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Posts Tagged ‘mortgage mess’

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.

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.

When Will Home Prices Stop Falling?

The answer is critical to millions of American homeowners who are watching their home equity melt away or are unable to move because falling values have sent potential buyers to the sidelines.

In the latest evidence that prices are still sliding, the National Association of Realtors reported Thursday that the median price of existing homes sold in June fell to $215,000, down 6.1 percent from a year ago. Sales fell 2.6 percent from the month before — far more than analysts had expected.

For starters, a lot depends on whether anything can be done to stop the ongoing wave of home foreclosures. As the inventory of bank-owned properties keeps rising, lenders have become eager sellers, hoping to get those properties off their books before prices fall further.

For the same reason, potential buyers are either waiting on the sidelines or making fire-sale bids. A surplus of motivated sellers and a dearth of interested buyers is pretty much the formula for further prices declines.

Congress this week finally passed a major housing bill after nearly a year of debate, but the measure is expected to help relatively few borrowers.