 18% after it said it would stop accepting loan applications. New Century has had a tough time securing financing to stay afloat, and some analysts think the company may be on the edge of declaring bankruptcy."
Bloomberg - "General Electric's WMC Mortgage Cuts Subprime Jobs (Update4)" (3-9-07)
"General Electric Co.'s U.S. mortgage unit will curtail lending and fire 460 workers, or 20 percent of staff, amid a rise in defaults by people with poor credit."
Market Watch - "New Century stops accepting loan applications" (3-8-07)
"New Century Financial Corp. said late Thursday that it has stopped accepting loan applications because some of the subprime-mortgage specialist's financial backers are refusing to provide access to financing."
Reuters - "FBI to warn borrowers, lenders on mortgage fraud" (3-8-07)
"The Federal Bureau of Investigation, seeking to stem a rising tide of crime in home financing, said on Thursday it will warn borrowers and lenders that mortgage fraud can result in stiff fines and prison time. The FBI said in its Web site that the warning, worked out with the industry's main lobbying group, will educate borrowers on the consequences of criminal activity and put potential perpetrators on notice. The form will likely be included in consumer loan packets together with other information on fair lending practices, said Stephen Kodak, an FBI press officer."
Business Week - "Who's Profiting from the Subprime Bust" (3-8-07)
"As the market in shaky mortgages collapsed, some hedge funds raked in profits by betting on a decline in the ABX subprime index"
Bloomberg - "Hovnanian Reports Loss on Canceled Home Contracts (Update1)" (3-8-07)
"Hovnanian Enterprises Inc., the sixth- largest U.S. homebuilder by revenue, reported a loss for the fiscal first quarter as sales slumped and Florida homebuyers canceled orders."
Bloomberg - "Fed Warned on Foreclosures as Mortgage Growth Cools (Update1)" (3-8-07)
"The Federal Reserve Board's Consumer Advisory Council, including consumer advocates and banks, met today in Washington, with Bernanke and Fed Governors Susan Bies, Randall Kroszner and Frederic Mishkin in attendance. Home-mortgage foreclosures were the first agenda item and the officials heard anecdotes of default and families at risk."
NAHB - "Rental Market Conditions Improve As Condo Market Recedes, Say Builders" (3-8-07)
"The rental apartment market shows signs of rebounding following the condo construction and conversion exuberance of recent years. The return of developers to the market-rate apartment sector – the low-rent government subsidized apartment sector never really faltered – is being fueled by increased household demand for rental units and depleted supply due to the earlier conversion of rental apartment buildings to condominium ownership."
"New Century Financial Corp. said late Thursday that it has stopped accepting loan applications because some of the subprime-mortgage specialist's financial backers are refusing to provide access to financing."
Reuters - "FBI to warn borrowers, lenders on mortgage fraud" (3-8-07)
"The Federal Bureau of Investigation, seeking to stem a rising tide of crime in home financing, said on Thursday it will warn borrowers and lenders that mortgage fraud can result in stiff fines and prison time. The FBI said in its Web site that the warning, worked out with the industry's main lobbying group, will educate borrowers on the consequences of criminal activity and put potential perpetrators on notice. The form will likely be included in consumer loan packets together with other information on fair lending practices, said Stephen Kodak, an FBI press officer."
Business Week - "Who's Profiting from the Subprime Bust" (3-8-07)
"As the market in shaky mortgages collapsed, some hedge funds raked in profits by betting on a decline in the ABX subprime index"
Bloomberg - "Hovnanian Reports Loss on Canceled Home Contracts (Update1)" (3-8-07)
"Hovnanian Enterprises Inc., the sixth- largest U.S. homebuilder by revenue, reported a loss for the fiscal first quarter as sales slumped and Florida homebuyers canceled orders."
Bloomberg - "Fed Warned on Foreclosures as Mortgage Growth Cools (Update1)" (3-8-07)
"The Federal Reserve Board's Consumer Advisory Council, including consumer advocates and banks, met today in Washington, with Bernanke and Fed Governors Susan Bies, Randall Kroszner and Frederic Mishkin in attendance. Home-mortgage foreclosures were the first agenda item and the officials heard anecdotes of default and families at risk."
NAHB - "Rental Market Conditions Improve As Condo Market Recedes, Say Builders" (3-8-07)
"The rental apartment market shows signs of rebounding following the condo construction and conversion exuberance of recent years. The return of developers to the market-rate apartment sector – the low-rent government subsidized apartment sector never really faltered – is being fueled by increased household demand for rental units and depleted supply due to the earlier conversion of rental apartment buildings to condominium ownership."
Wednesday, March 07, 2007
Yahoo! - "Bernanke: Toughen Up on Mortgage Giants" (3-6-07)
"Federal Reserve Chairman Ben Bernanke urged Congress on Tuesday to bolster regulation of mortgage giants Fannie Mae and Freddie Mac, and suggested limiting their massive holdings to guard against any danger their debt poses to the overall economy. Bernanke has previously supported efforts to pare the two mortgage companies' huge portfolios. This time, however, he was a bit more specific and recommended that their holdings might be linked to a 'measurable public purpose, such as the promotion of affordable housing.'"
Reuters - "Subprime guidance may hit 60% of Countrywide ARMs" (3-6-07)
Sixty percent of Countrywide's customers seeking hybrid adjustable-rate mortgages, or ARMs, such as "2-28" loans would fail to qualify under the guidance that urges lenders weigh the borrower's ability to repay at the highest possible rate during the life of the loan, Countrywide CFO Eric Sieracki said at a Raymond James Financial Inc. conference in Orlando, Florida.
Chron.com - "FBI: Mortgage Fraud a Growing Problem" (3-7-07)
"The number of mortgage fraud cases investigated by the FBI almost doubled the past three years, reflecting a problem that is "pervasive and growing," the bureau said Wednesday in its annual report on financial crimes. The bureau said its mortgage fraud cases increased from 436 in 2003 to 818 in 2006, and acknowledged that its case load likely represents a small piece of the problem."
Business Week - "The Mortgage Mess Spreads" (3-7-07)
"The subprime lending industry is getting hammered, and hedge funds and investment banks are feeling the pain"
CNN - "Toll Brothers: Worst in housing nearly over" (3-7-07)
"CEO of luxury home builder says lower cancellation rate means that their inventory could be sold down within four or five months."
Market Watch - "Accredited Home Lenders slides" (3-7-07)
"Shares of subprime mortgage firm Accredited Home Lenders fell almost 10% Wednesday, its second day of big losses as it became the latest target of sellers nervous about borrower defaults."
Market Watch - "Home builders tighten their belts" (3-7-07)
"While an uncertain housing market anxiously monitors the spring selling season for hints of a turnaround, home-builder chief executives are keeping a close eye on their costs and the overhang of unsold homes on the market."
CNN - "D.R. Horton CEO: '2007 is going to suck'" (3-7-07)
"No. 1 U.S. homebuilder sees further write-offs due to unsold homes, lower value lands; expects '08 to be better."
Reuters - "FDIC sanctions Fremont over subprime loans" (3-7-07)
"The U.S. Federal Deposit Insurance Corporation on Wednesday issued a cease-and-desist order against Fremont General Corp. (FMT.N: Quote, Profile, Research) because of its subprime mortgage and commercial real estate lending practices."
Real Estate Journal - "U.S. Housing Markets Expect A Surge in Buyer Interest" (3-7-07)
"Here's a look at what's new in real-estate markets across the U.S. from around the Web."
LA Times - "Fremont General says court reinstates two suits" (3-7-07)
"Fremont General Corp., the California thrift whose mortgage-lending arm was shut last week by U.S. bank regulators, said Tuesday that an appeals court had reinstated two 2004 lawsuits brought by the state's insurance commissioner."
MBAA.org - "MBA Will Sign Memorandum of Understanding with FBI at MBA’s National Fraud Conference" (3-7-07)
"The Mortgage Bankers Association (MBA) and the Federal Bureau of Investigation (FBI) will sign a memorandum of agreement in recognition of the joint approval of a Mortgage Fraud Warning Notice. MBA and the FBI will make the Notice available to mortgage lenders to permit institutions on a voluntary basis to utilize it as a proactive means of educating consumers and mortgage lending professionals of the penalties and consequences of mortgage fraud."
"Federal Reserve Chairman Ben Bernanke urged Congress on Tuesday to bolster regulation of mortgage giants Fannie Mae and Freddie Mac, and suggested limiting their massive holdings to guard against any danger their debt poses to the overall economy. Bernanke has previously supported efforts to pare the two mortgage companies' huge portfolios. This time, however, he was a bit more specific and recommended that their holdings might be linked to a 'measurable public purpose, such as the promotion of affordable housing.'"
Reuters - "Subprime guidance may hit 60% of Countrywide ARMs" (3-6-07)
Sixty percent of Countrywide's customers seeking hybrid adjustable-rate mortgages, or ARMs, such as "2-28" loans would fail to qualify under the guidance that urges lenders weigh the borrower's ability to repay at the highest possible rate during the life of the loan, Countrywide CFO Eric Sieracki said at a Raymond James Financial Inc. conference in Orlando, Florida.
Chron.com - "FBI: Mortgage Fraud a Growing Problem" (3-7-07)
"The number of mortgage fraud cases investigated by the FBI almost doubled the past three years, reflecting a problem that is "pervasive and growing," the bureau said Wednesday in its annual report on financial crimes. The bureau said its mortgage fraud cases increased from 436 in 2003 to 818 in 2006, and acknowledged that its case load likely represents a small piece of the problem."
Business Week - "The Mortgage Mess Spreads" (3-7-07)
"The subprime lending industry is getting hammered, and hedge funds and investment banks are feeling the pain"
CNN - "Toll Brothers: Worst in housing nearly over" (3-7-07)
"CEO of luxury home builder says lower cancellation rate means that their inventory could be sold down within four or five months."
Market Watch - "Accredited Home Lenders slides" (3-7-07)
"Shares of subprime mortgage firm Accredited Home Lenders fell almost 10% Wednesday, its second day of big losses as it became the latest target of sellers nervous about borrower defaults."
Market Watch - "Home builders tighten their belts" (3-7-07)
"While an uncertain housing market anxiously monitors the spring selling season for hints of a turnaround, home-builder chief executives are keeping a close eye on their costs and the overhang of unsold homes on the market."
CNN - "D.R. Horton CEO: '2007 is going to suck'" (3-7-07)
"No. 1 U.S. homebuilder sees further write-offs due to unsold homes, lower value lands; expects '08 to be better."
Reuters - "FDIC sanctions Fremont over subprime loans" (3-7-07)
"The U.S. Federal Deposit Insurance Corporation on Wednesday issued a cease-and-desist order against Fremont General Corp. (FMT.N: Quote, Profile, Research) because of its subprime mortgage and commercial real estate lending practices."
Real Estate Journal - "U.S. Housing Markets Expect A Surge in Buyer Interest" (3-7-07)
"Here's a look at what's new in real-estate markets across the U.S. from around the Web."
LA Times - "Fremont General says court reinstates two suits" (3-7-07)
"Fremont General Corp., the California thrift whose mortgage-lending arm was shut last week by U.S. bank regulators, said Tuesday that an appeals court had reinstated two 2004 lawsuits brought by the state's insurance commissioner."
MBAA.org - "MBA Will Sign Memorandum of Understanding with FBI at MBA’s National Fraud Conference" (3-7-07)
"The Mortgage Bankers Association (MBA) and the Federal Bureau of Investigation (FBI) will sign a memorandum of agreement in recognition of the joint approval of a Mortgage Fraud Warning Notice. MBA and the FBI will make the Notice available to mortgage lenders to permit institutions on a voluntary basis to utilize it as a proactive means of educating consumers and mortgage lending professionals of the penalties and consequences of mortgage fraud."
St. Petersburg Times - "Frustrated buyers sue for refund on condo" (3-6-07)
"They bought into the idea of living in Trump Tower luxury. Now they just want their deposit back."
OC Register - "O.C. building permits down 70 percent in January" (3-6-07)
"The number of residential building permits issued in Orange County fell 70 percent in January from the year before, driven mainly by a sharp decline in new condo and apartment project filings, the California Building Industry Association reports."
News-Press - "Inventory enemy of our real estate market" (3-4-07)
"I had a friend come into my office the morning after I delivered my Market Watch speech and she said she wanted to see for herself the man that had a target on his back. This is the same day that the front page of The News-Press had my picture with the headline "Home sellers advised to get real on prices." Throughout history, the bearer of bad news never had to ask about retirement benefits. I'm glad times have changed. I'm happy with just the target on my back, because in times past the wearer of it actually had sharp things hurled at it."
Bloomberg - "Greenspan Sees One-Third Chance of Recession in 2007 (Update2)" (3-6-07)
"Former Federal Reserve Chairman Alan Greenspan said there's a 'one-third probability' of a U.S. recession this year and the current expansion won't have the staying power of its decade-long predecessor."
Bloomberg - "Goldman, Lehman Most Vulnerable to Credit Decline, Hintz Says" (3-6-07)
"Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. would be hardest-hit on Wall Street if the slump in subprime mortgages becomes a credit crisis like the one that followed Russia's debt default in 1998, Sanford C. Bernstein & Co. analyst Brad Hintz said."
Bloomberg - "As Housing Goes Bust, Lenders Become Predators?: Caroline Baum" (3-6-07)
"Congress is gearing up for hearings on predatory lending, the latest chapter in its long history of barn-door-closings on already-departed horses. Just some background in case anyone hasn't picked up a U.S. newspaper in the last month. The subprime lending market is in trouble as borrowers who are, by definition, poor credit risks live up to their reputation. "
Business Week - "The Bubble Guru's Take On Housing" (3-6-07)
"Yale's Robert Shiller thinks the market hasn't hit bottom, but he leaves room for the human factor "
Bloomberg - "GM May Take Almost $1 Billion Charge for Mortgages (Update5)" (3-6-07)
"General Motors Corp., the world's largest automaker, may take a charge of almost $1 billion to cover bad mortgage loans made by its former home-lending unit, according to a Lehman Brothers Holdings Inc. analyst. Residential Capital LLC relies on loans to people with poor or limited credit records or high debt burdens, for more than three-quarters, or $57 billion, of its loan portfolio, Lehman analyst Brian Johnson wrote in a research report. Delinquency rates on such subprime loans made last year are at a record high. "
Bloomberg - "Pending Home Sales in U.S. Declined 4.1% in January (Update2)" (3-6-07)
"Fewer Americans signed contracts to buy previously owned homes in January, an indication of lingering weakness in the housing market. An index of signed purchase agreements fell 4.1 percent, the National Association of Realtors said today in Washington. The index was 8.9 percent below the year-earlier level. "
NAR - "January Pending Homes Sales Down Due to Weather Fluctuations" (3-6-07)
"Pending home sales declined in January from a strong upturn in December due to unusual weather patterns, according to the National Association of Realtors®. The Pending Home Sales Index,* a leading indicator for the housing sector based on contracts signed in January, fell 4.1 percent to an index of 108.7 from an upwardly revised reading of 113.3 in December, and is 8.9 percent lower than January 2006. "
CNN - "Bernanke: Fannie, Freddie threaten economy" (3-6-07)
"Fed chief says investments held by Fannie Mae and Freddie Mac should be 'anchored' to their affordable housing mission."
"They bought into the idea of living in Trump Tower luxury. Now they just want their deposit back."
OC Register - "O.C. building permits down 70 percent in January" (3-6-07)
"The number of residential building permits issued in Orange County fell 70 percent in January from the year before, driven mainly by a sharp decline in new condo and apartment project filings, the California Building Industry Association reports."
News-Press - "Inventory enemy of our real estate market" (3-4-07)
"I had a friend come into my office the morning after I delivered my Market Watch speech and she said she wanted to see for herself the man that had a target on his back. This is the same day that the front page of The News-Press had my picture with the headline "Home sellers advised to get real on prices." Throughout history, the bearer of bad news never had to ask about retirement benefits. I'm glad times have changed. I'm happy with just the target on my back, because in times past the wearer of it actually had sharp things hurled at it."
Bloomberg - "Greenspan Sees One-Third Chance of Recession in 2007 (Update2)" (3-6-07)
"Former Federal Reserve Chairman Alan Greenspan said there's a 'one-third probability' of a U.S. recession this year and the current expansion won't have the staying power of its decade-long predecessor."
Bloomberg - "Goldman, Lehman Most Vulnerable to Credit Decline, Hintz Says" (3-6-07)
"Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. would be hardest-hit on Wall Street if the slump in subprime mortgages becomes a credit crisis like the one that followed Russia's debt default in 1998, Sanford C. Bernstein & Co. analyst Brad Hintz said."
Bloomberg - "As Housing Goes Bust, Lenders Become Predators?: Caroline Baum" (3-6-07)
"Congress is gearing up for hearings on predatory lending, the latest chapter in its long history of barn-door-closings on already-departed horses. Just some background in case anyone hasn't picked up a U.S. newspaper in the last month. The subprime lending market is in trouble as borrowers who are, by definition, poor credit risks live up to their reputation. "
Business Week - "The Bubble Guru's Take On Housing" (3-6-07)
"Yale's Robert Shiller thinks the market hasn't hit bottom, but he leaves room for the human factor "
Bloomberg - "GM May Take Almost $1 Billion Charge for Mortgages (Update5)" (3-6-07)
"General Motors Corp., the world's largest automaker, may take a charge of almost $1 billion to cover bad mortgage loans made by its former home-lending unit, according to a Lehman Brothers Holdings Inc. analyst. Residential Capital LLC relies on loans to people with poor or limited credit records or high debt burdens, for more than three-quarters, or $57 billion, of its loan portfolio, Lehman analyst Brian Johnson wrote in a research report. Delinquency rates on such subprime loans made last year are at a record high. "
Bloomberg - "Pending Home Sales in U.S. Declined 4.1% in January (Update2)" (3-6-07)
"Fewer Americans signed contracts to buy previously owned homes in January, an indication of lingering weakness in the housing market. An index of signed purchase agreements fell 4.1 percent, the National Association of Realtors said today in Washington. The index was 8.9 percent below the year-earlier level. "
NAR - "January Pending Homes Sales Down Due to Weather Fluctuations" (3-6-07)
"Pending home sales declined in January from a strong upturn in December due to unusual weather patterns, according to the National Association of Realtors®. The Pending Home Sales Index,* a leading indicator for the housing sector based on contracts signed in January, fell 4.1 percent to an index of 108.7 from an upwardly revised reading of 113.3 in December, and is 8.9 percent lower than January 2006. "
CNN - "Bernanke: Fannie, Freddie threaten economy" (3-6-07)
"Fed chief says investments held by Fannie Mae and Freddie Mac should be 'anchored' to their affordable housing mission."
Market Watch - "Analysts warn New Century may not survive" (3-5-07)
"Several analysts agreed Monday that New Century Financial Corp., one of the nation's largest subprime mortgage lenders, likely faces liquidation or bankruptcy following revelations that it's under criminal investigation and in violation of debt covenants with several lenders."
Reuters - "New Century sheds 70 percent" (3-5-07)
"New Century Financial Inc. (NEW.N: Quote, Profile, Research) shares fell more than 70 percent on Monday amid worries it might go bankrupt, as mounting fears over defaults triggered a broad sell-off in mortgage lenders."
Yahoo! - "Fremont General Stock Falls on Sale News" (3-5-07)
"Fremont General Stock Falls to 52-Week Low on News of Sale of Subprime Business"
Bloomberg - "Lehman Cuts Prime Mortgage Lenders on Default Risks (Update3)" (3-5-07)
"Lehman Brothers Holdings Inc. cut its investment rating on U.S. mortgage companies including Countrywide Financial Corp. because a surge in defaults may be spreading beyond the riskiest loans."
Business Week - "Another Stumble for Subprime Lenders" (3-5-07)
"Stocks in the sector dropped Monday as New Century Financial announced more financing woes and a probe of its trading practices"
Smart Money - "Analysts Raise Specter of New Century Bankruptcy" (3-5-07)
" When Wall Street starts using terms like "death spiral" to describe the prospects of an already beleaguered subprime lender, the question isn't will the stock drop but rather when — and if — it'll ever stop falling."
Modesto Bee - "There is a lot of coming, going in valley" (3-5-07)
"Some relocating from Bay Area in search of lower housing cost"
"Several analysts agreed Monday that New Century Financial Corp., one of the nation's largest subprime mortgage lenders, likely faces liquidation or bankruptcy following revelations that it's under criminal investigation and in violation of debt covenants with several lenders."
Reuters - "New Century sheds 70 percent" (3-5-07)
"New Century Financial Inc. (NEW.N: Quote, Profile, Research) shares fell more than 70 percent on Monday amid worries it might go bankrupt, as mounting fears over defaults triggered a broad sell-off in mortgage lenders."
Yahoo! - "Fremont General Stock Falls on Sale News" (3-5-07)
"Fremont General Stock Falls to 52-Week Low on News of Sale of Subprime Business"
Bloomberg - "Lehman Cuts Prime Mortgage Lenders on Default Risks (Update3)" (3-5-07)
"Lehman Brothers Holdings Inc. cut its investment rating on U.S. mortgage companies including Countrywide Financial Corp. because a surge in defaults may be spreading beyond the riskiest loans."
Business Week - "Another Stumble for Subprime Lenders" (3-5-07)
"Stocks in the sector dropped Monday as New Century Financial announced more financing woes and a probe of its trading practices"
Smart Money - "Analysts Raise Specter of New Century Bankruptcy" (3-5-07)
" When Wall Street starts using terms like "death spiral" to describe the prospects of an already beleaguered subprime lender, the question isn't will the stock drop but rather when — and if — it'll ever stop falling."
Modesto Bee - "There is a lot of coming, going in valley" (3-5-07)
"Some relocating from Bay Area in search of lower housing cost"
Sunday, March 04, 2007
Arizona Republic - "Lawsuits targeting mortgage schemes " (3-4-07)
"Big lenders and Wall Street investors are going after Arizona mortgage brokers, appraisers, real estate agents, title firms and home buyers for fraud. Dozens of civil lawsuits alleging the gamut of mortgage fraud, from cash-back deals to lying about income on loan documents, have been filed against Valley firms and individuals during the past few months."
"Big lenders and Wall Street investors are going after Arizona mortgage brokers, appraisers, real estate agents, title firms and home buyers for fraud. Dozens of civil lawsuits alleging the gamut of mortgage fraud, from cash-back deals to lying about income on loan documents, have been filed against Valley firms and individuals during the past few months."
Sign On San Diego - "County unemployment hits a six-month high" (3-3-07)
"Construction and real estate layoffs helped push San Diego County's unemployment rate to its highest point since last July, according to data released yesterday by the California Employment Development Department. The county lost 23,400 jobs from December to January, but most of the losses were caused by seasonal reductions at retail shops and restaurants related to the end of the holiday shopping season. More significant were the cuts in the real estate industry, continuing a five-month decline. January's job cutbacks included 2,500 construction workers, 700 real estate workers and 1,100 workers at furniture and home-improvement stores."
Sign On San Diego - "North County housing problems cause buzz at forum" (3-3-07)
"A session focusing on North County's housing ills brought calls yesterday to turn renters into buyers through builder-subsidized homes, to require lenders to offer mortgages their clients can afford and to rezone neighborhoods to make room for the young and old."
North County Times - "Prominent mortgage exec sees further dip in market" (3-3-07)
"We're all going to be struggling, struggling more than we are today," he said. "We're headed halfway down the mountain, and we've got a ways to go."
Sign On San Diego - "Lennar asks contractors for discounts on finished work" (3-3-07)
"Lennar Corp., San Diego County's top home builder last year, is asking its framers, plumbers and other contractors to reduce their bills by as much as 20 percent for work under way or already completed or face exclusion from bidding on future jobs for the next six months."
Palm Beach Post - "Ballooning foreclosures tax court clerks, judges" (3-3-07)
"For months, a ceaseless routine has gripped the St. Lucie clerk of court's civil office: New mortgage foreclosure lawsuits arrive in unprecedented numbers - huge stacks, some a foot or 2 tall. But as soon as one stack is processed and emptied from the in-box, another dozen or more foreclosures show up the next day."
"Construction and real estate layoffs helped push San Diego County's unemployment rate to its highest point since last July, according to data released yesterday by the California Employment Development Department. The county lost 23,400 jobs from December to January, but most of the losses were caused by seasonal reductions at retail shops and restaurants related to the end of the holiday shopping season. More significant were the cuts in the real estate industry, continuing a five-month decline. January's job cutbacks included 2,500 construction workers, 700 real estate workers and 1,100 workers at furniture and home-improvement stores."
Sign On San Diego - "North County housing problems cause buzz at forum" (3-3-07)
"A session focusing on North County's housing ills brought calls yesterday to turn renters into buyers through builder-subsidized homes, to require lenders to offer mortgages their clients can afford and to rezone neighborhoods to make room for the young and old."
North County Times - "Prominent mortgage exec sees further dip in market" (3-3-07)
"We're all going to be struggling, struggling more than we are today," he said. "We're headed halfway down the mountain, and we've got a ways to go."
Sign On San Diego - "Lennar asks contractors for discounts on finished work" (3-3-07)
"Lennar Corp., San Diego County's top home builder last year, is asking its framers, plumbers and other contractors to reduce their bills by as much as 20 percent for work under way or already completed or face exclusion from bidding on future jobs for the next six months."
Palm Beach Post - "Ballooning foreclosures tax court clerks, judges" (3-3-07)
"For months, a ceaseless routine has gripped the St. Lucie clerk of court's civil office: New mortgage foreclosure lawsuits arrive in unprecedented numbers - huge stacks, some a foot or 2 tall. But as soon as one stack is processed and emptied from the in-box, another dozen or more foreclosures show up the next day."
OC Register - "Citigroup will bankroll ACC Capital" (3-2-07)
"ACC Capital, the parent of Orange-based Ameriquest Mortgage, said Wednesday it struck a deal with New York's Citigroup Inc. to provide it with cash to keep operating and funding loans. The deal is the latest in a saga that saw ACC rise to become the nation's largest maker of loans to people with poor credit and then become the first top lender in the county to downsize amid a slowdown in home sales and price appreciation."
Bloomberg - "U.S. Regulators Urge Scrutiny of Subprime Mortgages (Update5)" (3-2-07)
"The Federal Reserve, seeking to limit defaults that have roiled the subprime mortgage-lending market, told banks to scrutinize their underwriting standards and be more transparent with customers about borrowing risks."
OC Register - "New Century cuts 300 jobs, 124 of them in O.C." (3-2-07)
"EMC Mortgage said it's opening an Irvine office and hiring 250 workers over the next 18 months."
LA Times - "Man charged with theft in home rental scheme" (3-2-07)
"A Venice man was charged Thursday in connection with a scheme in which police said he posed as a landlord, showed vacant homes in the South Bay and San Diego to prospective tenants and collected thousands of dollars in security deposits."
Reuters - "Housing sector may be hit by "piggyback" loans" (3-2-07)
"U.S. homeowners who bought using 100 percent financing, and those who took out "home equity" loans against the value of their properties, even though they have good credit ratings, could be the next to cause problems in the U.S. housing market."
Business Week - "Why Subprime Lenders Are In Trouble" (3-2-07)
"New analysis suggests that subprime lenders lowered their lending standards last year as they competed for business"
Bloomberg - "Goldman, Merrill Almost `Junk,' Their Own Traders Say (Update2)" (3-2-07)
"Goldman Sachs Group Inc., Merrill Lynch & Co. and Morgan Stanley, which earned a record $24.5 billion in 2006, suddenly have become so speculative that their own traders are valuing the three biggest securities firms as barely more creditworthy than junk bonds."
Market Watch - "Tougher subprime-lending standards urged" (3-2-07)
"Federal bank regulators demanded tougher standards for subprime loans Friday, saying they're worried that borrowers who select adjustable-rate mortgages may not understand the risks associated with them."
Market Watch - "New Century says it faces criminal probe" (3-2-07)
"New Century Financial Corp. said late Friday that it's facing a federal criminal probe and will likely breach a major lending covenant with its financial backers, bringing into question the survival of the second-largest U.S. subprime-mortgage lender."
NAHB - "Condo Builders' Confidence On The Rise" (3-2-07)
"Condo builders reported somewhat better market conditions in the fourth quarter of 2006 than in the previous quarter, according to the latest results of the National Association of Home Builders’ (NAHB) Multifamily Condo Market Index (MCMI) released today. The current-conditions index remained substantially lower than it was at the same time last year, but builders and developers are more optimistic about what they think the condo market will be doing six months out. Traffic of prospective buyers also rose slightly from the previous quarter."
"ACC Capital, the parent of Orange-based Ameriquest Mortgage, said Wednesday it struck a deal with New York's Citigroup Inc. to provide it with cash to keep operating and funding loans. The deal is the latest in a saga that saw ACC rise to become the nation's largest maker of loans to people with poor credit and then become the first top lender in the county to downsize amid a slowdown in home sales and price appreciation."
Bloomberg - "U.S. Regulators Urge Scrutiny of Subprime Mortgages (Update5)" (3-2-07)
"The Federal Reserve, seeking to limit defaults that have roiled the subprime mortgage-lending market, told banks to scrutinize their underwriting standards and be more transparent with customers about borrowing risks."
OC Register - "New Century cuts 300 jobs, 124 of them in O.C." (3-2-07)
"EMC Mortgage said it's opening an Irvine office and hiring 250 workers over the next 18 months."
LA Times - "Man charged with theft in home rental scheme" (3-2-07)
"A Venice man was charged Thursday in connection with a scheme in which police said he posed as a landlord, showed vacant homes in the South Bay and San Diego to prospective tenants and collected thousands of dollars in security deposits."
Reuters - "Housing sector may be hit by "piggyback" loans" (3-2-07)
"U.S. homeowners who bought using 100 percent financing, and those who took out "home equity" loans against the value of their properties, even though they have good credit ratings, could be the next to cause problems in the U.S. housing market."
Business Week - "Why Subprime Lenders Are In Trouble" (3-2-07)
"New analysis suggests that subprime lenders lowered their lending standards last year as they competed for business"
Bloomberg - "Goldman, Merrill Almost `Junk,' Their Own Traders Say (Update2)" (3-2-07)
"Goldman Sachs Group Inc., Merrill Lynch & Co. and Morgan Stanley, which earned a record $24.5 billion in 2006, suddenly have become so speculative that their own traders are valuing the three biggest securities firms as barely more creditworthy than junk bonds."
Market Watch - "Tougher subprime-lending standards urged" (3-2-07)
"Federal bank regulators demanded tougher standards for subprime loans Friday, saying they're worried that borrowers who select adjustable-rate mortgages may not understand the risks associated with them."
Market Watch - "New Century says it faces criminal probe" (3-2-07)
"New Century Financial Corp. said late Friday that it's facing a federal criminal probe and will likely breach a major lending covenant with its financial backers, bringing into question the survival of the second-largest U.S. subprime-mortgage lender."
NAHB - "Condo Builders' Confidence On The Rise" (3-2-07)
"Condo builders reported somewhat better market conditions in the fourth quarter of 2006 than in the previous quarter, according to the latest results of the National Association of Home Builders’ (NAHB) Multifamily Condo Market Index (MCMI) released today. The current-conditions index remained substantially lower than it was at the same time last year, but builders and developers are more optimistic about what they think the condo market will be doing six months out. Traffic of prospective buyers also rose slightly from the previous quarter."
CNN - "The risk in subprime" (3-1-07)
"During the boom, lenders gave homeowners loans they couldn't afford. Now they're feeling the consequences."
Bloomberg - "Construction Spending in U.S. Decreased 0.8% in January" (3-1-07)
"Construction spending in the U.S. fell by the most in three months in January, pulled lower by the biggest decline in homebuilding since July. Spending on residential and non-residential projects dropped 0.8 percent after a revised 0.6 percent increase in December, the Commerce Department said today in Washington. The government previously estimated a drop in December spending. "
Bloomberg - "Countrywide Says Late Payments on Subprime Loans Rose (Update4)" (3-1-07)
"Countrywide Financial Corp., the biggest U.S. mortgage lender, said payments were late on almost 20 percent of the subprime loans it manages for clients. Delinquencies of 30 days or more on `nonprime' loans, or those to borrowers whose credit ratings fell short of the highest criteria, widened to 19 percent as of Dec. 31 from 15 percent a year earlier, Countrywide said in a regulatory filing. The data reflect loans not owned by Countrywide where the company performs billing and record-keeping. "
Bloomberg - "Greenspan Says U.S. Recession Possible, Not Probable (Update5)" (3-1-07)
"Former Federal Reserve Chairman Alan Greenspan said a recession in the U.S. is possible, though not probable this year as excess inventory is being reduced quickly, according to people attending a CLSA Japan Forum in Tokyo today."
CAR - "C.A.R. reports entry-level housing affordability at 25 percent in California" (3-1-07)
"The percentage of households who could afford to buy an entry-level home in California stood at 25 percent in the fourth quarter of 2006, compared with 27 percent for the same period a year ago, according to a report released today by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)."
CBIA - "Total Housing Production Drops 9 Percent in January" (3-1-07)
"While total housing production in California continued to fall in January, single-family housing starts recorded their first month-over-month increase since last June, the California Building Industry Association announced today."
Business Week - "Lender Woes Go Beyond Subprime" (3-1-07)
"While the stocks of some subprime players have been battered, even diversified lenders and big banks have their concerns"
"Few are feeling the hangover from housing's heyday as much as subprime lenders that cater to risky borrowers. The stocks of such players as New Century Financial Corp. (NEW) and NovaStar (NFI) have been slashed, 50% and 63% respectively, since February (see BusinessWeek.com, 2/21/07, "Fears Reignite for Subprime Lenders"). But even diversified lenders and mainstream banks have headaches. Countrywide Financial (CFC) is off 13%, Washington Mutual (WM) has slipped 6%, and Europe's HSBC (HBC) is down 5% since it revealed that its 2006 charges for bad debts would exceed forecasts by $1.76 billion."
ABC - "Mortgage Meltdown Angers Ex-Workers" (3-1-07)
"Former employees of Folsom-based Central Pacific Mortgage are angry over the lack of warning before this week's sudden layoffs."
Chron.com - "GMAC's Subprime Mortgages a Threat to GM" (3-1-07)
"The world's largest auto maker disclosed Thursday that it will need more time to file its 2006 annual report with the Securities and Exchange Commission, marking the second year in a row the company has postponed the key filing. Many analysts attribute this year's delay to a substantial hit the Detroit-based automaker might take from the exposure its part-owned finance unit _ GMAC Financial Services _ has to the business of making mortgage loans to people with weak credit or heavy debt burdens."
CNN - "Mr. Real Estate: 'All systems go, pockets of pain'" (3-1-07)
"David Lereah, chief economist for the National Association of Realtors, is ready to call a bottom. But some markets still face corrections."
"If you look at local areas, that statement is true. California has a long way to go. I expect them to continue to experience pain all throughout this year. Southern Florida, same thing. Las Vegas is probably going to take a little longer to correct as well. A quarter of the country is still feeling pain, and I can't guarantee that it's going to be over by the end of 2007 for some of those areas."
"During the boom, lenders gave homeowners loans they couldn't afford. Now they're feeling the consequences."
Bloomberg - "Construction Spending in U.S. Decreased 0.8% in January" (3-1-07)
"Construction spending in the U.S. fell by the most in three months in January, pulled lower by the biggest decline in homebuilding since July. Spending on residential and non-residential projects dropped 0.8 percent after a revised 0.6 percent increase in December, the Commerce Department said today in Washington. The government previously estimated a drop in December spending. "
Bloomberg - "Countrywide Says Late Payments on Subprime Loans Rose (Update4)" (3-1-07)
"Countrywide Financial Corp., the biggest U.S. mortgage lender, said payments were late on almost 20 percent of the subprime loans it manages for clients. Delinquencies of 30 days or more on `nonprime' loans, or those to borrowers whose credit ratings fell short of the highest criteria, widened to 19 percent as of Dec. 31 from 15 percent a year earlier, Countrywide said in a regulatory filing. The data reflect loans not owned by Countrywide where the company performs billing and record-keeping. "
Bloomberg - "Greenspan Says U.S. Recession Possible, Not Probable (Update5)" (3-1-07)
"Former Federal Reserve Chairman Alan Greenspan said a recession in the U.S. is possible, though not probable this year as excess inventory is being reduced quickly, according to people attending a CLSA Japan Forum in Tokyo today."
CAR - "C.A.R. reports entry-level housing affordability at 25 percent in California" (3-1-07)
"The percentage of households who could afford to buy an entry-level home in California stood at 25 percent in the fourth quarter of 2006, compared with 27 percent for the same period a year ago, according to a report released today by the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)."
CBIA - "Total Housing Production Drops 9 Percent in January" (3-1-07)
"While total housing production in California continued to fall in January, single-family housing starts recorded their first month-over-month increase since last June, the California Building Industry Association announced today."
Business Week - "Lender Woes Go Beyond Subprime" (3-1-07)
"While the stocks of some subprime players have been battered, even diversified lenders and big banks have their concerns"
"Few are feeling the hangover from housing's heyday as much as subprime lenders that cater to risky borrowers. The stocks of such players as New Century Financial Corp. (NEW) and NovaStar (NFI) have been slashed, 50% and 63% respectively, since February (see BusinessWeek.com, 2/21/07, "Fears Reignite for Subprime Lenders"). But even diversified lenders and mainstream banks have headaches. Countrywide Financial (CFC) is off 13%, Washington Mutual (WM) has slipped 6%, and Europe's HSBC (HBC) is down 5% since it revealed that its 2006 charges for bad debts would exceed forecasts by $1.76 billion."
ABC - "Mortgage Meltdown Angers Ex-Workers" (3-1-07)
"Former employees of Folsom-based Central Pacific Mortgage are angry over the lack of warning before this week's sudden layoffs."
Chron.com - "GMAC's Subprime Mortgages a Threat to GM" (3-1-07)
"The world's largest auto maker disclosed Thursday that it will need more time to file its 2006 annual report with the Securities and Exchange Commission, marking the second year in a row the company has postponed the key filing. Many analysts attribute this year's delay to a substantial hit the Detroit-based automaker might take from the exposure its part-owned finance unit _ GMAC Financial Services _ has to the business of making mortgage loans to people with weak credit or heavy debt burdens."
CNN - "Mr. Real Estate: 'All systems go, pockets of pain'" (3-1-07)
"David Lereah, chief economist for the National Association of Realtors, is ready to call a bottom. But some markets still face corrections."
"If you look at local areas, that statement is true. California has a long way to go. I expect them to continue to experience pain all throughout this year. Southern Florida, same thing. Las Vegas is probably going to take a little longer to correct as well. A quarter of the country is still feeling pain, and I can't guarantee that it's going to be over by the end of 2007 for some of those areas."
Market Watch - "House panel to examine predatory lending in subprime market" (2-28-07)
"Reacting to increased foreclosures of mortgages in the subprime market, a subcommittee of the House Financial Services Committee will hold a hearing next Tuesday to examine possible predatory lending practices, Rep. Carolyn Maloney, D-N.Y., announced Wednesday."
Yahoo! - "UPDATE 2-Subprime lender Fremont delays results,shares sink" (2-28-07)
"Fremont General Corp., one of the largest U.S. mortgage lenders for people with poor credit histories, said on Tuesday it will delay releasing fourth-quarter results, and not file its 2006 annual report by the March 1 deadline."
Ventura County Star - "Realtors predict better year: County's median house price continues to decrease; is now at $664,400" (2-28-07)
"The county's median price for existing single-family homes was $664,400 in January, down 2.6 percent from the same month last year and 1 percent from $670,830 in December, the California Association of Realtors reported. The median is the point at which half the homes sell for more and half for less."
KCRA3 - "Homeowners Pinched By Adjustable Mortgages: 7,000 Sacramento County Foreclosures In 2006" (2-28-07)
"With interest rates on the rise and the real estate market in a slump, adjustable mortgage rates are skyrocketing, and the high cost of low interest is turning the American dream into a nightmare for some."
CAR - "C.A.R. sponsors legislation to protect Californians from private transfer taxes that cost home buyers thousands and negatively impact affordability" (2-28-07)
"Because of a loophole in existing law, developers can impose private transfer taxes on unsuspecting home buyers. The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today announced it will sponsor SB 670 (Correa), “Private Transfer Tax Prohibition,” to eliminate this unfair tax on Californians."
"Reacting to increased foreclosures of mortgages in the subprime market, a subcommittee of the House Financial Services Committee will hold a hearing next Tuesday to examine possible predatory lending practices, Rep. Carolyn Maloney, D-N.Y., announced Wednesday."
Yahoo! - "UPDATE 2-Subprime lender Fremont delays results,shares sink" (2-28-07)
"Fremont General Corp., one of the largest U.S. mortgage lenders for people with poor credit histories, said on Tuesday it will delay releasing fourth-quarter results, and not file its 2006 annual report by the March 1 deadline."
Ventura County Star - "Realtors predict better year: County's median house price continues to decrease; is now at $664,400" (2-28-07)
"The county's median price for existing single-family homes was $664,400 in January, down 2.6 percent from the same month last year and 1 percent from $670,830 in December, the California Association of Realtors reported. The median is the point at which half the homes sell for more and half for less."
KCRA3 - "Homeowners Pinched By Adjustable Mortgages: 7,000 Sacramento County Foreclosures In 2006" (2-28-07)
"With interest rates on the rise and the real estate market in a slump, adjustable mortgage rates are skyrocketing, and the high cost of low interest is turning the American dream into a nightmare for some."
CAR - "C.A.R. sponsors legislation to protect Californians from private transfer taxes that cost home buyers thousands and negatively impact affordability" (2-28-07)
"Because of a loophole in existing law, developers can impose private transfer taxes on unsuspecting home buyers. The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today announced it will sponsor SB 670 (Correa), “Private Transfer Tax Prohibition,” to eliminate this unfair tax on Californians."
Subscribe to:
Posts (Atom)
Posts
