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09 Feb 2012 11:12


Biz: Federal government, states agree to settle with mortgage industry

  • $26 billion “historic” settlement with the mortgage industry
  • $17B of that settlement is expected to help out more than 1 million homeowners — breaking that dow, that’s an average of $17,000 each
  • 50 states could sign on as part of the settlement, making it the largest multistate settlement since the big tobacco deal in 1998
  • $2,000 the amount some homeowners who already lost their homes to foreclosure could get as part of the long-planned settlement source
  • » But is all this enough? While some will say the settlement doesn’t go far enough in addressing the concerns homeowners have dealt with in the years since the housing bubble burst, officials suggest it could provide $40 billion in mortgage relief by reducing loan principals, which would make the dollars go further. Problem is, it’s estimated that homeowners collectively owe $700 billion more on their homes than they’re actually worth. So while the dollar number sounds high, it may only be a drop in the bucket comparatively.

18 Dec 2011 11:20


Politics: So … who’s paying for the payroll tax cut, anyway? Homeowners

  • $17 per month charges on new homeowners’ mortgages source
  • » Those who refinance will feel the pinch, too: To help pay for the $33 billion cost of the extended-by-two-months payroll tax cut, the federal government will increase the cost for homeowners to get their homes insured by Fannie Mae and Freddie Mac, who currently back nine out of ten home mortgages in the U.S. The fee, currently around 0.3 percentage points, would jump by 0.1 percentage points, which translates to roughly $17 per month for most homeowners. However, this fee would not affect current homeowners unless they refinance starting next year. Is this the best way to handle the extension?

18 Aug 2011 11:52


Biz: Mortgage rates fall to their lowest level in 50 years

  • 4.15% the current rate for a 30-year fixed loan source
  • » To explain why this is important: Mortgage rates tend to go down when people aren’t buying homes, as an incentive to get them to buy. When the economy was doing well back around 2000, this rate was around 8 percent. Now, the rate is so low that the last time it was this low, 30-year fixed loans weren’t even widely available and the numbers were based on 20 or 25-year fixed loans. This particular statistic has been below 5 percent for the entire year, minus around two weeks.

25 Feb 2011 23:26


Biz: Bank Of America, Citigroup, Wells Fargo feel heat over mortgages

  • The current environment of heightened regulatory scrutiny has the potential to subject the corporation to inquiries or investigations that could significantly adversely affect its reputation.
  • A statement from Bank of America • Noting in a filing with the Securities and Exchange Commission that the company could be subject to huge penalties over their abusive mortgage practices. They’re not alone; Wells Fargo and Citigroup ware in the same boat, and it’s all thanks to the shady way that the trio dealt with their foreclosures. The reports from the companies suggest that all three will take a financial hit for said shadiness. Bank of America says that the state and federal inquiries “could result in material fines, penalties, equitable remedies (including requiring default servicing or other process changes), or other enforcement actions, and result in significant legal costs.” In other words, they’re screwed for screwing over homeowners. Oops. source

22 Jan 2011 10:53


Biz: Bank of America takes epic charge on its hot mortgage mess

  • $2.24
    the amount the bailed-out Bank of America lost in 2010, hurt by charges due to their Countrywide merger
  • $4.1
    the size of the charge they had to take for investors with claims against their mortgage securities  source
  • » Why such a big charge? Apparently, someone at Bank of America (or Countrywide) was really bad at doing paperwork, or was trying to push through half-baked mortgages. Because both were named as factors in creating the huge charges which resulted from investors making claims against them. Most of the fees are headed to Fannie Mae and Freddie Mac, by the way. Had this charge (and a separate $2 billion goodwill charge related to the Countrywide merger) not been there, Bank of America would’ve been profitable in the fourth quarter.

06 Nov 2010 00:01


Biz: Fannie Mae’s losses like a depressing slow-motion car crash

  • $3.5billion lost in the most recent quarter; that’s great!
  • 13 number of quarterly losses the government-owned mortgage finance firm has had in a row
  • $19.8B the amount of money it lost in the same ultra-depressing quarter about a year ago
  • $89B the amount of money the government has poured into Fannie Mae during the recession source
  • » Oh yeah, they need more help. We can’t imagine how much fun it is to work at Fannie Mae right now. The company, after all the loans they’ve already gotten from the government, needs another $2.5 billion from the U.S. Treasury. And their buddy Freddie Mac had an even bigger loss last quarter, with $4.1 billion falling in their depressing money pit.

15 Oct 2010 20:46


Biz: Countrywide’s former CEO nailed with massive fine by SEC

  • You know Countrywide? Of course you do, if you have any knowledge of big evil companies that screwed millions of good people by convincing them to get into subprime mortgages. Before the proverbial doo-doo hit the fan, the company’s former CEO, Angelo Mozilo, cashed out big time, using his insider knowledge to ensure a big payday. Now, a couple years after the fact, the SEC twisted his arm until he agreed to forfeit a bunch of that money. The details:
  • $140 million in stock sold, based on insider information
  • $22.5
    the size of the fine Mozilo will have to pay to settle securities fraud charges
  • $45 million the amount Mozilo will have to give back due to the charges source

07 Oct 2010 11:11


Biz: Freddie Mac: Mortgage rates lower than they’ve ever been

  • 4.27% mortgage rates; that’s the lowest ever source

14 Apr 2010 09:51


Biz: Even for those on Obama’s foreclosure plan, it’s not really helping

  • 75% of people in Obama’s foreclosure-prevention plan owe more than their homes are worth
  • 50% of people owe more than
    25 percent in negative equity on
    their homes; crazy source

07 Apr 2010 10:17


Biz: Alan Greenspan: The mortgage crisis not caused by the poor

  • The house price bubble, the most prominent global bubble in generations, was caused by lower interest rates but. … it was long-term mortgage rates that galvanized prices, not the overnight rates of central banks, as has become the seeming conventional wisdom.
  • Former Federal Reserve Chairman (and all-around smart guy) Alan Greenspan • Speaking in business-ese about something which we can put much more simply: Low interest rates that allowed low-income people to buy houses didn’t cause the housing crisis. Instead, the culprit was a couple levels up the food chain. Speak English, Alan. (Greenspan, by the way, is attempting to defend his legacy here.) source