Feeling tired and rundown because you have an out of shape mortgage?  The FHFA is working on a plan for you to shed those excess dollars on your mortgage: WASHINGTON, Oct 26 (Reuters) – The regulator for Fannie Mae and Freddie Mac was reviewing a proposal to help troubled homeowners by forgiving a portion of their outstanding mortgage debt, Democrats in the U.S. House of Representatives said on Wednesday. The head of the Federal Housing Finance Agency (FHFA), which oversees the mortgage-financing companies, met with 19 Democrats and discussed a proposal that would allow bankruptcy judges to reduce principal amounts…
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From the website of PMI Mortgage Insurance: [Hat tip L!] To all policyholders, insureds, and servicers: On August 19, 2011, PMI informed you of regulatory decisions that impacted our ability to write new commitments of insurance. Specifically, PMI Mortgage Insurance Co. (“PMI”) was required to cease writing new commitments. Today, we are informing all policyholders, insureds, and servicers of loans insured by PMI that the Director of the Arizona Department of Insurance obtained an “Order Directing Full and Exclusive Possession and Control of Insurer” (the “Order”) with respect to PMI. Under the Order, the Arizona Department of Insurance now has…
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The proliferation of “too big to fail” banks may be playing havoc with our economy, but at least we can have fun singing about it.  Here’s the latest video from our friends at VersusPlus:   IPO, anyone?

It’s been awhile since we’ve looked at sales data out of Phoenix.  One of the more interesting trends I’m seeing in sales is actually how it relates to rental data. [Thanks L for the data!] Rental data from ARMLS (The Phoenix area MLS service) is not as comprehensive as the sales data.  Many homes and apartments are not rented through the MLS.  However, I believe that for comparisons over time, the information is useful.  Here’s how the data compares: Note that even though there have been significant swings in home sales over the past 11 years, rentals have grown in…
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Foreclosures have slowed and home prices are remaining relatively flat.  These sobering statistics, however, show why it’s still too early to think that the housing market has bottomed: – Median household income has fallen for three straight years, declining 6.4 percent from $52,823 in 2007 to $49,445 in 2010. –The portion of households living in poverty grew to 15.1 percent last year, encompassing a record 46.2 million people. For a family of four, that meant income of less than $22,314. – More families are “doubling up” because of the economy. The number of combined households rose to 21.8 million this…
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I’m a little early for the fall color, but I’m in New England this week. Look for more regular posts starting next Monday.

I couldn’t help but be struck by the similarity of these two articles this past week.  It appears that on both the federal and state (AZ) level, foreclosure assistance is going begging. First this federal program for the unemployed: The federal government can’t even give money away to help the unemployed pay their mortgage. A $1 billion program to assist the jobless will likely end up spending only half the funds, at most, because so few people met the strict criteria. The Housing Department, which had to approve the applications for the Emergency Homeowners’ Loan Program by Friday, expects that…
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Doom contributors and I have often noted that commenters on MSM articles are often smarter than the reporters. [Granted, commenters are often dumb as a post too, but we can't have everything.] Even when comments aren’t stellar, you can get a feel for reader sentiment by perusing them. In 2006  commenters in the Arizona Republic overwhelmingly ridiculed the idea that housing could crash.  Today, we’ve seen that sentiment reverse.  Today Catherine Reagor, reporter for the Republic wrote about foreclosures being down in September and a slight uptick in the median home price.  To her credit, Reagor did admit that one…
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A lot of folks don’t believe that “It’s always a good time to buy or sell a house” anymore. Homeownership is at its lowest point in years.  This is a trend that is likely to continue for awhile.  People don’t see a lot of reward, and are worried about the downside.

According to yesterday’s New York Times, Foreclosures Are Killing Us.  The article was written by Craig E. Pollack, an assistant professor of internal medicine at Johns Hopkins and Julia F. Lynch, associate professor of political science at the University of Pennsylvania. If you believe the article, losing a house isn’t just an economic issue, but a health issue– and they describe the situation as “epidemic”: Foreclosure is not just a metaphorical epidemic, but a bona fide public health crisis. When breadwinners become ill, they miss work, lose their jobs, face daunting medical bills — and have trouble making mortgage payments as…
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You know that old joke about “Sure, we lose money on every deal, but we figure we’ll make it up on volume”?  I couldn’t help but think of that this morning when I was reading an article L sent me this morning. The article was about FHFA’s review of Bank of America’s mortgages, and indicated that FHFA examiners did have some concerns about how Freddie Mac was reviewing mortgages.  Doesn’t this sound like that “make it up on volume” strategy? Senior Freddie Mac managers disagreed with the examiner’s concerns and said they feared losing business from Bank of America if…
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A Mattia Mcintyre of Hannibal, New York was in talks with Citimortgage to refinance her home.  She was behind in her payments, but she had not received a Notice of Default.  Imagine her surprise when she came home to find that without giving notice, the lender hired a contractor to clean out her house. Safeguard Properties LLC was hired by Citimortgage to secure the property.  I found the following from their website ironic: At Safeguard, we believe that communication is the key to all areas of success.  Without it, we cannot successfully manage the preservation process or our relationships with…
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On of the bigger chuckles I’ve had this week was an explanation of how junk bonds work, forwarded to me by L.  For those of you who wondered what “mortgage bond securities” were and how they worked, this is one of the clearer explanations of how bond markets work that I’ve seen. I understand it’s been floating around the internet awhile, but it was new to me. Heidi is the proprietor of a bar in Detroit. She realizes that virtually all of her customers are unemployed alcoholics and, as such, can no longer afford to patronize her bar. To solve…
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Stan Humphries, chief economist for Zillow, spoke yesterday about government intervention in the housing markets.  I loved his point that “government policy can only do so much against fundamental market movements.  He made three major points: First, don’t underestimate the market’s ability to fix itself. This is, in fact, already happening. We may not like the timetable, but economic recovery can’t always happen overnight. Second, many policies addressing foreclosures are simply addressing symptoms, not fundamental drivers of a healthy housing market. Yes, declining values have led to foreclosures, which have created an excess supply of housing. But eliminating this excess…
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It has been interesting watching the mantra of the National Association of Realtors change with the changing market.  At the peak it was “Buy before it’s too late!” As the market started to cool it was “It’s always a great time to buy or sell a house!” As it cooled further, the new mantra was “You don’t want to time the market.”  Here’s the latest version I’ve seen of that advice: QUESTION: We are tired of renting and want to buy a home but we are afraid that prices will keep falling. How do we know when it is the…
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