Our Awful Situation

Archive for the ‘Mortgages’ Category

Jim Rogers: Fannie and Freddie … let it die!

Posted by Charlie Kilo on July 15th, 2008

Way to go Jim Rogers!

Confidence Ebbs for Bank Sector and Stocks Fall

Posted by Charlie Kilo on July 15th, 2008

The house of cards begins to fall:

Even as the Bush administration moved to rescue the nation’s two largest mortgage finance companies, confidence in the banking sector spiraled downward Monday. 

In Southern California, lines snaked around branches of IndyMac Bancorp, the large lender that was seized by federal regulators on Friday, as customers hurried to withdraw their money. As the anxiety spread through the financial markets, two other big banks, one in Ohio and another in Washington State, were compelled to assert that they were sound.

Even as federal regulators issued assurances that depositors’ savings were safe, Wall Street analysts circulated lists of lenders that might be vulnerable. Shares of regional banks plunged in one of the sharpest declines since the 1980s.

Illinois to Sue Countrywide

Posted by Charlie Kilo on June 25th, 2008

Here come the lawsuits:

The Illinois attorney general is suing Countrywide Financial, the troubled mortgage lender, and Angelo R. Mozilo, its chief executive, contending that the company and its executives defrauded borrowers in the state by selling them costly and defective loans that quickly went into foreclosure.

Senators’ mortgages under microscope

Posted by Charlie Kilo on June 24th, 2008

What comes around goes around:

Amid a brewing scandal over special mortgage deals given to two U.S. senators, Politico last week asked the offices of all 100 senators to describe the circumstances under which they obtained their own home loans. Seventy-seven senators have complied so far. Twenty-three have not.

Senators are not required to report in their disclosure forms any financial information about their homes unless they draw rental income from the home. But in the wake of questions regarding mortgages obtained by Sens. Chris Dodd (D-Conn.) and Kent Conrad (D-N.D.) — loans they received through a VIP program run by Countrywide Financial Corp. — Senate Majority Leader Harry Reid (D-Nev.) has said that the disclosure rules should be changed so that senators’ mortgage details are made public.

Mortgage Applications Hit 6-Year Low as Rates Surge

Posted by Charlie Kilo on June 4th, 2008

Its a very hard to time to be in the banking and mortgage business. What’s that old saying? What comes around…

Applications for mortgages stumbled to their lowest level in six years last week as rates on fixed-rate mortgages surged, according to data released Wednesday morning by the Mortgage Bankers Association. The association’s composite index, which covers purchase and refinancing activity, fell 15.3 percent on a seasonally-adjusted basis to 502.3 for the week ended May 30, from a reading of 593.3 one week earlier. Applications were off 20.3 percent compared to the same week one year earlier.

U.S. House Approves Democratic Anti-Foreclosure Bill

Posted by Charlie Kilo on May 9th, 2008

More tax payer insured garbage:

The U.S. House of Representatives approved legislation to let the government insure up to $300 billion in mortgages to help homeowners avert foreclosure, after the White House said the measure would force taxpayers to bear excessive risk.

Here Comes the Next Mortgage Crisis

Posted by Charlie Kilo on April 18th, 2008

Subprime was just the beginning. Wait until California’s prime borrowers start handing their keys to the bank:

California is to mortgage lending what Chicago is to pork bellies. For years, that meant it was a place with soaring house values; today, the foreclosure rate across the state is twice the national average and going up fast. Riverside County, outside Los Angeles, may be the foreclosure capital of the country, with a rate close to six times the national average. And housing prices are in freefall.

California should be the poster child for a mortgage-loan bailout. In few other places have so many taken on such onerous debts with so little equity. Unfortunately, the crisis in California is going to get much worse, and there is no bailout that will solve it. Why? Because if the first stage of the foreclosure crisis was about people who could not afford their mortgages, the next stage will be about people who have every reason not even to try to pay their mortgages.

Moving back with mom and dad…at 52

Posted by Charlie Kilo on April 16th, 2008

Learn to tell them “no” at a very young age:

After being laid off from her job as an events planner at an upscale resort, Jo Ann Bauer struggled financially. She worked at several lower-paying jobs, relocated to a new city and even declared bankruptcy.

Then in December, she finally accepted her parents’ invitation to move into their home — at age 52. “I’m back living in the bedroom that I grew up in,” she said.

Taking shelter with parents isn’t uncommon for young people in their 20s, especially when the job market is poor. But now the slumping economy and the credit crunch are forcing some children to do so later in life — even in middle age.

Financial planners report receiving many calls from parents seeking advice about taking in their grown children following divorces and layoffs.

Kim Foss Erickson, a financial planner in Roseville, Calif., north of Sacramento, said she has never seen older children, even those in their 50s, depending so much on their parents as in the last six months.

“This is not like, ‘OK, my son just graduated from college and needs to move back in’ type of thing,” she said. “These are 40- and 50-year-old children of my clients that they’re helping out.”

Parents “jeopardize their financial freedom by continuing to subsidize their children,” said Karin Maloney Stifler, a financial planner in Hudson, Ohio, and a board member of the Financial Planning Association. “We have a hard time saying no as a culture to our children, and they keep asking for more.”

Bush’s rescue plan would help some avoid foreclosure

Posted by Charlie Kilo on April 2nd, 2008

This could be a bonanza for those left in the mortgage business - especially the FHA mortgage business:

The Bush administration is finalizing details of a plan to rescue thousands of homeowners at risk of foreclosure by helping them refinance into more affordable mortgages backed by public funds, government officials said.

The proposal is aimed at assisting borrowers who owe their banks more than their homes are worth due to plummeting home prices, an issue at the heart of the nation’s housing crisis. Under the plan, the Federal Housing Administration would encourage lenders to forgive a portion of those loans and issue new, smaller mortgages in exchange for the financial backing of the federal government.

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