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Archive for the ‘Housing Crisis’ Category

Obama Unveils Home Mortgage and Foreclosure Prevention Plan

NEW YORK (CNNMoney.com) — President Obama unveiled a $75 billion multi-pronged plan Wednesday that seeks to help up to 9 million borrowers suffering from falling home prices and unaffordable monthly payments.

The long-awaited foreclosure fix marks a sharp departure from the Bush administration, which relied mainly on having servicers voluntarily modify troubled mortgages.

Obama, on the other hand, will make it easier for homeowners to afford their monthly payments either by refinancing the mortgages or having their loans modified. The president is vastly broadening the scope of the government rescue by focusing on homeowners who are still current in their payments but at risk of default. And he puts billions of federal funds into enticing servicers to modify the loans of those who’ve already stopped paying.

Wayne County Sheriff Halts  Home Mortgage Foreclosure  Sales

DETROIT – Wayne County Sheriff Warren Evans announced today that his office will halt all mortgage foreclosure sales.

Evans said a review of federal law has determined that to continue foreclosure sales would conflict with a recently enacted law that provides protection for homeowners.

“To proceed with sales without assuring that homeowners have been able to avail themselves of those protections would put me in a position of violating federal law,” Evans said during an 11 a.m. press conference.

“I cannot in clear conscience allow any more families to lose their homes through foreclosure sales until I’m satisfied they have been afforded every option they are entitled to under the law to avoid foreclosure.”

Foreclosed Homeowners Should Stay Put Says Congresswoman

If you’re poor and the bank is coming for your home, Congresswoman Marcy Kaptur has a plan for you.

Just squat, she says.

Yes, this Ohio Democrat is actually encouraging her financially distressed constituents whose homes have been foreclosed upon, to simply stay put.

In a Friday report, CNN’s Drew Griffin explored the case of Ohioan Andrea Geiss, whose home was foreclosed upon in April.

“Behind in payments, out of work, a husband sick, she had nowhere to go,” said Griffin. “So, she decided to follow the advice of her Congresswoman and go nowhere.”

“So I say to the American people, you be squatters in your own homes,” said Congresswoman Kaptur before the House of Representatives. “Don’t you leave.”

She’s called on all of her foreclosed-upon constituents to stay in their homes and refuse to leave without “an attorney and a fight,” said CNN.

By telling a bank to “produce the note,” a homeowner can delay foreclosure by forcing the lender to prove the suing institution is actually the same which owns the debt.

Home Prices Continue Slide Down

NEW YORK — A closely watched index shows home prices dropped by the sharpest annual rate on record in October.

The Standard & Poor’s/Case-Shiller 20-city housing index released Tuesday fell by a record 18 percent from October last year, the largest drop since its inception in 2000. The 10-city index tumbled 19.1 percent, its biggest decline in its 21-year history.

Both indices have recorded year-over-year declines for 22 straight months. Prices are at levels not seen since March 2004.

FDIC Chief, Says More Help is Needed to Prevent Foreclosures

NEW YORK (CNNMoney.com) — The nation’s top banking regulator warned Tuesday that help for troubled homeowners is failing to keep pace with the foreclosure crisis.

“We’re definitely behind the curve, and we fall further behind the curve every day,” FDIC Chairwoman Sheila Bair told an audience at the Fortune 500 Forum in Washington, D.C.

According to Bair, the nation’s financial system would be in much better condition today if earlier warnings she made about mortgage modification had been heeded.

Bair began sounding the alarm more than two years ago, warning that lenders had to shore up capital reserves to offset non-performing loans. In October 2007, she told lenders that they should start modifying more at-risk mortgages so borrowers could afford to stay in their homes.

Meanwhile the mortgage mess has ballooned, expanding beyond the housing market into the entire financial sector and the overall economy.

Both the government and the banking industry have tried to slow the mortgage meltdown. Hope Now, the Bush-administration led coalition of banks, loan servicers and community advocacy groups created to tackle the foreclosure problem, says it has has helped 2.7 million homeowners keep their homes since July 2007.

Lenders like JPMorgan Chase (JPM, Fortune 500), Citigroup (C, Fortune 500) and Bank of America (BAC, Fortune 500) have all recently implemented new loan modification programs.

She told the Fortune 500 Forum that it’s not too late to step up foreclosure prevention initiatives.

“The sooner we do it the better,” she replied. “I see higher delinquencies growing through 2010.”

Acting now would help many families who would otherwise lose their homes. And that would benefit everyone.

“Attacking the financial problem at its roots is the fiscally responsible and smart thing to do,” she said.

Massive Effort by J.P. Morgan to Save Mortgages

J.P. Morgan Chase & Co. launched an ambitious plan Friday to modify the terms of $70 billion in mortgages for borrowers who are behind on their payments or soon could be.

The move by the New York bank will cover as many as 400,000 borrowers. They’ll be moved into loans carrying lower interest rates, smaller principal amounts and other more-affordable terms.