NAHB - "Total Housing Starts Rebound by Nearly 39 Percent in March" (4-26-07)
"Total housing starts in California rebounded sharply from February’s production levels, climbing by almost 39 percent compared to February, the California Building Industry Association announced today. Both single-family homes and multifamily construction showed strong increases compared to the previous month, but production still lags behind last year’s levels. In March, permits were pulled for 7,743 single-family homes statewide, up almost 23 percent from the previous month but down 31 percent from March 2006, while multifamily housing starts — condos and apartments — totaled 5,408, up 70 percent from the previous month but down just under 5 percent compared to March 2006. Multifamily starts, however, tend to be more volatile than single-family starts on a month-to-month basis. Overall for the month, builders pulled permits for 13,151 homes, condos and apartments, according to statistics compiled by the Burbank-based Construction Industry Research Board. For the first quarter of the year, production began on 32,646 homes and apartments, down 28 percent from the same period last year. "
OC Register - "Countrywide, IndyMac report drop in earnings" (4-26-07)
"You were right. Voters in my poll published Tuesday overwhelmingly (79%) said both Countrywide Financial and IndyMac Bancorp would see profits fall in the first quarter. They reported today and both companies said profits were down by more than a third from the same period a year ago. (More than a hundred people voted.)"
Bloomberg - "Pulte, Beazer, Ryland Have Losses on Land Writedowns" (4-26-07)
"Pulte Homes Inc., Beazer Homes USA Inc. and Ryland Group Inc. reported quarterly losses as the deteriorating housing market forced them to write down the value of property and abandon land purchases. Beazer and Ryland withdrew their earnings forecasts for 2007 and Pulte declined to provide an outlook for the rest of the year. Beazer Chief Executive Officer Ian McCarthy said the market was 'extremely challenging' and he doesn't see any signs of a housing recovery. Pulte, Beazer and Ryland had a combined $300 million in costs for land and options on parcels they no longer need. Each posted a decline in new home orders. U.S. homebuilders are in their second year of a slump as tightening credit standards and a glut of unsold homes reduces potential buyers and prompts some to wait for prices to fall further before making offers. "
Bloomberg - "Friedman Billings Posts Loss on Mortgage Writedowns" (4-26-07)
"Friedman, Billings, Ramsey Group Inc., the investment bank that's trying to sell its money-losing subprime mortgage unit, posted a first-quarter loss because of writedowns tied to home loans. The loss -- the third in four quarters for the Arlington, Virginia-based company -- was $185.9 million, or $1.08 a share, compared with a profit of $26.6 million, or 16 cents a share, in the year-earlier period, Friedman Billings said today in a statement. "
Real Estate Journal - "For Some Americans, Buying Land Is Like Collecting Art and Autos" (4-26-07)
"The rich are accumulating open spaces across the U.S. much as they have with vacation homes, automobiles and paintings in the past. As urban areas have grown, some well-off city dwellers have purchased spreads in remote places, thousands of miles from the typical playgrounds of the wealthy."
Thursday, April 26, 2007
Bloomberg - "Subprime `Liar Loans' Fuel Bust With $1 Billion Fraud" (4-25-07)
"Cheating on mortgage applications is so widespread and so seldom punished that it's fueling an increase in foreclosures that will prolong the housing slump, said Robert W. Russell, counsel to the director of the Office of Thrift Supervision, which oversees savings and loans. Borrowers and brokers commit fraud when they exaggerate the applicant's income, qualifying the borrower for a home he otherwise couldn't afford. Such fraud robbed lenders of an estimated $1 billion last year, according to data collected by the Washington- based Mortgage Bankers Association and the Federal Bureau of Investigation. "
Daily News - "Housing market finally cools off" (4-25-07)
"The home sales market in the Santa Clarita Valley is returning to normal, not generating the spectacular profits that marked the past two years, but staying solid, real estate experts said. Sales of single-family homes in the region were up 11.7 percent in January compared with a year ago. The month saw escrows close on 172 houses, compared with 154 in January 2006. "
CNN - "Mortgage applications rebound" (4-25-07)
"Five-week decline ends as activity climbs more than 3 percent, helped by a dip in interest rates, MBA's weekly index says."
CNN - "Foreclosures surge on mortgage woes" (4-25-07)
"Filings were up 35 percent in the first quarter; Detroit and Las Vegas get hammered."
LA Times - "Home sales plunge 8.4% in March" (4-25-07)
"The U.S. housing market will continue softening because prices are too high while too many homes remain unsold, industry observers said after a trade group reported a steep drop in existing-home sales. Sub-prime mortgage woes and harsh winter weather were the main culprits for an 8.4% decline in sales of existing homes in March from the month before, the National Assn. of Realtors said Tuesday. It was the sharpest month-to-month fall since a 12.6% plunge in January 1989."
Yahoo! - "Top 10 remodeling projects for resale" (5-24-07)
"Expecting to plant a "For Sale" sign in the front yard any time soon? Whether the target date for listing your home on the market is a few months or a few years away -- or whether you simply like to make decisions with an eye toward the future -- you may well be wondering how putting some money into the house now will pay off later."
CNN - "Subprime bailouts: How they work" (4-25-07)
"There's some state-sponsored help on the way for subprime borrowers."
Bloomberg - "New-Home Sales in U.S. Increase 2.6% to 858,000 Pace" (4-25-07)
"Purchases of new homes in the U.S. rose for the first time in three months in March as unusually warm weather and incentives brought out more buyers. Sales rose 2.6 percent to an annual pace of 858,000 last month from an 836,000 rate in February that was lower than previously reported, the Commerce Department said today in Washington. The supply of unsold homes at the current sales pace declined. "
Press Enterprise - "Is the Inland housing market weakening?" (4-24-07)
" Two real estate reports released Tuesday suggest the housing market in the Inland region is still weakening. The number of homes on the market in the Inland region is at its highest level in eight years, according to Multi-Regional Multiple Listing Service, which tracks resale homes in western Riverside and San Bernardino counties and eastern Los Angeles County. The service reports that more than 34,700 homes are listed for sale in the region. And, the length of time those houses stay on the market has nearly doubled in the past 12 months, the report found. The month's supply of listings, or how long it would take for this supply of homes to be sold at the current pace, is at 13.2 months, up from 6.9 monthsa year ago. "
CBS - "Study: California Foreclosures Up 68 Percent" (4-25-07)
"California reported 80,595 first-quarter foreclosure filings, about 18 percent of the national total and numerically more than any other state, according to figures released Wednesday by Irvine-based RealtyTrac. Foreclosures increased 68 percent statewide from the previous quarter and more than doubled from the first quarter of 2006, resulting in a foreclosure rate of one foreclosure filing for every 152 households -- fifth highest among the states and 1.7 times the national average, according to RealtyTrac.
eFinanceDirector - "Federal Reserve Urged to Crack Down on Mortgage Originators" (4-25-07)
"The subprime meltdown has led to a great deal of finger pointing. On Monday, a group of senators did some pointing of their own and urged the Fed to use existing authority to restrict some of the mortgage loans being offered by both banks and non-banks."
NAHB - "New Home Sales Tick Up in March in Uncertain Climate" (4-25-07)
"Sales of new single-family homes increased a slight 2.6 percent in March to a seasonally adjusted annual rate of 858,000 units, following sharp declines in both January and February, according to figures released by the U.S. Commerce Department today. The March sales pace was 23.5 percent below a year earlier."
Real Estate Jounral - "U.S. House Prices Slide As Property Glut Grows" (4-25-07)
"Tighter credit and a growing glut of properties are depressing an already weak U.S. housing market, wrecking the industry's hopes for an early rebound. That leaves buyers in a strong position to negotiate for bargains during the spring home-shopping season, the busiest time of the year for housing sales. Yesterday, the National Association of Realtors reported that sales of previously occupied homes in March dropped 8.4% from the prior month to a seasonally adjusted annual rate of 6.12 million units -- the largest monthly drop since 1989. The trade group said the median price for homes was $217,000 in March, down 0.3% from a year earlier."
"Cheating on mortgage applications is so widespread and so seldom punished that it's fueling an increase in foreclosures that will prolong the housing slump, said Robert W. Russell, counsel to the director of the Office of Thrift Supervision, which oversees savings and loans. Borrowers and brokers commit fraud when they exaggerate the applicant's income, qualifying the borrower for a home he otherwise couldn't afford. Such fraud robbed lenders of an estimated $1 billion last year, according to data collected by the Washington- based Mortgage Bankers Association and the Federal Bureau of Investigation. "
Daily News - "Housing market finally cools off" (4-25-07)
"The home sales market in the Santa Clarita Valley is returning to normal, not generating the spectacular profits that marked the past two years, but staying solid, real estate experts said. Sales of single-family homes in the region were up 11.7 percent in January compared with a year ago. The month saw escrows close on 172 houses, compared with 154 in January 2006. "
CNN - "Mortgage applications rebound" (4-25-07)
"Five-week decline ends as activity climbs more than 3 percent, helped by a dip in interest rates, MBA's weekly index says."
CNN - "Foreclosures surge on mortgage woes" (4-25-07)
"Filings were up 35 percent in the first quarter; Detroit and Las Vegas get hammered."
LA Times - "Home sales plunge 8.4% in March" (4-25-07)
"The U.S. housing market will continue softening because prices are too high while too many homes remain unsold, industry observers said after a trade group reported a steep drop in existing-home sales. Sub-prime mortgage woes and harsh winter weather were the main culprits for an 8.4% decline in sales of existing homes in March from the month before, the National Assn. of Realtors said Tuesday. It was the sharpest month-to-month fall since a 12.6% plunge in January 1989."
Yahoo! - "Top 10 remodeling projects for resale" (5-24-07)
"Expecting to plant a "For Sale" sign in the front yard any time soon? Whether the target date for listing your home on the market is a few months or a few years away -- or whether you simply like to make decisions with an eye toward the future -- you may well be wondering how putting some money into the house now will pay off later."
CNN - "Subprime bailouts: How they work" (4-25-07)
"There's some state-sponsored help on the way for subprime borrowers."
Bloomberg - "New-Home Sales in U.S. Increase 2.6% to 858,000 Pace" (4-25-07)
"Purchases of new homes in the U.S. rose for the first time in three months in March as unusually warm weather and incentives brought out more buyers. Sales rose 2.6 percent to an annual pace of 858,000 last month from an 836,000 rate in February that was lower than previously reported, the Commerce Department said today in Washington. The supply of unsold homes at the current sales pace declined. "
Press Enterprise - "Is the Inland housing market weakening?" (4-24-07)
" Two real estate reports released Tuesday suggest the housing market in the Inland region is still weakening. The number of homes on the market in the Inland region is at its highest level in eight years, according to Multi-Regional Multiple Listing Service, which tracks resale homes in western Riverside and San Bernardino counties and eastern Los Angeles County. The service reports that more than 34,700 homes are listed for sale in the region. And, the length of time those houses stay on the market has nearly doubled in the past 12 months, the report found. The month's supply of listings, or how long it would take for this supply of homes to be sold at the current pace, is at 13.2 months, up from 6.9 monthsa year ago. "
CBS - "Study: California Foreclosures Up 68 Percent" (4-25-07)
"California reported 80,595 first-quarter foreclosure filings, about 18 percent of the national total and numerically more than any other state, according to figures released Wednesday by Irvine-based RealtyTrac. Foreclosures increased 68 percent statewide from the previous quarter and more than doubled from the first quarter of 2006, resulting in a foreclosure rate of one foreclosure filing for every 152 households -- fifth highest among the states and 1.7 times the national average, according to RealtyTrac.
eFinanceDirector - "Federal Reserve Urged to Crack Down on Mortgage Originators" (4-25-07)
"The subprime meltdown has led to a great deal of finger pointing. On Monday, a group of senators did some pointing of their own and urged the Fed to use existing authority to restrict some of the mortgage loans being offered by both banks and non-banks."
NAHB - "New Home Sales Tick Up in March in Uncertain Climate" (4-25-07)
"Sales of new single-family homes increased a slight 2.6 percent in March to a seasonally adjusted annual rate of 858,000 units, following sharp declines in both January and February, according to figures released by the U.S. Commerce Department today. The March sales pace was 23.5 percent below a year earlier."
Real Estate Jounral - "U.S. House Prices Slide As Property Glut Grows" (4-25-07)
"Tighter credit and a growing glut of properties are depressing an already weak U.S. housing market, wrecking the industry's hopes for an early rebound. That leaves buyers in a strong position to negotiate for bargains during the spring home-shopping season, the busiest time of the year for housing sales. Yesterday, the National Association of Realtors reported that sales of previously occupied homes in March dropped 8.4% from the prior month to a seasonally adjusted annual rate of 6.12 million units -- the largest monthly drop since 1989. The trade group said the median price for homes was $217,000 in March, down 0.3% from a year earlier."
CAR - "C.A.R. reports sales decrease 20.8 percent in March, median price of a home in California at $580,090, up 3.2 percent from year ago" (4-24-07)
"Home sales decreased 20.8 percent in March in California compared with the same period a year ago, while the median price of an existing home increased 3.2 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today."
CNN - "Home sales: Worst drop in 18 years" (4-24-07)
"Sales pace much lower than forecasts, prices show year-over-year drop for eighth straight month."
Bloomberg - "S&P/Case-Shiller Home Price Index Fell 1% in Year" (4-24-07)
"Declines in home prices in 20 U.S. metropolitan areas accelerated in the 12 months ended in February, a private survey showed today. Values fell 1 percent from February 2006 after dropping 0.1 percent in the year ended January, according to the S&P/Case- Shiller home-price index. January's decrease was the first since the group started keeping year-over-year records in 2001. Slow demand has left a glut of homes for sale on the market that's forcing sellers to reduce prices, economists said. A rise in foreclosures may add to the number of unsold homes, suggesting prices will be slow to rebound and housing will continue to limit economic growth. "
Bloomberg - "Subprime Bondholders May Lose $75 Billion From Slump" (4-24-07)
"Bond investors who financed the U.S. housing boom are starting to pay the price for slumping home values and record delinquencies in subprime loans. They will lose as much as $75 billion on securities made up of millions of mortgages to people with poor credit, says Pacific Investment Management Co., manager of the world's biggest bond fund. Some of the $450 billion in subprime mortgage-backed debt sold last year has lost 37 percent, according to Merrill Lynch & Co. "
North County Times - "Home sales plunge in San Diego, Riverside counties" (4-24-07)
"Sales of existing single-family homes plummeted last month in San Diego and Riverside counties -- and in nearly every other California market -- amid growing anxiety over the collapse of the subprime market, real estate officials said Tuesday. San Diego County posted a year-over-year decline of 20 percent in March, nearly matching the statewide decline of 21 percent, according to a new report from the Los Angeles-based California Association of Realtors."
NAR - "Weather Hits March Existing-Home Sales After Three Monthly Gains" (4-24-07)
"Unusually bad winter weather in February curtailed home shopping, slowing sales that closed in March, which may have been dampened further by a decrease in subprime lending volume, according to the National Association of Realtors®. After rising for three consecutive months, total existing-home sales – including single-family, townhomes,condominiums and co-ops – fell 8.4 percent to a seasonally adjusted annual rate1 of 6.12 million units in March from a pace of 6.68 million in February, and are 11.3 percent below the 6.90 million-unit level in March 2006."
"Home sales decreased 20.8 percent in March in California compared with the same period a year ago, while the median price of an existing home increased 3.2 percent, the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) reported today."
CNN - "Home sales: Worst drop in 18 years" (4-24-07)
"Sales pace much lower than forecasts, prices show year-over-year drop for eighth straight month."
Bloomberg - "S&P/Case-Shiller Home Price Index Fell 1% in Year" (4-24-07)
"Declines in home prices in 20 U.S. metropolitan areas accelerated in the 12 months ended in February, a private survey showed today. Values fell 1 percent from February 2006 after dropping 0.1 percent in the year ended January, according to the S&P/Case- Shiller home-price index. January's decrease was the first since the group started keeping year-over-year records in 2001. Slow demand has left a glut of homes for sale on the market that's forcing sellers to reduce prices, economists said. A rise in foreclosures may add to the number of unsold homes, suggesting prices will be slow to rebound and housing will continue to limit economic growth. "
Bloomberg - "Subprime Bondholders May Lose $75 Billion From Slump" (4-24-07)
"Bond investors who financed the U.S. housing boom are starting to pay the price for slumping home values and record delinquencies in subprime loans. They will lose as much as $75 billion on securities made up of millions of mortgages to people with poor credit, says Pacific Investment Management Co., manager of the world's biggest bond fund. Some of the $450 billion in subprime mortgage-backed debt sold last year has lost 37 percent, according to Merrill Lynch & Co. "
North County Times - "Home sales plunge in San Diego, Riverside counties" (4-24-07)
"Sales of existing single-family homes plummeted last month in San Diego and Riverside counties -- and in nearly every other California market -- amid growing anxiety over the collapse of the subprime market, real estate officials said Tuesday. San Diego County posted a year-over-year decline of 20 percent in March, nearly matching the statewide decline of 21 percent, according to a new report from the Los Angeles-based California Association of Realtors."
NAR - "Weather Hits March Existing-Home Sales After Three Monthly Gains" (4-24-07)
"Unusually bad winter weather in February curtailed home shopping, slowing sales that closed in March, which may have been dampened further by a decrease in subprime lending volume, according to the National Association of Realtors®. After rising for three consecutive months, total existing-home sales – including single-family, townhomes,condominiums and co-ops – fell 8.4 percent to a seasonally adjusted annual rate1 of 6.12 million units in March from a pace of 6.68 million in February, and are 11.3 percent below the 6.90 million-unit level in March 2006."
Bloomberg - "In Case You Missed It: Charts Show Bond Rally Is Over" (4-23-07)
"The biggest bull market in U.S. Treasury bonds is over, according to the analysts who rely on historical price patterns to make their assumptions. The proof that it now pays to be bearish can be found in financial futures based on the government's 4 3/4 percent bond maturing in 2037, a benchmark for the 22-year, 11-month rally that began in May 1984 and ended on April 6, says John Kosar, president of Asbury Research in Lake in the Hills, Illinois. That's when the price of 30-year Treasury bonds for delivery on the Chicago Board of Trade fell below 110 20/32 and signaled a new direction for the market, he said. "
Bloomberg - "Countrywide's Mozilo Says Regulators May Worsen Subprime Losses " (4-22-07)
"Banking regulators may push more homeowners into foreclosure by making it tougher to refinance subprime mortgages, said Angelo Mozilo, head of the largest U.S. home-loan lender. The Federal Reserve, Federal Deposit Insurance Corp., and Office of the Comptroller of the Currency proposed guidelines last month that would encourage lenders to turn down borrowers who won't be able to afford mortgages after ``teaser'' rates expire. Rates on loans to people with poor or limited credit are typically fixed for two or three years and then rise. "
"The biggest bull market in U.S. Treasury bonds is over, according to the analysts who rely on historical price patterns to make their assumptions. The proof that it now pays to be bearish can be found in financial futures based on the government's 4 3/4 percent bond maturing in 2037, a benchmark for the 22-year, 11-month rally that began in May 1984 and ended on April 6, says John Kosar, president of Asbury Research in Lake in the Hills, Illinois. That's when the price of 30-year Treasury bonds for delivery on the Chicago Board of Trade fell below 110 20/32 and signaled a new direction for the market, he said. "
Bloomberg - "Countrywide's Mozilo Says Regulators May Worsen Subprime Losses " (4-22-07)
"Banking regulators may push more homeowners into foreclosure by making it tougher to refinance subprime mortgages, said Angelo Mozilo, head of the largest U.S. home-loan lender. The Federal Reserve, Federal Deposit Insurance Corp., and Office of the Comptroller of the Currency proposed guidelines last month that would encourage lenders to turn down borrowers who won't be able to afford mortgages after ``teaser'' rates expire. Rates on loans to people with poor or limited credit are typically fixed for two or three years and then rise. "
Press Enterprise - "Rate of Inland foreclosures is expected to rise because of risky loans easily obtained" (4-22-07)
" Inland home foreclosures this year have increased more than ninefold over the same period a year ago, driven by flat appreciation and sagging home sales that make it increasingly difficult for homeowners in financial trouble to escape disaster."
Sign On San Diego - "Potential for mortgage fraud is on the rise in county" (4-22-07)
"After monitoring San Diego County's falling home prices, sluggish sales and a surge in foreclosures, real estate analysts are warning that the potential for mortgage fraud is on the rise. The doubling of home prices here between 2000 and 2005 created ideal conditions for masking mortgage fraud, said Mark Fleming, chief economist for CoreLogic Systems, a Sacramento-based firm that specializes in measuring lending risks. "
LA Times - "Buyers in for future shock" (4-22-07)
"Builders of housing developments generally are required to pay for the construction of roads, sewers and schools for the new residents. It's a given that those costs are passed along to the buyers of those homes. What isn't a given is that, for years, some builders in California and a handful of other states have been passing along other costs of doing business — appeasing environmentalists and local governments to get their projects approved — to subsequent buyers as well."
" Inland home foreclosures this year have increased more than ninefold over the same period a year ago, driven by flat appreciation and sagging home sales that make it increasingly difficult for homeowners in financial trouble to escape disaster."
Sign On San Diego - "Potential for mortgage fraud is on the rise in county" (4-22-07)
"After monitoring San Diego County's falling home prices, sluggish sales and a surge in foreclosures, real estate analysts are warning that the potential for mortgage fraud is on the rise. The doubling of home prices here between 2000 and 2005 created ideal conditions for masking mortgage fraud, said Mark Fleming, chief economist for CoreLogic Systems, a Sacramento-based firm that specializes in measuring lending risks. "
LA Times - "Buyers in for future shock" (4-22-07)
"Builders of housing developments generally are required to pay for the construction of roads, sewers and schools for the new residents. It's a given that those costs are passed along to the buyers of those homes. What isn't a given is that, for years, some builders in California and a handful of other states have been passing along other costs of doing business — appeasing environmentalists and local governments to get their projects approved — to subsequent buyers as well."
OC Register - "Mortgage help on the way for some" (4-21-07)
"People already behind on their loans may still need to sell, but can get help avoiding foreclosure."
Boston.com - "KPMG claims fraud at Fannie Mae" (4-21-07)
"KPMG LLP sued former auditing client Fannie Mae, the biggest source of money for US home loans, for "fraudulent deception" that prevented KPMG from uncovering $6.3 billion in overstated earnings."
"People already behind on their loans may still need to sell, but can get help avoiding foreclosure."
Boston.com - "KPMG claims fraud at Fannie Mae" (4-21-07)
"KPMG LLP sued former auditing client Fannie Mae, the biggest source of money for US home loans, for "fraudulent deception" that prevented KPMG from uncovering $6.3 billion in overstated earnings."
CNN - "Subprime mess - no easy fix" (4-20-07)
"Swapping risky mortgages for those with steady payments sounds like a reasonable plan to keep millions out of foreclosure. But the way mortgage products have been packaged and sold into financial markets presents a big hurdle. At a Congressional hearing Tuesday, several speakers - including lawmakers, activists and real estate professionals - called for loan modifications that would move troubled borrowers out of adjustable-rate mortgages, forgive late penalties and add late-payments to the end of the loan. "
Sign On San Diego - "Trend called 'disturbing'" (4-20-07)
"San Diego County neighborhoods with large minority populations have been especially hard hit with foreclosures and risky subprime loans, members of the San Diego City-County Reinvestment Task Force were told yesterday. Steve Bouton, an El Cajon banking consultant, said his analysis of census tracts showed a clear pattern of subprime loans – higher-priced loans for people with tarnished credit or low incomes who are considered greater risks. "
Yahoo! - "Luxury Homes on the Block" (4-20-07)
"Subprime lending. It’s enough to strike fear in the heart of the most credit-worthy homeowner. Indeed, scores of homeowners and banks, reacting to recent mortgage defaults, are scrambling to sell off housing, often at a loss. In watching congressional hearings and reading media reports, it seems the subprime problem is germane to the low end of the market."
CNN - "5 dumbest renovation fads" (4-20-07)
"A remodeling trend may look good on paper, but it may not make your home more livable - or more valuable. These five alternatives from Money Magazine will."
MSNBC - "Subprime assault on southern California" (4-20-07)
"Far away from the sun-kissed beaches and palm trees that make up southern California's idyllic coastline, trouble is brewing in the Inland Empire. Two years ago the sprawling arid region that lies to the east of Los Angeles was one of California's property hot spots. House buyers priced out of expensive Orange County and the more affluent neighbourhoods of Los Angeles poured into towns such as Riverside, Moreno Valley and Perris. Limited housing stock and a relatively benign regulatory environment attracted developers, who built scores of new homes."
Market Watch - "California home prices to weaken further: Goldman" (4-20-07)
" Investment bank Goldman Sachs is increasingly concerned about the health of California's real estate market and reckons mortgage giant Countrywide Financial could be harder hit than other lenders because of its big exposure to the state."
Yahoo - "Is There Still Value in Subprimes?" (4-20-07)
"NovaStar Financial is one of the most controversial stocks we cover. The subprime mortgage lender rode the wave of the housing boom over the past few years, and it is now struggling to survive the storm in the subprime mortgage industry--a storm that already forced industry stalwart New Century Financial into bankruptcy. NovaStar's stock price has plummeted from more than $30 per share in early December to approximately $5 per share today. Right now, NovaStar's long-term prospects are up in the air. It is unclear whether the company can survive the mortgage malaise, stave off liquidity problems and emerge as one of the few stand-alone players in the industry."
OC Register - "Orange County home prices and sales" (4-20-07)
"For the 22 business days ending April 6, sales for all types of Orange County home sales decreased 23.7 percent. The median sales price increased 3.1 percent. The median is where half the homes sold for more and half for less. Types of homes selling, as well as home value changes, cause the median to change."
"Swapping risky mortgages for those with steady payments sounds like a reasonable plan to keep millions out of foreclosure. But the way mortgage products have been packaged and sold into financial markets presents a big hurdle. At a Congressional hearing Tuesday, several speakers - including lawmakers, activists and real estate professionals - called for loan modifications that would move troubled borrowers out of adjustable-rate mortgages, forgive late penalties and add late-payments to the end of the loan. "
Sign On San Diego - "Trend called 'disturbing'" (4-20-07)
"San Diego County neighborhoods with large minority populations have been especially hard hit with foreclosures and risky subprime loans, members of the San Diego City-County Reinvestment Task Force were told yesterday. Steve Bouton, an El Cajon banking consultant, said his analysis of census tracts showed a clear pattern of subprime loans – higher-priced loans for people with tarnished credit or low incomes who are considered greater risks. "
Yahoo! - "Luxury Homes on the Block" (4-20-07)
"Subprime lending. It’s enough to strike fear in the heart of the most credit-worthy homeowner. Indeed, scores of homeowners and banks, reacting to recent mortgage defaults, are scrambling to sell off housing, often at a loss. In watching congressional hearings and reading media reports, it seems the subprime problem is germane to the low end of the market."
CNN - "5 dumbest renovation fads" (4-20-07)
"A remodeling trend may look good on paper, but it may not make your home more livable - or more valuable. These five alternatives from Money Magazine will."
MSNBC - "Subprime assault on southern California" (4-20-07)
"Far away from the sun-kissed beaches and palm trees that make up southern California's idyllic coastline, trouble is brewing in the Inland Empire. Two years ago the sprawling arid region that lies to the east of Los Angeles was one of California's property hot spots. House buyers priced out of expensive Orange County and the more affluent neighbourhoods of Los Angeles poured into towns such as Riverside, Moreno Valley and Perris. Limited housing stock and a relatively benign regulatory environment attracted developers, who built scores of new homes."
Market Watch - "California home prices to weaken further: Goldman" (4-20-07)
" Investment bank Goldman Sachs is increasingly concerned about the health of California's real estate market and reckons mortgage giant Countrywide Financial could be harder hit than other lenders because of its big exposure to the state."
Yahoo - "Is There Still Value in Subprimes?" (4-20-07)
"NovaStar Financial is one of the most controversial stocks we cover. The subprime mortgage lender rode the wave of the housing boom over the past few years, and it is now struggling to survive the storm in the subprime mortgage industry--a storm that already forced industry stalwart New Century Financial into bankruptcy. NovaStar's stock price has plummeted from more than $30 per share in early December to approximately $5 per share today. Right now, NovaStar's long-term prospects are up in the air. It is unclear whether the company can survive the mortgage malaise, stave off liquidity problems and emerge as one of the few stand-alone players in the industry."
OC Register - "Orange County home prices and sales" (4-20-07)
"For the 22 business days ending April 6, sales for all types of Orange County home sales decreased 23.7 percent. The median sales price increased 3.1 percent. The median is where half the homes sold for more and half for less. Types of homes selling, as well as home value changes, cause the median to change."
MBA - MBA Chairman Robbins Testifies on Behalf of FHA Reform (4-19-07)
“MBA strongly supports the FHA and believes that it still plays a critical role in today’s marketplace. Most of FHA’s business is directed toward low- and moderate-income and minority borrowers – the very strata that is most challenged to be part of the American Dream.
At the same time, we have watched with growing concern as FHA has steadily lost market share over the past decade, potentially threatening its long-term ability to help underserved borrowers. As the market continues to evolve around FHA, the great fear is that many aspiring homeowners will either be left behind or forced into higher-cost alternatives.
MBA applauds the introduction of FHA reform bills: H.R. 1852 and H.R. 1752, and starting the reform effort early in the 110th Congress. MBA strongly supports changes to FHA’s single-family and multifamily loan limits, and downpayment flexibility and requirements, including the elimination of the complicated downpayment formula.
FHA has an important role to play in the market in expanding affordable homeownership opportunities for the underserved and addressing the homeownership gap. For low and moderate income families, FHA should be the financing considered first because it has the lowest rate and provides the borrower the best opportunity to become a successful homeowner.
Recent unrest in the mortgage industry has led to a number of lenders either significantly tightening underwriting standards or leaving the business altogether. MBA believes the individuals who will be most directly impacted by these events are the consumers that FHA was created to serve: first-time homebuyers, low-income families, and those with less than perfect credit histories. Congress can empower FHA with the authority it needs to provide these consumers with affordable, viable lending options needed to help them achieve and maintain homeownership.
I urge Congress to enact legislation to reform FHA to increase its availability to homebuyers, promote consumer choice, and ensure its ability to continue serving American families. MBA stands ready to work with you on this important issue.”
Reuters - "Horton cuts jobs and sees less risky loans" (4-19-07)
"D.R. Horton Inc.,the largest U.S. home builder, on Thursday said it has cut 10,000 jobs since last spring and now has a staff of about 7,300. Horton also said it has seem some increased defaults on relatively new loans -- but also said that more customers are shying away from what are seen as riskier loans and are opting for mortgages that require full documentation of income and assets."
Reuters - "Housing market bottom hoped for, not expected" (4-19-07)
"Investors hope the next round of results from U.S. home builders, starting on Thursday, will show that the slump in the housing market is abating, but realistically they expect no sign of a bottom yet. In fact, many investors and analysts expect the market downturn -- caused by a glut of homes for sale, tighter lending standards and weak demand -- to worsen until at least the second half of this year."
Bloomberg - "Housing Bust Meets the Equity Blues: Gene Sperling" (4-19-07)
"While the subprime and exotic mortgage fallout has been grabbing recent housing headlines, another potential story for 2007 may be in the wings: as Americans withdraw less equity from their homes will it mean a big or little hit for growth and consumer spending? The connection between housing and consumption isn't a new story. Economists have long assumed that there is a so-called wealth effect from rising home prices: for each dollar of housing wealth accumulated, people spend anywhere from 4 cents (as conventional economic models predict) to 9 cents, as Johns Hopkins economist Christopher Carroll found in a December study. "
CNN - "Stocks vs. Real Estate" (4-19-07)
"Both real estate and stocks have had their day, but the question you need answered is this: Which contender is the superior long-term bet today?"
Daily News - "California foreclosures nearly twice U.S. rate" (4-19-07)
"California was hit hard by rising foreclosure numbers in March, although the higher rates weren't all that out of line with historical standards."
Sign On San Diego - "GE's WMC Mortgage to lay off half of staff" (4-19-07)
"General Electric Co.'s WMC Mortgage subprime lending unit plans to lay off 771 workers, about half of its staff, a spokeswoman said Thursday. The layoffs will include the closing of facilities in Costa Mesa and San Ramon, California, as well as Addison, Texas. Following the cuts, WMC will employ about 700 people, spokeswoman Brandie Young told Reuters. "
Bloomberg - "GMAC, GE Will Cut 1,400 Job Cuts on Subprime Decline" (4-19-07)
"GMAC LLC's Residential Capital home- lending unit and General Electric Co.'s WMC Mortgage division announced more than 1,400 job reductions as losses mount in the U.S. subprime loan industry. WMC Mortgage, part of the GE Money consumer-finance unit, today slashed 771 jobs and closed three centers. WMC, based in Burbank, California, has cut more than half its workforce this year. Between 600 and 700 workers at GMAC's Minneapolis-based Residential Capital, known as ResCap, will lose their jobs by midyear, and at least 300 vacant positions won't be filled. "
Yahoo! - "Footing the Bill for the Subprime Fiasco" (4-19-07)
"Last week, Sen. Charles Schumer (D-N.Y.) proposed that the federal government spend hundreds of millions of dollars to help bail out subprime mortgage borrowers who are defaulting on their loans. A report by the Joint Economic Committee of Congress, which Schumer chairs, estimates that the average cost of a foreclosure -- to the homeowner, lender, local government, and neighbors (whose homes decline in value) -- is $78,000. By contrast, preventing the foreclosure would cost $3,300 per home on average."
“MBA strongly supports the FHA and believes that it still plays a critical role in today’s marketplace. Most of FHA’s business is directed toward low- and moderate-income and minority borrowers – the very strata that is most challenged to be part of the American Dream.
At the same time, we have watched with growing concern as FHA has steadily lost market share over the past decade, potentially threatening its long-term ability to help underserved borrowers. As the market continues to evolve around FHA, the great fear is that many aspiring homeowners will either be left behind or forced into higher-cost alternatives.
MBA applauds the introduction of FHA reform bills: H.R. 1852 and H.R. 1752, and starting the reform effort early in the 110th Congress. MBA strongly supports changes to FHA’s single-family and multifamily loan limits, and downpayment flexibility and requirements, including the elimination of the complicated downpayment formula.
FHA has an important role to play in the market in expanding affordable homeownership opportunities for the underserved and addressing the homeownership gap. For low and moderate income families, FHA should be the financing considered first because it has the lowest rate and provides the borrower the best opportunity to become a successful homeowner.
Recent unrest in the mortgage industry has led to a number of lenders either significantly tightening underwriting standards or leaving the business altogether. MBA believes the individuals who will be most directly impacted by these events are the consumers that FHA was created to serve: first-time homebuyers, low-income families, and those with less than perfect credit histories. Congress can empower FHA with the authority it needs to provide these consumers with affordable, viable lending options needed to help them achieve and maintain homeownership.
I urge Congress to enact legislation to reform FHA to increase its availability to homebuyers, promote consumer choice, and ensure its ability to continue serving American families. MBA stands ready to work with you on this important issue.”
Reuters - "Horton cuts jobs and sees less risky loans" (4-19-07)
"D.R. Horton Inc.,the largest U.S. home builder, on Thursday said it has cut 10,000 jobs since last spring and now has a staff of about 7,300. Horton also said it has seem some increased defaults on relatively new loans -- but also said that more customers are shying away from what are seen as riskier loans and are opting for mortgages that require full documentation of income and assets."
Reuters - "Housing market bottom hoped for, not expected" (4-19-07)
"Investors hope the next round of results from U.S. home builders, starting on Thursday, will show that the slump in the housing market is abating, but realistically they expect no sign of a bottom yet. In fact, many investors and analysts expect the market downturn -- caused by a glut of homes for sale, tighter lending standards and weak demand -- to worsen until at least the second half of this year."
Bloomberg - "Housing Bust Meets the Equity Blues: Gene Sperling" (4-19-07)
"While the subprime and exotic mortgage fallout has been grabbing recent housing headlines, another potential story for 2007 may be in the wings: as Americans withdraw less equity from their homes will it mean a big or little hit for growth and consumer spending? The connection between housing and consumption isn't a new story. Economists have long assumed that there is a so-called wealth effect from rising home prices: for each dollar of housing wealth accumulated, people spend anywhere from 4 cents (as conventional economic models predict) to 9 cents, as Johns Hopkins economist Christopher Carroll found in a December study. "
CNN - "Stocks vs. Real Estate" (4-19-07)
"Both real estate and stocks have had their day, but the question you need answered is this: Which contender is the superior long-term bet today?"
Daily News - "California foreclosures nearly twice U.S. rate" (4-19-07)
"California was hit hard by rising foreclosure numbers in March, although the higher rates weren't all that out of line with historical standards."
Sign On San Diego - "GE's WMC Mortgage to lay off half of staff" (4-19-07)
"General Electric Co.'s WMC Mortgage subprime lending unit plans to lay off 771 workers, about half of its staff, a spokeswoman said Thursday. The layoffs will include the closing of facilities in Costa Mesa and San Ramon, California, as well as Addison, Texas. Following the cuts, WMC will employ about 700 people, spokeswoman Brandie Young told Reuters. "
Bloomberg - "GMAC, GE Will Cut 1,400 Job Cuts on Subprime Decline" (4-19-07)
"GMAC LLC's Residential Capital home- lending unit and General Electric Co.'s WMC Mortgage division announced more than 1,400 job reductions as losses mount in the U.S. subprime loan industry. WMC Mortgage, part of the GE Money consumer-finance unit, today slashed 771 jobs and closed three centers. WMC, based in Burbank, California, has cut more than half its workforce this year. Between 600 and 700 workers at GMAC's Minneapolis-based Residential Capital, known as ResCap, will lose their jobs by midyear, and at least 300 vacant positions won't be filled. "
Yahoo! - "Footing the Bill for the Subprime Fiasco" (4-19-07)
"Last week, Sen. Charles Schumer (D-N.Y.) proposed that the federal government spend hundreds of millions of dollars to help bail out subprime mortgage borrowers who are defaulting on their loans. A report by the Joint Economic Committee of Congress, which Schumer chairs, estimates that the average cost of a foreclosure -- to the homeowner, lender, local government, and neighbors (whose homes decline in value) -- is $78,000. By contrast, preventing the foreclosure would cost $3,300 per home on average."
North County Times - "San Diego foreclosure activity hits two-year high" (4-18-07)
"Foreclosure filings in San Diego County doubled during the first three months of this year over the same period last year and increased sixfold over 2005, according to a survey released Wednesday. For the month of March, county properties in some stage of foreclosure climbed by 49 percent from February to 2,551, the highest one-month level since the real estate market began to cool in 2005, according to RealtyTrac Inc., an Irvine foreclosure listing service in Irvine. That figure represents one in every 408 households. During foreclosure, a mortgage holder such as a bank or mortgage lender takes legal steps to seize property from an owner who is in default, or behind in making payments. Of the 2,551 properties in the county, 1,998 were in default, 415 were on notice the property would be sold for repayment and 138 had been foreclosed on or repurchased by the lenders. While foreclosures nationwide are on the increase after years of a robust housing market, James J. Saccacio, CEO of RealtyTrac, said in a news release that they are not far from historical norms, but cautioned that there could be widespread consequences if foreclosure activity continues to accelerate."
OC Register - "Poll results: Buyers won't return until 2009 or later" (4-18-07)
"O.C. homebuyers are clearly taking a wait-and-see-approach. By DataQuick's count, the pace of purchases of newly built homes (or converted apartments) hasn't been this slow in more than a decade. We asked visitors to the Lansner on Real Estate blog when buyers will return to the market with vigor."
CNN - "Subprime solution: Swap ARMs for fixed-rates" (4-18-07)
"Panel members at a Congressional hearing on the subprime crisis recommend changing the terms of ARM loans to forestall foreclosures."
Market Watch - "Pulte Homes warns of deeper net losses" (4-18-07)
"Pulte Homes warned late Wednesday that losses for the first quarter will come in deeper than previously anticipated due to a "challenging" market for homebuilders."
"Foreclosure filings in San Diego County doubled during the first three months of this year over the same period last year and increased sixfold over 2005, according to a survey released Wednesday. For the month of March, county properties in some stage of foreclosure climbed by 49 percent from February to 2,551, the highest one-month level since the real estate market began to cool in 2005, according to RealtyTrac Inc., an Irvine foreclosure listing service in Irvine. That figure represents one in every 408 households. During foreclosure, a mortgage holder such as a bank or mortgage lender takes legal steps to seize property from an owner who is in default, or behind in making payments. Of the 2,551 properties in the county, 1,998 were in default, 415 were on notice the property would be sold for repayment and 138 had been foreclosed on or repurchased by the lenders. While foreclosures nationwide are on the increase after years of a robust housing market, James J. Saccacio, CEO of RealtyTrac, said in a news release that they are not far from historical norms, but cautioned that there could be widespread consequences if foreclosure activity continues to accelerate."
OC Register - "Poll results: Buyers won't return until 2009 or later" (4-18-07)
"O.C. homebuyers are clearly taking a wait-and-see-approach. By DataQuick's count, the pace of purchases of newly built homes (or converted apartments) hasn't been this slow in more than a decade. We asked visitors to the Lansner on Real Estate blog when buyers will return to the market with vigor."
CNN - "Subprime solution: Swap ARMs for fixed-rates" (4-18-07)
"Panel members at a Congressional hearing on the subprime crisis recommend changing the terms of ARM loans to forestall foreclosures."
Market Watch - "Pulte Homes warns of deeper net losses" (4-18-07)
"Pulte Homes warned late Wednesday that losses for the first quarter will come in deeper than previously anticipated due to a "challenging" market for homebuilders."
Tuesday, April 17, 2007
NAR - "Statement by NAR President on Supreme Court Ruling on Preemption of State Banking Laws" (4-17-07)
"Pat Vredevoogd Combs, 2007 president of the National Association of Realtors® released the following statement, expressing disappointment with the opinion issued today by the U.S. Supreme Court in the case of Watters v. Wachovia:"
North County Times - "Foreclosure wave hits record levels" (4-17-07)
"A record number of Riverside County homes went into foreclosure in the first three months of the year, and people in the real estate industry said they expect the number to go higher, as rising debt obligations overtake thousands of people who bought houses with unconventional mortgages. Mortgage defaults numbered 5,750, a record, rising from 4,528 in the last three months of 2006 and nearly tripling from 2,148 in the first three months of 2006, DataQuick Information Systems said in a quarterly report Monday. Such foreclosure activity also rose sharply elsewhere in the region, but Riverside County recently had one default for every 270 households, one of the highest rates of default in the nation, according to RealtyTrac, another research firm."
Voice of San Diego - "Foreclosure Record Eclipsed in March" (4-17-07)
"The 433 homes lost in foreclosure represented a more-than six-fold increase over the previous March, when there were only 66 such repossessions, according to La Jolla-based DataQuick Information Systems. The previous record was 389 homes in October 1996."
Yahoo! - "Regulators Call on Lenders to Help" (4-17-07)
"With foreclosures rising, federal bank regulators called on lenders Tuesday to work with distressed borrowers unable to meet payments on high-risk mortgages to help them keep their homes. The heads of Fannie Mae and Freddie Mac said the mortgage finance giants are developing new types of loans to aid homeowners in avoiding default. Home-mortgage delinquencies and foreclosures have been surging in recent months, especially for people who took out subprime mortgages -- higher-priced loans for people with tarnished credit or low incomes who are considered greater risks. The distress has roiled financial markets and stoked anxiety that it could spill over into the broader economy."
Bloomberg - "Freddie Mac to Buy $20 Billion in Subprime Home Loans" (4-17-07)
"Freddie Mac, the second-largest source of money for U.S. home loans, plans to buy as much as $20 billion in subprime mortgages to help borrowers with poor credit histories avoid default and the loss of their homes."
Ventura County Star - "Homeowner default notices jump 123%" (4-17-07)
"California's slow housing market turned down a bleak path during the first quarter as thousands of homeowners fell months behind in their mortgage payments, leading to a surge of default notices. Lending institutions filed 46,760 defaults, the most in almost 10 years. The news was coupled by a wave of foreclosures statewide."
USA Today - "Subprime lenders' big gifts helped lawmakers" (4-17-07)
"The nation's top subprime lenders, including New Century Financial (NEWC), which has filed for Chapter 11, have lavished generous donations on homeownership programs sponsored by black or Hispanic members of Congress. The paid sponsorships give lenders an entree to lawmakers and their constituents. Along with New Century, backers include Countrywide Financial (CFC), which settled a New York fair-lending investigation in 2006 by agreeing to compensate black and Latino borrowers for improper loans and set up a $3 million consumer-education program. Another is Ameriquest Mortgage, which in 2006 agreed to a $295 million settlement with state attorneys general who charged it with improper lending practices. Minority homeownership rates rose in the past several years. But the Congressional Hispanic Caucus Institute and Congressional Black Caucus Foundation today face an imploding market as subprime mortgages — higher-priced loans to consumers with impaired or scanty credit — go bad at an escalating rate. Federal regulators are tightening up on the lenders. The non-profit groups, founded by lawmakers, run education and outreach programs."
Bloomberg - "Housing Starts in U.S. Unexpectedly Rose in March (Update3)" (4-17-07)
"Housing starts in the U.S. unexpectedly rose for a second month in March, bolstering expectations the worst housing slump in 15 years may be easing. Builders broke ground on new homes at an annual rate of 1.518 million last month, an increase of 0.8 percent from February, the Commerce Department said today in Washington. Building permits, a sign of future construction, also rose 0.8 percent. "
Retuers - "Wells Fargo not eyeing mortgage lender purchases" (4-17-07)
"Wells Fargo & Co. isn't likely to buy another mortgage lender as the market for subprime loans goes through an "adjustment," and is probably adding market share as weaker lenders pull back, Chief Financial Officer Howard Atkins said on Tuesday. The No. 2 U.S. mortgage lender has fared better than many lenders in the slowing U.S. housing market, saying it does not make some loans that have proved troublesome, and passes off the credit risks on some loans to investment banking partners. Last quarter, mortgage applications and new mortgages at Wells Fargo both rose from a year earlier."
Press Enterprise - "Inland region leads Southern California in mortgage defaults" (4-16-07)
" Mortgage defaults increased at a faster pace in the Inland region during the first quarter of this year than anywhere else in Southern California, reaching a record high in Riverside County, according to report released Monday. A notice of default is the first step a lender takes to foreclose on a property. In the first quarter, foreclosures soared to a near-record high of 1,460 in Riverside County, 10 times as many as a year ago when 144 homes were foreclosed on. Also, last quarter San Bernardino County had 909 foreclosures, a sharp increase from 111 foreclosures during the first quarter of 2006. "
Yahoo! - "WaMu tops lenders in some riskier loans : WSJ" (4-17-07)
"Washington Mutual Inc. topped the list of mortgage lenders in the percentage of loans it gave to investors or second-home buyers, the Wall Street Journal reported on its Web site on Tuesday.Of the loans that WaMu originated last year, 15 percent were backed by homes that were not the borrower's main residence, compared with 13 percent at Countrywide Financial Corp., 11 percent at Wells Fargo & Co., 9 percent at JPMorgan Chase & Co. and 5 percent at Citigroup, the paper said, citing its analysis of data filed with banking regulators."
Daily Bulletin - "Subprime losses showing up earlier than expected in bonds" (4-17-07)
"Losses are showing up in subprime mortgage bonds earlier than expected as the home foreclosure process becomes speedier, according to one research firm. Investors with exposure to the riskiest asset-backed securities had expected to see some losses as a result of the problems with subprime loans underwritten in 2006, but many reckoned the red ink would start flowing much later as foreclosures can take up to two years to complete. "
Retuers - "Limited options for subprime woes, lawmakers hear" (4-17-07)
"Federal lawmakers can take steps to protect consumers from bad mortgages in the future but have limited options in how to assist troubled borrowers today, a Congressional panel heard on Tuesday."
NAHB - "Midwest Rebound Edges National Housing Starts Up In March" (4-17-07)
"National housing starts edged up 0.8 percent in March as the Midwest region rebounded from a sharp decline in February and posted a 44.5 percent increase for the month, the Commerce Department reported today. The pace of housing starts for March was a seasonally adjusted annual rate of 1.518 million units, 23.0 percent below a year earlier. Construction of new single-family homes, boosted by a 35.9 percent surge in the Midwest, was up 2.0 percent in March to a seasonally adjusted annual rate of 1.218 million units. This was 24.6 percent below a year earlier. Multifamily housing construction decreased 3.8 percent for the month to a seasonally adjusted annual rate of 300,000 units and was down 16.0 percent from a year earlier."
Inman - "Supreme Court decision upsets Realtors, pleases banks" (4-17-07)
"Mortgage lending subsidiaries of federally chartered banks are subject to federal oversight, not state regulations, the Supreme Court ruled in a 5-3 decision today. Michigan regulators had sought to block the operations of Wachovia Mortgage Co., a subsidiary of Wachovia Bank, after the subsidiary surrendered its registration in Michigan. State law required bank subsidiaries to register with a state regulatory agency and submit to state supervision. Wachovia contested these regulations in a lawsuit, charging that the state requirements do not apply because its subsidiary is regulated by the National Bank Act and the U.S. Office of the Comptroller of the Currency. The lower courts had held that federal regulations preempted state regulations in the oversight of a federally chartered banking company's subsidiary. Justice Ruth Bader Ginsburg delivered the court's opinion in Watters v. Wachovia, and she was joined by Anthony Kennedy, David Hackett Souter, Stephen Breyer and Samuel Alito. Justices John Paul Stevens, John Roberts and Antonin Scalia dissented." Supremem Court Files
OC Register - "Blue Shield can cancel Realtor's coverage, judge rules" (4-17-07)
"A Los Angeles County superior court has denied the California Association of Realtors attempt to halt cancellation of health coverage offered to its members."
"Pat Vredevoogd Combs, 2007 president of the National Association of Realtors® released the following statement, expressing disappointment with the opinion issued today by the U.S. Supreme Court in the case of Watters v. Wachovia:"
North County Times - "Foreclosure wave hits record levels" (4-17-07)
"A record number of Riverside County homes went into foreclosure in the first three months of the year, and people in the real estate industry said they expect the number to go higher, as rising debt obligations overtake thousands of people who bought houses with unconventional mortgages. Mortgage defaults numbered 5,750, a record, rising from 4,528 in the last three months of 2006 and nearly tripling from 2,148 in the first three months of 2006, DataQuick Information Systems said in a quarterly report Monday. Such foreclosure activity also rose sharply elsewhere in the region, but Riverside County recently had one default for every 270 households, one of the highest rates of default in the nation, according to RealtyTrac, another research firm."
Voice of San Diego - "Foreclosure Record Eclipsed in March" (4-17-07)
"The 433 homes lost in foreclosure represented a more-than six-fold increase over the previous March, when there were only 66 such repossessions, according to La Jolla-based DataQuick Information Systems. The previous record was 389 homes in October 1996."
Yahoo! - "Regulators Call on Lenders to Help" (4-17-07)
"With foreclosures rising, federal bank regulators called on lenders Tuesday to work with distressed borrowers unable to meet payments on high-risk mortgages to help them keep their homes. The heads of Fannie Mae and Freddie Mac said the mortgage finance giants are developing new types of loans to aid homeowners in avoiding default. Home-mortgage delinquencies and foreclosures have been surging in recent months, especially for people who took out subprime mortgages -- higher-priced loans for people with tarnished credit or low incomes who are considered greater risks. The distress has roiled financial markets and stoked anxiety that it could spill over into the broader economy."
Bloomberg - "Freddie Mac to Buy $20 Billion in Subprime Home Loans" (4-17-07)
"Freddie Mac, the second-largest source of money for U.S. home loans, plans to buy as much as $20 billion in subprime mortgages to help borrowers with poor credit histories avoid default and the loss of their homes."
Ventura County Star - "Homeowner default notices jump 123%" (4-17-07)
"California's slow housing market turned down a bleak path during the first quarter as thousands of homeowners fell months behind in their mortgage payments, leading to a surge of default notices. Lending institutions filed 46,760 defaults, the most in almost 10 years. The news was coupled by a wave of foreclosures statewide."
USA Today - "Subprime lenders' big gifts helped lawmakers" (4-17-07)
"The nation's top subprime lenders, including New Century Financial (NEWC), which has filed for Chapter 11, have lavished generous donations on homeownership programs sponsored by black or Hispanic members of Congress. The paid sponsorships give lenders an entree to lawmakers and their constituents. Along with New Century, backers include Countrywide Financial (CFC), which settled a New York fair-lending investigation in 2006 by agreeing to compensate black and Latino borrowers for improper loans and set up a $3 million consumer-education program. Another is Ameriquest Mortgage, which in 2006 agreed to a $295 million settlement with state attorneys general who charged it with improper lending practices. Minority homeownership rates rose in the past several years. But the Congressional Hispanic Caucus Institute and Congressional Black Caucus Foundation today face an imploding market as subprime mortgages — higher-priced loans to consumers with impaired or scanty credit — go bad at an escalating rate. Federal regulators are tightening up on the lenders. The non-profit groups, founded by lawmakers, run education and outreach programs."
Bloomberg - "Housing Starts in U.S. Unexpectedly Rose in March (Update3)" (4-17-07)
"Housing starts in the U.S. unexpectedly rose for a second month in March, bolstering expectations the worst housing slump in 15 years may be easing. Builders broke ground on new homes at an annual rate of 1.518 million last month, an increase of 0.8 percent from February, the Commerce Department said today in Washington. Building permits, a sign of future construction, also rose 0.8 percent. "
Retuers - "Wells Fargo not eyeing mortgage lender purchases" (4-17-07)
"Wells Fargo & Co. isn't likely to buy another mortgage lender as the market for subprime loans goes through an "adjustment," and is probably adding market share as weaker lenders pull back, Chief Financial Officer Howard Atkins said on Tuesday. The No. 2 U.S. mortgage lender has fared better than many lenders in the slowing U.S. housing market, saying it does not make some loans that have proved troublesome, and passes off the credit risks on some loans to investment banking partners. Last quarter, mortgage applications and new mortgages at Wells Fargo both rose from a year earlier."
Press Enterprise - "Inland region leads Southern California in mortgage defaults" (4-16-07)
" Mortgage defaults increased at a faster pace in the Inland region during the first quarter of this year than anywhere else in Southern California, reaching a record high in Riverside County, according to report released Monday. A notice of default is the first step a lender takes to foreclose on a property. In the first quarter, foreclosures soared to a near-record high of 1,460 in Riverside County, 10 times as many as a year ago when 144 homes were foreclosed on. Also, last quarter San Bernardino County had 909 foreclosures, a sharp increase from 111 foreclosures during the first quarter of 2006. "
Yahoo! - "WaMu tops lenders in some riskier loans : WSJ" (4-17-07)
"Washington Mutual Inc. topped the list of mortgage lenders in the percentage of loans it gave to investors or second-home buyers, the Wall Street Journal reported on its Web site on Tuesday.Of the loans that WaMu originated last year, 15 percent were backed by homes that were not the borrower's main residence, compared with 13 percent at Countrywide Financial Corp., 11 percent at Wells Fargo & Co., 9 percent at JPMorgan Chase & Co. and 5 percent at Citigroup, the paper said, citing its analysis of data filed with banking regulators."
Daily Bulletin - "Subprime losses showing up earlier than expected in bonds" (4-17-07)
"Losses are showing up in subprime mortgage bonds earlier than expected as the home foreclosure process becomes speedier, according to one research firm. Investors with exposure to the riskiest asset-backed securities had expected to see some losses as a result of the problems with subprime loans underwritten in 2006, but many reckoned the red ink would start flowing much later as foreclosures can take up to two years to complete. "
Retuers - "Limited options for subprime woes, lawmakers hear" (4-17-07)
"Federal lawmakers can take steps to protect consumers from bad mortgages in the future but have limited options in how to assist troubled borrowers today, a Congressional panel heard on Tuesday."
NAHB - "Midwest Rebound Edges National Housing Starts Up In March" (4-17-07)
"National housing starts edged up 0.8 percent in March as the Midwest region rebounded from a sharp decline in February and posted a 44.5 percent increase for the month, the Commerce Department reported today. The pace of housing starts for March was a seasonally adjusted annual rate of 1.518 million units, 23.0 percent below a year earlier. Construction of new single-family homes, boosted by a 35.9 percent surge in the Midwest, was up 2.0 percent in March to a seasonally adjusted annual rate of 1.218 million units. This was 24.6 percent below a year earlier. Multifamily housing construction decreased 3.8 percent for the month to a seasonally adjusted annual rate of 300,000 units and was down 16.0 percent from a year earlier."
Inman - "Supreme Court decision upsets Realtors, pleases banks" (4-17-07)
"Mortgage lending subsidiaries of federally chartered banks are subject to federal oversight, not state regulations, the Supreme Court ruled in a 5-3 decision today. Michigan regulators had sought to block the operations of Wachovia Mortgage Co., a subsidiary of Wachovia Bank, after the subsidiary surrendered its registration in Michigan. State law required bank subsidiaries to register with a state regulatory agency and submit to state supervision. Wachovia contested these regulations in a lawsuit, charging that the state requirements do not apply because its subsidiary is regulated by the National Bank Act and the U.S. Office of the Comptroller of the Currency. The lower courts had held that federal regulations preempted state regulations in the oversight of a federally chartered banking company's subsidiary. Justice Ruth Bader Ginsburg delivered the court's opinion in Watters v. Wachovia, and she was joined by Anthony Kennedy, David Hackett Souter, Stephen Breyer and Samuel Alito. Justices John Paul Stevens, John Roberts and Antonin Scalia dissented." Supremem Court Files
OC Register - "Blue Shield can cancel Realtor's coverage, judge rules" (4-17-07)
"A Los Angeles County superior court has denied the California Association of Realtors attempt to halt cancellation of health coverage offered to its members."
Monday, April 16, 2007
DQ News - "California Foreclosure Activity Jumps Again" (4-16-07)
"The number of default notices sent to California homeowners last quarter increased to its highest level in almost ten years, the result of flat appreciation, slow sales, and post teaser-rate mortgage resets, a real estate information service reported. Lending institutions filed 46,760 Notices of Default (NoDs) during the January-to-March period. That was up by 23.1 percent from a revised 37,994 for the previous quarter, and up 148.0 percent from 18,856 for first-quarter 2006, according to DataQuick Information Systems. "
Yahoo! - "Group Trying to Keep Borrowers in Homes" (4-16-07)
"Financial institutions making changes to the terms of home loans -- such as extending the initial low, or "teaser" interest rates on adjustable-rate mortgages -- may help ease the distress of borrowers who are making regular payments but facing possible default, said Sheila Bair, chairman of the Federal Deposit Insurance Corp. Bair organized the unusual seven-hour meeting at FDIC headquarters on the turmoil in the market for so-called subprime mortgages, which are higher-priced home loans for people with tarnished credit or low incomes who are considered greater risks. In recent weeks, the distress has roiled financial markets and stoked anxiety that it could spill over into the broader economy."
Yahoo! - "Foreclosure forecast: Blizzard brewing" (4-16-07)
"Economic forecasters worry the combination of a real estate market in the doldrums and unfortunate timing may be blowing in a blizzard of new foreclosure filings. The first flurries are already arriving."
Yahoo! - "Riding Out the Subprime Disaster" (4-16-07)
"You've no doubt heard about the subprime mess in the mortgage industry. That's the bad news. But there's a flip side: Even though there's trouble in the subprime market, bankers haven't stopped lending money on good real estate to sound investors."
Fresno Bee - "Officials hope for housing funds" (4-16-07)
"A new proposal seeks to give families like the Espinosas some hope. The plan, contained in state legislation, is to create a Valleywide housing trust that would dedicate a permanent source of revenue for affordable housing programs. That could include things like incentives for developers to build more homes for low-income residents, or money for first-time buyer programs. Funded with real estate taxes, developer fees or other methods, housing trusts are an increasingly popular option for communities, which are getting less outside help as federal housing assistance becomes more scarce each passing year, advocates say."
Contractor Mag - "Builder tells subs to cut prices mid-contract" "So they gave us a choice of either reducing all unpaid invoices under current contracts by a percentage that varies from contractor to contractor, but it's a range of 3% to 20%," the contractor said. "This is for work that we had already been lowest bidder on and it was ongoing like the fourth or fifth phases of the project. Lennar already demanded a 5% decrease from the previous phase, so this is the second time they've come to the well. They're not a huge book in my business but I know roofers or concrete people that it's 50% or more of their work."
Sign On San Diego - "San Diego sees record number of foreclosures in March" (4-16-07)
"A record 433 owners lost their homes in San Diego County to foreclosure last month, more than six times the March 2006 figure, DataQuick Information Systems reported Monday. The previous record was 337 in March 1996 at the tail end of the 1990s real estate recession, after which foreclosures dropped to as low as just four in December 2004."
LA Times - "Get rid of reconveyance" (4-16-07)
"A DEVELOPER BUILDING a housing tract wants to do its part in preserving adjacent wetlands, helping the community's homeless or providing perpetual funding for nearby park maintenance. The company hits on an ingenious solution: a perpetual fee (called "reconveyance"), grafted right into the deed as a percentage of the sale price, that each buyer of the property must pay. Forever. This new contractual scheme has begun to spring up all over California."
NAHB - "Builder Confidence Recedes Further In April" (4-16-07)
"Deepening problems in the subprime mortgage market continued to take a toll on builder confidence in April, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The index declined three points to 33 in April, its lowest level since December of 2006."
Bloomberg - "Citigroup Net Income Declines 11 Percent on Charge (Update5)" (4-16-07)
"Citigroup Inc., the biggest U.S. bank, said first-quarter earnings dropped 11 percent because of expenses to slash 17,000 jobs and reported the fastest growth in revenue in almost three years. Net income fell for the third straight quarter, declining to $5.01 billion, or $1.01 a share, from $5.64 billion, or $1.12, a year earlier, New York-based Citigroup said today in a statement. Profit excluding the $871 million charge rose 4.3 percent to $5.88 billion, or $1.18 a share, beating estimates by 9 cents. "
Bloomberg - "Greenspan Says Global Growth to Cushion U.S. Economy (Update5)" (4-16-07)
"Former Federal Reserve chairman Alan Greenspan played down his earlier concern about a possible U.S. recession, saying the world economy would provide a cushion, according to people attending a forum in Tokyo today. Greenspan said growth in the rest of the world is creating demand for services from companies such as Microsoft Corp., according to Vaseehar Hassan Abdul Razack, chairman of Kuala Lumpur-based RHB Islamic Bank Bhd, who attended the meeting, hosted by Nomura Research Institute Ltd. Greenspan was speaking via satellite from Washington. "
Bloomberg - "Subprime Mess Produces Unqualified Victims: Michael Lewis" (4-16-07)
"The story line of the newest American financial debacle is now clear: President Bill Clinton eased lending standards to encourage the rich people who run the mortgage market to embrace poor people with low credit ratings. Then these horrible rich people -- these unfeeling sharks -- went to work exploiting the poor. "
OC Register - "Calif. defaults at near 10-year high" (4-16-07)
"The number of default notices sent to California homeowners last quarter increased to its highest level in almost ten years, the result of flat appreciation, slow sales, and post teaser-rate mortgage resets, a real estate information service reported. Lending institutions filed 46,760 Notices of Default (NoDs) during the January-to-March period. That was up by 23.1 percent from a revised 37,994 for the previous quarter, and up 148.0 percent from 18,856 for first-quarter 2006, according to DataQuick Information Systems."
Bloomberg - "U.S. Homebuilder Confidence Index Falls to 33 in April From 36" (4-16-07)
"An index of U.S. homebuilders' confidence fell to the lowest level of the year this month amid concern that an increase in mortgage defaults is resulting in tighter lending standards that are discouraging would-be buyers. The National Association of Home Builders/Wells Fargo index of sentiment fell to 33 from 36 in March, the Washington-based association said today. A reading below 50 means most respondents view conditions as poor. "
Bloomberg - "Fremont Agrees to Sell $2.9 Billion of Subprime Loans (Update3)" (4-16-07)
"Fremont General Corp., barred by U.S. regulators from offering mortgages to borrowers with poor credit, agreed to sell $2.9 billion of subprime home loans in a transaction that may help the company recover from a tailspin that wiped out half its market value this year. The sale, involving the majority of Fremont's remaining subprime loans, will result in a $100 million pretax loss because the mortgages are being sold at a discount, the Santa Monica, California-based company said in a statement on PRNewswire today. The unidentified buyer also signed a letter of intent to acquire most of Fremont's residential real estate business and assets. "
CAR - "C.A.R. launches $2.3 million ad campaign highlighting value REALTORS® bring to the transaction" (4-16-07)
"The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today launched a brand new Consumer Advertising Campaign highlighting the value REALTORS® bring to the transaction. Through a bold, new approach and theme -- “California REALTORS® - We get it.” -- the campaign also will raise awareness of the REALTOR® brand and reinforce the professionalism of REALTORS® who belong to C.A.R."
House Committee on Financial Services - "Subcommittee on Housing and Community Opportunity Hearing" (4-16-07)
The Expanding American Homeownership Act of 2007: H.R. 1852 and Related FHA Modernization Issues - Thursday, April 19, 2007, 10:00 a.m., 2128 Rayburn House Office Building
Follow Link to listen live over web.
Inman - "House Finance Committee holding hearings on mortgage lending Restrictions on lenders, FHA modernization to be debated
Monday, April 16, 2007
Inman News - "House Finance Committee holding hearings on mortgage lending" (4-16-07)
"This week will be a busy one for lawmakers on Capitol Hill, who plan two hearings that could shape the federal government's response to rising delinquencies and foreclosures among subprime mortgage borrowers. At a hearing Tuesday, the House Committee on Financial Services will consider recommendations in a recent report by the Congressional Joint Economic Committee, including increased support for local foreclosure programs and strengthening Federal Housing Authority mortgage insurance programs. The report also recommended instituting a federal anti-predatory-lending law, tougher loan disclosure requirements and suitability standards requiring borrowers to demonstrate their ability to repay mortgage loans. Lending industry groups including the Mortgage Bankers Association say they support stronger foreclosure prevention and FHA insurance programs, but oppose some of the proposed restrictions on lenders such as suitability standards."
Inman - "A bill sponsored by Democrats Barney Frank and Maxine Waters, HR 1852, would increase FHA loan limits in high-cost areas such as California, New York and Massachusetts; authorize no- or low-down-payment FHA-backed loans to compete with private sector loans; permit FHA to underwrite loans to borrowers with higher credit risk than currently allowed; and eliminate a volume cap on FHA reverse mortgage loans."
"The number of default notices sent to California homeowners last quarter increased to its highest level in almost ten years, the result of flat appreciation, slow sales, and post teaser-rate mortgage resets, a real estate information service reported. Lending institutions filed 46,760 Notices of Default (NoDs) during the January-to-March period. That was up by 23.1 percent from a revised 37,994 for the previous quarter, and up 148.0 percent from 18,856 for first-quarter 2006, according to DataQuick Information Systems. "
Yahoo! - "Group Trying to Keep Borrowers in Homes" (4-16-07)
"Financial institutions making changes to the terms of home loans -- such as extending the initial low, or "teaser" interest rates on adjustable-rate mortgages -- may help ease the distress of borrowers who are making regular payments but facing possible default, said Sheila Bair, chairman of the Federal Deposit Insurance Corp. Bair organized the unusual seven-hour meeting at FDIC headquarters on the turmoil in the market for so-called subprime mortgages, which are higher-priced home loans for people with tarnished credit or low incomes who are considered greater risks. In recent weeks, the distress has roiled financial markets and stoked anxiety that it could spill over into the broader economy."
Yahoo! - "Foreclosure forecast: Blizzard brewing" (4-16-07)
"Economic forecasters worry the combination of a real estate market in the doldrums and unfortunate timing may be blowing in a blizzard of new foreclosure filings. The first flurries are already arriving."
Yahoo! - "Riding Out the Subprime Disaster" (4-16-07)
"You've no doubt heard about the subprime mess in the mortgage industry. That's the bad news. But there's a flip side: Even though there's trouble in the subprime market, bankers haven't stopped lending money on good real estate to sound investors."
Fresno Bee - "Officials hope for housing funds" (4-16-07)
"A new proposal seeks to give families like the Espinosas some hope. The plan, contained in state legislation, is to create a Valleywide housing trust that would dedicate a permanent source of revenue for affordable housing programs. That could include things like incentives for developers to build more homes for low-income residents, or money for first-time buyer programs. Funded with real estate taxes, developer fees or other methods, housing trusts are an increasingly popular option for communities, which are getting less outside help as federal housing assistance becomes more scarce each passing year, advocates say."
Contractor Mag - "Builder tells subs to cut prices mid-contract" "So they gave us a choice of either reducing all unpaid invoices under current contracts by a percentage that varies from contractor to contractor, but it's a range of 3% to 20%," the contractor said. "This is for work that we had already been lowest bidder on and it was ongoing like the fourth or fifth phases of the project. Lennar already demanded a 5% decrease from the previous phase, so this is the second time they've come to the well. They're not a huge book in my business but I know roofers or concrete people that it's 50% or more of their work."
Sign On San Diego - "San Diego sees record number of foreclosures in March" (4-16-07)
"A record 433 owners lost their homes in San Diego County to foreclosure last month, more than six times the March 2006 figure, DataQuick Information Systems reported Monday. The previous record was 337 in March 1996 at the tail end of the 1990s real estate recession, after which foreclosures dropped to as low as just four in December 2004."
LA Times - "Get rid of reconveyance" (4-16-07)
"A DEVELOPER BUILDING a housing tract wants to do its part in preserving adjacent wetlands, helping the community's homeless or providing perpetual funding for nearby park maintenance. The company hits on an ingenious solution: a perpetual fee (called "reconveyance"), grafted right into the deed as a percentage of the sale price, that each buyer of the property must pay. Forever. This new contractual scheme has begun to spring up all over California."
NAHB - "Builder Confidence Recedes Further In April" (4-16-07)
"Deepening problems in the subprime mortgage market continued to take a toll on builder confidence in April, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The index declined three points to 33 in April, its lowest level since December of 2006."
Bloomberg - "Citigroup Net Income Declines 11 Percent on Charge (Update5)" (4-16-07)
"Citigroup Inc., the biggest U.S. bank, said first-quarter earnings dropped 11 percent because of expenses to slash 17,000 jobs and reported the fastest growth in revenue in almost three years. Net income fell for the third straight quarter, declining to $5.01 billion, or $1.01 a share, from $5.64 billion, or $1.12, a year earlier, New York-based Citigroup said today in a statement. Profit excluding the $871 million charge rose 4.3 percent to $5.88 billion, or $1.18 a share, beating estimates by 9 cents. "
Bloomberg - "Greenspan Says Global Growth to Cushion U.S. Economy (Update5)" (4-16-07)
"Former Federal Reserve chairman Alan Greenspan played down his earlier concern about a possible U.S. recession, saying the world economy would provide a cushion, according to people attending a forum in Tokyo today. Greenspan said growth in the rest of the world is creating demand for services from companies such as Microsoft Corp., according to Vaseehar Hassan Abdul Razack, chairman of Kuala Lumpur-based RHB Islamic Bank Bhd, who attended the meeting, hosted by Nomura Research Institute Ltd. Greenspan was speaking via satellite from Washington. "
Bloomberg - "Subprime Mess Produces Unqualified Victims: Michael Lewis" (4-16-07)
"The story line of the newest American financial debacle is now clear: President Bill Clinton eased lending standards to encourage the rich people who run the mortgage market to embrace poor people with low credit ratings. Then these horrible rich people -- these unfeeling sharks -- went to work exploiting the poor. "
OC Register - "Calif. defaults at near 10-year high" (4-16-07)
"The number of default notices sent to California homeowners last quarter increased to its highest level in almost ten years, the result of flat appreciation, slow sales, and post teaser-rate mortgage resets, a real estate information service reported. Lending institutions filed 46,760 Notices of Default (NoDs) during the January-to-March period. That was up by 23.1 percent from a revised 37,994 for the previous quarter, and up 148.0 percent from 18,856 for first-quarter 2006, according to DataQuick Information Systems."
Bloomberg - "U.S. Homebuilder Confidence Index Falls to 33 in April From 36" (4-16-07)
"An index of U.S. homebuilders' confidence fell to the lowest level of the year this month amid concern that an increase in mortgage defaults is resulting in tighter lending standards that are discouraging would-be buyers. The National Association of Home Builders/Wells Fargo index of sentiment fell to 33 from 36 in March, the Washington-based association said today. A reading below 50 means most respondents view conditions as poor. "
Bloomberg - "Fremont Agrees to Sell $2.9 Billion of Subprime Loans (Update3)" (4-16-07)
"Fremont General Corp., barred by U.S. regulators from offering mortgages to borrowers with poor credit, agreed to sell $2.9 billion of subprime home loans in a transaction that may help the company recover from a tailspin that wiped out half its market value this year. The sale, involving the majority of Fremont's remaining subprime loans, will result in a $100 million pretax loss because the mortgages are being sold at a discount, the Santa Monica, California-based company said in a statement on PRNewswire today. The unidentified buyer also signed a letter of intent to acquire most of Fremont's residential real estate business and assets. "
CAR - "C.A.R. launches $2.3 million ad campaign highlighting value REALTORS® bring to the transaction" (4-16-07)
"The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) today launched a brand new Consumer Advertising Campaign highlighting the value REALTORS® bring to the transaction. Through a bold, new approach and theme -- “California REALTORS® - We get it.” -- the campaign also will raise awareness of the REALTOR® brand and reinforce the professionalism of REALTORS® who belong to C.A.R."
House Committee on Financial Services - "Subcommittee on Housing and Community Opportunity Hearing" (4-16-07)
The Expanding American Homeownership Act of 2007: H.R. 1852 and Related FHA Modernization Issues - Thursday, April 19, 2007, 10:00 a.m., 2128 Rayburn House Office Building
Follow Link to listen live over web.
Inman - "House Finance Committee holding hearings on mortgage lending Restrictions on lenders, FHA modernization to be debated
Monday, April 16, 2007
Inman News - "House Finance Committee holding hearings on mortgage lending" (4-16-07)
"This week will be a busy one for lawmakers on Capitol Hill, who plan two hearings that could shape the federal government's response to rising delinquencies and foreclosures among subprime mortgage borrowers. At a hearing Tuesday, the House Committee on Financial Services will consider recommendations in a recent report by the Congressional Joint Economic Committee, including increased support for local foreclosure programs and strengthening Federal Housing Authority mortgage insurance programs. The report also recommended instituting a federal anti-predatory-lending law, tougher loan disclosure requirements and suitability standards requiring borrowers to demonstrate their ability to repay mortgage loans. Lending industry groups including the Mortgage Bankers Association say they support stronger foreclosure prevention and FHA insurance programs, but oppose some of the proposed restrictions on lenders such as suitability standards."
Inman - "A bill sponsored by Democrats Barney Frank and Maxine Waters, HR 1852, would increase FHA loan limits in high-cost areas such as California, New York and Massachusetts; authorize no- or low-down-payment FHA-backed loans to compete with private sector loans; permit FHA to underwrite loans to borrowers with higher credit risk than currently allowed; and eliminate a volume cap on FHA reverse mortgage loans."
Sign On San Diego - "Real estate cheerleader concedes price drop" (4-15-07)
" Satan must be shoveling snow out of his driveway, because the underworld has frozen over. By that I mean that the National Association of Realtors has finally conceded that home prices are falling nationwide. Last week, the association – the top real estate booster in the country after Donald Trump – forecast that the median home price would slide 0.7 percent this year. David Lereah, the association's chief economist, predicted that home prices will rebound next year, with a 1.6 percent rise. But after adjusting for inflation, that will mark the third straight year of declines for real estate. (Last year's 1 percent rise in nationwide home prices was negated by the 3.2 percent inflation rate. The median dropped 0.8 percent in San Diego County, even without adjusting for inflation.) "
Sign On San Diego - "An unsettling adjustment" (4-15-07)
"Facing a big jump in payments, couple feels trapped"
OC Register - "How New Century ran out of money" (4-15-07)
"Some say it got caught in the perfect storm. Others say it ran into the rocks."
Sign On San Diego - "Borrowers are caught in backlash over loan defaults" (4-15-07)
"Critics say the tough new underwriting standards that were imposed to prop up the sagging subprime mortgage market are harming some creditworthy borrowers by trapping them in high-cost loans. Reacting to a nationwide spike in subprime loan defaults, lenders recently raised their requirements for loans to borrowers with low credit scores. Some analysts say the industry is overreacting. "
OC Register - "Insider Q&A with head of Mortgage Bankers Association on lending crisis" (4-15-07)
"I got on the phone with John Robbins, chairman of the Mortgage Bankers Association, and one of the first things he said was that loan underwriting standards became too lax. I expected to grill him a bit before getting such an admission – I guess there’s no questioning its veracity now. He noted the use of no income, no asset verification loans to subprime borrowers as particularly reckless. "
" Satan must be shoveling snow out of his driveway, because the underworld has frozen over. By that I mean that the National Association of Realtors has finally conceded that home prices are falling nationwide. Last week, the association – the top real estate booster in the country after Donald Trump – forecast that the median home price would slide 0.7 percent this year. David Lereah, the association's chief economist, predicted that home prices will rebound next year, with a 1.6 percent rise. But after adjusting for inflation, that will mark the third straight year of declines for real estate. (Last year's 1 percent rise in nationwide home prices was negated by the 3.2 percent inflation rate. The median dropped 0.8 percent in San Diego County, even without adjusting for inflation.) "
Sign On San Diego - "An unsettling adjustment" (4-15-07)
"Facing a big jump in payments, couple feels trapped"
OC Register - "How New Century ran out of money" (4-15-07)
"Some say it got caught in the perfect storm. Others say it ran into the rocks."
Sign On San Diego - "Borrowers are caught in backlash over loan defaults" (4-15-07)
"Critics say the tough new underwriting standards that were imposed to prop up the sagging subprime mortgage market are harming some creditworthy borrowers by trapping them in high-cost loans. Reacting to a nationwide spike in subprime loan defaults, lenders recently raised their requirements for loans to borrowers with low credit scores. Some analysts say the industry is overreacting. "
OC Register - "Insider Q&A with head of Mortgage Bankers Association on lending crisis" (4-15-07)
"I got on the phone with John Robbins, chairman of the Mortgage Bankers Association, and one of the first things he said was that loan underwriting standards became too lax. I expected to grill him a bit before getting such an admission – I guess there’s no questioning its veracity now. He noted the use of no income, no asset verification loans to subprime borrowers as particularly reckless. "
Financial Times - "GE warns of bubble in credit markets amid subprime woes" (4-14-07)
"The US subprime mortgage crisis hit General Electric yesterday, wiping $373m from the industrial conglomerate's first-quarter profits and prompting its executives to warn of an incipient "bubble" in global credit markets. GE said it had replaced the senior management team at its mortgage unit and would reduce its workforce by about 1,000people, or 40 per cent."
Bloomberg - "U.S. Homebuilders Face Bankruptcy Risk in '08, Lawyers Say" (4-14-07)
"The collapse of the subprime mortgage market may push some big U.S. homebuilders toward Chapter 11 beginning next year, according to bankruptcy advisers and lawyers who specialize in the real estate industry. The weakest publicly held builders are staying out of bankruptcy by relying on the profits they made when sales boomed and on the public debt they sold in those years, said Ronald Greenspan, a lawyer and financial adviser to the creditors of four bankrupt subprime mortgage lenders. Homebuilders issued $3.6 billion in public debt in 2005 and 2006, though only $600 million of that comes due this year, Greenspan said."
News 10 - "Early Buyers Feel Condo Conversion Sting" (4-14-07)
"Owners who bought 'luxury' condo conversions at the peak of the market now complain their complexes still feel like apartments."
"The US subprime mortgage crisis hit General Electric yesterday, wiping $373m from the industrial conglomerate's first-quarter profits and prompting its executives to warn of an incipient "bubble" in global credit markets. GE said it had replaced the senior management team at its mortgage unit and would reduce its workforce by about 1,000people, or 40 per cent."
Bloomberg - "U.S. Homebuilders Face Bankruptcy Risk in '08, Lawyers Say" (4-14-07)
"The collapse of the subprime mortgage market may push some big U.S. homebuilders toward Chapter 11 beginning next year, according to bankruptcy advisers and lawyers who specialize in the real estate industry. The weakest publicly held builders are staying out of bankruptcy by relying on the profits they made when sales boomed and on the public debt they sold in those years, said Ronald Greenspan, a lawyer and financial adviser to the creditors of four bankrupt subprime mortgage lenders. Homebuilders issued $3.6 billion in public debt in 2005 and 2006, though only $600 million of that comes due this year, Greenspan said."
News 10 - "Early Buyers Feel Condo Conversion Sting" (4-14-07)
"Owners who bought 'luxury' condo conversions at the peak of the market now complain their complexes still feel like apartments."
Friday, April 13, 2007
Voice of San Diego - "Foreclosure Wave Said to Hit Latinos Hard" (4-13-07)
"After unprecedented gains in homeownership, experts say Latinos and other minorities are now suffering disproportionately from the risky loans offered during the raging housing boom."
BRUCE NORRIS IS FEATURED IN THIS ARTICLE.
USA Today - "Rising foreclosures reshaping communities" (4-13-07)
"And as thousands of homeowners across the nation are learning, it's not only home values that are being affected by the foreclosure crisis. When foreclosures rise, as they have in Waters Edge and other middle-class areas amid the meltdown of the subprime mortgage market, they can unravel the social fabric and reshape neighborhoods."
CNN - "Subprime bailout? $120 billion" (4-13-07)
"More than 1 million borrowers may be at risk of defaulting on their mortgages. Assisting them all wouldn't come cheap."
Bloomberg - "Fed Says What It Means -- No Interest Rate Cut: John M. Berry " (4-13-07)
"The Federal Reserve has demonstrated over the past three weeks that even with the best of intentions, communicating the nuances of monetary policy decisions often isn't easy. It took the Fed three attempts after the March 20-21 Federal Open Market Committee meeting -- the FOMC statement issued the day of the meeting, congressional testimony by Fed Chairman Ben S. Bernanke on March 28 and release of the minutes on April 11 --before investors and traders finally understood that an interest rate cut isn't in the cards. "
Press Enterprise - "New-home builders try auctions, some online, as the market softens" (4-13-07)
" Inland builders in recent months have been cutting prices and throwing in extras such as free swimming pools to move their new houses in a slowing market. And recently, joining a national trend, some are finding success with public auctions, traditionally seen more as a way to sell artwork or rare antiques. Some of those builders are incorporating online elements into their auctions, giving Web shoppers a chance to bid in real time against the on-premises participants."
ABC News - "Real Estate Leaves One Investor High and Dry" (4-13-07)
"After Spending Big to Strike It Rich, Some Speculators Coming Up Broke as Market Cools."
"After unprecedented gains in homeownership, experts say Latinos and other minorities are now suffering disproportionately from the risky loans offered during the raging housing boom."
BRUCE NORRIS IS FEATURED IN THIS ARTICLE.
USA Today - "Rising foreclosures reshaping communities" (4-13-07)
"And as thousands of homeowners across the nation are learning, it's not only home values that are being affected by the foreclosure crisis. When foreclosures rise, as they have in Waters Edge and other middle-class areas amid the meltdown of the subprime mortgage market, they can unravel the social fabric and reshape neighborhoods."
CNN - "Subprime bailout? $120 billion" (4-13-07)
"More than 1 million borrowers may be at risk of defaulting on their mortgages. Assisting them all wouldn't come cheap."
Bloomberg - "Fed Says What It Means -- No Interest Rate Cut: John M. Berry " (4-13-07)
"The Federal Reserve has demonstrated over the past three weeks that even with the best of intentions, communicating the nuances of monetary policy decisions often isn't easy. It took the Fed three attempts after the March 20-21 Federal Open Market Committee meeting -- the FOMC statement issued the day of the meeting, congressional testimony by Fed Chairman Ben S. Bernanke on March 28 and release of the minutes on April 11 --before investors and traders finally understood that an interest rate cut isn't in the cards. "
Press Enterprise - "New-home builders try auctions, some online, as the market softens" (4-13-07)
" Inland builders in recent months have been cutting prices and throwing in extras such as free swimming pools to move their new houses in a slowing market. And recently, joining a national trend, some are finding success with public auctions, traditionally seen more as a way to sell artwork or rare antiques. Some of those builders are incorporating online elements into their auctions, giving Web shoppers a chance to bid in real time against the on-premises participants."
ABC News - "Real Estate Leaves One Investor High and Dry" (4-13-07)
"After Spending Big to Strike It Rich, Some Speculators Coming Up Broke as Market Cools."
Thursday, April 12, 2007
Inman - "Congressional report backs suitability, predatory lending standards" (4-12-07)
"A new Congressional report on rising delinquencies and foreclosures in subprime loans overstates the problem because it relies on "faulty, inflated data," the Mortgage Bankers Association maintains. The report, by the Congressional Joint Economic Committee, cites statistics from RealtyTrac and predictions by the Center for Responsible Lending to make the case for increased regulation of the mortgage lending industry. The JEC report cites a prediction by the Center for Responsible Lending that one in five subprime loans issued in 2005 and 2006 will default, and that 2.2 million families have lost or will lose their homes in the next several years. The report also relies on statistics from RealtyTrac, which claims 1.2 million foreclosures were reported in 2006 and that as many or more are expected this year."
The Wall Street Journal - "Bankruptcy May Not Save Homes" (4-12-07)
"Filing Isn't Helping Many Borrowers Avoid Foreclosure"
CNN - "Subprime: Bailouts won't cut it" (4-12-07)
"A number of states are aiding subprime homeowners with assistance plans, but critics say that won't stop foreclosures from climbing."
CNN - "Buyers in charge: 4 strategies" (4-12-07)
"The good news: Rocky real estate markets mean home shoppers finally have the upper hand."
Real Estate Journal - "Realtors Predict Price Drop, Lower Forecasts for Sales" (4-12-07)
"The National Association of Realtors, which has long proclaimed that U.S. home prices haven't declined on a nationwide basis since the Great Depression, now says they are likely to do just that this year."
OC Register - "Home values will decline in 2007, Realtors say" (4-12-07)
"An index of home values is set to drop in 2007 for the first time in nearly 40 years of records, a leading association of real estate professionals said Wednesday. The median price of an existing-home is expected to slip 0.7 percent to $220,300 this year, the National Association of Realtors said. Last month, the group predicted the median price of an existing home would increase 1.2 percent this year. Economist Edward Leamer, director of the UCLA's Anderson Forecast, says that estimate is too conservative. He predicts a decline in the price of existing homes of between 2 percent and 3 percent this year, and he expects that trend to continue for two to three more years."
DQ News - "Bay Area home prices up, sales still slow" (4-12-07)
"The median price paid for a Bay Area home moved up in March, regaining much of the decline since last summer even as sales remained at the lowest level in 11 years, a real estate information service reported. The median price paid for a home in the nine-county Bay Area was $639,000 last month, up 3.1 percent from $620,000 for February, and up 2.1 percent from $626,000 for March last year, according to DataQuick Information Systems. "
Retuers - "Derivatives markets may hold key to U.S. recession" (4-12-07)
"Relaxed lending standards may have contributed to a surge in U.S. mortgage failures this year, but the chance of recession could hang on the complex derivatives used to hedge loan risk, analysts say. Collateralised Debt Obligations (CDOs) are baskets of bonds that give investors varying levels of exposure to defaults. CDOs helped fuel the U.S. housing boom by purchasing bonds backed by sub-prime mortgages and distributing the risk."
DQ News - "Slow sales, record median for Southland homes" (4-12-07)
"Southern California's housing market continued to send contradicting messages in March. Sales remained at a ten-year low while the median sales price increased to a new peak. The rise in median is in part due to a drop-off in sales of entry-level homes, a real estate information service reported. A total of 21,856 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 23.6 percent from 17,680 for the month before, and down 32.4 percent from 32,320 for March last year, according to DataQuick Information Systems. Last month's sales were the lowest for any March since 1997 when 20,024 homes were sold. The slowest March in DataQuick's statistics, which go back to 1988, was in 1993 when 16,214 homes were sold, while the strongest was in 2004 when 37,030 were sold. The March average is 26,033. Last month's sales drop was steepest in San Bernardino and Riverside counties. "
Yahoo! - "Countrywide mortgage lending in foreclosure rises" (4-12-07)
"Countrywide Financial Corp., the largest U.S. mortgage lender, said on Thursday the share of its mortgage portfolio that faces foreclosure nearly doubled in March from a year earlier in a difficult housing market. Its overall mortgage lending, however, rose 5 percent in the month from March 2006 and 25 percent from February, suggesting that the Calabasas, California-based lender is adding market share as weaker rivals pull back and industrywide volume contracts."
Bloomberg - "Housing Bubble Accomplices Preparing for Death: Caroline Baum" (4-12-07)
" First came denial: It isn't a bubble. Banks don't have any exposure to mortgages. Housing is a small sector of the economy. Subprime mortgages are a small segment of the home-loan market. Then came the Feb. 7 double time-bomb from HSBC Holdings Plc, Europe's biggest bank, and New Century Financial, the No. 2 subprime lender in the U.S., that they were setting aside more money as a cushion against rising loan delinquencies. New Century filed for Chapter 11 bankruptcy protection on April 2, one of more than 40 lenders that have ceased operations or sought buyers since the start of 2006, according to Bloomberg data. "
OC Register - "Subprime resets to peak through April 2008" (4-12-07)
"A total of 32 percent of balances face rate adjustments over the next 12 months."
OC Register - "Loan defaults spike in Orange County" (4-12-07)
"Loan delinquencies in Orange County rose to the highest level in nine years last month, as the mortgage meltdown and housing slump continued to weigh on homeowners. Lenders sent out 986 notices of default in March to homeowners behind on their loan payments -- the biggest total since January 1998, reports DataQuick. Defaults -- the formal start of a foreclosure proceeding -- were up 21.6% from a month earlier and 142% from a year ago. (Of course, February is a short month.)"
"A new Congressional report on rising delinquencies and foreclosures in subprime loans overstates the problem because it relies on "faulty, inflated data," the Mortgage Bankers Association maintains. The report, by the Congressional Joint Economic Committee, cites statistics from RealtyTrac and predictions by the Center for Responsible Lending to make the case for increased regulation of the mortgage lending industry. The JEC report cites a prediction by the Center for Responsible Lending that one in five subprime loans issued in 2005 and 2006 will default, and that 2.2 million families have lost or will lose their homes in the next several years. The report also relies on statistics from RealtyTrac, which claims 1.2 million foreclosures were reported in 2006 and that as many or more are expected this year."
The Wall Street Journal - "Bankruptcy May Not Save Homes" (4-12-07)
"Filing Isn't Helping Many Borrowers Avoid Foreclosure"
CNN - "Subprime: Bailouts won't cut it" (4-12-07)
"A number of states are aiding subprime homeowners with assistance plans, but critics say that won't stop foreclosures from climbing."
CNN - "Buyers in charge: 4 strategies" (4-12-07)
"The good news: Rocky real estate markets mean home shoppers finally have the upper hand."
Real Estate Journal - "Realtors Predict Price Drop, Lower Forecasts for Sales" (4-12-07)
"The National Association of Realtors, which has long proclaimed that U.S. home prices haven't declined on a nationwide basis since the Great Depression, now says they are likely to do just that this year."
OC Register - "Home values will decline in 2007, Realtors say" (4-12-07)
"An index of home values is set to drop in 2007 for the first time in nearly 40 years of records, a leading association of real estate professionals said Wednesday. The median price of an existing-home is expected to slip 0.7 percent to $220,300 this year, the National Association of Realtors said. Last month, the group predicted the median price of an existing home would increase 1.2 percent this year. Economist Edward Leamer, director of the UCLA's Anderson Forecast, says that estimate is too conservative. He predicts a decline in the price of existing homes of between 2 percent and 3 percent this year, and he expects that trend to continue for two to three more years."
DQ News - "Bay Area home prices up, sales still slow" (4-12-07)
"The median price paid for a Bay Area home moved up in March, regaining much of the decline since last summer even as sales remained at the lowest level in 11 years, a real estate information service reported. The median price paid for a home in the nine-county Bay Area was $639,000 last month, up 3.1 percent from $620,000 for February, and up 2.1 percent from $626,000 for March last year, according to DataQuick Information Systems. "
Retuers - "Derivatives markets may hold key to U.S. recession" (4-12-07)
"Relaxed lending standards may have contributed to a surge in U.S. mortgage failures this year, but the chance of recession could hang on the complex derivatives used to hedge loan risk, analysts say. Collateralised Debt Obligations (CDOs) are baskets of bonds that give investors varying levels of exposure to defaults. CDOs helped fuel the U.S. housing boom by purchasing bonds backed by sub-prime mortgages and distributing the risk."
DQ News - "Slow sales, record median for Southland homes" (4-12-07)
"Southern California's housing market continued to send contradicting messages in March. Sales remained at a ten-year low while the median sales price increased to a new peak. The rise in median is in part due to a drop-off in sales of entry-level homes, a real estate information service reported. A total of 21,856 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was up 23.6 percent from 17,680 for the month before, and down 32.4 percent from 32,320 for March last year, according to DataQuick Information Systems. Last month's sales were the lowest for any March since 1997 when 20,024 homes were sold. The slowest March in DataQuick's statistics, which go back to 1988, was in 1993 when 16,214 homes were sold, while the strongest was in 2004 when 37,030 were sold. The March average is 26,033. Last month's sales drop was steepest in San Bernardino and Riverside counties. "
Yahoo! - "Countrywide mortgage lending in foreclosure rises" (4-12-07)
"Countrywide Financial Corp., the largest U.S. mortgage lender, said on Thursday the share of its mortgage portfolio that faces foreclosure nearly doubled in March from a year earlier in a difficult housing market. Its overall mortgage lending, however, rose 5 percent in the month from March 2006 and 25 percent from February, suggesting that the Calabasas, California-based lender is adding market share as weaker rivals pull back and industrywide volume contracts."
Bloomberg - "Housing Bubble Accomplices Preparing for Death: Caroline Baum" (4-12-07)
" First came denial: It isn't a bubble. Banks don't have any exposure to mortgages. Housing is a small sector of the economy. Subprime mortgages are a small segment of the home-loan market. Then came the Feb. 7 double time-bomb from HSBC Holdings Plc, Europe's biggest bank, and New Century Financial, the No. 2 subprime lender in the U.S., that they were setting aside more money as a cushion against rising loan delinquencies. New Century filed for Chapter 11 bankruptcy protection on April 2, one of more than 40 lenders that have ceased operations or sought buyers since the start of 2006, according to Bloomberg data. "
OC Register - "Subprime resets to peak through April 2008" (4-12-07)
"A total of 32 percent of balances face rate adjustments over the next 12 months."
OC Register - "Loan defaults spike in Orange County" (4-12-07)
"Loan delinquencies in Orange County rose to the highest level in nine years last month, as the mortgage meltdown and housing slump continued to weigh on homeowners. Lenders sent out 986 notices of default in March to homeowners behind on their loan payments -- the biggest total since January 1998, reports DataQuick. Defaults -- the formal start of a foreclosure proceeding -- were up 21.6% from a month earlier and 142% from a year ago. (Of course, February is a short month.)"
NAR - "Tighter Lending Standards Good For Housing, But Will Dampen Sales" (4-11-07)
"Tighter lending criteria and fallout from the subprime loan debacle will lead to a healthier housing market with greater assurance that owners can handle mortgage adjustments, but higher loan standards will slow the housing recovery, according to the latest forecast by the National Association of Realtors®."
"David Lereah, NAR’s chief economist, said the changes are necessary for the long-term health of the housing market. “We want to people to be able to stay in their homes with mortgage terms they understand and can handle,” he said. 'Simply stated, a loan with the lowest monthly payment probably isn’t in your best interests – borrowers need to understand worst-case scenarios. If you’re in a mortgage you aren’t comfortable with, now is an excellent time to refinance, if you can, with historically low rates on safer conventional loans.'"
CNN - "Home prices set for first drop in 40 years" (4-11-07)
"The National Association of Realtors said Wednesday it expects its measure of home prices to fall this year for the first time since the group began keeping track nearly 40 years ago. In its latest monthly forecast, the real estate group said it expects a 0.7 percent decline in the median price of an existing home sold in 2007. A month ago it had been projecting a 1.2 percent increase. Half of all homes sell for more than the median and half for less."
Bloomberg - "Subprime Losers Blame Bear, Credit Suisse, JPM, Morgan Stanley" (4-11-07)
"When Buck Meyer thinks about the $300,000 he lost after he bought a subprime mortgage lender's bonds, he doesn't hesitate to denounce financial titans Bear Stearns Cos., Credit Suisse Group, JPMorgan Chase & Co. and Morgan Stanley. Like the thousands of people who snapped up American Business Financial Services Inc.'s notes yielding 10 times the going rate on Treasury bills, Meyer had no idea that the company was on the verge of bankruptcy. He wondered how something so celebrated as ``a kitchen-table startup'' by the Philadelphia Business Journal and so lucrative that it paid $50 million in fees to the four firms for its burgeoning credit, could default on his money. "
Market Watch - "KB Home CEO says housing slump will get worse" (4-11-07)
"The chief executive of KB Home, one of the nation's largest home builders, said Tuesday he expects the housing slump to worsen, even though sales have improved in some areas of the U.S."
MSNBC - "HUD auditors find widespread mortgage fraud" (4-9-07)
"As the government’s head of the investigations in the savings and loan industry collapse of the late 1980s and early 1990s, Kenneth Donohue is no stranger to mortgage fraud. Today, as inspector general for the Department of Housing and Urban Development, Donohue is looking into fraud and abusive lending practices related to mortgages insured by the Federal Housing Administration."
Bloomberg - "National City, SunTrust May Say Net Fell on Mortgages (Update1)" (4-11-07)
"National City Corp., Capital One Financial Corp. and SunTrust Banks Inc. may report lower first- quarter profits as the worst housing slump in more than a decade reduces income from mortgages. Earnings per share for the 10 largest regional U.S. banks fell an average 1.1 percent in the first three months from a year earlier, according to analysts' estimates compiled by Bloomberg. The last decline occurred in the fourth quarter of 2004. "
MSNBC - "Mortgage mess spreads to Alt-A segment" (4-11-07)
"Now the so-called Alternative-A mortgage sector, which loans to borrowers with better credit than subprime borrowers but not quite prime, is starting to hurt. One Alt-A lender, American Home Mortgage Investment Corp. of Melville, N.Y., announced late last week that it was having trouble selling its mortgages into the secondary market and would have to cut its earnings forecast for the quarter and the year. At least five analysts downgraded the stock on Monday, and its shares fell more than 15 percent on the New York Stock Exchange. The shares dropped $2.37, or 11 percent, on Tuesday to close at $19.55."
New York Post - "LEGAL EAGLES CLAW OVER NEW CENTURY" (4-11-07)
"The collapse of subprime mortgage giant New Century Financial, which created more than $220 billion in shaky home loans, is growing into one of the biggest bankruptcy tangles ever to hit Wall Street as shocking new claims of insider windfalls and hijacked millions emerge. At least 95 lawyers have fought all week in the Delaware bankruptcy court to alter New Century's own breakup blueprint, which has triggered several red flags. "
CNN - "Shiller: Mr. Worst-case scenario" (4-11-07)
"Robert Shiller called the tech-stock crash just as the Nasdaq peaked. But he is also the expert on the real estate market. And where does he think it's headed now? Uh-oh."
Bloomberg - "Fed Minutes Say Rate Increases May `Prove Necessary' (Update3)" (4-11-07)
"Federal Reserve officials concluded last month that higher interest rates could still be needed even as they removed a reference in their policy statement to tighter credit."
Sign On San Diego - "More homeowners fail to avoid foreclosures via bankruptcy" (4-11-07)
"The Kings and people like them present a worrisome trend for investors already spooked by soaring delinquencies and defaults on home loans to people with the weakest credit. According to a study released in March by Credit Suisse Group , more subprime borrowers are turning to bankruptcy court to stave off foreclosure, as softening housing prices make it harder for them to sell their homes to repay debts. At the same time, the study shows, the number of borrowers who are actually able to bring current their mortgage payments through bankruptcy is declining, and more filers are ultimately turning their homes over to the lenders. The finding means investors in high-yielding mortgage-backed securities should expect higher losses on the underlying collateral. At least part of the blame, says the report, lies with the bankruptcy law passed in October 2005. The law raised the bar for people to qualify for Chapter 7 “fresh start” bankruptcy proceedings. Chapter 7 can enable individual filers to wipe away debts such as credit-card and medical bills so they can continue to make their mortgage payments. With access limited, more subprime borrowers are forced into Chapter 13, where some can't maintain their payment schedules for more than a couple of months. "
CNN - "Schumer calls for subprime bailout" (4-11-07)
"The federal government should offer troubled borrowers hundreds of millions of dollars to bail them out of subprime mortgage loans, several leading Democratic lawmakers said on Wednesday."
Chron.com - "Moody's Downgrades Hovnanian" (4-11-07)
"Moody's Investors Service said Wednesday it cut its rating on Hovnanian Enterprises Inc.'s debt, saying the homebuilder is bleeding cash amid a downturn in the housing market. Moody's cut its the corporate family rating of the Red Bank, N.J.-based homebuilder's debt quality to 'Ba2' from 'Ba1,' and said it may downgrade the debt further. Both Ba2 and Ba1 are non-investment-grade designations."
Financial Times - "US plans curbs on subprime lenders" (4-11-07)
"US politicians are drawing up a bill that could make it less attractive for Wall Street investment banks and other financiers to repackage risky mortgages into securities and then sell them to investors around the world. Senior figures in Congress hope to force the financiers who buy mortgages and create mortgage-backed securities to share some of the liability – and thus financial cost – that might arise if mortgages were mis-sold to borrowers who proved unable to meet payments."
Reuters - "Mortgage defaults, delinquencies at record -survey" (4-11-07)
"Mortgage late payments and defaults reached record levels in the first quarter and may threaten the modest U.S. economic expansion seen this year, Moody's Economy.com said in a survey released on Wednesday."
OC Register - "MBA forms plan of attack" (4-11-07)
"The Mortgage Bankers Association has a plan to fend off regulation and deal with a wave of bad press, according to a letter to its members that was sent to me by a source and verified by the MBA. The letter speaks for itself, so here it is:"
"Tighter lending criteria and fallout from the subprime loan debacle will lead to a healthier housing market with greater assurance that owners can handle mortgage adjustments, but higher loan standards will slow the housing recovery, according to the latest forecast by the National Association of Realtors®."
"David Lereah, NAR’s chief economist, said the changes are necessary for the long-term health of the housing market. “We want to people to be able to stay in their homes with mortgage terms they understand and can handle,” he said. 'Simply stated, a loan with the lowest monthly payment probably isn’t in your best interests – borrowers need to understand worst-case scenarios. If you’re in a mortgage you aren’t comfortable with, now is an excellent time to refinance, if you can, with historically low rates on safer conventional loans.'"
CNN - "Home prices set for first drop in 40 years" (4-11-07)
"The National Association of Realtors said Wednesday it expects its measure of home prices to fall this year for the first time since the group began keeping track nearly 40 years ago. In its latest monthly forecast, the real estate group said it expects a 0.7 percent decline in the median price of an existing home sold in 2007. A month ago it had been projecting a 1.2 percent increase. Half of all homes sell for more than the median and half for less."
Bloomberg - "Subprime Losers Blame Bear, Credit Suisse, JPM, Morgan Stanley" (4-11-07)
"When Buck Meyer thinks about the $300,000 he lost after he bought a subprime mortgage lender's bonds, he doesn't hesitate to denounce financial titans Bear Stearns Cos., Credit Suisse Group, JPMorgan Chase & Co. and Morgan Stanley. Like the thousands of people who snapped up American Business Financial Services Inc.'s notes yielding 10 times the going rate on Treasury bills, Meyer had no idea that the company was on the verge of bankruptcy. He wondered how something so celebrated as ``a kitchen-table startup'' by the Philadelphia Business Journal and so lucrative that it paid $50 million in fees to the four firms for its burgeoning credit, could default on his money. "
Market Watch - "KB Home CEO says housing slump will get worse" (4-11-07)
"The chief executive of KB Home, one of the nation's largest home builders, said Tuesday he expects the housing slump to worsen, even though sales have improved in some areas of the U.S."
MSNBC - "HUD auditors find widespread mortgage fraud" (4-9-07)
"As the government’s head of the investigations in the savings and loan industry collapse of the late 1980s and early 1990s, Kenneth Donohue is no stranger to mortgage fraud. Today, as inspector general for the Department of Housing and Urban Development, Donohue is looking into fraud and abusive lending practices related to mortgages insured by the Federal Housing Administration."
Bloomberg - "National City, SunTrust May Say Net Fell on Mortgages (Update1)" (4-11-07)
"National City Corp., Capital One Financial Corp. and SunTrust Banks Inc. may report lower first- quarter profits as the worst housing slump in more than a decade reduces income from mortgages. Earnings per share for the 10 largest regional U.S. banks fell an average 1.1 percent in the first three months from a year earlier, according to analysts' estimates compiled by Bloomberg. The last decline occurred in the fourth quarter of 2004. "
MSNBC - "Mortgage mess spreads to Alt-A segment" (4-11-07)
"Now the so-called Alternative-A mortgage sector, which loans to borrowers with better credit than subprime borrowers but not quite prime, is starting to hurt. One Alt-A lender, American Home Mortgage Investment Corp. of Melville, N.Y., announced late last week that it was having trouble selling its mortgages into the secondary market and would have to cut its earnings forecast for the quarter and the year. At least five analysts downgraded the stock on Monday, and its shares fell more than 15 percent on the New York Stock Exchange. The shares dropped $2.37, or 11 percent, on Tuesday to close at $19.55."
New York Post - "LEGAL EAGLES CLAW OVER NEW CENTURY" (4-11-07)
"The collapse of subprime mortgage giant New Century Financial, which created more than $220 billion in shaky home loans, is growing into one of the biggest bankruptcy tangles ever to hit Wall Street as shocking new claims of insider windfalls and hijacked millions emerge. At least 95 lawyers have fought all week in the Delaware bankruptcy court to alter New Century's own breakup blueprint, which has triggered several red flags. "
CNN - "Shiller: Mr. Worst-case scenario" (4-11-07)
"Robert Shiller called the tech-stock crash just as the Nasdaq peaked. But he is also the expert on the real estate market. And where does he think it's headed now? Uh-oh."
Bloomberg - "Fed Minutes Say Rate Increases May `Prove Necessary' (Update3)" (4-11-07)
"Federal Reserve officials concluded last month that higher interest rates could still be needed even as they removed a reference in their policy statement to tighter credit."
Sign On San Diego - "More homeowners fail to avoid foreclosures via bankruptcy" (4-11-07)
"The Kings and people like them present a worrisome trend for investors already spooked by soaring delinquencies and defaults on home loans to people with the weakest credit. According to a study released in March by Credit Suisse Group , more subprime borrowers are turning to bankruptcy court to stave off foreclosure, as softening housing prices make it harder for them to sell their homes to repay debts. At the same time, the study shows, the number of borrowers who are actually able to bring current their mortgage payments through bankruptcy is declining, and more filers are ultimately turning their homes over to the lenders. The finding means investors in high-yielding mortgage-backed securities should expect higher losses on the underlying collateral. At least part of the blame, says the report, lies with the bankruptcy law passed in October 2005. The law raised the bar for people to qualify for Chapter 7 “fresh start” bankruptcy proceedings. Chapter 7 can enable individual filers to wipe away debts such as credit-card and medical bills so they can continue to make their mortgage payments. With access limited, more subprime borrowers are forced into Chapter 13, where some can't maintain their payment schedules for more than a couple of months. "
CNN - "Schumer calls for subprime bailout" (4-11-07)
"The federal government should offer troubled borrowers hundreds of millions of dollars to bail them out of subprime mortgage loans, several leading Democratic lawmakers said on Wednesday."
Chron.com - "Moody's Downgrades Hovnanian" (4-11-07)
"Moody's Investors Service said Wednesday it cut its rating on Hovnanian Enterprises Inc.'s debt, saying the homebuilder is bleeding cash amid a downturn in the housing market. Moody's cut its the corporate family rating of the Red Bank, N.J.-based homebuilder's debt quality to 'Ba2' from 'Ba1,' and said it may downgrade the debt further. Both Ba2 and Ba1 are non-investment-grade designations."
Financial Times - "US plans curbs on subprime lenders" (4-11-07)
"US politicians are drawing up a bill that could make it less attractive for Wall Street investment banks and other financiers to repackage risky mortgages into securities and then sell them to investors around the world. Senior figures in Congress hope to force the financiers who buy mortgages and create mortgage-backed securities to share some of the liability – and thus financial cost – that might arise if mortgages were mis-sold to borrowers who proved unable to meet payments."
Reuters - "Mortgage defaults, delinquencies at record -survey" (4-11-07)
"Mortgage late payments and defaults reached record levels in the first quarter and may threaten the modest U.S. economic expansion seen this year, Moody's Economy.com said in a survey released on Wednesday."
OC Register - "MBA forms plan of attack" (4-11-07)
"The Mortgage Bankers Association has a plan to fend off regulation and deal with a wave of bad press, according to a letter to its members that was sent to me by a source and verified by the MBA. The letter speaks for itself, so here it is:"
Tuesday, April 10, 2007
Yahoo! - "D.R. Horton 2Q orders fall 37 percent" (4-10-07)
"The peak spring home-selling season is off to a slow start, builder D.R. Horton Inc. said Tuesday, another sign that bad times in the housing market may last longer than expected. Horton, the nation's largest homebuilder by deliveries, said Tuesday that its sales order in the most recent quarter fell 37 percent, led by even steeper declines in California and the Southwest."
CNN - "Home builder: Spring hasn't sprung" (4-10-07)
"D.R. Horton reports sharp drops in sales value, volume in three months ending in March; weakness is widespread across nation."
Bloomberg - "Growth Prospects in U.S. Dim on Subprime Crisis (Update2)" (4-10-07)
"Prospects for stronger U.S. growth in the second half of 2007 have dimmed as the housing recession deepens and businesses cut spending, according to economists surveyed this month by Bloomberg News. The economy grew at an annual pace of 2 percent last quarter, compared with a 2.4 percent pace forecast last month, according to the median estimate of 29 economists surveyed. Growth estimates for the last half of the year were trimmed for the first time since November. "
Market Watch - "Subprime crisis shines light on mortgage brokers" (4-10-07)
"The subprime mortgage crisis has re-ignited scrutiny of the industry and people who broker home loans, with some critics arguing that hidden fees and other dubious practices have contributed to the surge in delinquencies."
Yahoo! - "Risky loans - alive and well" (4-10-07)
"Option ARMs remain an option. Despite problems in the mortgage market, brokers say lenders are still willing to make risky loans - including those that allow borrowers to make monthly payments that don't even cover the interest (so-called 'option ARMs')."
News 10 - "Condo Conversion Suffers from Bad Timing" (4-10-07)
"At least 150 units in a Sacramento-area condominium complex are headed into foreclosure in an ambitious conversion project stung by the market slowdown. A development company operating under the name Rollingwood North LLC purchased the former Rollingwood Commons apartment complex in Fair Oaks and Orangevale in 2004 when the housing market was near an all-time high."
Daily News - "Reality bites real estate market" (4-10-07)
"Inland Empire among most overvalued"
Bloomberg - "Mortgage Bondholders May Bear Subprime Loan Risk (Update3)" (4-10-07)
"The top Democrat and Republican on the House Financial Services Committee said investors in mortgage bonds should be liable for deceptive loans made by banks. Democratic Chairman Barney Frank of Massachusetts and Spencer Bachus of Alabama, the committee's highest-ranking Republican, said such legislation would discourage lenders from extending loans to people with poor credit histories by making it more difficult and expensive for the banks to sell the mortgages."
Yahoo! - "Six Steps to Avoiding Foreclosure" (4-10-07)
"If you're a homeowner and are having trouble paying your mortgage, this article could save your house and your family's finances. As I write this, several million Americans are in jeopardy of losing their greatest investment to foreclosure within the next 18 months. But help is available, and there are ways to work with your lender to help keep your home."
Market Watch - "Subprime crisis shines light on mortgage brokers" (4-10-07)
"The subprime mortgage crisis has re-ignited scrutiny of the industry and people who broker home loans, with some critics arguing that hidden fees and other dubious practices have contributed to the surge in delinquencies."
Charles Hughs Smith - "The Mortgage Mess: The Soft Underbelly Beyond Subprime" (4-10-07)
Business Week - "Fannie, Freddie are regulatory 'concern'" (4-10-07)
"Government-sponsored mortgage giants Fannie Mae and Freddie Mac 'remain a significant supervisory concern' despite progress in fixing financial control issues that resulted in multibillion-dollar earnings restatements, according to a federal regulatory report released Tuesday."
"The Office of Federal Housing Enterprise Oversight's annual report to Congress notes that 'while both enterprises made progress in correcting their problems, especially in systems, controls and financial reporting, it has taken much more time and money to correct than ... expected.'"
MSN - "D.R. Horton orders down, spring sales weak" (4-10-07)
"D.R. Horton Inc. , the largest U.S. home builder, said on Tuesday orders for new homes tumbled 37 percent last quarter and the spring selling season has been slower than usual, suggesting the U.S. housing market has not yet hit bottom."
"While the Fort Worth, Texas-based company saw orders fall in all regions, the biggest decline was in California, where they fell 59 percent to 1,107 homes. California was also the market that saw the biggest dip in dollar value of orders, down about 57 percent to $533.5 million."
MSNBC - "Mortgage woes could be 'tip of the iceberg'" (4-10-07)
"Fraud, abusive lending crushes dreams for millions of home owners"
Market Watch - "End of housing bubble should have been obvious to everyone" (4-10-07)
"Why are so many people so surprised that the housing market has weakened and that a growing number of loans are in default? It should have been as plain as the noses on their faces."
"The peak spring home-selling season is off to a slow start, builder D.R. Horton Inc. said Tuesday, another sign that bad times in the housing market may last longer than expected. Horton, the nation's largest homebuilder by deliveries, said Tuesday that its sales order in the most recent quarter fell 37 percent, led by even steeper declines in California and the Southwest."
CNN - "Home builder: Spring hasn't sprung" (4-10-07)
"D.R. Horton reports sharp drops in sales value, volume in three months ending in March; weakness is widespread across nation."
Bloomberg - "Growth Prospects in U.S. Dim on Subprime Crisis (Update2)" (4-10-07)
"Prospects for stronger U.S. growth in the second half of 2007 have dimmed as the housing recession deepens and businesses cut spending, according to economists surveyed this month by Bloomberg News. The economy grew at an annual pace of 2 percent last quarter, compared with a 2.4 percent pace forecast last month, according to the median estimate of 29 economists surveyed. Growth estimates for the last half of the year were trimmed for the first time since November. "
Market Watch - "Subprime crisis shines light on mortgage brokers" (4-10-07)
"The subprime mortgage crisis has re-ignited scrutiny of the industry and people who broker home loans, with some critics arguing that hidden fees and other dubious practices have contributed to the surge in delinquencies."
Yahoo! - "Risky loans - alive and well" (4-10-07)
"Option ARMs remain an option. Despite problems in the mortgage market, brokers say lenders are still willing to make risky loans - including those that allow borrowers to make monthly payments that don't even cover the interest (so-called 'option ARMs')."
News 10 - "Condo Conversion Suffers from Bad Timing" (4-10-07)
"At least 150 units in a Sacramento-area condominium complex are headed into foreclosure in an ambitious conversion project stung by the market slowdown. A development company operating under the name Rollingwood North LLC purchased the former Rollingwood Commons apartment complex in Fair Oaks and Orangevale in 2004 when the housing market was near an all-time high."
Daily News - "Reality bites real estate market" (4-10-07)
"Inland Empire among most overvalued"
Bloomberg - "Mortgage Bondholders May Bear Subprime Loan Risk (Update3)" (4-10-07)
"The top Democrat and Republican on the House Financial Services Committee said investors in mortgage bonds should be liable for deceptive loans made by banks. Democratic Chairman Barney Frank of Massachusetts and Spencer Bachus of Alabama, the committee's highest-ranking Republican, said such legislation would discourage lenders from extending loans to people with poor credit histories by making it more difficult and expensive for the banks to sell the mortgages."
Yahoo! - "Six Steps to Avoiding Foreclosure" (4-10-07)
"If you're a homeowner and are having trouble paying your mortgage, this article could save your house and your family's finances. As I write this, several million Americans are in jeopardy of losing their greatest investment to foreclosure within the next 18 months. But help is available, and there are ways to work with your lender to help keep your home."
Market Watch - "Subprime crisis shines light on mortgage brokers" (4-10-07)
"The subprime mortgage crisis has re-ignited scrutiny of the industry and people who broker home loans, with some critics arguing that hidden fees and other dubious practices have contributed to the surge in delinquencies."
Charles Hughs Smith - "The Mortgage Mess: The Soft Underbelly Beyond Subprime" (4-10-07)
Business Week - "Fannie, Freddie are regulatory 'concern'" (4-10-07)
"Government-sponsored mortgage giants Fannie Mae and Freddie Mac 'remain a significant supervisory concern' despite progress in fixing financial control issues that resulted in multibillion-dollar earnings restatements, according to a federal regulatory report released Tuesday."
"The Office of Federal Housing Enterprise Oversight's annual report to Congress notes that 'while both enterprises made progress in correcting their problems, especially in systems, controls and financial reporting, it has taken much more time and money to correct than ... expected.'"
MSN - "D.R. Horton orders down, spring sales weak" (4-10-07)
"D.R. Horton Inc. , the largest U.S. home builder, said on Tuesday orders for new homes tumbled 37 percent last quarter and the spring selling season has been slower than usual, suggesting the U.S. housing market has not yet hit bottom."
"While the Fort Worth, Texas-based company saw orders fall in all regions, the biggest decline was in California, where they fell 59 percent to 1,107 homes. California was also the market that saw the biggest dip in dollar value of orders, down about 57 percent to $533.5 million."
MSNBC - "Mortgage woes could be 'tip of the iceberg'" (4-10-07)
"Fraud, abusive lending crushes dreams for millions of home owners"
Market Watch - "End of housing bubble should have been obvious to everyone" (4-10-07)
"Why are so many people so surprised that the housing market has weakened and that a growing number of loans are in default? It should have been as plain as the noses on their faces."
Financial News Online - "Alt-A mortgage pricing points to spread of sub-prime woes" (4-9-07)
"Trading volumes of Alt-A mortgages, which are considered less risky than the US sub-prime sector, have hit a wall in the past month as banks reported problems selling the loans in the secondary market."
CS Monitor - "Foreclosure's shadow falls across diverse set of US homeowners" (4-9-07)
"At the housing boom's peak in 2005, 20 percent of new mortgage loans were subprime, four times the share a decade earlier."
Inman - "Mortgage lenders, builders pick up pace of job cuts" (4-9-07)
"Real estate firms cut jobs during the first quarter at the same pace as last year, but job losses in the mortgage lending industry nearly doubled for the period, according to a consulting firm that helps workers find new jobs. Announced job cuts in the real estate industry totaled 1,149 during the first quarter, about the same as the 1,152 tracked during the same quarter of 2006 by Challenger, Gray & Christmas Inc., a New York-based outplacement job consulting firm. There were 3,490 announced job cuts in real estate in 2006, Challenger said in an April 4 report."
"Mortgage lenders announced 6,138 job cuts in the first quarter of 2007, compared with 3,497 in the same period last year, the report said. There were 12,874 announced job cuts in mortgage lending last year."
"Announced job cuts in housing construction totaled 13,958 during the first quarter -- more than double the 6,450 positions eliminated in all of 2006."
"Announced first-quarter job cuts in all three housing related industries -- real estate, mortgage lending and construction -- totaled 21,245, rivaling the 22,814 jobs lost in all of 2006, the report said."
CNN - "Subprime blame game" (4-9-07)
"Some 2.4 million homeowners are in danger of losing their homes, many because of bad subprime loans. Critics are pointing their fingers at who is responsible - here are the main targets."
NAR - "NAR Urges HUD to Revamp FHA Program to Help People Stay in Their Homes" (4-9-07)
"In light of the many families being affected by negative subprime mortgages, the National Association of Realtors® encouraged the Department of Housing and Urban Development to act quickly to change the FHA mortgage insurance program to enable more homeowners and their families to keep their homes."
Reuters - "American Home Mortgage sinks on lower outlook" (4-9-07)
"American Home Mortgage Investment Corp. (AHM.N: Quote, Profile, Research) shares sank as much as 18.2 percent on Monday after the company slashed its dividend and 2007 profit forecasts, and several analysts downgraded its stock."
The Tribune - "Local foreclosures on the rise, so far" (4-9-07)
"Whether they’re first-time home buyers or investors, more San Luis Obispo County property owners are facing foreclosure, according to local real estate experts. For the first three months of this year, 215 notices of default — the first step in the foreclosure process — were sent to homeowners, up from 99 in the same period a year ago, according to All American Foreclosure Service, a San Luis Obispo firm that tracks foreclosures in the county."
The Jounral Gazette - "Housing analysts forecast gloomy spring" (4-9-07)
"Signs of a sobering slowdown emerged throughout March, ranging from gloomy forecasts among homebuilders to a growing number of high-risk borrowers struggling to make payments on exotic mortgages they probably couldn’t afford in the first place. The latest flare came less than two weeks ago as Lennar Corp., one of the nation’s largest homebuilders, reported a 73 percent drop in its first-quarter profit and warned that its results for the remainder of the year won’t live up to previous expectations."
"Trading volumes of Alt-A mortgages, which are considered less risky than the US sub-prime sector, have hit a wall in the past month as banks reported problems selling the loans in the secondary market."
CS Monitor - "Foreclosure's shadow falls across diverse set of US homeowners" (4-9-07)
"At the housing boom's peak in 2005, 20 percent of new mortgage loans were subprime, four times the share a decade earlier."
Inman - "Mortgage lenders, builders pick up pace of job cuts" (4-9-07)
"Real estate firms cut jobs during the first quarter at the same pace as last year, but job losses in the mortgage lending industry nearly doubled for the period, according to a consulting firm that helps workers find new jobs. Announced job cuts in the real estate industry totaled 1,149 during the first quarter, about the same as the 1,152 tracked during the same quarter of 2006 by Challenger, Gray & Christmas Inc., a New York-based outplacement job consulting firm. There were 3,490 announced job cuts in real estate in 2006, Challenger said in an April 4 report."
"Mortgage lenders announced 6,138 job cuts in the first quarter of 2007, compared with 3,497 in the same period last year, the report said. There were 12,874 announced job cuts in mortgage lending last year."
"Announced job cuts in housing construction totaled 13,958 during the first quarter -- more than double the 6,450 positions eliminated in all of 2006."
"Announced first-quarter job cuts in all three housing related industries -- real estate, mortgage lending and construction -- totaled 21,245, rivaling the 22,814 jobs lost in all of 2006, the report said."
CNN - "Subprime blame game" (4-9-07)
"Some 2.4 million homeowners are in danger of losing their homes, many because of bad subprime loans. Critics are pointing their fingers at who is responsible - here are the main targets."
NAR - "NAR Urges HUD to Revamp FHA Program to Help People Stay in Their Homes" (4-9-07)
"In light of the many families being affected by negative subprime mortgages, the National Association of Realtors® encouraged the Department of Housing and Urban Development to act quickly to change the FHA mortgage insurance program to enable more homeowners and their families to keep their homes."
Reuters - "American Home Mortgage sinks on lower outlook" (4-9-07)
"American Home Mortgage Investment Corp. (AHM.N: Quote, Profile, Research) shares sank as much as 18.2 percent on Monday after the company slashed its dividend and 2007 profit forecasts, and several analysts downgraded its stock."
The Tribune - "Local foreclosures on the rise, so far" (4-9-07)
"Whether they’re first-time home buyers or investors, more San Luis Obispo County property owners are facing foreclosure, according to local real estate experts. For the first three months of this year, 215 notices of default — the first step in the foreclosure process — were sent to homeowners, up from 99 in the same period a year ago, according to All American Foreclosure Service, a San Luis Obispo firm that tracks foreclosures in the county."
The Jounral Gazette - "Housing analysts forecast gloomy spring" (4-9-07)
"Signs of a sobering slowdown emerged throughout March, ranging from gloomy forecasts among homebuilders to a growing number of high-risk borrowers struggling to make payments on exotic mortgages they probably couldn’t afford in the first place. The latest flare came less than two weeks ago as Lennar Corp., one of the nation’s largest homebuilders, reported a 73 percent drop in its first-quarter profit and warned that its results for the remainder of the year won’t live up to previous expectations."
OC Register - "Are property taxes in subprime soup?" (4-7-07)
"O.C. tax collector says some ailing lenders may be unable to get borrowers' payments to the right place."
Washington Post - "The Subprime Meltdown and the Ownership Society" (4-7-07)
"A huge percentage of the easy-money mortgages issued to low- and moderate-income families in the past few years are going bad. This has led to bankruptcies for the big lenders in this market and millions of dollars in losses. The chain of defaults has also raised concerns about the mortgage and housing market more generally, and a growing number of economists view a recession induced by a housing crash as a distinct possibility."
Contra Costa Times - "Bay Area sees jump in listings for homes" (4-7-07)
"Bay Area home listings rose in March at one of the nation's highest rates, according to a survey released this week by Emeryville-based ZipRealty Inc. The number of homes for sale -- both old and new listings -- increased 12.2 percent in March from February. That's almost twice the 6.5 percent increase of listings in 18 major metropolitan markets served by ZipRealty. The only area that topped the Bay Area was Los Angeles, which had a 12.8 percent inventory increase. Local real estate professionals said there are many reasons a Bay Area seller might have put a home up for sale last month. "
"O.C. tax collector says some ailing lenders may be unable to get borrowers' payments to the right place."
Washington Post - "The Subprime Meltdown and the Ownership Society" (4-7-07)
"A huge percentage of the easy-money mortgages issued to low- and moderate-income families in the past few years are going bad. This has led to bankruptcies for the big lenders in this market and millions of dollars in losses. The chain of defaults has also raised concerns about the mortgage and housing market more generally, and a growing number of economists view a recession induced by a housing crash as a distinct possibility."
Contra Costa Times - "Bay Area sees jump in listings for homes" (4-7-07)
"Bay Area home listings rose in March at one of the nation's highest rates, according to a survey released this week by Emeryville-based ZipRealty Inc. The number of homes for sale -- both old and new listings -- increased 12.2 percent in March from February. That's almost twice the 6.5 percent increase of listings in 18 major metropolitan markets served by ZipRealty. The only area that topped the Bay Area was Los Angeles, which had a 12.8 percent inventory increase. Local real estate professionals said there are many reasons a Bay Area seller might have put a home up for sale last month. "
Yahoo! - "Buffett-Style Home Buying" (4-6-07)
"In the stock market, being a value investor means buying stocks when they are trading at low prices relative to underlying fundamentals--things like earnings, cash flow, assets or book value. Eventually these inefficiencies disappear and value investors are paid off handsomely. However value investing takes lot of hard work, patience and an ability to quiet one's emotions. This isn't the way residential real estate is typically bought and sold. But there is a new reality forming in real estate. Houses are sitting on the market longer, the subprime end of the market is a mess and new home sales are in the doldrums. Should home buyers adopt a value approach to the market?"
"In the stock market, being a value investor means buying stocks when they are trading at low prices relative to underlying fundamentals--things like earnings, cash flow, assets or book value. Eventually these inefficiencies disappear and value investors are paid off handsomely. However value investing takes lot of hard work, patience and an ability to quiet one's emotions. This isn't the way residential real estate is typically bought and sold. But there is a new reality forming in real estate. Houses are sitting on the market longer, the subprime end of the market is a mess and new home sales are in the doldrums. Should home buyers adopt a value approach to the market?"
Thursday, April 05, 2007
CVBT - " California foreclosure sales near $2 Billion in March" (4-5-07)
"With the Central Valley leading the way, 5,316 homes were lost to foreclosure sales in March in California, according to figures compiled by Foreclosure Radar, a Discovery Bay-based foreclosure listings and software company. The homes sold at auction last month represented a 27 percent increase from February and a 264 percent increase in the last six months, the company says. Of the $2 billion worth of properties sold in March, 4,796 went back to the lender after receiving no bids, representing $1.82 billion, it says."
Times Daily - "UBS lawsuit claims New Century misappropriated mortgage payments" (4-5-07)
"UBS Real Estate Securities Inc. sued New Century Financial Corp. on Thursday, claiming the subprime lender misappropriated millions of dollars from mortgage payments made on loans owned by the investment firm. In the 14-page filing with the U.S. Bankruptcy Court for the District of Delaware, UBS claims New Century breached the terms of a contract that called for the subprime lender to buy back home loans sold to UBS under certain conditions, such as when borrowers default soon after taking on the loans."
CAR - "Subprime's springtime surprise" (4-5-07)
"Upbeat housing data this week coupled with a renewed fighting spirit among survivors of this year's subprime saga may signal an unexpected spring comeback for the beleaguered sector."
"Supporting that upbeat assessment is news this week from the National Association of Realtors that pending sales of existing homes increased at a seasonally adjusted annual rate of 0.7 percent to 109.3 in February, from a reading of 108.5 in January. That's 8.5 percent below the level of a year earlier, but stronger than the market had been expecting."
CNN - "When credit is tight, getting the best loan" (4-5-07)
"Just as housing prices stall, lenders are making it tougher to borrow. A recent report from the Federal Reserve shows that 15 percent of U.S. banks began tightening credit standards at the end of 2006 - the most since the early 1990s."
Retuers - "Citigroup tightens mortgage lending standards" (4-5-07)
"Citigroup Inc. (C.N: Quote, Profile, Research), the largest U.S. bank and one of the largest U.S. mortgage lenders, is telling brokers that on Monday it will stop making some riskier home loans, documents obtained by Reuters show."
NAHB - "NAACP and National Association of Home Builders Address Affordable Housing Need" (4-5-07)
"Effective deterrents to predatory lending, land banks that make lots available for housing, broad-based consumer education efforts and a revitalized Federal Housing Administration – are a few of the many ideas generated and refined in a recent roundtable discussion on housing affordability conducted in Washington, D.C."
CBIA - "California New Home Sales Fall by Just 1.5% in February While Median Prices Remain Unchanged, CBIA Reports" (4-5-07)
"Total new-home sales at California’s major new-home communities fell by just 1.5 percent in February compared to the previous month while asking prices remained steady, the California Building Industry Association reported today. The monthly CBIA/Hanley Wood Market Intelligence sales report found that 5,996 new single-family homes, condos and townhomes were sold in February, while median asking prices rose by a slight 0.2 percent to $464,990. While February’s total sales figure was 33.9 percent below that recorded in February 2006, median asking prices rose by 3.3 percent compared to the previous year."
Modesto Bee - "Home sales downturn can be a boon for renters" (4-5-07)
"Many people are trying to hold onto houses they bought as investments by becoming landlords. That has flooded the Northern San Joaquin Valley rental market with houses, pushing down rents and forcing landlords to compete for tenants."
Market Watch - "Lower home prices force Ryland write-downs" (4-5-07)
"Hopes for a housing rebound this spring selling season were further diminished Thursday, as Ryland Group Inc. said lower home prices will likely drive write-downs and a quarterly loss as subprime-mortgage fears weigh heavily on the market."
USA Today - "A foreclosure still requires you to determine if you have a capital gain" (4-5-07)
"I received a 1099-A from the lender on a foreclosure from 2006. Do I have to claim it on my 1040 as income? Balance was $108,000 and fair market value is $149,000. I was held responsible even though the lender sold the property for only $136,000."
Seeking Alpha - "Top 15 Creditors to New Century" (4-5-07)
"Goldman Sachs has emerged as the single biggest creditor of New Century, the American sub-prime mortgage lender, which filed for Chapter 11 bankruptcy last night, after writing $60 billion (£30.4 billion) of American home loans. Barclays, the British bank, is at No 15 in the list of top 50 creditors. HSBC, which is already directly exposed to turmoil in the sub-prime market through its US sub-prime lending subsidiary, is at No 22. Here's the top lenders to New Century, which prior to their Chapter 11 bankruptcy filing, had borrowed over $60 billion to underwrite sub-prime home loans."
Real Estate Jounral - "Housing Inventory Surges In March Across the U.S." (4-5-07)
"Large inventories have caused prices to level off or fall modestly in much of the country over the past year or so. The recent surge in defaults on subprime mortgages -- loans to people with blemished credit records -- has prompted lenders to tighten credit standards. That tightening is expected to put downward pressure on home prices by removing many potential buyers from the market."
LA Times - "L.A. plan could raise stakes for condo projects" (4-5-07)
"After hearing from a nearly packed chamber of feisty tenants and anxious landlords, the Los Angeles City Council on Wednesday voted to dramatically raise the relocation fees that condominium developers must pay before kicking out residents of rent-controlled apartments."
Bloomberg - "U.S. Apartment Vacancies Rose to 6% in First Quarter (Update2)" (4-5-07)
"The vacancy rate for U.S. apartments climbed to 6 percent in the first quarter, the highest in almost two years, as the number of available properties increased, real estate research firm Reis Inc. said."
"With the Central Valley leading the way, 5,316 homes were lost to foreclosure sales in March in California, according to figures compiled by Foreclosure Radar, a Discovery Bay-based foreclosure listings and software company. The homes sold at auction last month represented a 27 percent increase from February and a 264 percent increase in the last six months, the company says. Of the $2 billion worth of properties sold in March, 4,796 went back to the lender after receiving no bids, representing $1.82 billion, it says."
Times Daily - "UBS lawsuit claims New Century misappropriated mortgage payments" (4-5-07)
"UBS Real Estate Securities Inc. sued New Century Financial Corp. on Thursday, claiming the subprime lender misappropriated millions of dollars from mortgage payments made on loans owned by the investment firm. In the 14-page filing with the U.S. Bankruptcy Court for the District of Delaware, UBS claims New Century breached the terms of a contract that called for the subprime lender to buy back home loans sold to UBS under certain conditions, such as when borrowers default soon after taking on the loans."
CAR - "Subprime's springtime surprise" (4-5-07)
"Upbeat housing data this week coupled with a renewed fighting spirit among survivors of this year's subprime saga may signal an unexpected spring comeback for the beleaguered sector."
"Supporting that upbeat assessment is news this week from the National Association of Realtors that pending sales of existing homes increased at a seasonally adjusted annual rate of 0.7 percent to 109.3 in February, from a reading of 108.5 in January. That's 8.5 percent below the level of a year earlier, but stronger than the market had been expecting."
CNN - "When credit is tight, getting the best loan" (4-5-07)
"Just as housing prices stall, lenders are making it tougher to borrow. A recent report from the Federal Reserve shows that 15 percent of U.S. banks began tightening credit standards at the end of 2006 - the most since the early 1990s."
Retuers - "Citigroup tightens mortgage lending standards" (4-5-07)
"Citigroup Inc. (C.N: Quote, Profile, Research), the largest U.S. bank and one of the largest U.S. mortgage lenders, is telling brokers that on Monday it will stop making some riskier home loans, documents obtained by Reuters show."
NAHB - "NAACP and National Association of Home Builders Address Affordable Housing Need" (4-5-07)
"Effective deterrents to predatory lending, land banks that make lots available for housing, broad-based consumer education efforts and a revitalized Federal Housing Administration – are a few of the many ideas generated and refined in a recent roundtable discussion on housing affordability conducted in Washington, D.C."
CBIA - "California New Home Sales Fall by Just 1.5% in February While Median Prices Remain Unchanged, CBIA Reports" (4-5-07)
"Total new-home sales at California’s major new-home communities fell by just 1.5 percent in February compared to the previous month while asking prices remained steady, the California Building Industry Association reported today. The monthly CBIA/Hanley Wood Market Intelligence sales report found that 5,996 new single-family homes, condos and townhomes were sold in February, while median asking prices rose by a slight 0.2 percent to $464,990. While February’s total sales figure was 33.9 percent below that recorded in February 2006, median asking prices rose by 3.3 percent compared to the previous year."
Modesto Bee - "Home sales downturn can be a boon for renters" (4-5-07)
"Many people are trying to hold onto houses they bought as investments by becoming landlords. That has flooded the Northern San Joaquin Valley rental market with houses, pushing down rents and forcing landlords to compete for tenants."
Market Watch - "Lower home prices force Ryland write-downs" (4-5-07)
"Hopes for a housing rebound this spring selling season were further diminished Thursday, as Ryland Group Inc. said lower home prices will likely drive write-downs and a quarterly loss as subprime-mortgage fears weigh heavily on the market."
USA Today - "A foreclosure still requires you to determine if you have a capital gain" (4-5-07)
"I received a 1099-A from the lender on a foreclosure from 2006. Do I have to claim it on my 1040 as income? Balance was $108,000 and fair market value is $149,000. I was held responsible even though the lender sold the property for only $136,000."
Seeking Alpha - "Top 15 Creditors to New Century" (4-5-07)
"Goldman Sachs has emerged as the single biggest creditor of New Century, the American sub-prime mortgage lender, which filed for Chapter 11 bankruptcy last night, after writing $60 billion (£30.4 billion) of American home loans. Barclays, the British bank, is at No 15 in the list of top 50 creditors. HSBC, which is already directly exposed to turmoil in the sub-prime market through its US sub-prime lending subsidiary, is at No 22. Here's the top lenders to New Century, which prior to their Chapter 11 bankruptcy filing, had borrowed over $60 billion to underwrite sub-prime home loans."
Real Estate Jounral - "Housing Inventory Surges In March Across the U.S." (4-5-07)
"Large inventories have caused prices to level off or fall modestly in much of the country over the past year or so. The recent surge in defaults on subprime mortgages -- loans to people with blemished credit records -- has prompted lenders to tighten credit standards. That tightening is expected to put downward pressure on home prices by removing many potential buyers from the market."
LA Times - "L.A. plan could raise stakes for condo projects" (4-5-07)
"After hearing from a nearly packed chamber of feisty tenants and anxious landlords, the Los Angeles City Council on Wednesday voted to dramatically raise the relocation fees that condominium developers must pay before kicking out residents of rent-controlled apartments."
Bloomberg - "U.S. Apartment Vacancies Rose to 6% in First Quarter (Update2)" (4-5-07)
"The vacancy rate for U.S. apartments climbed to 6 percent in the first quarter, the highest in almost two years, as the number of available properties increased, real estate research firm Reis Inc. said."
Wednesday, April 04, 2007
MBA - "MBA Chairman Robbins Responds to Call for Moratorium on Foreclosures" (4-4-07)
"Nobody wins when a home goes into foreclosure. Consumers lose their homes and suffer a ding on their credit rating, and lenders and investors lose significant amounts of money. The industry wants to take every possible step to avoid foreclosure which is why we have developed a number of loss mitigation tools in order to help those who are at risk of losing their homes. Lenders are already using a number of tools to help financially-stretched borrowers stay in their homes, including forbearance, payment plans and various other options."
Reuters - "Past due subprime mortgage payments at record high" (4-4-07)
"The percentage of home owners with subprime mortgages who are dangerously falling behind on monthly home loan payments rose to a record high in February, according to a First American LoanPerformance report provided on Wednesday to Reuters."
Chron.com - "Bankruptcy Filings Surged in Q1" (4-4-07)
"Spurred by a sputtering U.S. economy, bankruptcy filings are on the rise in 2007, an increase analysts predict will continue. In the first three months of 2007, business bankruptcy filings rose 60 percent and consumer filings increased by 70 percent, compared with the first three months of 2006, according to data collected by Jupiter eSources LLC, an Oklahoma City company that runs a bankruptcy database called Automated Access to Court Electronic Records, or AACER."
Yahoo! - "Buy-Backs: Keeping Lenders On The Hook" (4-4-07)
"In today's mortgage world a large percentage of all loans are routinely sold and resold. The buyers include insurance companies, pensions as well as purchasers such as Fannie Mae and Freddie Mac. To some extent selling a mortgage is a lot like selling a shirt. A purchaser has certain expectations and if the shirt is not up to par the buyer can bring it back for a refund. With mortgages, the same arrangement applies with each mortgage sale. If a loan is not up to snuff, the seller — meaning the lender who originated the loan in the first place — can be forced to buy back the mortgage. Clothing stores know that relatively few shirts will be returned and they also know something else: Paying for a few shirts will not bankrupt the company. The situation with mortgage loans is different because mortgages are big-ticket items. A conventional, everyday loan today can easily be worth more than $400,000. Return a few of these and you're out big money — perhaps more than $1 million. That's a problem because many of the businesses most people see as “lenders” do not actually fund mortgages with their own dollars. They're middlemen who obtain loans from the wholesale marketplace and then resell those loans at retail to borrowers. If there's an unacceptable loan default, our "lender" may not have enough capital to buy back one mortgage much less three or four. Rack up enough problem loans and lenders facing buy-backs — even big lenders — can quickly go broke. "
AP - "Mortgage Pros Scramble to Modify Loans" (4-4-07)
"As home foreclosures mount, mortgage companies are knocking on doors, sending letters and making phone calls with a simple message for struggling homeowners: They'd rather modify your loan than foreclose. EMC Mortgage Corp., which has a $78 billion loan portfolio that includes subprime loans made to homeowners with weak credit, this week launched a 50-person team it calls "the Mod Squad." Members will spend an unlimited time on the phone with troubled borrowers, sifting through their bills to compute a workable monthly payment. In an industry that often rewards workers for getting off the phone quickly, the team is preparing to speak to just three people a day."
CNN - "Activists want foreclosure moratorium" (4-4-07)
"Housing activists say families that have mortgages with questionable terms should be given six months to work out deals."
CNN - "Mortgage applications fall again" (4-4-07)
"Down for third straight week, industry group says; rate of average 30-year fixed-rate mortgage rose to 6.13%, highest mark since late February."
Voice of San Diego - "For Distressed Homeowners, Short Sales Stave Off Credit Ruin" (4-4-07)
"As a growing number of homeowners stare down the barrel of foreclosure, some are electing to negotiate with lenders to sell their homes at a loss, hoping to avoid the credit-marring implications of surrendering the home to the bank."
Real Estate Journal - "Home Buyers, Sellers Feel Fallout From Housing Market" (4-4-07)
"In Orange County, Calif., both home sales and the median price have dropped, the Orange County Register reports. Sales and prices were measured for the 22 business days ending March 9, the article says. Overall in the county, sales fell by 18.8%, while the median price decreased 0.8%, the newspaper says. The article includes a sortable chart that allows a look at the data by community, zip code, median price, change in median price, number of sales and change in the number of sales. Newport Beach saw the biggest decline in median price -- 44.2% to $910,000 -- while the Dana Point neighborhood saw only one sale, a percentage drop of 90% in home sales, the article says."
Merced Sun Star - "Merced homeowners flock to risky loans" (4-4-07)
"Merced homeowners are among the most likely in the country to have subprime mortgages -- the risky loans linked to skyrocketing foreclosure rates -- according to a survey published recently in the Wall Street Journal."
OC Register - "New Century's $150 million bankruptcy loan approved" (4-4-07)
"New Century Financial Corp. can borrow up to $150 million to stay open while it auctions off its assets, a judge ruled Tuesday."
OC Register - "Subprime trickles down to area businesses" (4-4-07)
"Hometown lenders including New Century, which filed for bankruptcy protection Monday, and Ameriquest Mortgage Co. already have fired more than 3,500 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."
OC Register - "O.C. residential rents likely to increase" (4-4-07)
"With a funding crisis under way among subprime lenders and Orange County's home prices still high, more renters will find their home buying options limited, said Delores Conway, director of the USC Lusk Center's Casden Forecast. Fewer people will qualify for home loans, she said. The center sees apartment rents rising in Orange County by 4 percent to 5 percent this year. Still, that would be down a tad from last year's increase of 5.3 percent and 6.5 percent in 2005. The average monthly rent at the end of 2006 was $1,472."
Yahoo! - "Western real estate cools, with exceptions" (4-4-07)
"While the West is experiencing the same buyer's market as the rest of the country, it enjoys some special factors that set it apart. First, with a median home price of $355,100 at the end of 2006, home costs are higher than in any other region of the country, according to the National Association of Realtors (NAR)."
LA Times - "Signs of vigor boost stocks" (4-4-07)
"An unexpected rise in home sales, a gain in consumer spending and falling oil prices give investors reason to rally."
"Nobody wins when a home goes into foreclosure. Consumers lose their homes and suffer a ding on their credit rating, and lenders and investors lose significant amounts of money. The industry wants to take every possible step to avoid foreclosure which is why we have developed a number of loss mitigation tools in order to help those who are at risk of losing their homes. Lenders are already using a number of tools to help financially-stretched borrowers stay in their homes, including forbearance, payment plans and various other options."
Reuters - "Past due subprime mortgage payments at record high" (4-4-07)
"The percentage of home owners with subprime mortgages who are dangerously falling behind on monthly home loan payments rose to a record high in February, according to a First American LoanPerformance report provided on Wednesday to Reuters."
Chron.com - "Bankruptcy Filings Surged in Q1" (4-4-07)
"Spurred by a sputtering U.S. economy, bankruptcy filings are on the rise in 2007, an increase analysts predict will continue. In the first three months of 2007, business bankruptcy filings rose 60 percent and consumer filings increased by 70 percent, compared with the first three months of 2006, according to data collected by Jupiter eSources LLC, an Oklahoma City company that runs a bankruptcy database called Automated Access to Court Electronic Records, or AACER."
Yahoo! - "Buy-Backs: Keeping Lenders On The Hook" (4-4-07)
"In today's mortgage world a large percentage of all loans are routinely sold and resold. The buyers include insurance companies, pensions as well as purchasers such as Fannie Mae and Freddie Mac. To some extent selling a mortgage is a lot like selling a shirt. A purchaser has certain expectations and if the shirt is not up to par the buyer can bring it back for a refund. With mortgages, the same arrangement applies with each mortgage sale. If a loan is not up to snuff, the seller — meaning the lender who originated the loan in the first place — can be forced to buy back the mortgage. Clothing stores know that relatively few shirts will be returned and they also know something else: Paying for a few shirts will not bankrupt the company. The situation with mortgage loans is different because mortgages are big-ticket items. A conventional, everyday loan today can easily be worth more than $400,000. Return a few of these and you're out big money — perhaps more than $1 million. That's a problem because many of the businesses most people see as “lenders” do not actually fund mortgages with their own dollars. They're middlemen who obtain loans from the wholesale marketplace and then resell those loans at retail to borrowers. If there's an unacceptable loan default, our "lender" may not have enough capital to buy back one mortgage much less three or four. Rack up enough problem loans and lenders facing buy-backs — even big lenders — can quickly go broke. "
AP - "Mortgage Pros Scramble to Modify Loans" (4-4-07)
"As home foreclosures mount, mortgage companies are knocking on doors, sending letters and making phone calls with a simple message for struggling homeowners: They'd rather modify your loan than foreclose. EMC Mortgage Corp., which has a $78 billion loan portfolio that includes subprime loans made to homeowners with weak credit, this week launched a 50-person team it calls "the Mod Squad." Members will spend an unlimited time on the phone with troubled borrowers, sifting through their bills to compute a workable monthly payment. In an industry that often rewards workers for getting off the phone quickly, the team is preparing to speak to just three people a day."
CNN - "Activists want foreclosure moratorium" (4-4-07)
"Housing activists say families that have mortgages with questionable terms should be given six months to work out deals."
CNN - "Mortgage applications fall again" (4-4-07)
"Down for third straight week, industry group says; rate of average 30-year fixed-rate mortgage rose to 6.13%, highest mark since late February."
Voice of San Diego - "For Distressed Homeowners, Short Sales Stave Off Credit Ruin" (4-4-07)
"As a growing number of homeowners stare down the barrel of foreclosure, some are electing to negotiate with lenders to sell their homes at a loss, hoping to avoid the credit-marring implications of surrendering the home to the bank."
Real Estate Journal - "Home Buyers, Sellers Feel Fallout From Housing Market" (4-4-07)
"In Orange County, Calif., both home sales and the median price have dropped, the Orange County Register reports. Sales and prices were measured for the 22 business days ending March 9, the article says. Overall in the county, sales fell by 18.8%, while the median price decreased 0.8%, the newspaper says. The article includes a sortable chart that allows a look at the data by community, zip code, median price, change in median price, number of sales and change in the number of sales. Newport Beach saw the biggest decline in median price -- 44.2% to $910,000 -- while the Dana Point neighborhood saw only one sale, a percentage drop of 90% in home sales, the article says."
Merced Sun Star - "Merced homeowners flock to risky loans" (4-4-07)
"Merced homeowners are among the most likely in the country to have subprime mortgages -- the risky loans linked to skyrocketing foreclosure rates -- according to a survey published recently in the Wall Street Journal."
OC Register - "New Century's $150 million bankruptcy loan approved" (4-4-07)
"New Century Financial Corp. can borrow up to $150 million to stay open while it auctions off its assets, a judge ruled Tuesday."
OC Register - "Subprime trickles down to area businesses" (4-4-07)
"Hometown lenders including New Century, which filed for bankruptcy protection Monday, and Ameriquest Mortgage Co. already have fired more than 3,500 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."
OC Register - "O.C. residential rents likely to increase" (4-4-07)
"With a funding crisis under way among subprime lenders and Orange County's home prices still high, more renters will find their home buying options limited, said Delores Conway, director of the USC Lusk Center's Casden Forecast. Fewer people will qualify for home loans, she said. The center sees apartment rents rising in Orange County by 4 percent to 5 percent this year. Still, that would be down a tad from last year's increase of 5.3 percent and 6.5 percent in 2005. The average monthly rent at the end of 2006 was $1,472."
Yahoo! - "Western real estate cools, with exceptions" (4-4-07)
"While the West is experiencing the same buyer's market as the rest of the country, it enjoys some special factors that set it apart. First, with a median home price of $355,100 at the end of 2006, home costs are higher than in any other region of the country, according to the National Association of Realtors (NAR)."
LA Times - "Signs of vigor boost stocks" (4-4-07)
"An unexpected rise in home sales, a gain in consumer spending and falling oil prices give investors reason to rally."
NAR - "Pending Home Sales Show Effects of Weather, Possible Subprime Impact" (4-3-07)
"A forward-looking index based on pending home sales indicates that bad weather, and possibly the loss of some subprime lending, will dampen sales closed in March and April, according to the National Association of Realtors®."
"The Pending Home Sales Index,* based on contracts signed in February, stood at 109.3 – down 8.5 percent from February 2006 when it reached 119.4, but is 0.7 percent higher than a downwardly revised reading of 108.5 in January. Earlier, mild weather caused the index to spike at 113.3 in December."
"David Lereah, NAR’s chief economist, said there has been a steady narrowing from year-ago readings since last July. 'If it wasn’t for the unusually bad weather in February, we’d be seeing a better performance in pending home sales,” he said. “We also may be seeing some fallout from a decline in subprime lending, but a slight improvement in the more volatile month-to-month index is encouraging – the data suggests an underlying stabilization is taking place in the housing market, but it will take another month or two to clarify.'"
Reuters - "Mortgage crisis calls American Dream into question" (4-3-07)
"There is no shortage these days of tragic stories of homeowners caught in America's subprime mortgage meltdown, as risky borrowing, reckless lending and a slump in the housing market drives millions into foreclosure. But while statistics show poor and minority homeowners are bearing the brunt of the crisis, the belief that every American can or should own their own home remains so pervasive few politicians admit that it just might not be true."
Market Watch - "Pending home sales up 0.7% in February" (4-3-07)
"Pending sales of U.S. homes rose by 0.7% in February, although the gain may have been held in check by bad weather during the month and by possible repercussions from the shakeout in subprime lending, the National Association of Realtors said Tuesday."
OC Register - "New Century 'Like Titanic sinking'" (4-3-07)
"The end came as no surprise, but it was still a shock for laid-off workers at New Century Financial Corp. when the Irvine-based subprime lender filed for bankruptcy protection Monday."
Washington Post - "Fannie Mae Plans To Cut Workforce" (4-3-07)
"Fannie Mae, the District-based mortgage funding company, plans to reduce its workforce by several hundred full-time employees by the end of this year, a company spokesman said."
Builder Online - "Subprime, Alt-A Woes to Shrink Borrower Market" (4-3-07)
"The bottom line for builders is that as lenders go under, tighten the qualification process, or face possible government restrictions on future subprime or Alt-A loans, the pool of potential borrowers for new home purchases could be negatively impacted by as high as 20 percent."
"A forward-looking index based on pending home sales indicates that bad weather, and possibly the loss of some subprime lending, will dampen sales closed in March and April, according to the National Association of Realtors®."
"The Pending Home Sales Index,* based on contracts signed in February, stood at 109.3 – down 8.5 percent from February 2006 when it reached 119.4, but is 0.7 percent higher than a downwardly revised reading of 108.5 in January. Earlier, mild weather caused the index to spike at 113.3 in December."
"David Lereah, NAR’s chief economist, said there has been a steady narrowing from year-ago readings since last July. 'If it wasn’t for the unusually bad weather in February, we’d be seeing a better performance in pending home sales,” he said. “We also may be seeing some fallout from a decline in subprime lending, but a slight improvement in the more volatile month-to-month index is encouraging – the data suggests an underlying stabilization is taking place in the housing market, but it will take another month or two to clarify.'"
Reuters - "Mortgage crisis calls American Dream into question" (4-3-07)
"There is no shortage these days of tragic stories of homeowners caught in America's subprime mortgage meltdown, as risky borrowing, reckless lending and a slump in the housing market drives millions into foreclosure. But while statistics show poor and minority homeowners are bearing the brunt of the crisis, the belief that every American can or should own their own home remains so pervasive few politicians admit that it just might not be true."
Market Watch - "Pending home sales up 0.7% in February" (4-3-07)
"Pending sales of U.S. homes rose by 0.7% in February, although the gain may have been held in check by bad weather during the month and by possible repercussions from the shakeout in subprime lending, the National Association of Realtors said Tuesday."
OC Register - "New Century 'Like Titanic sinking'" (4-3-07)
"The end came as no surprise, but it was still a shock for laid-off workers at New Century Financial Corp. when the Irvine-based subprime lender filed for bankruptcy protection Monday."
Washington Post - "Fannie Mae Plans To Cut Workforce" (4-3-07)
"Fannie Mae, the District-based mortgage funding company, plans to reduce its workforce by several hundred full-time employees by the end of this year, a company spokesman said."
Builder Online - "Subprime, Alt-A Woes to Shrink Borrower Market" (4-3-07)
"The bottom line for builders is that as lenders go under, tighten the qualification process, or face possible government restrictions on future subprime or Alt-A loans, the pool of potential borrowers for new home purchases could be negatively impacted by as high as 20 percent."
Monday, April 02, 2007
MSNBC - "Housing, Mortgage Troubles Will Hurt Calif. Economy" (4-2-07)
"California's economy will slow this year because of a 'double whammy' of a stagnant housing market and mortgage foreclosures, UCLA economists predicted Monday."
Realty Times - "Low Ball Offers Are Back" (4-2-07)
"Many parts of the country are currently experiencing an 'adjusting' market. Such an environment tends to bring out low ball offers. Considering that many -- indeed, probably most -- currently active agents have only been in the business during the past five years, i.e. during the good times, low ball offers are pretty much a new phenomenon to them. They merit some thought."
OC Register - "Percentage Change in Foreclosure in California" (4-2-07)
Bloomberg - "Subprime Mortgage Bond Sales Plunge in First Quarter (Update1)" (4-2-07)
"Sales of bonds backed by subprime mortgages are tumbling as investors and bankers, concerned about rising delinquency rates, pull back from what had been one of Wall Street's fastest growing businesses. About $79.3 billion of securities backed mainly by loans to people with poor credit or high amounts of debt were issued this year, down 37 percent from $125 billion in the same period last year, according to a March 30 Citigroup Inc. report. "
Bloomberg - "New Century, Biggest Subprime Casualty, Goes Bankrupt (Update2)" (4-2-07)
"New Century Financial Corp. became the biggest subprime mortgage company to go bankrupt after the lender, which specialized in loans to people with poor credit records, was overwhelmed by customer defaults. The company filed for Chapter 11 protection today in Wilmington, Delaware, from creditors that include Morgan Stanley and Goldman Sachs Group Inc. About 3,200 people, more than half the workforce, will lose their jobs at the Irvine, California- based company, which said it agreed to sell its mortgage billings and collections unit to Carrington Capital Management LLC for $139 million. "
Market Watch - "Mortgage crisis to hit holders of risky derivatives" (4-2-07)
"The shakeout in the subprime-mortgage business is inexorably worming its way through the credit markets that fueled the sector's rapid growth. So who ultimately holds the risk? Many experts point vaguely to Asian and especially Japanese investors who have been hungry for any assets yielding more than the almost-nonexistent interest rates offered by the world's second-largest economy in recent years."
LA Times - "Housing woes will be drag on state" (4-2-07)
"The real estate slowdown will be a major drag on California's economy this year, but not enough to pull the state into recession, UCLA economists said in their forecast to be released today. A jump in mortgage defaults and tightened lending standards, caused by the meltdown in the high-risk sub-prime lending market, will further slow home sales and result in more job losses, said economist Ryan Ratcliff, author of the California segment of the closely watched UCLA Anderson Forecast."
OC Register - "Let the borrower beware" (4-2-07)
"Officials say a growing number of 'foreclosure rescue scams' are targeting property owners who fall behind on their loans, siphoning off their equity and causing them to lose their houses."
"California's economy will slow this year because of a 'double whammy' of a stagnant housing market and mortgage foreclosures, UCLA economists predicted Monday."
Realty Times - "Low Ball Offers Are Back" (4-2-07)
"Many parts of the country are currently experiencing an 'adjusting' market. Such an environment tends to bring out low ball offers. Considering that many -- indeed, probably most -- currently active agents have only been in the business during the past five years, i.e. during the good times, low ball offers are pretty much a new phenomenon to them. They merit some thought."
OC Register - "Percentage Change in Foreclosure in California" (4-2-07)
Bloomberg - "Subprime Mortgage Bond Sales Plunge in First Quarter (Update1)" (4-2-07)
"Sales of bonds backed by subprime mortgages are tumbling as investors and bankers, concerned about rising delinquency rates, pull back from what had been one of Wall Street's fastest growing businesses. About $79.3 billion of securities backed mainly by loans to people with poor credit or high amounts of debt were issued this year, down 37 percent from $125 billion in the same period last year, according to a March 30 Citigroup Inc. report. "
Bloomberg - "New Century, Biggest Subprime Casualty, Goes Bankrupt (Update2)" (4-2-07)
"New Century Financial Corp. became the biggest subprime mortgage company to go bankrupt after the lender, which specialized in loans to people with poor credit records, was overwhelmed by customer defaults. The company filed for Chapter 11 protection today in Wilmington, Delaware, from creditors that include Morgan Stanley and Goldman Sachs Group Inc. About 3,200 people, more than half the workforce, will lose their jobs at the Irvine, California- based company, which said it agreed to sell its mortgage billings and collections unit to Carrington Capital Management LLC for $139 million. "
Market Watch - "Mortgage crisis to hit holders of risky derivatives" (4-2-07)
"The shakeout in the subprime-mortgage business is inexorably worming its way through the credit markets that fueled the sector's rapid growth. So who ultimately holds the risk? Many experts point vaguely to Asian and especially Japanese investors who have been hungry for any assets yielding more than the almost-nonexistent interest rates offered by the world's second-largest economy in recent years."
LA Times - "Housing woes will be drag on state" (4-2-07)
"The real estate slowdown will be a major drag on California's economy this year, but not enough to pull the state into recession, UCLA economists said in their forecast to be released today. A jump in mortgage defaults and tightened lending standards, caused by the meltdown in the high-risk sub-prime lending market, will further slow home sales and result in more job losses, said economist Ryan Ratcliff, author of the California segment of the closely watched UCLA Anderson Forecast."
OC Register - "Let the borrower beware" (4-2-07)
"Officials say a growing number of 'foreclosure rescue scams' are targeting property owners who fall behind on their loans, siphoning off their equity and causing them to lose their houses."
Recordnet.com - "Mortgage defaults on the rise, but what's next?" (4-1-07)
"About one in 10 homes on the market now is either a bank-owned foreclosure property or a short-sale - a house forced on the market by the lender because the payments are late. Over the past year, the markets for both foreclosures and trustee sales have tripled, www.sjforeclosures.com reported. The increase has been steady with a surge in recent months."
Sign On San Diego - "Industry tightens standards on 'no proof' loans" (4-1-07)
"Designer mortgage loans that don't require borrowers to prove how much money they earn or make downpayments are getting much of the blame for the wave of defaults racking the subprime mortgage industry. Many lenders are tightening qualifications for such 'stated income loans' and other financing that requires little or no documentation."
Inside Bay Area - "East Bay hit hard by slump in realty" (4-1-07)
"The East Bay has become one of the worst-hit epicenters jolted by the housing slump, and the aftermath is likely to slow the region's surging economy and job market, according to a report released today. Some of the sharpest spikes in home mortgage defaults in California have surfaced in the East Bay, a study by the University of California, Los Angeles, Anderson Forecast disclosed. The Anderson Forecast used data supplied by DataQuick to produce the downbeat assessment. "
Yahoo! - "Subprime woes to drag '07 market" (4-1-07)
"More than two dozen subprime lenders have shut down in recent months and others are scrambling to stay in business as a spike in defaults caused by borrowers unable to make payments has rocked the mortgage industry. Now, as lenders tighten credit standards, the housing market will likely see further declines in price and output, senior economist David Shulman wrote in the quarterly Anderson Report to be released Monday by the University of California, Los Angeles."
LA Times - "Values drop, so can taxes" (4-1-07)
"Home prices are dropping in parts of Southern California and, for owners who bought at the market's peak, that could translate to lower property tax bills. Because property taxes are based on 1% of the sales price of a home, a dip in the market can shave more than a few dollars off the assessed value of a house and the biannual payment — the second of which must be paid by April 10 to avoid penalties. Reductions are permitted by Proposition 8 — an amendment to tax-limiting Proposition 13 — that allows county assessors to reduce property taxes when market values fall. To get one, homeowners must be able to show their residence is worth less than its purchase price."
"About one in 10 homes on the market now is either a bank-owned foreclosure property or a short-sale - a house forced on the market by the lender because the payments are late. Over the past year, the markets for both foreclosures and trustee sales have tripled, www.sjforeclosures.com reported. The increase has been steady with a surge in recent months."
Sign On San Diego - "Industry tightens standards on 'no proof' loans" (4-1-07)
"Designer mortgage loans that don't require borrowers to prove how much money they earn or make downpayments are getting much of the blame for the wave of defaults racking the subprime mortgage industry. Many lenders are tightening qualifications for such 'stated income loans' and other financing that requires little or no documentation."
Inside Bay Area - "East Bay hit hard by slump in realty" (4-1-07)
"The East Bay has become one of the worst-hit epicenters jolted by the housing slump, and the aftermath is likely to slow the region's surging economy and job market, according to a report released today. Some of the sharpest spikes in home mortgage defaults in California have surfaced in the East Bay, a study by the University of California, Los Angeles, Anderson Forecast disclosed. The Anderson Forecast used data supplied by DataQuick to produce the downbeat assessment. "
Yahoo! - "Subprime woes to drag '07 market" (4-1-07)
"More than two dozen subprime lenders have shut down in recent months and others are scrambling to stay in business as a spike in defaults caused by borrowers unable to make payments has rocked the mortgage industry. Now, as lenders tighten credit standards, the housing market will likely see further declines in price and output, senior economist David Shulman wrote in the quarterly Anderson Report to be released Monday by the University of California, Los Angeles."
LA Times - "Values drop, so can taxes" (4-1-07)
"Home prices are dropping in parts of Southern California and, for owners who bought at the market's peak, that could translate to lower property tax bills. Because property taxes are based on 1% of the sales price of a home, a dip in the market can shave more than a few dollars off the assessed value of a house and the biannual payment — the second of which must be paid by April 10 to avoid penalties. Reductions are permitted by Proposition 8 — an amendment to tax-limiting Proposition 13 — that allows county assessors to reduce property taxes when market values fall. To get one, homeowners must be able to show their residence is worth less than its purchase price."
OC Register - "Subprime worries shake up housing market" (3-31-07)
"While Orange County won't be affected as much as other areas that rely more heavily on lending for risky borrowers, tighter standards will eliminate some home buyers here while pushing others into foreclosure, experts say."
"While Orange County won't be affected as much as other areas that rely more heavily on lending for risky borrowers, tighter standards will eliminate some home buyers here while pushing others into foreclosure, experts say."
Subscribe to:
Posts (Atom)
Posts
