Remember back a few months ago when Fannie and Freddie told the banks they had to take back the bad mortgages?  Lenders have decided to “just say no”: Fannie Mae and Freddie Mac are facing growing resistance as they attempt to push failed home loans off their books and onto the balance sheets of banks including Bank of America Corp. and JPMorgan Chase & Co. The two government-owned mortgage companies are enforcing contracts that require lenders to buy back loans that didn’t meet underwriting standards. At the end of September, the companies reported, banks hadn’t responded to $13 billion in…
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The claim has been made than the “robo-signing” fiasco has resulted in “wrongful foreclosures”.  Given the speed at which many of the documents were processed, errors and irregularities and almost inevitable.  Does this make the foreclosures “wrongful”?  What is a “wrongful foreclosure”? There is currently no legal definition, and opinions vary widely.  There are some advocates who would ban all foreclosures as “wrongful”. Marian Wang of ProPublica recently wrote an article in which she lists situations she describes as “wrongful foreclosure”, and I find her definitions useful, and I’ve added a few notes of my own. 1.  Homeowners were not…
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There has been a question as to how much the “foreclosure-gate scandal” would impact the market, according to CNN this morning, auctions are down by more than 30%: In San Diego, according to broker Scott Cheng of Cheng Realty, who puts investors together with foreclosed properties, the number of auctions scheduled has fallen from 500 a day, to 300. “That part of my business has dried up,” Cheng said. “A lot of my investors have stopped looking.” Cheng used to be able to find about three or four suitable homes a month for investors looking for a bargain. Now, he…
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Don’t you just love a poorly researched article on a Sunday morning?  It is the weekend, after all.  Who wants to clutter up the day with facts?  I ran across one this morning–a classic case of “reporting via press release”.  If the reporter had done even the most rudimentary of Google searches, it would have been apparent that there are holes in this story.  The story is from Reuters and deals with a development here in Austin: [T]here still are still prime areas, such as Austin, Texas, where there is life in the move-up market for current homeowners. Wheelock Street…
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The Fed’s own holdings of MBS shrank again, but by only $0.475 billion, while there were against-trend moves in both types of foreign central bank holdings of US obligations. Indeed the levels for both treasuries and agencies revisited values from between two and three weeks ago. At this point the trend only seems to be a blip / pause / breather. This week’s Reuters report1 was, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.2 Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set. Treasuries retreated a…
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After the “foreclosure-gate” scandal, Fannie Mae and Freddie Mac suspended sales of its foreclosed properties. They are now putting their foreclosed properties back on the market again: Fannie said Friday it had lifted a moratorium on foreclosed-property sales following a review of the affected properties it has acquired and after consulting with its government regulator, the Federal Housing Finance Agency. It was unclear how quickly sales would resume because loan servicers are still completing their reviews of paperwork. “Our decision was motivated by several factors including the protection of buyers with title insurance, the negative impact lingering foreclosed properties has…
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Granite countertops and stainless steel appliances could be considered the symbols of the housing bubble.  Considered an expensive luxury in the pre-bubble years, granite countertops became so common during the boom that no self-respecting crack house could be seen without them. I knew the housing craze was fading in 2006 when I went through a model home that was sporting Formica.  Falling home prices were forcing builders to cut corners, and granite countertops were one of the first thing to go. But what was the cost of all that granite?  How much did Americans spend before they discovered that other…
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Homeowners desperate to save their homes have paid thousands to firms who promise to help them with their loan mods, only to discover that these firms did less for them than they could have done themselves.  The FTC has decided to crack down on these firms by banning up front modification fees: Under new rules outlined on Nov. 19, the agency plans to ban virtually all upfront payments, institute mandatory disclosure rules and clamp new federal restrictions on lawyers who participate in mortgage-modification schemes. Under these rules, companies offering mortgage relief will have to contact your lender or servicer and…
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There are a lot of folks who just don’t feel right about walking away from their homes and mortgages.  They cut a deal- but they just can’t make the payments any more.  Rather than resorting to “jingle mail” and just mailing in the keys, they go through a “short sale”.  A short sale is when the lender agrees to take less than the amount owed. A short sale can be a real trial for a homeowner.  It’s bad enough trying to sell a home in this market without the added grief of needed a lender’s permission.  Imagine how frustrating it…
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If you are looking for an excellent review of the current foreclosure situation, here’s a summary of a great presentation by LPS: JACKSONVILLE, Fla., Nov. 23, 2010 – The October Mortgage Monitor report released by Lender Processing Services, Inc. (NYSE: LPS) shows that accelerated foreclosure referral activity over the last several months has pushed the foreclosure inventory rate to all-time highs. As of the end of October 2010, foreclosure inventories are 7.4 times historical averages and rising. The report also shows that foreclosure sales decreased dramatically over the last month as a result of the widespread moratoria. Overall, the percentage…
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I used to take a lot of heat from Las Vegas housing analysts Larry Murphy and Steven Bottfeld about my bearish predictions for Las Vegas.  Now even Murphy and Bottfeld don’t dare predict a recovery for the next two years. R.L. Brown, a Phoenix housing analyst, has no such reservations.  He remains as bullish as ever about Phoenix real estate and describes a scenario for Phoenix that couldn’t sound brighter if it had come from a fortune cookie: [Thanks L!] “Foreclosures will be flushed thru [sic] the system. Inventories will rebalance. Prices will begin to see upward pressure. Legislation will…
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The Fed’s own holdings of MBS shrank by $12.759 billion and cenbanks’ holdings of obligations (mostly treasuries) rose nicely, but didn’t quite offset the Fed’s own sale. This (well, last) week’s Reuters report1 was, as usual, based on the weekly update from the NY Fed’s H.4.1 table site.2 Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set. Treasuries continued a merely robust upward trend. At $9.714 bilion the Treasury Debt holdings grew at roughtly 3/4th last week’s rate. Agencies rebounded after the previous week’s selloff, but to the tune of only $0.690…
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There’s a vacant house just down the street from me.  The owners just picked up and left several months ago.  About two months ago the lender sent out landscapers to clean the yard up.  Since then, the house has just sat there. There are other houses out there like my neighbor’s former residence.  Lots and lots of them. [Thanks L!] CoreLogic (NYSE: CLGX), a leading provider of consumer, financial and property information and business services, reported today that shadow inventory of residential property as of August 2010, reached 2.1 million units, or eight months worth of supply, up from 1.9…
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Just had this forwarded to me. It’s a little oversimplified, but it is a great introduction.

A big hat tip to Zero Hedge for this funny CSpan video of Fraudclosure testimony by Chase Home Lending’s CEO: