October

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“Bridge Loan to Nowhere”: Public Outcry Forces House to Reject $700 Billion BailoutOn Monday, the House voted 228-to-205 against authorizing the largest government intervention in the financial market in US history. The measure would have granted the Treasury unprecedented authority and up to $700 billion to relieve faltering banks and other firms of bad assets backed by home mortgages, which are falling into foreclosure at record rates. As the economic crisis worsens and spreads across the globe, Democracy Now! speaks with Robert Johnson, former chief economist of the Senate Banking Committee, and Bruce Marks, the founder and CEO of NACA, the Neighborhood Assistance Corporation of America. October 1, 2008
Home Prices Hint at StabilizationBig-city home prices in July were down 16.3% from a year earlier, but the decline in prices appears to be slowing. The Standard & Poor’s/Case-Shiller 20-city housing index released Tuesday showed the largest 12-month decline since it began in 2000. Home values in all 20 cities fell year-over-year. Las Vegas and Phoenix reported year-over-year declines of nearly 30%. Miami reported a decline of 28.2% from July 2007. October 1, 2008
FDIC Deposit Insurance Limit Could Bump Up to $250,000Savers who are frustrated with limits on federal deposit insurance could find temporary relief in the $700 billion financial rescue package pending on Capitol Hill. Lawmakers are considering adding a provision to the bailout bill that would temporarily increase the federal deposit insurance limit to $250,000 from $100,000. On Tuesday, presidential nominees John McCain and Barack Obama spoke out in favor of the increase. October 1, 2008
HUD ENCOURAGES TEXAS AND LOUISIANA LANDLORDS TO LIST VACANCIES IN THE NATIONAL HOUSING LOCATOR SYSTEM TO HELP DISPLACED FAMILIESThe U.S. Department of Housing and Urban Development is appealing to landlords in Texas and Louisiana to list their vacant properties on HUD’s National Housing Locator System (NHLS). Working with federal and private housing databases, HUD uses this web-based system to offer thousands of displaced families referrals to longer term housing. More than 50,000 apartments and single-family homes are currently available through the NHLS in Texas, Louisiana, Arkansas, Oklahoma and New Mexico. This includes approximately 240 units within a 300-mile radius of Harris County. Several landlords hoping to help hurricane victims have asked HUD how to get their properties listed in the NHLS. Landlords and property owners can obtain advice and assistance on how to add available units to the National Housing Locator by calling (703) 667-9420 x114. October 1, 2008
Failed Deals Replace Real Estate BoomAfter seven years of nonstop construction, skyrocketing rents and sales prices, and a seemingly endless appetite for luxury housing that transformed gritty and glamorous neighborhoods alike, the credit crisis and the turmoil on Wall Street are bringing New York’s real estate boom to an end. Developers are complaining that lenders are now refusing to finance projects that were all but certain months or even weeks ago. Landlords bewail their inability to refinance skyscrapers with blue-chip tenants. And corporations are afraid to relocate within Manhattan for fear of making the wrong move if rents fall or a flagging economy forces layoffs. October 1, 2008
Hopkins Expands Homeownership ProgramA program that encourages Johns Hopkins employees to buy homes in certain Baltimore neighborhoods has been expanded, with the amount of the largest grants set at nearly seven times the previous cap. The “Live Near Your Work” program, which had offered up to $2,500 to help with down payments and closing costs, now offers up to $17,000, depending on the neighborhood. Much of the added funding comes from a grant from the Rouse Company Foundation. October 1, 2008
Recovery Cottages Have Yet to Go UpPublic officials say they have made progress on an alternative housing program in the seven months since Gov. Bobby Jindal stripped the project from the Louisiana Housing Finance Agency and gave it to the Louisiana Recovery Authority. But through two governors, two contracts with the same builder and a change in the state agency responsible for oversight, none of the projected 500 or so Louisiana Cottages have been built; and there are no groundbreakings scheduled for Louisiana’s $75 million share of the $400 million pilot program that Congress authorized in 2006. October 1, 2008
Senate Approves BailoutThe Senate last night easily approved a massive plan to shore up the U.S. financial system, but the measure faces a tougher test tomorrow in the House, where leaders will try to reverse the stunning defeat the legislation suffered earlier this week. As the Bush administration issued fresh warnings that Congress’s failure to act would have dire consequences for the economy, the Senate revived the package the House defeated Monday and voted to approve it, 74 to 25. October 2, 2008
State Discount Mortgage Unit Moves to Increase Interest RateSqueezed by the tightening credit markets, a New York State agency that provides subsidized mortgages to first-time home buyers stopped offering discounted interest rates this week and started looking for new sources of funds. Officials at the State of New York Mortgage Agency said on Wednesday that they had decided this week to raise their interest rates because they were struggling to borrow money to finance the purchase of mortgages. The agency postponed the sale of $250 million in bonds this week because of turmoil in the credit markets, said Priscilla Almodovar, the president and chief executive of the mortgage agency. October 2, 2008
HUD TO HOST NATIONAL HOUSING SUMMIT IN WASHINGTONFederal, state, and community leaders from around the nation will be gathering in Washington next week for a two-day national Summit on Housing sponsored by the U.S. Department of Housing and Urban Development. HUD Secretary Steve Preston invited key housing and finance staffs from state, city and county government, as well as representatives from the banking and housing industries, non-profit organizations, and foundations to address the country’s urgent and long-term housing issues. October 2, 2008
Foreclosures on Million-dollar Homes Surgen 2003, Robert Provost snapped up a $2.5 million villa with its own boat dock in Sarasota, Fla. A finance chief for an auto-sales chain, Mr. Provost earned more than $250,000 a year and had an impeccable credit history. Then he lost his job. Mr. Provost missed one $10,500 mortgage payment, then another. This month, the 53-year-old put his house, a five-bedroom with sweeping views of an intercoastal waterway, on the market for $3.4 million. But the listing has thus far attracted little interest. Mr. Provost says he expects to receive a notice of default from the bank — the first step to foreclosure — in the next month or two. October 2, 2008
Towns That Could Be Hit Hardest by CrisisHow many former Lehman Brothers bankers or AIG executives are likely to be buying a Park Avenue apartment or a home in Darien, Conn., this year? Most likely answer: not many at all. As anyone who works on Wall Street, invests in the stock market, or just reads the newspapers knows, the past few weeks for the financials sector have been as ugly as Frankenstein’s sister. People have seen their net worth eviscerated, if not obliterated completely. October 2, 2008
Bank of America To Modify Mortgages From CountrywideBank of America has agreed to rework the terms of up to 400,000 distressed mortgages nationwide starting Dec. 1 to settle lawsuits and investigations pending against one of its subsidiaries. The settlement could be the largest in predatory lending history. It could save $8.7 billion for customers of Countrywide Financial, the nation’s largest mortgage lender before it was hobbled by subprime loans and bought by Bank of America. October 7, 2008
Failure This Big Wasn’t Born YesterdayIf you’re mad as hell about what’s happening to our economy and need to stay mad to keep from wailing, read the October selection for the Color of Money Book Club. Two years ago, Gary Weiss wrote “Wall Street Versus America: The Rampant Greed and Dishonesty That Imperil Your Investments.” The subtitle was changed for the paperback edition last year. Now the book is called “Wall Street Versus America: A Muckraking Look at the Thieves, Fakers, and Charlatans Who Are Ripping You Off” (Portfolio, $14.95). I like the revision, given current events. October 7, 2008
Financial Crisis Takes a Toll on Already-Squeezed CitiesAfter the layoff of 160 full-time and part-time city workers, the slashing of recreation programs and a call for volunteers to shelve books at the branch libraries (open two days a week now instead of six), the people of Duluth, Minn., thought they had seen the worst of a bad year for the municipal budget. To help close a gap of more than $6 million that yawned open over the summer, the artsy shipping city on Lake Superior had considered selling its prized Tiffany stained-glass window depicting Longfellow’s American Indian character Minnehaha, a one-of-a-kind work donated by a civic group more than 100 years ago. And some even pushed forward with plans to sell valuable beachfront property along the lake. The city had options, things were looking up. October 7, 2008
Hurricane Ike Produces 76,000 Damage Claims So FarMore than 76,000 damage claims from Hurricane Ike have been filed with the Texas-backed windstorm insurance association, which expects to pay billions of dollars to policy holders for losses.Texas Windstorm Insurance Association general manager Jim Oliver cautioned Wednesday that the final figure will depend on whether claims are determined to be wind or flood damage. The association says it will pay for wind damage, but not storm surge damage, which it considers to be flooding. “We are going to look at every single claim individually,” Oliver said. “That is going to make the process slow.” October 9, 2008
Credit Crisis Threatens New Orleans’ RecoveryA prolonged recession and a tight credit market would cripple New Orleans’ still-fragile recovery from Hurricane Katrina, delaying or eliminating road work, new construction and repairs to homes and businesses that have stood empty since 2005. The city’s infrastructure plans should stay on track, but a real estate expert calls it a “terrifying” scenario: A lack of sufficient credit would smother companies trying to start up or expand, and with them the new jobs needed to grow the area’s economy. It would choke the flow of cash that developers need to build new homes and first-time homeowners need to buy them. And it would make it tough for the city to sell bonds to finance rebuilding projects on its appointed timeline. October 9, 2008
Fannie, Freddie Become Hot Topic in CampaignThey long have been political hot potatoes inside the Beltway, but suddenly Fannie Mae and Freddie Mac have become pawns in the 2008 presidential campaign. During Tuesday’s debate, Republican presidential nominee Sen. John McCain (Ariz.) charged that the mortgage finance giants “lit this fire” under the economic crisis. He said Democratic presidential nominee Sen. Barack Obama (Ill.) and “his cronies” encouraged the companies to make risky loans. And he claimed that he took a stand two years ago to rein them in. October 9, 2008
HUD CHARGES ALABAMA LANDLORDS WITH DISCRIMINATIONThe U.S. Department of Housing and Urban Development (HUD) today announced that it has charged two Tallassee, Alabama landlords with violating the Fair Housing Act for allegedly forcing white tenants to move out of their house after the owners saw the couple talking with black neighbors in their front yard. In February 2008, Melissa Jones, her fiancé, and their child moved into a property owned by Wilber and Julie Williams.” While Jones’ African-American neighbors were visiting with her in the front yard, the Williamses drove by and witnessed the gathering. “Later that day, Ms. Williams called Ms. Jones and allegedly said, “Those people need to leave. “I don’t want those people on my property.” According to the HUD charge, Ms. Williams intimidated and coerced Ms. Jones during another phone call. October 9, 2008
Obama Camp Says McCain Mortgage Plan Won’t WorkSen. Barack Obama’s campaign criticized Sen. John McCain’s mortgage bailout plan yesterday, saying it would cause the government to lose money by paying too much for bad loans. The Arizona Republican’s proposal to spend $300 billion in federal funds to buy distressed mortgages was a highlight of Tuesday’s presidential debate, and it seemed to catch Obama off guard. At first, the Illinois Democrat’s campaign said that he had made similar proposals and that there was nothing new in McCain’s remarks. October 9, 2008
A Rising Tide of ‘Underwater’ HomeownersThe relentless slide in home prices has left nearly one in six U.S. homeowners owing more on a mortgage than the home is worth, raising the possibility of a rise in defaults — the very misfortune that touched off the credit crisis last year. The result of homeowners being “underwater” is more pressure on an economy that is already in a downturn. No longer having equity in their homes makes people feel less rich and thus less inclined to shop at the mall. October 9, 2008
Experts Skeptical About McCain Mortgage PlanOrdering the government to buy up bad mortgages to cut homeowners’ monthly payments might sound good, but experts are skeptical. They say the plan John McCain is promoting is unlikely to solve the housing crisis that’s pushing the economy toward recession. One big problem: The vast majority of the toxic home loans that are clogging financial markets and freezing up credit have been sliced, diced and repackaged into complex investments that the government would be hard-pressed to unravel and buy. October 9, 2008
Sheriff Tells Deputies Not to Help In ForeclosuresThe sheriff here said Wednesday that he’s ordering his deputies to stop evicting people from foreclosed properties because many people his office has helped throw out on the street are renters who did nothing wrong. “We will no longer be a party to something that’s so unjust,” a visibly angry Cook County Sheriff Tom Dart said at a news conference. October 9, 2008
Coastal Rebuilding Awash in DebateIt’s late afternoon in this Gulf Coast community and the Mockingbird Café is abuzz: Businessmen nurse pints of local beer, a group of middle-school-age girls huddle around their homework, latte-drinkers peck at laptops. Barely a hint anywhere of the 30-foot storm surge and raging winds of Hurricane Katrina three years ago that shredded shops in the downtown area, tore up streets and decimated homes. Gustav and Ike last month again flooded homes and ravaged local beaches. October 10, 2008
Pitt’s First ‘Make It Right’ Homes Complete in La.The first homes in Brad Pitt’s Make It Right rebuilding project are complete, and some three years after Hurricane Katrina devastated New Orleans, 68-year-old grandmother Gloria Guy was on hand to give the actor a big hug. Pitt, his partner Angelina Jolie and their family of six children privately toured the hard-hit Lower 9th Ward district earlier this week. The celebrity couple bought a home in New Orleans about a year after Katrina struck and became involved in launching the project to help rebuild the city’s hardest-hit neighborhood. October 10, 2008
Home Builders, Broker Charged With TheftThey promised to deliver brick-front colonials in a sparkling new subdivision in Upper Marlboro, homes on as much as an acre of land for as little as $370,000. Instead, the home builders and the mortgage broker pocketed payments from 11 buyers and left them empty-handed, Glenn F. Ivey, state’s attorney for Prince George’s County, said yesterday. The builders and broker are accused of collecting about $1 million for homes that were never built in what was to be the Kings Grant subdivision. October 10, 2008
HUD TO HOST THREE REGIONAL HOUSING SUMMITSThe U.S. Department of Housing and Urban Development will host three regional housing summits across the country to help launch HUD’s new Neighborhood Stabilization Program (NSP). HUD is inviting key State, city and county leaders to address the country’s urgent and long-term housing issues including how to deal with abandoned foreclosed properties within their communities. NSP provides nearly $4 billion in targeted emergency assistance to state and local governments to acquire and redevelop foreclosed properties that might otherwise become sources of abandonment and blight within their communities. HUD plans summits in Los Angeles (October 10th); Columbus, Ohio (October 14th); and Orlando, Florida (October 16). October 10, 2008
HUD CHARGES NEW YORK CO-OP WITH DISCRIMINATING AGAINST FAMILY OF A DISABLED CHILDThe U. S. Department of Housing and Urban Development announced today that it has charged The Townsend House Corp., a private cooperative in New York City, with housing discrimination for refusing to allow a family to obtain an animal that provides emotional support for their autistic child.The Fair Housing Act makes it unlawful to refuse to make reasonable accommodations in rules, policies, practices, or services, when such accommodation may be necessary to afford a person with disabilities equal opportunity to use and enjoy a dwelling. October 10, 2008
Promises of Help Added to WoesTwo women beset with health and financial problems were facing imminent foreclosure on their Ellicott City homes when they thought rescue was at hand. Betty J. Bullock, 63, had poor eyesight and diabetes for years and lived on about $800 a month in Social Security. She had no savings and hadn’t worked since 1997. Griselda Mason, 68, also had vision problems and trouble walking, which limited her ability to work. She fell behind on mortgage payments, which ruined her credit and brought the threat of foreclosure.Then the promises of help came in the mail. October 10, 2008
Mortgage Rates Drop Below 6 PercentRates on 30-year mortgages fell below 6 percent this week, recording the first decline in three weeks.Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages averaged 5.94 percent this week, down from 6.10 percent last week. It marked the first decline since rates fell on Sept. 18 to 5.78 percent, a seven-month low. October 10, 2008
Obama Details Plan to Aid Victims of Fiscal CrisisSenator Barack Obama proposed new steps on Monday to address the economic crisis, calling for temporary but costly new programs to help employers, automakers, homeowners, the unemployed, and state and local governments. In an address here, Mr. Obama, the Democratic presidential nominee, proposed giving employers a $3,000 tax credit for each new hire to encourage job creation. He said he would seek to allow Americans of all ages to borrow from retirement savings without a tax penalty; to eliminate income taxes on unemployment benefits; and to double, to $50 billion, the government’s loan guarantees for automakers. October 14, 2008
The Homes Are Familiar, the Buyers Much Less SoSomeone left the back-door light on at 3407 Bruckner Boulevard one recent afternoon, but no one yet lives in this large, red-brick dwelling in the Bronx neighborhood south of Pelham Bay Park. The house is part of Waterbury Estates, which is described on the answering machine of its sales office as new luxury two-family homes. This particular house, however, could soon be a group residence for six mentally disabled adults. Such a switch in intended occupants is becoming a familiar local story. Just last month, Community Board 10 narrowly supported another group home in Throgs Neck, to the south. Around the same time, Throgs Neck residents discovered another nearby group home, as well as the news about the proposed use for the house on Bruckner Boulevard. October 14, 2008
States Warned About Impending Mortgage CrisisMore than five years ago, in April 2003, the attorneys general of two small states traveled to Washington with a stern warning for the nation’s top bank regulator. Sitting in the spacious Office of the Comptroller of the Currency, with its panoramic view of the capital, the AGs from North Carolina and Iowa said lenders were pushing increasingly risky mortgages. Their host, John D. Hawke Jr., expressed skepticism. Roy Cooper of North Carolina and Tom Miller of Iowa headed a committee of state officials concerned about new forms of “predatory” lending. They urged Hawke to give states more latitude to limit exorbitant interest rates and fine-print fees. “People out there are struggling with oppressive loans,” Cooper recalls saying. October 14, 2008
Greenspan Pegs Housing Recovery to Early 2009Former Federal Reserve chairman Alan Greenspan said the U.S. housing market will begin to recover in the first half of 2009, according to an article he wrote for Emerging Markets magazine published on Friday. Greenspan wrote that the recent slowing in the rate of decline in U.S. home prices is the first positive note in the year-long trauma and that eventually, frozen credit markets will thaw “as frightened investors take tentative steps toward reengagement with risk.” “More conclusive signs of pending home price stability are likely to become visible in the first half of 2009,” he wrote. October 14, 2008
HUD AWARDS MORE THAN $21 MILLION IN GRANTS TO FIGHT HOUSING DISCRIMINATIONThe U.S. Department of Housing and Urban Development today awarded $21.8 million to Fair Housing, and other non-profits agencies in 37 states and the District of Columbia to assist people who believe they have been victims of housing discrimination. “These Fair Housing Initiatives Program grants will help us continue our efforts to educate the public, the housing industry, real estate professionals and financial institutions about their rights and responsibilities under the Fair Housing Act,” said Kim Kendrick, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “Our local partners are critical not only in enforcing the law but in reinforcing the message — housing discrimination is illegal and HUD will take action to eliminate it.” HUD awarded $500,000 to Howard University Law School to organize and operate a fair housing legal-clinic education program. October 21, 2008
From Door to Door, Foreclosure Knocks HereAt times, this stretch of 118th Avenue in South Jamaica, Queens, feels not so much like a neighborhood but a memory of one. A red-brick house with overgrown weeds in the yard is boarded shut. A house with a dirty awning has a thick chain looping out from a hole in the door where a deadbolt once was. On the front window of a vacant property around the corner, someone has taped a sign warning that the water supply has been shut off and antifreeze added to the sinks and toilets.Newton and Ronda Whyte have gotten used to living next door to no one. “Every two or three houses it’s empty,” said Ms. Whyte, 36, a nurse assistant. “It’s not a good feeling. You see the weeds growing tall and the junk mail piling up.” October 19, 2008
A Program to Keep the Roof Over Your Head — but It Will Cost You in the Long RunFor homeowners trying to renegotiate their loans under the government’s new HOPE for Homeowners program, please read the paperwork carefully — because once again, you’ll be stuck with a costly mortgage deal. HOPE for Homeowners, nicknamed H4H, became law this summer to help keep homeowners from defaulting on their mortgages and going into foreclosure. Lenders who voluntarily allow borrowers to refinance under H4H are required to reduce the size of the mortgage to a maximum of 90 percent of the home’s current appraised value. Additionally, they are only allowed to put people in 30-year, fixed-rate loans. October 20, 2008
Green Tax Breaks, and a Government Site Named DSIREGiven the economic battering we’re withstanding, anyone of sound mind is thinking twice before buying as much as a cheap sweater, not to mention expensive home improvements. But recessions don’t last forever. At their worst, they always look like the start of a dark new era, but even then, somewhere in the background, the business cycle keeps chugging, building traction toward an eventual recovery. Now may not be the time to invest in your house, but it’s a very good time to plan. October 20, 2008
The Strangers Next DoorAs dusk sets in on Macdougal Street, the rats who inhabit No. 43 lope out into the shadows, two, three, four at a time. They make their home on this otherwise elegant block in a vacant four-story building at King Street, directly across the street from the Cooke Center Academy, a private high school whose students hang out on the closed-off street. Neighbors call the structure many things: a blight, a menace, a mystery. The building, an 1846 red brick row house, is boarded up and covered in graffiti, its once-grand cornice in poor condition, the paint on the doors of its cracked Greek Revival entryway peeling off in crimson flakes the size of thumbnails. A weathered violation notice from the city’s Department of Buildings, dated Aug. 1, flaps on the door. October 20, 2008
Taking a FallWith the real estate market slowdown, what once made sense when it came to pricing a house no longer holds true. Across the Baltimore region, as in the rest of the country, the average sales price of houses continues to drop. In September, the average sales price in the Baltimore metropolitan area dipped more than $21,000 from the prior month to about $296,000, according to Metropolitan Regional Information Systems. Compared to a year ago, home prices were down almost 6 percent overall - retreating to figures not seen since 2005. That price drop was the largest since the housing slump began. October 20, 2008
8,800 Road Home Properties to Return to Private HandsActor Wendell Pierce and trumpeter Terence Blanchard have come back to their old neighborhood, Pontchartrain Park, and are poised to take over one of every nine properties there — so they can build and sell affordable homes. On Monday, the New Orleans Redevelopment Authority will vote on an agreement to transfer 114 abandoned and vacant properties to Pierce and Blanchard’s Pontchartrain Park Community Development Corp. It’s a big moment for the star of HBO’s cop drama “The Wire,” the Grammy-winning musician and some of their childhood buddies and fellow investors, who want to return New Orleans’ first middle-class black subdivision to its pre-Katrina glory. October 20, 2008
States Act for Renters Caught in Foreclosure TrapTita Mendoza and her husband moved into their Miami Beach condo in June and have been dutifully paying the $1,800 rent on time every month. And yet, they could be evicted any day now. Last month, the Mendozas were served with court papers notifying them that their landlord was being foreclosed on, meaning the couple could be turned out on the street. October 20, 2008
Homeless Numbers ‘Alarming’More families with children are becoming homeless as they face mounting economic pressures, including mortgage foreclosures, according to a USA TODAY survey of a dozen of the largest cities in the nation. Local authorities say the number of families seeking help has risen in Atlanta, Boston, Denver, Minneapolis, New York, Phoenix, Portland, Seattle and Washington. October 21, 2008
Democracy Now!: Grassroots Effort Helps New York Mother Avoid ForeclosureJocelyne Voltaire, a resident of Queens Village, New York, saw her home go up for auction after a mortgage company foreclosed. She had made a fifty percent down payment twenty years ago, but recently saw her mortgage payments skyrocket under a predatory loan scam. Her mortgage is controlled by the company Litton Mortgage, an affiliate of the Wall Street giant Goldman Sachs. Voltaire had fallen behind on her payments in part because she no longer had the support of her son, a former Marine who served in the Iraq war. She was told her of son’s death just weeks after being informed of the foreclosure. October 21, 2008
HUD AND ALASKA HOUSING FINANCE CORPORATION AGREE TO INCREASE ACCESSIBLE HOUSINGThe U.S. Department of Housing and Urban Development (HUD) and the Alaska Housing Finance Corporation (AHFC) today signed an agreement that will create more housing for persons with disabilities. As part of the Voluntary Compliance Agreement announced today, AHFC agreed to make five percent of its housing stock fully accessible. The Agreement is the result of a HUD review of AHFC in September 2006 that included an accessibility inspection of housing units, administrative offices and common areas, and an analysis of, the agency’s policies and procedures. HUD also reviewed AHFC’s management of applicant waiting lists, applications, maintenance records, and reasonable accommodation requests. October 21, 2008
Green Tax Breaks, and a Government Site Named DSIREGiven the economic battering we’re withstanding, anyone of sound mind is thinking twice before buying as much as a cheap sweater, not to mention expensive home improvements. But recessions don’t last forever. At their worst, they always look like the start of a dark new era, but even then, somewhere in the background, the business cycle keeps chugging, building traction toward an eventual recovery. Now may not be the time to invest in your house, but it’s a very good time to plan. October 21, 2008
Surrounded by Ruins, Mortgage Market Remains IntactEverybody knows how severe and painful the global financial breakdown has been, with banks unwilling to lend even to other banks. But what about mortgages and real estate? Can you still get a home loan with less than 20 percent or 30 percent down? Or with a credit score below 720? Absolutely. It would be a big stretch to label housing the sunny side of the market at the moment, but there’s a lot more light there than in most other financial sectors. October 21, 2008
To Avoid Sublet Headaches, Cover All Your Legal BasesSo you landed a spot on the next dating reality show, but you still have to pay rent during the two months of taping. Why not sublet? Although subletting can be a great way for a renter to recoup money during a long vacation, the arrangement can be risky and complicated, with rules varying by state and landlord. First, check your lease to see whether it allows subleasing. Don’t try to fly under the radar or you may violate your lease and find yourself homeless or in court. October 21, 2008
Prepay a Mortgage? It DependsHOMEOWNERS with an aversion to debt are sometimes tempted to pay down their mortgages before they come due. That can be a misguided approach, some financial counselors say, if borrowers can instead put that money into relatively safe investments that produce a higher rate of return than the interest rate they are paying on their mortgages. In the current financial environment, however, prepaying on a mortgage might make sense. With the securities markets plunging early this month, there have been few well-paying safe harbors for investors, making early mortgage payments more enticing than might otherwise be the case. “As usual, a lot of this depends on your risk appetite,” said Jonathan M. Satovsky, chief executive officer of Satovsky Asset Management, a financial counseling service based in Manhattan. October 21, 2008
Fannie, Freddie CEOs discuss foreclosuresThe new chief executives of Fannie Mae and Freddie Mac are trying do more to stop the home foreclosures hammering the housing market, but said it still might take years for real estate to recover in some cities. “I don’t think there is any magic bullet in regards to overbuilt markets” like Miami and parts of California, Nevada and Arizona, said Freddie Mac CEO David Moffett at the Mortgage Bankers Association’s annual convention Monday. October 21, 2008
Lenders Help More Homeowners Avoid ForeclosureThe deep economic crisis has more lenders willing to change mortgages or repayment schedules for homeowners at risk of default, to stem their potential losses from foreclosures. More than 3 million U.S. homeowners have received — or are expected to receive — more affordable loans through ongoing programs initiated over the last 15 months. But even outside the formal programs, says David Kittle, chairman-elect of the Mortgage Bankers Association, lenders are more willing now than a few months ago to agree to changes in monthly payments. In some areas that have a high number of subprime loans or foreclosures, he says, some lenders are even going door-to-door to contact homeowners. October 22, 2008
Protests and Hecklers Have Mortgage Bankers Longing for Good Old DaysIt was just another business-as-usual day at the annual convention of the nation’s mortgage bankers: a few panels, a few presentations and an attempted abduction of Karl Rove. Mr. Rove, the Republican strategist and former adviser to President Bush, was accosted onstage during a convention panel here on Tuesday morning by a protester who tried to handcuff and arrest him “for treason.” Mr. Rove tried to elbow her away before she was taken offstage. No one was injured and no arrests were made, but the stage-storming was just the latest outburst at an event that usually packs all the excitement of a mortgage calculator. On Monday, another panel was interrupted by protesters demanding a moratorium on foreclosures, and hecklers screamed at attendees through bullhorns outside. October 22, 2008
Healthy Lawns vs. Clean Water?Maneuvering slowly between rows of rosemary and not-yet-blooming poinsettias that fill his main greenhouse, Alfred H. Krautter, owner of Sprainbrook Nursery here and a proponent of organic gardening, seems an unlikely agitator. But Mr. Krautter, 73, spelled out why he is opposed to legislation that would regulate the use of lawn fertilizer in Westchester — legislation that proponents say is essential for keeping the water supply safe. “Organic fertilizers are the answer to our environmental problems, they are not the problem,” he said. “To do away with organic fertilizers will be a disservice to people in Westchester and in particular the ones who have worked so hard to do what’s right for the environment.” October 22, 2008
Lawmakers Blast Credit Rating AgenciesThe hunt for scapegoats in the financial crisis focused firmly on credit ratings agencies Wednesday as U.S. lawmakers probed how the firms gave top ratings to debt that later turned out to be toxic. The three leading agencies — Moody’s, Standard & Poor’s and Fitch Ratings — are considered key financial gatekeepers because they issue ratings that determine if a company is worth lending to, and at what cost. However, in recent years the agencies gave triple-A ratings to complex financial instruments backed by subprime mortgages. When the real estate market collapsed, the securities did too, triggering a domino effect that led to the worst financial crisis since the Great Depression. October 23, 2008
Mortgage Applications Sink to 8-year LowDemand for applications to buy homes and refinance mortgages sank to the lowest level in nearly eight years in the most recent week, a trade group said Wednesday. The Mortgage Bankers Association’s seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, slid 16.6% to 408.1 last week, lowest reading since December 2000. Potential buyers are in many cases paralyzed by tumbling stocks, a two-year home price slump that still has room to run, mortgage rates close to the year’s peak and higher downpayments required by lenders making it harder to get a mortgage. October 23, 2008
Mortgage Losses Plunge Wachovia Into $23.9B LossWachovia (WB) on Wednesday posted a $23.9 billion third-quarter loss, a record for any U.S. lender in the global credit crisis, underscoring the challenges Wells Fargo (WFC) will face after it acquires the big lender. The loss totaled $11.18 a share, and stemmed mostly from an $18.7 billion write-down of goodwill because asset values declined, as well as a big increase in reserves for soured loans. Wachovia has lost $33 billion in the last two quarters. October 23, 2008
A Matter of Life and DebtThis week, credit has begun to loosen, stock markets have been encouraged enough to reclaim lost ground (at least for now) and there is a collective sigh of hope that lenders will begin to trust in the financial system again. But we’re deluding ourselves if we assume that we can recover from the crisis of 2008 so quickly and easily simply by watching the Dow creep upward. The wounds go deeper than that. To heal them, we must repair the broken moral balance that let this chaos loose. Debt — who owes what to whom, or to what, and how that debt gets paid — is a subject much larger than money. It has to do with our basic sense of fairness, a sense that is embedded in allof our exchanges with our fellow human beings. October 23, 2008
PRESTON ACCEPTS $10 MILLION INDIANA DISASTER RECOVERY PLANU.S. Housing and Urban Development Secretary Steve Preston today accepted a $10 million disaster plan from the State of Indiana to recover from severe storms, tornadoes and flooding earlier this year. Indiana intends to use the funding provided through HUD’s Community Development Block Grant (CDBG) Program to acquire and demolish substantially damaged residential properties contained within a flood plain or floodway and to redevelop the area into permanent green space for community use. “These funds will help Indiana to redevelop flood-prone areas into attractive green spaces and open areas in some of the State’s most affected counties,” said Preston. “HUD will continue to work very closely with Governor Daniels and his staff to support long-term sustainable recovery throughout the State.” October 23, 2008
Who’s Looking Out for the Mortgages?The recent wild fluctuations seen in the stock market’s performance haven’t just freaked out banking customers. It’s also worrying those with mortgages, like Steve Seffens of Westminster. “How can I find out if my bank and my mortgage company are sound?” Seffens asked. “I found PNC Bank on the FDIC Web site - the information was not useful, unless you’re a financial analyst, and I couldn’t even determine if PNC is insured under the FDIC. October 23, 2008
Corps Proposals get Rowdy ReceptionMore than 100 residents and property owners who filled a Lakeview school gymnasium Wednesday to talk about the construction of permanent pump stations and surge barriers on New Orleans drainage canals roundly criticized the Army Corps of Engineers. Some of those who spoke were angry about one or more of the sites that the corps prefers for building stations and gates on the 17th Street, Orleans Avenue and London Avenue canals. October 23, 2008
Foreclosure Activity Rises 71 PercentThe number of homeowners ensnared in the foreclosure crisis grew by more than 70 percent in the third quarter of this year compared with the same period in 2007, according to data released Thursday. Nationwide, nearly 766,000 homes received at least one foreclosure-related notice from July through September, up 71 percent from a year earlier, said foreclosure listing service RealtyTrac Inc. By the end of the year, RealtyTrac expects more than a million bank-owned properties to have piled up on the market, representing around a third of all properties for sale in the U.S. October 23, 2008
IndyMac Could be Model for Mortgage ReliefMaribel Carrillo is one of the new, happy-ending stories for bank regulators who hope to stem the foreclosure pandemic by modifying delinquent mortgages in bulk. Carrillo, 32, lost her $150,000-a-year job managing a record label in Los Angeles earlier this year. With her family’s construction business sputtering, she and her husband soon fell behind on their home loan on their four-bedroom ranch home in Los Angeles. October 23, 2008
PA: Run to aid Laurel HouseThe victory of domestic violence victims to courageously reach out and begin life anew and free of violence for themselves and their children is what the efforts of Laurel House are all about. The nonprofit domestic violence agency serves individuals, families and communities throughout Montgomery County. It was founded in 1980 by the Women’s Center of Montgomery County as a shelter and has since expanded into all kinds of support and prevention services. In 1981, Laurel House was incorporated as an independent nonprofit organization. In its 27-year history, Laurel House has developed programs to better support the efforts of domestic violence victims rebuilding their lives. October 23, 2008
ALABAMA VOICES: Fight Predatory LendersIt’s report card time again, and a nationwide coalition of consumer groups recently handed out its grades. We’re failing. Alabama recently received three Fs on the Small Dollar Loan Products Scorecard issued by the Consumers Union, National Consumer Law Center and the Consumer Federation of America. The report card places Alabama near the bottom of all states in protecting citizens from predatory lending practices. October 23, 2008
Foreclosure Filings Rose 71% in Third Quarter as Prices FellU.S. foreclosure filings increased 71 percent in the third quarter from a year earlier to the highest on record as home prices fell and stricter mortgage standards made it harder for homeowners to sell or refinance, RealtyTrac said. A total of 765,558 U.S. properties got a default notice, were warned of a pending auction or were foreclosed on in the quarter, the most since records began in January 2005, the Irvine, California-based seller of default data said in a statement today. Filings rose 3 percent from the second quarter and fell 12 percent in September from August as state laws created to keep people in homes slowed the pace of defaults. October 23, 2008
Low-cost Housing to be Legacy of 2010 GamesUp to 36 units of affordable housing will be built in Saanich as part of the legacy of the 2010 Olympic Games. The announcement came yesterday from the provincial government and the Vancouver Olympic Organizing Committee, in a followup to a Tuesday announcement from Premier Gordon Campbell. The Saanich units are part of 156 units to be completed in six communities around the province. At the conclusion of the 2010 Games, temporary modular housing units from the Olympic and Paralympic Village at Whistler will be dismantled, removed and set up again as permanent affordable, housing suites. October 23, 2008
Looks Like That ‘Black Tax’ is Still Hanging AroundA report this month about apartment-hunting discrimination in Hampton Roads re-opened an old wound for me. It was spring 1983 and I was moving from St. Petersburg, Fla., where they did not even have a baseball team, to work for Newsday in Long Island, N.Y. The company put me up in a hotel for a week to find an apartment, but after five days, I was coming up empty. Using Newsday’s classified ads, I would find apartment listings and call to verify availability. But once I showed up, I would be told the apartment had been rented. I was also told either that there were no waiting lists or that there was a list but vacancies were rare. October 23, 2008
54,000 Empty New Properties in Málaga ProvinceThe number comes from the Ministry for Housing, and has been doubted by real estate promoters. The latest study from the Ministry for Housing shows that there are 54,000 newly built homes in Málaga province which remain unsold on the market. Local promoters however doubt the number, which they say is closer to 25,000. October 23, 2008
County Considers Housing ProgramAs the federal government looks to buy up foreclosed homes, Sarasota County leaders are hoping to avoid many foreclosures altogether with a unique new program to help struggling homeowners. County administrator Jim Ley laid out an aggressive foreclosure prevention program Wednesday that would divert money from affordable housing programs toward the growing ranks of troubled mortgages — more than 8,000 foreclosures in Sarasota County so far this year. Ley’s rough sketch proposal is to take money earmarked for groups like Habitat for Humanity and programs that provide down payment assistance to new homeowners and help existing homeowners. October 23, 2008
Fla. No. 2 in the Nation for ForeclosuresFlorida’s housing market continues to be pummeled by the housing crisis. The Sunshine State ranked second, only to Nevada, in the number of homes going into default last month, according to the latest report from RealtyTrac. A 9 percent month-over-month increase in foreclosure activity helped Florida’s foreclosure rate leapfrog foreclosure rates in Arizona and California, according to the California-based company, which tracks foreclosure properties. October 23, 2008
FHFA Second Quarter Mortgage Metrics Report ReleasedThe Federal Housing Finance Agency’s (FHFA’s) Mortgage Metrics Report for the second quarter of 2008 was released today. The report presents key performance data on 30.6 million first lien residential mortgages with outstanding balances totaling $4.5 trillion serviced on behalf of Fannie Mae and Freddie Mac for the first and second quarters of 2008. The FHFA Mortgage Metrics Report summarizes data provided by Fannie Mae and Freddie Mac (also called the Enterprises) and gives a comprehensive view of their efforts to assist borrowers, including forbearance plans, short sales, deeds in lieu, assumptions, and charge-offs in lieu of foreclosure. The report focuses on the delinquencies, loss mitigation actions, and foreclosure data reported by more than 3,000 approved servicers. October 23, 2008
More Governments Coming to Evicted Renters’ RescueGovernments from California to Ohio are beginning to pass new laws to protect a quiet victim of the nationwide economic slide: renters getting blindsided by foreclosures against their landlords. The issue made international news this month when a Chicago sheriff temporarily halted all evictions in Cook County to draw attention to the problem. Governments have been taking notice and are starting to pass and consider laws to protect renters who have no idea their landlords have defaulted on their mortgages until they receive an eviction notice. October 27, 2008
Programs are Available to Help Struggling HomeownersAssistance is growing to help financially distressed homeowners, but the nation’s mounting caseload of foreclosures and mortgage delinquencies is rising faster. The Bush administration should have a plan for a systematic approach to help homeowners rework their mortgages within weeks, the Treasury official in charge of implementation of the $700 billion financial rescue package said Thursday. “The plan is under development now,” Treasury’s Neel Kashkari told members of the Senate Banking Committee. October 27, 2008
Trying for a Bigger Tax CreditReluctant potential home buyers could be in line for some additional tax and financing enticements, either through a post-election lame duck congressional session or from the new Congress arriving in January. Though House and Senate leaders have not agreed on whether to hold a session immediately after the election, national housing industry trade groups are pressing hard for a second round of emergency economic stimulus legislation, ideally before the end of December. October 27, 2008
Scope of Foreclosure Crisis Daunts GovernmentEach day from July through September, more than 2,700 Americans lost their homes in foreclosure. That number, up from 1,200 a day a year ago, is a sign that the mortgage industry and government programs have done little to help troubled homeowners. The mortgage market’s troubles have proved to be far more serious and intractable than most in government or the private sector had predicted a year ago. October 27, 2008
Existing Home Sales See Largest Gain in YearsSales of existing homes rose by the largest amount in more than five years in September. But analysts cautioned against reading too much into the gain, noting that it reflected conditions before the latest upheaval in financial markets increased the likelihood of a recession in the overall economy. The National Association of Realtors reported that sales of existing homes rose by 5.5 percent from August to September to a seasonally adjusted annual rate of 5.18 million units — far better than the flat results analysts had expected. On an unadjusted basis, sales were up 7.8 percent from September last year. October 27, 2008
Good Credit? Home Loans No Longer a Sure ThingJonathan Schecter is set to close next month on the purchase of an apartment in New York City, but it’s been an adventure getting there. He began home-shopping a year ago. Schecter’s lender said in September that he could count on 80% financing up to $420,000. The other 20%, or $105,000, would come from Schecter’s down payment. But things changed after he committed to buy a place on Manhattan’s Lower East Side. The bank said it would finance only $393,000, increasing the down payment he needed by $27,000. October 28, 2008
Foreclosures Open Door To DisorderAmong the many harsh lessons for mortgage lenders in the housing bust is this one about evictions: Selling a house is far easier than taking it back. Clever opportunists and struggling families have figured this out, too, and the result is a rapidly evolving free-for-all coursing through the Washington region’s worst foreclosure-racked suburbs. Defaulting homeowners are taking advantage of banking chaos to live mortgage-free for six months or longer, dragging out the eviction process, according to lenders and real estate agents. Unscrupulous landlords are collecting rent but withholding mortgage payments, leaving a rude surprise for their tenants when repossession comes. And banks are so eager to avoid the hassle of eviction that they are paying occupants $5,000 or more simply to hand over the keys and move out without a fight. October 28, 2008
Study Notes Fewer Loans to Hispanics and BlacksThe number of new mortgages to blacks and Hispanics fell sharply in New York City in 2007, while staying flat for white borrowers and — surprisingly — rising for Asian-Americans, according to an analysis of federal mortgage data released on Monday by the Furman Center for Real Estate and Urban Policy at New York University. As a result, the racial breakdown of home buyers in New York City changed significantly during the period studied, which predated the financial turmoil in the markets this year. October 29, 2008
525 Homes Sue Over Sewer Hookup CostsMORE than 500 households in the North Mianus neighborhood here have joined a lawsuit to try to stop Greenwich from charging them about $30,000 each to pay for a sewer hookup. The town dug up streets in the neighborhood beginning in 2001 to switch homes from individual septic systems to the town’s sewer system. Residents were to be billed their share of the expense of connecting to the system, divided by its 790 households. But they were surprised when the bill came in at $23.5 million. October 28, 2008
Lumber Industry Threatened by Glut of Unsold HomesThe glut of homes in foreclosure, vacant, or stuck on the market has the nation’s lumber industry hanging on by a limb. Since housing starts hit their peak in mid-2005, demand for lumber used in floors, home frames, and cabinets has declined sharply, and experts say the number of unsold homes would need to significantly decrease before homebuilders commit to building new ones. With fewer new houses under construction, and foreclosure notices surging this summer, there’s a lot at stake for the sawmills and loggers that feed the nation’s dwindling appetite for floorboard, housing frames and cabinets. October 28, 2008
Nagin Seeking to Raise Property Taxes for New Orleans ResidentsNew Orleans Mayor Ray Nagin said Monday that the 2009 operating budget he will present today to the City Council will call for a slight reduction in city spending next year but a 10-mill increase in the property tax rate to bring in an additional $24.5 million. He said the extra money, which he called “a modest amount, ” is needed to let the city restore its emergency reserve fund, which was depleted by Hurricane Gustav. October 28, 2008
New Home Sales Unexpectedly Rise 2.7 PercentSales of new homes recorded an unexpected increase in September as median home prices dropped to the lowest level in four years, the Commerce Department reported Monday. Sales of new single-family homes rose by 2.7 percent last month to a seasonally adjusted annual rate of 464,000 homes, Commerce said. Economists had expected sales would drop from the August level. October 28, 2008
Review Public Housing Drug RuleFor 43 years, Olevia Kennedy - a 71-year-old African-American woman - has lived in a Thibodaux public housing project. Besides being poor, she is in poor health. Last year, she suffered a stroke. Kennedy was ordered out of her home of 43 years recently because her son, Douglas, was arrested for possession of marijuana near her address. Douglas is 52. The action taken against his mother for his offense seems unnecessarily harsh. While a few government officials, clergy and civil rights leaders have rallied behind her, there is little chance Kennedy’s eviction will be overturned. The housing authority’s one-strike rule is very clear. No drugs are allowed on the property. Residents bear full responsibility. If drug use or possession is discovered on a resident’s property, even though the resident is not involved, eviction is mandatory. October 28, 2008
Predatory Lending is An Issue in N.J.Soon after the New Jersey legislature passed a tough law aimed at controlling predatory lending, State Sens. John Adler (D., Camden) and Gerald Cardinale (R., Bergen) teamed up to sponsor a bill that weakened it. Adler and Cardinale said they were responding to pressure from the lending industry, which argued that New Jersey’s anti-predatory lending law was so tough that it would have kept legitimate lenders out of the market. But now, as Adler runs for Congress, his Republican opponent is charging that he made those changes in 2004 because he was getting campaign cash from predatory lenders who wanted to continue to victimize vulnerable borrowers. October 28, 2008
Loan Giants’ Takeover Hasn’t Paid OffAlmost two months ago, the government sought to revive the nation’s ailing mortgage sector by seizing Fannie Mae and Freddie Mac and pumping money into the home-loan market. But so far, the measures have yet to achieve their intended effect. Backed by taxpayers, the mortgage finance giants have spent billions in an attempt to push down loan rates and make it easier for people to borrow money to buy homes. But mortgage rates have gone up. October 29, 2008
U.S. Vouchers to Be Used for 8,400 Public ApartmentsThousands of apartments at nearly two dozen public housing complexes will be rented out to tenants with federal Section 8 vouchers under a new plan by the New York City Housing Authority that has drawn criticism for reducing the city’s already dwindling supply of privately owned subsidized housing. The Housing Authority’s plan will remove 8,400 units at 21 of its complexes from the public housing inventory and make them available to Section 8 voucher holders. The move is intended to help the agency stem its financial crisis by pumping money from the federally financed vouchers into 21 cash-poor developments. October 29, 2008
$112 Million to Be Spent to Improve Elevators and Inspections at Public HousingManagers of the city’s public housing agency will pump more money, staff and technology into their elevator operations, seeking to restore public confidence 10 weeks after a 5-year-old boy fell to his death while trying to escape a stalled elevator in Brooklyn. The agency, the New York City Housing Authority, plans to spend $107 million to replace 630 elevators at 45 developments in the next five years and another $5 million to hire additional inspectors and others to focus on the 50 complexes with the most elevator failures. October 29, 2008
O’Neill: 20 Percent Down or No MortgagePresident Bush’s first treasury secretary says Congress should scrap plans for a new economic stimulus package and instead require that no future home mortgage be awarded without a 20 percent down payment. Paul O’Neill said Tuesday it doesn’t surprise him that neither presidential candidate has endorsed his position, but he insisted it is the best way to quickly improve the nation’s economic footing. October 29, 2008
Nonprofit: Landlords Unfair to Section 8-voucher RentersRenters in the county using federal vouchers to secure housing face a 15 percent discrimination rate from landlords and property owners, according to a report released Monday by a nonprofit civil rights organization. The findings by the Equal Rights Center were gathered through a series of phone tests conducted by the group between March and April to 99 properties throughout the county. The properties, all of which had more than 25 units, represented 45 different ownership companies. Because no legal action was filed against the landlords, the Equal Rights Center did not release the names of the properties. October 29, 2008
Complaints Over Foreclosure Fraud Spike in UtahAs home foreclosures have spiked, so has fraud. State regulators say they are receiving about double the number of complaints this year over last from homeowners preyed upon by people promising an easy way to save homes threatened with foreclosure, said Mark Steinagel, director of the state Division of Real Estate. “I just had a guy come in at lunchtime who said he wanted to report a lease-option situation - [he was] promised if he sold his home for $100,000 he could buy it back for $110,000 a year or two later,” Steinagel said Tuesday. “The people said later on, ‘The market’s going great. You owe us $145,000.’ And he had no recourse because he had signed everything over to them.” October 29, 2008
Housing Authority to Issue Rental VouchersThe Galveston Housing Authority has started issuing Disaster Housing Assistance Program vouchers, which will pay for families displaced by Hurricane Ike to live in apartments or rental homes beginning Saturday. The families must have been declared eligible for aid by the Federal Emergency Management Agency. October 29, 2008
Proposition B Would Keep State Housing Funds Coming to Los AngelesThere’s no campaign, no mailers, no education or outreach on Proposition B, but city leaders say the measure means Los Angeles could keep or lose millions of dollars in affordable-housing money. Proposition B would erase restrictions in place to prohibit low-income housing projects that are larger than five units and taller than two stories. Those limits have been city law since the 1970s as a backlash against massive public housing projects, but the restrictions have been ignored in recent years as the city and state subsidized the construction of many larger low-income projects. October 29, 2008
Orland Park Continues to Tweak Proposed Rental Housing OrdinanceOrland Park officials have postponed taking action on a crime-free housing ordinance. Thomas Joseph, the government affairs director of the Mainstreet Organization of Realtors, brought up some concerns about the proposed ordinance during the village’s development services and planning committee meeting Monday. “This is an issue that is of concern to our Realtor association members,” Joseph said. October 29, 2008
Feds Finish First Inspections of Public HousingInspectors hired by the federal government completed inspections of the island’s federally subsidized housing units and will start inspecting each unit individually to determine which can be reopened and which must be demolished, a federal housing spokeswoman said. Contractors hired by the U.S. Department of Housing and Urban Development inspected all housing authority properties, including Section 8 homes, to determine which units damaged when Hurricane Ike roared ashore Sept. 13 would take longer than 60 days to repair, said Patricia Campbell, spokeswoman for the U.S. Department of Housing and Urban Development’s regional office in Fort Worth. October 29, 2008
Follow the Money in Wall Street CollapseThe collapse of the financial system is not an unfortunate byproduct of deregulation; it was a cold and calculated enterprise. The conspirators even had a dry run here in Chicago in 2001. Close to 1,500 people lost much of their life savings when Superior Bank of Chicago went bankrupt with a billion dollars in deposits. October 29, 2008
Plan to Refinance Mortgages May Save Millions of HomesThe government is weighing a plan to restructure hundreds of billions of dollars in home mortgages, its most ambitious effort yet to curb high foreclosures. The plan is expected to help 2 million to 3 million homeowners at risk of losing their homes and cost the Treasury Department $40 billion to $50 billion, according to two sources familiar with the matter. The plan is still being finalized, and the details could change, the sources said. They declined to speak on the record because they were not authorized to discuss the proposal. October 30, 2008
Rental Assistance Program for Ike and Gustav Evacuees Begins November 1The U.S. Department of Housing and Urban Development (HUD) on November 1st will begin implementing its temporary disaster housing program to assist families displaced by Hurricanes Ike and Gustav. In anticipation of the start date, the Federal Emergency Management Agency (FEMA) has given the names of more than 6,500 eligible families to HUD which will provide temporary housing assistance until March 2010. These families have been identified by FEMA as eligible for HUD’s Disaster Housing Assistance Program-Ike (DHAP-Ike). This program will provide housing assistance and case management for homeowners and renters who were displaced by the 2008 hurricanes. Families whose homes received substantial damage and are likely uninhabitable during the 17-month program should register with FEMA at 1 (800) 621-FEMA (3362). October 30, 2008
Treasury, FDIC Near Deal on Mortgage AidNegotiators for the Treasury and Federal Deposit Insurance Corp. are nearing agreement on a plan to have the government guarantee the mortgages of millions of distressed homeowners in what would be a significant departure for the federal rescue program, which has so far directed relief exclusively to banks and other financial institutions. The plan, which sources said could cover as many as 3 million homeowners in danger of foreclosure and cost $40 billion to $50 billion, would go well beyond previous government and private-sector initiatives. Critics say these have attracted too few lenders or offered too little aid to homeowners to stem the foreclosure crisis. October 30, 2008
Concerned Fed Trims Key Rate by a Half PointThe Federal Reserve lowered its benchmark interest rate by half a percentage point on Wednesday, its second big rate cut this month, as policy makers tried to fend off what could be the worst economic downturn in decades. The move brought the target rate for federal funds — the interest rate at which banks lend to each other overnight — to 1 percent, down to the near-record lows reached in 2003 and 2004, when the Fed was trying to encourage an economic recovery after the bursting of the Internet bubble. The central bank left open the possibility of going still lower, warning “downside risks to growth remain.” October 30, 2008
Many Displaced Renters Remain on Their Own, Awaiting Hurricane Katrina AidTate collects an average of $900 a month between her job and a disability check, she said, putting rent and utilities out of reach even if she lands the full-time job she now seeks. When she looked at apartments renting for $500 or less, she found inoperable plumbing, holes in the floors and dangerous wiring. “Horrible, ” she said. Before Hurricane Katrina, Tate, now 30, rented in Curran Place, a privately owned complex in eastern New Orleans subsidized by the U.S. Department of Housing and Urban Development. Like residents of public housing, Tate paid standard HUD-subsidized rent: up to one-third of her monthly income. Though she would qualify for the Section 8 rental-assistance program, the Section 8 list kept by the Housing Authority of New Orleans has not accepted new applications for years. October 30, 2008
Housing Is Issue In County Board RaceBarbara A. Favola and John G. Reeder agree on the problem: It’s tough to find an affordable apartment in Arlington County. Since 2000, thousands of residences have dropped from the affordable category, they say, squeezing out many lower- and middle-income families. Reeder, a retired foreign trade economist, has built his bid for a spot on Arlington’s County Board around this theme. “The number of affordable rental units in Arlington fell by about 13,000 between 2000 and 2008,” Reeder wrote on his campaign blog. October 30, 2008
Foreclosures: Feds to the Rescue?The Federal Deposit Insurance Corp. and the Treasury Dept. are working on a major program to prevent widespread foreclosures that would include government guarantees of home mortgages. The plan would use $50 billion from the recently passed bailout package to provide as much as $500 billion to $600 billion in government guarantees on up to 3 million at-risk mortgages. It might require banks and savings and loans to offer loans with lower interest rates for a five-year period, while shifting to the government any risk if the home doesn’t recover its full mortgage value within that time. October 30, 2008
Groups Push for Minimum Housing CodeThe Henderson County Board of Commissioners is considering whether or not the county needs a minimum housing code. On Oct. 23, a public hearing was held at the historic courthouse in downtown Hendersonville. A number of folks representing different agencies spoke in support of adopting the code, including the Affordable Housing Coalition, the Pisgah Legal Services, the League of Women Voters, the Board of Realtors, the United Way, the Children and Family Resource Center and the Council on Aging. October 30, 2008
20% of Homeowners Owe More to Lender Than Their Homes are WorthHere’s a shocker: almost half of Nevada homeowners with a mortgage owe more to the bank than their homes are worth. If you add in the homeowners like them in California, Arizona, Florida, Georgia and Michigan, together they account for nearly 60% of all homeowners who are “underwater” on their mortgages. October 31, 2008
HUD MODERNIZES ONLINE GUIDE FOR AVOIDING FORECLOSUREDo you need help finding a housing counselor or contacting your lender? Or do you want more information about mortgage refinance options offered by HUD’s Federal Housing Administration (FHA)? Americans are able to do all this and more thanks to an updated website developed by the U.S. Department of Housing and Urban Development. The Guide to Avoiding Foreclosure is a one-stop-shop designed to educate Americans about the most current housing information and resources HUD has to offer. The updated site has a number of helpful resources particularly important for Americans at risk for losing their homes. October 31, 2008
Mortgage Plan May Aid Many and Irk OthersAs the Treasury Department prepares a $40 billion program to help delinquent homeowners avoid foreclosure, it confronts a difficult challenge: not making the plan too tempting to people like Todd Lawrence. An airline pilot who lives outside Norwich, Conn., Mr. Lawrence has a traditional 30-year mortgage that he has no trouble paying every month. But, thanks to the plunging real estate market, he owes more on his house than it is worth, like millions of other people. October 31, 2008
Homes Looking for Good OwnersFor middle-income families who want to live in Howard County, the four new detached homes sitting in a row in Elkridge offer discount prices and guaranteed financing. But they lack one thing - qualified buyers. The 1,728-square-foot, three-bedroom homes on Cherry Avenue near the Anne Arundel County border are newly finished - three by the nonprofit Columbia Housing Corp. and one by Habitat for Humanity, the church-backed affordable-home builder. October 31, 2008
New Federal Funding Creates Opportunity to Generate, Preserve Affordable Housing in Response to Foreclosure CrisisNCB Capital Impact provides strategies for shared equity homeownership under $4 billion HUD Neighborhood Stabilization Program Local and state governments will now have the opportunity to purchase vacant, foreclosed properties and create affordable homes for low- and moderate-income families and individuals under the recent U.S. Department of Housing and Urban Development (HUD) Housing and Economic Recovery Act of 2008 (HERA). HUD’s Neighborhood Stabilization Program (NSP) can provide millions in support of community efforts to create lasting affordable housing and wealth-building opportunities for future generations of home buyers. October 31, 2008
Lexington, KY: Fund Trust for Affordable HousingIn April, Mayor Jim Newberry pledged to 1,000-plus members of BUILD at Consolidated Baptist Church that he would create an affordable-housing trust fund, with the goal of having it operational by the summer of 2009. In May, he appointed a commission to come up with a plan for creating a workable trust fund. The commission reported back to the mayor in August. Now BUILD, which stands for Building a United Interfaith Lexington through Direct Action, has invited the mayor back to talk about when the report will be transformed into action. October 31, 2008
Oxford House Suit Set for TrialBarring a settlement or dismissal, a nonprofit organization’s lawsuit against the city government will go to a jury next spring. On Sept. 23, Oxford House Inc., a Maryland-based organization that facilitates sober-living houses, filed the lawsuit in federal court. The complaint alleges that the city’s Zoning Ordinance violates federal housing laws. The case has been tentatively scheduled to be heard by a jury April 6-9. Seven houses in Winchester are rented to people recovering from drug and alcohol abuse under an Oxford House charter. October 31, 2008
Landlord’s Pesticides Leave Tenants in a FogQ I had problems with roaches at my apartment, which came from the neighbor downstairs. They moved out three weeks ago and left a very filthy place, infested with roaches. The manager has been trying to get rid of them by fumigating constantly. The problem is that my apartment and furniture is impregnated with the smell of the pesticides. My daughter and I have had to leave (the fumes are aggravating her asthma), and we’ve been away for two weeks (with no sign of when the fogging will stop). October 31, 2008
Suit: Firms Victimized Foreclosed CustomersThe N.C. attorney general has filed lawsuits against three Charlotte-area foreclosure rescue companies, saying they charged high fees but failed to save their customers’ homes. The goal: fight companies that offer homeowners false hope, Roy Cooper said during a news conference Thursday at the Better Business Bureau of Southern Piedmont in Ballantyne. October 31, 2008

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