![Picture](/uploads/2/2/0/1/22019298/7383449.jpg)
August 7, 2013
NEW YORK (CNNMoney)
Fresh off a speech in Phoenix in which he outlined his vision for the
housing market, President Obama took to the web Wednesday to answer questions
from Americans wondering what the government can do to help.
Taking questions submitted online in an event live-streamed in cooperation
with real estate site Zillow (Z), Obama reiterated in broad terms
his support for scaling down government-backed housing finance firms Fannie Mae
and Freddie Mac, a key theme of his speech in Phoenix on Tuesday.
"We're actually confident that the private market can step in, do a good
job, and the government can be a backstop so that we still have affordability
and 30-year mortgages," he said. Obama said the Consumer Financial Protection Bureau will release
new guidelines "as soon as the fall" in an attempt to simplify the mortgage-application process.
Related: Top 10 consumer
complaints
While he touted home ownership as a key aspect of the "American Dream,"
Obama also expressed support for an expansion of affordable rental housing,
praising moves by institutional investors to buy and rent out residential
properties. These investors, he added, can help stabilize home values in neighborhoods that have been
blighted by foreclosures. Obama touted immigration reform as another way to strengthen the housing
market. "We know that if we get immigration reform done, suddenly you've got all
kinds of families coming out the shadows, paying taxes, paying penalties," he
said. "They're also going to be really likely to buy homes, often times in some
of the neighborhoods where you had the most foreclosures." Throughout the discussion, Obama emphasized the importance of the housing
market to the broader economy. "This is where most Americans have their wealth," he said. "If we get that
right, it makes a big difference everywhere else"
Find homes for sale
NEW YORK (CNNMoney)
Fresh off a speech in Phoenix in which he outlined his vision for the
housing market, President Obama took to the web Wednesday to answer questions
from Americans wondering what the government can do to help.
Taking questions submitted online in an event live-streamed in cooperation
with real estate site Zillow (Z), Obama reiterated in broad terms
his support for scaling down government-backed housing finance firms Fannie Mae
and Freddie Mac, a key theme of his speech in Phoenix on Tuesday.
"We're actually confident that the private market can step in, do a good
job, and the government can be a backstop so that we still have affordability
and 30-year mortgages," he said. Obama said the Consumer Financial Protection Bureau will release
new guidelines "as soon as the fall" in an attempt to simplify the mortgage-application process.
Related: Top 10 consumer
complaints
While he touted home ownership as a key aspect of the "American Dream,"
Obama also expressed support for an expansion of affordable rental housing,
praising moves by institutional investors to buy and rent out residential
properties. These investors, he added, can help stabilize home values in neighborhoods that have been
blighted by foreclosures. Obama touted immigration reform as another way to strengthen the housing
market. "We know that if we get immigration reform done, suddenly you've got all
kinds of families coming out the shadows, paying taxes, paying penalties," he
said. "They're also going to be really likely to buy homes, often times in some
of the neighborhoods where you had the most foreclosures." Throughout the discussion, Obama emphasized the importance of the housing
market to the broader economy. "This is where most Americans have their wealth," he said. "If we get that
right, it makes a big difference everywhere else"
Find homes for sale
![Picture](/uploads/2/2/0/1/22019298/2297320.jpg)
August 6, 2013
NEW YORK (CNNMoney)
Bank of America is back in the government's crosshairs. The Department of Justice announced a civil lawsuit on Tuesday alleging that Bank of America defrauded buyers of mortgage-backed securities by lying about the quality of the home loans involved. The Securities and Exchange Commission also announced a parallel case.
Mortgage-backed securities are bonds created by packaging together and selling groups of residential mortgage loans. These securities played a key role in the 2008 financial crisis, failing in huge numbers as the housing market collapsed.
"Bank of America's reckless and fraudulent origination and securitization practices in the lead-up to the financial crisis caused significant losses to investors," Anne Tompkins, the U.S. Attorney in the Western District of North Carolina, said in a statement. "Now, Bank of America will have to face the consequences of its actions"
Bank of America is back in the government's crosshairs.
The Department of Justice announced a civil lawsuit on Tuesday alleging that
Bank of America defrauded buyers of mortgage-backed securities by lying about
the quality of the home loans involved. The Securities and Exchange Commission
also announced a parallel case.
Mortgage-backed securities are bonds created by packaging together and
selling groups of residential mortgage loans. These securities played a key role
in the 2008 financial crisis, failing in huge numbers as the housing market
collapsed.
"Bank of America's reckless and fraudulent origination and securitization
practices in the lead-up to the financial crisis caused significant losses to
investors," Anne Tompkins, the U.S. Attorney in the Western District of North
Carolina, said in a statement. "Now, Bank of America will have to face the
consequences of its actions"
The allegations center on a specific offering from 2008 in which investors
including Wachovia Bank and the Federal Home Loan Bank of San Francisco
purchased over $850 million worth of supposedly high-quality mortgage-backed
securities from Bank of America (BAC, Fortune 500).
The DOJ estimates that investors will ultimately lose more than $100 million
on the offering. As of June, the Justice Department said, 23% of the mortgages
involved had failed or were delinquent.
Bank spokesman Lawrence Grayson said Tuesday that the mortgages in question
were "sold to sophisticated investors who had ample access to the underlying
data," and that Bank of America would fight the charges.
"The loans in this pool performed better than loans with similar
characteristics originated and securitized at the same time by other financial
institutions," Grayson said.
"We are not responsible for the housing market collapse that caused mortgage
loans to default at unprecedented rates, and these securities to lose value as a
result."
Bank of America revealed the possibility of charges in its
quarterly report last week. The firm has been forced to pay billions of dollars
in legal costs related to the housing bust and the financial crisis over the
past few years.
NEW YORK (CNNMoney)
Bank of America is back in the government's crosshairs. The Department of Justice announced a civil lawsuit on Tuesday alleging that Bank of America defrauded buyers of mortgage-backed securities by lying about the quality of the home loans involved. The Securities and Exchange Commission also announced a parallel case.
Mortgage-backed securities are bonds created by packaging together and selling groups of residential mortgage loans. These securities played a key role in the 2008 financial crisis, failing in huge numbers as the housing market collapsed.
"Bank of America's reckless and fraudulent origination and securitization practices in the lead-up to the financial crisis caused significant losses to investors," Anne Tompkins, the U.S. Attorney in the Western District of North Carolina, said in a statement. "Now, Bank of America will have to face the consequences of its actions"
Bank of America is back in the government's crosshairs.
The Department of Justice announced a civil lawsuit on Tuesday alleging that
Bank of America defrauded buyers of mortgage-backed securities by lying about
the quality of the home loans involved. The Securities and Exchange Commission
also announced a parallel case.
Mortgage-backed securities are bonds created by packaging together and
selling groups of residential mortgage loans. These securities played a key role
in the 2008 financial crisis, failing in huge numbers as the housing market
collapsed.
"Bank of America's reckless and fraudulent origination and securitization
practices in the lead-up to the financial crisis caused significant losses to
investors," Anne Tompkins, the U.S. Attorney in the Western District of North
Carolina, said in a statement. "Now, Bank of America will have to face the
consequences of its actions"
The allegations center on a specific offering from 2008 in which investors
including Wachovia Bank and the Federal Home Loan Bank of San Francisco
purchased over $850 million worth of supposedly high-quality mortgage-backed
securities from Bank of America (BAC, Fortune 500).
The DOJ estimates that investors will ultimately lose more than $100 million
on the offering. As of June, the Justice Department said, 23% of the mortgages
involved had failed or were delinquent.
Bank spokesman Lawrence Grayson said Tuesday that the mortgages in question
were "sold to sophisticated investors who had ample access to the underlying
data," and that Bank of America would fight the charges.
"The loans in this pool performed better than loans with similar
characteristics originated and securitized at the same time by other financial
institutions," Grayson said.
"We are not responsible for the housing market collapse that caused mortgage
loans to default at unprecedented rates, and these securities to lose value as a
result."
Bank of America revealed the possibility of charges in its
quarterly report last week. The firm has been forced to pay billions of dollars
in legal costs related to the housing bust and the financial crisis over the
past few years.
![Picture](/uploads/2/2/0/1/22019298/6066659.jpg)
August 1, 2013
NEW YORK (CNNMoney)
Home prices have been seeing rapid gains in recent months, but don't expect that to continue. While double digit gains have been common, home appreciation is projected to drop to 6.5% during the 12 months ending March 31, 2014, according to a report released Thursday. That will follow a 10.2% jump for the preceding 12 months, the first double-digit increase since the peak of the housing boom seven years ago.
The forecast is based on the CoreLogic Case-Shiller home price indexes and covers 384 metro areas and more than 80% of the total U.S. housing market.
Related: 10 most expensive cities in the world
Home prices have been seeing rapid gains in recent months, but don't expect
that to continue.
While double digit gains have been common, home
appreciation is projected to drop to 6.5% during the 12 months ending March 31,
2014, according to a report released Thursday. That will follow a 10.2% jump for
the preceding 12 months, the first double-digit increase since the peak of the
housing boom seven years ago.
The forecast is based on the CoreLogic Case-Shiller home price indexes and
covers 384 metro areas and more than 80% of the total U.S. housing market.
Related: 10 most expensive cities in the world
Dr. David Stiff, chief economist for CoreLogic Case-Shiller, expects home prices
in most markets to continue to increase significantly for several months before
slowing down.
"Record levels of affordability, a slowly improving job market and very
small inventories of new and existing homes for sale will continue to drive U.S.
home price appreciation during the summer," he said.
In the handful of markets where prices have recently declined, Stiff said
they'll likely turn positive before the year is out. Even with the dramatic
price increase recently, he remained unconcerned about a new bubble, as "home
prices remain 26% below their peak nationally and are even lower in some metro
areas."
Related: Housing markets where cash is king
San Jose, Calif., was the biggest winner over the 12 months that ended in
March 2013, with an increase of 23.7%, but it's forecast to gain just 7.4% in
the current period.
Phoenix and Sacramento will also see a significant slowdown, with price
gains dropping from above 20% to the single digits.
Related: 10 big, booming cities
Other markets will take up some of the slack. Prices in Hartford, Conn.,
should increase by 9.8% after recording a 1.2% year-over-year gain through March
2013. Baltimore and Philadelphia will also see their prices jump.
Stiff has consistently projected stagnation in Florida housing markets, and this
year is no different. He thinks prices will dip in Miami by 2.7%; Fort
Lauderdale by 2.6%; and Orlando by 1.6%. Tampa is a lone bright spot, where
prices are expected to rise 2.3%.
NEW YORK (CNNMoney)
Home prices have been seeing rapid gains in recent months, but don't expect that to continue. While double digit gains have been common, home appreciation is projected to drop to 6.5% during the 12 months ending March 31, 2014, according to a report released Thursday. That will follow a 10.2% jump for the preceding 12 months, the first double-digit increase since the peak of the housing boom seven years ago.
The forecast is based on the CoreLogic Case-Shiller home price indexes and covers 384 metro areas and more than 80% of the total U.S. housing market.
Related: 10 most expensive cities in the world
Home prices have been seeing rapid gains in recent months, but don't expect
that to continue.
While double digit gains have been common, home
appreciation is projected to drop to 6.5% during the 12 months ending March 31,
2014, according to a report released Thursday. That will follow a 10.2% jump for
the preceding 12 months, the first double-digit increase since the peak of the
housing boom seven years ago.
The forecast is based on the CoreLogic Case-Shiller home price indexes and
covers 384 metro areas and more than 80% of the total U.S. housing market.
Related: 10 most expensive cities in the world
Dr. David Stiff, chief economist for CoreLogic Case-Shiller, expects home prices
in most markets to continue to increase significantly for several months before
slowing down.
"Record levels of affordability, a slowly improving job market and very
small inventories of new and existing homes for sale will continue to drive U.S.
home price appreciation during the summer," he said.
In the handful of markets where prices have recently declined, Stiff said
they'll likely turn positive before the year is out. Even with the dramatic
price increase recently, he remained unconcerned about a new bubble, as "home
prices remain 26% below their peak nationally and are even lower in some metro
areas."
Related: Housing markets where cash is king
San Jose, Calif., was the biggest winner over the 12 months that ended in
March 2013, with an increase of 23.7%, but it's forecast to gain just 7.4% in
the current period.
Phoenix and Sacramento will also see a significant slowdown, with price
gains dropping from above 20% to the single digits.
Related: 10 big, booming cities
Other markets will take up some of the slack. Prices in Hartford, Conn.,
should increase by 9.8% after recording a 1.2% year-over-year gain through March
2013. Baltimore and Philadelphia will also see their prices jump.
Stiff has consistently projected stagnation in Florida housing markets, and this
year is no different. He thinks prices will dip in Miami by 2.7%; Fort
Lauderdale by 2.6%; and Orlando by 1.6%. Tampa is a lone bright spot, where
prices are expected to rise 2.3%.
![Picture](/uploads/2/2/0/1/22019298/6394363.jpg)
July 30, 2013
NEW YORK (CNNMoney)
Richmond Mayor Gayle McLaughlin said the city is "stepping into the void with a local principal reduction program" after other attempts to stem foreclosures failed. The California city of Richmond said Tuesday that it's ready to take an extraordinary step in its bid to stop foreclosures -- threatening to wrest mortgages from the investors who now control them.As a first step, the San Francisco Bay city said it will work with an investment firm to try to purchase mortgages of underwater homeowners at a price well below their current balances. It would then try to get those loans restructured to make them affordable.
Richmond Mayor Gayle McLaughlin said the city is "stepping into the void with
a local principal reduction program" after other attempts to stem foreclosures failed.
The California city of Richmond said Tuesday that it's ready to take an
extraordinary step in its bid to stop foreclosures -- threatening to wrest
mortgages from the investors who now control them.
As a first step, the San Francisco Bay city said it will work with an
investment firm to try to purchase mortgages of underwater homeowners at a price
well below their current balances. It would then try to get those loans
restructured to make them affordable.
But if the holders of the loans, who are mostly investors, refuse to sell by
Aug. 14, the city said it will invoke eminent domain to seize the mortgages so
it has more control over the process of making them affordable.
Eminent domain is the legal principle that lets government entities purchase
land or structures, usually from reluctant owners who don't want to sell. It is
typically invoked for public uses such as parks, roads or utilities -- not
mortgages.
In the case of Richmond, the city argues that eminent domain is in the
public interest because it could let people stay in their homes and help keep
neighborhoods, especially minority communities and low-income neighborhoods,
from fraying.
"After years of waiting for a comprehensive fix, we're stepping into the void
with a local principal reduction program," said Gayle McLaughlin, mayor of
Richmond.
The idea is controversial and reflects the frustration, seven years after
the housing market started to collapse, of homeowners and officials in areas
that are still reeling.
The Richmond plan was proposed by a private backer, Mortgage Resolution
Partners, which will find the money the city needs to buy the mortgages. It
stands to profit by taking a cut when the loans are refinanced.
There's no question the housing meltdown has thwacked Richmond.
The median home price peaked at about $460,000 in early 2006, according to
real estate website Zillow. Today, it
is $206,000.
That means a family that purchased at the top of the market could still owe
twice the current value of its home.
The idea of invoking eminent domain has been considered but rejected by other
localities, including Chicago and San Bernardino, another California city hit
hard by the real estate collapse.
Richmond's efforts are likely to draw court challenges from investors and
others who hold the current mortgages and stand to lose financially, experts
said.
And banks could be scared off lending to homeowners in Richmond in the
future.
"Eminent domain refinancing may offer temporary benefits to underwater
borrowers in specific markets, but there will be longer-term harm as lenders are
likely to pull out of those markets and mortgage financing costs across the
board are likely to rise," said Jaret Seiberg, a banking analyst at Guggenheim
Partners. Richmond homeowner Morris LeGrande, however, said the city is already paying
a big price for the severely underwater mortgages.
Borrowers paying off bloated loans have less money to spend at businesses in
town. And the homes lost to foreclosure can blight entire neighborhoods, lower
property values for every homeowner and contribute to crime.
"We want the city to purchase the loans at fair market value so we can
manage our lives more effectively and economically," he said.
NEW YORK (CNNMoney)
Richmond Mayor Gayle McLaughlin said the city is "stepping into the void with a local principal reduction program" after other attempts to stem foreclosures failed. The California city of Richmond said Tuesday that it's ready to take an extraordinary step in its bid to stop foreclosures -- threatening to wrest mortgages from the investors who now control them.As a first step, the San Francisco Bay city said it will work with an investment firm to try to purchase mortgages of underwater homeowners at a price well below their current balances. It would then try to get those loans restructured to make them affordable.
Richmond Mayor Gayle McLaughlin said the city is "stepping into the void with
a local principal reduction program" after other attempts to stem foreclosures failed.
The California city of Richmond said Tuesday that it's ready to take an
extraordinary step in its bid to stop foreclosures -- threatening to wrest
mortgages from the investors who now control them.
As a first step, the San Francisco Bay city said it will work with an
investment firm to try to purchase mortgages of underwater homeowners at a price
well below their current balances. It would then try to get those loans
restructured to make them affordable.
But if the holders of the loans, who are mostly investors, refuse to sell by
Aug. 14, the city said it will invoke eminent domain to seize the mortgages so
it has more control over the process of making them affordable.
Eminent domain is the legal principle that lets government entities purchase
land or structures, usually from reluctant owners who don't want to sell. It is
typically invoked for public uses such as parks, roads or utilities -- not
mortgages.
In the case of Richmond, the city argues that eminent domain is in the
public interest because it could let people stay in their homes and help keep
neighborhoods, especially minority communities and low-income neighborhoods,
from fraying.
"After years of waiting for a comprehensive fix, we're stepping into the void
with a local principal reduction program," said Gayle McLaughlin, mayor of
Richmond.
The idea is controversial and reflects the frustration, seven years after
the housing market started to collapse, of homeowners and officials in areas
that are still reeling.
The Richmond plan was proposed by a private backer, Mortgage Resolution
Partners, which will find the money the city needs to buy the mortgages. It
stands to profit by taking a cut when the loans are refinanced.
There's no question the housing meltdown has thwacked Richmond.
The median home price peaked at about $460,000 in early 2006, according to
real estate website Zillow. Today, it
is $206,000.
That means a family that purchased at the top of the market could still owe
twice the current value of its home.
The idea of invoking eminent domain has been considered but rejected by other
localities, including Chicago and San Bernardino, another California city hit
hard by the real estate collapse.
Richmond's efforts are likely to draw court challenges from investors and
others who hold the current mortgages and stand to lose financially, experts
said.
And banks could be scared off lending to homeowners in Richmond in the
future.
"Eminent domain refinancing may offer temporary benefits to underwater
borrowers in specific markets, but there will be longer-term harm as lenders are
likely to pull out of those markets and mortgage financing costs across the
board are likely to rise," said Jaret Seiberg, a banking analyst at Guggenheim
Partners. Richmond homeowner Morris LeGrande, however, said the city is already paying
a big price for the severely underwater mortgages.
Borrowers paying off bloated loans have less money to spend at businesses in
town. And the homes lost to foreclosure can blight entire neighborhoods, lower
property values for every homeowner and contribute to crime.
"We want the city to purchase the loans at fair market value so we can
manage our lives more effectively and economically," he said.