"Spending on U.S. construction projects fell less than half as much as forecast in November, reflecting gains in commercial and government building that partially cushioned the slump in residential real estate. The 0.6 percent decline followed a 0.4 percent drop the prior month that was smaller than previously reported, the Commerce Department said today in Washington. The median estimate of economists surveyed by Bloomberg News was a 1.4 percent slide."
Bloomberg - "Paulson’s Pellegrini Said to Resign to Start Own Hedge Fund" (1-5-08)
"Paolo Pellegrini, the hedge-fund manager who helped Paulson & Co. make more than $3 billion in 2007 on bets the U.S. housing bubble would burst, resigned to start his own fund, a person familiar with the matter said."
Bloomberg - "Non-Agency Mortgage Bonds Rallied as Rates Declined" (1-5-08)
"U.S. mortgage bonds without government support rose last month, as lower home-loan rates boosted investor demand. Securities initially rated AAA and backed by prime-jumbo mortgages with five years of fixed rates climbed 5 cents on the dollar in December to 75 cents, according to JPMorgan Chase & Co. data. Bonds of 30-year Alt-A loans with “conforming” balances rose to 45 cents less than similar Fannie Mae bonds, from 52 cents, New York-based JPMorgan said in a Jan. 2 report."
"In October, lower-priced homes in LA/OC were selling 38.8% below a year ago. Higher-prices homes sold at just a 20.6% discount vs. a year ago. See chart of annual change rates at right! There’s now been a double-digit, percentage-point gap between cheaper housing and the top in terms of price losses for nine consecutive months. The last time this happened was 1991, and then only for two months."
Realtors List - "Washington Report: Who Chooses Appraisers?" (1-5-08)
"Mortgage brokers -- who still account for a significant percentage of new home loan originations -- are totally banned from selecting appraisers. Realtors are also specifically forbidden from having any say or influence over the choice of an appraiser on a sale transaction. Well, you might ask: Since appraisers in the past have often complained about pressure from loan brokers and realty agents to 'hit the number' -- that is, turn in valuations high enough to allow transactions to go to closing -- aren't they happy about the new prohibitions? They're not. Many local appraisers have built up long-standing, legitimate relationships with brokers, small lenders and Realtors as sources of assignments. Under Fannie's and Freddie's new rules , they fear, the mortgage business will shift away from local brokers to large national lenders, who'll use big 'appraisal management companies' to handle home valuations."
Inman News - "'Cramdowns' on tap in 2009?" (1-5-08)
"Democrats are planning to reintroduce legislation that would allow bankruptcy judges to modify the terms of troubled borrowers' loans -- a move that industry opponents say will lead to higher interest rates and down payments for all borrowers. Rep. Brad Miller, D-N.C., said he plans to introduce a bill today allowing bankruptcy 'cramdowns' of mortgage loan principal, the Wall Street Journal reported. Sen. Richard Durbin, D-Ill., plans to sponsor similar legislation in the Senate, the paper said."
Inman News - "'New IndyMac' to continue loan mods" (1-5-08)
"A group of investors who have agreed to put up $1.3 billion in cash to acquire IndyMac Bank are expected to continue an FDIC mortgage loan modification program that aims to help nearly 50,000 borrowers avoid foreclosure. The FDIC said it will continue to share losses on loans made by IndyMac and provide secured financing to the new owners, who are expected to acquire the failed bank's $16 billion loan portfolio and $6.9 billion in securities in late January or early February."
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