Having weathered four years of declining property values, local governments have whittled spending to essential services, and some have spent reserve funds, according to city managers and finance directors.
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It's all the fault of Privatopia for failing to preserve property values.
Saturday, September 03, 2011
Friday, September 02, 2011
The $4 Trillion Dollar Question | The Big Picture
The $4 Trillion Dollar Question | The Big Picture
This analysis is by Dhaval Joshi, a financial analyst, reprinted on Barry Ritholtz's blog (highly recommended). It appeared in June 2010 but I just ran across it. Here's the lead:
"Can the US economy really return to “business as usual” when it has 4 million houses surplus to requirement, when 1 out of 4 mortgages are in negative equity, and when by our calculation, it is burdened with $4 trillion of excess mortgage debt, equivalent to 30% of GDP?"
This analysis is by Dhaval Joshi, a financial analyst, reprinted on Barry Ritholtz's blog (highly recommended). It appeared in June 2010 but I just ran across it. Here's the lead:
"Can the US economy really return to “business as usual” when it has 4 million houses surplus to requirement, when 1 out of 4 mortgages are in negative equity, and when by our calculation, it is burdened with $4 trillion of excess mortgage debt, equivalent to 30% of GDP?"
Robo-signed mortgage docs date back to late 1990s - Yahoo! News
Robo-signed mortgage docs date back to late 1990s - Yahoo! News
Counties across the United States are discovering that illegal or questionable mortgage paperwork is far more widespread than thought, tainting the deeds of tens of thousands of homes dating to the late 1990s.
The suspect documents could create legal trouble for homeowners for years.
Counties across the United States are discovering that illegal or questionable mortgage paperwork is far more widespread than thought, tainting the deeds of tens of thousands of homes dating to the late 1990s.
The suspect documents could create legal trouble for homeowners for years.
The Real Deal on HOAs - RE/MAX Baja Realty
The Real Deal on HOAs - RE/MAX Baja Realty
"The City Council is working on setting up a new department to coordinate the HOA of the different developments, to solve internal problems between residents, the HOA and the developer. Before the developer establishes the HOA the new department appointed by the City Council will check the regulations and then give its authorization to go ahead and establish it. Raúl Aragón, council member of Rosarito and businessman has made a lot of effort for this to happen; he is also assisting the Rosarito Realtors Association and obtaining a licensed requirement to practice real estate in the city of Rosarito." Gustavo Torres, President of AMPI, commented on the subject. The new department will have the obligations to create reorganization and modernizing programs, annual income and expense reports, administrative manuals, it will keep a statistical control, impose sanctions in case of violation of the law, inspections and notices when applicable, it will supervise the appointment of board members, security and management; it will also establish the budget for common expenses, types of payment and a reserve fund.
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Thanks to Robert Rancansky for this interesting link. The writer doesn't understand why associations are proliferating and explains that all wrong, but this last paragraph is worth noting. This is in Baja California, Mexico, where apparently they have some concept of the need to keep track of association affairs. I guess Milton Friedman didn't get around to preaching his gospel there.
"The City Council is working on setting up a new department to coordinate the HOA of the different developments, to solve internal problems between residents, the HOA and the developer. Before the developer establishes the HOA the new department appointed by the City Council will check the regulations and then give its authorization to go ahead and establish it. Raúl Aragón, council member of Rosarito and businessman has made a lot of effort for this to happen; he is also assisting the Rosarito Realtors Association and obtaining a licensed requirement to practice real estate in the city of Rosarito." Gustavo Torres, President of AMPI, commented on the subject. The new department will have the obligations to create reorganization and modernizing programs, annual income and expense reports, administrative manuals, it will keep a statistical control, impose sanctions in case of violation of the law, inspections and notices when applicable, it will supervise the appointment of board members, security and management; it will also establish the budget for common expenses, types of payment and a reserve fund.
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Thanks to Robert Rancansky for this interesting link. The writer doesn't understand why associations are proliferating and explains that all wrong, but this last paragraph is worth noting. This is in Baja California, Mexico, where apparently they have some concept of the need to keep track of association affairs. I guess Milton Friedman didn't get around to preaching his gospel there.
Calculated Risk: Lawler: Census 2010: Homeownership Rates by Selected Age Groups
Calculated Risk: Lawler: Census 2010: Homeownership Rates by Selected Age Groups
Homeownership rates for those under the age of 55 have fallen dramatically since 1980, according to the Census.
Homeownership rates for those under the age of 55 have fallen dramatically since 1980, according to the Census.
Wednesday, August 31, 2011
Oregon Foreclosures Appear Likely to Shift to the Courts | LoanSafe.org
Oregon Foreclosures Appear Likely to Shift to the Courts | LoanSafe.org
For half a century, the vast majority of the state’s residential foreclosures have occurred without a judge’s involvement. Oregon is one of 24 states that allow nonjudicial foreclosures, provided lenders give borrowers proper notice, publicize the sale and abide by other requirements.
But late last year, federal judges began blocking them, ruling that lenders had failed to follow one of those requirements: filing the mortgage’s ownership history in county records.
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I have said many times that nonjudicial foreclosure is a terrible thing, whether done by CIDs or banks. Here is some reconsideration of the practice taking place in Oregon.
For half a century, the vast majority of the state’s residential foreclosures have occurred without a judge’s involvement. Oregon is one of 24 states that allow nonjudicial foreclosures, provided lenders give borrowers proper notice, publicize the sale and abide by other requirements.
But late last year, federal judges began blocking them, ruling that lenders had failed to follow one of those requirements: filing the mortgage’s ownership history in county records.
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I have said many times that nonjudicial foreclosure is a terrible thing, whether done by CIDs or banks. Here is some reconsideration of the practice taking place in Oregon.
The Home Equity Theft Reporter: May 1, 2011
The Home Equity Theft Reporter: May 1, 2011
Ohio Supremes To Decide Whether Foreclosing Party Must Own Both Note, Mortgage At The Time Complaint Is Filed
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Interesting blog--and looks like a big case.
Ohio Supremes To Decide Whether Foreclosing Party Must Own Both Note, Mortgage At The Time Complaint Is Filed
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Interesting blog--and looks like a big case.
Guilty plea in homeowners association scheme - Houston Chronicle
Guilty plea in homeowners association scheme - Houston Chronicle
LAS VEGAS (AP) — A Las Vegas political consultant pleaded guilty Tuesday in federal court to taking part in a scheme to control condominium homeowners associations and steer business to favored companies in southern Nevada.
Steven Wark, 54, admitted in a plea agreement that in 2005 he joined an effort to control homeowners association boards of directors to send legal work and building contracts to a law firm and construction company designated by his co-conspirators, prosecutors said.
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Thanks to Bill Davis for the link. Others sent me a link to the Las Vegas Review-Journal version, but I never quote anything from that newspaper because they sued people for doing it.
LAS VEGAS (AP) — A Las Vegas political consultant pleaded guilty Tuesday in federal court to taking part in a scheme to control condominium homeowners associations and steer business to favored companies in southern Nevada.
Steven Wark, 54, admitted in a plea agreement that in 2005 he joined an effort to control homeowners association boards of directors to send legal work and building contracts to a law firm and construction company designated by his co-conspirators, prosecutors said.
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Thanks to Bill Davis for the link. Others sent me a link to the Las Vegas Review-Journal version, but I never quote anything from that newspaper because they sued people for doing it.
Tuesday, August 30, 2011
Guilty plea in homeowners association scheme
LAS VEGAS (AP) — A Las Vegas political consultant pleaded guilty Tuesday in federal court to taking part in a scheme to control condominium homeowners associations and steer business to favored companies in southern Nevada.
Steven Wark, 54, admitted in a plea agreement that in 2005 he joined an effort to control homeowners association boards of directors to send legal work and building contracts to a law firm and construction company designated by his co-conspirators, prosecutors said.
The Justice Department also alleged in the statement that co-conspirators forged ballots and rigged board elections in the scheme that involved about a dozen homeowners associations and took place from about August 2003 through February 2009. The names of the co-conspirators and other companies weren't made public.
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The story goes on to note a federal prosecutor expects more federal cases to be filed in the coming days and weeks. The late Las Vegan and wannabe wiseguy Phil "The Ghostbuster" Testa must be having a posthumous "told ya so" moment. Thanks to Bill Davis for the story.
Orange County, CA, may go bankrupt...again???
Second District Supervisor John Moorlach warned in a weekend editorial in the Register that the county is poised at the edge of bankruptcy – again.
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Thus spake Orange County Second District Supervisor John Moorlach, who was the county treasurer for 12 years--following the first Orange County bankruptcy in 1994. That time, it was the result of bonehead financial decisions made by the previous treasurer, Robert Citron, who thought investing public money in complex derivatives was a great way for the Republicans of Orange County to avoid paying taxes. This time? It sounds like a combination of factors, but the tax phobia of Orange County residents is a perennial fact of life for county officials.
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Thus spake Orange County Second District Supervisor John Moorlach, who was the county treasurer for 12 years--following the first Orange County bankruptcy in 1994. That time, it was the result of bonehead financial decisions made by the previous treasurer, Robert Citron, who thought investing public money in complex derivatives was a great way for the Republicans of Orange County to avoid paying taxes. This time? It sounds like a combination of factors, but the tax phobia of Orange County residents is a perennial fact of life for county officials.
Monday, August 29, 2011
Dispute could force out residents of rundown condo | The Tennessean | tennessean.com
Dispute could force out residents of rundown condo | The Tennessean | tennessean.com
Residents of a West Nashville condominium complex could soon be forced to search for new homes because of a complicated dispute between absentee real estate investors and their homeowners association.
The West Meade Condominium complex, located off Charlotte Pike next to the Nashville West shopping center, has become dangerously rundown because the homeowners association doesn’t have enough money to pay for repairs.
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Yet another collapsing condo project. I expect this sort of story to become commonplace over the next few years. Thanks to Fred Pilot for this link.
Residents of a West Nashville condominium complex could soon be forced to search for new homes because of a complicated dispute between absentee real estate investors and their homeowners association.
The West Meade Condominium complex, located off Charlotte Pike next to the Nashville West shopping center, has become dangerously rundown because the homeowners association doesn’t have enough money to pay for repairs.
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Yet another collapsing condo project. I expect this sort of story to become commonplace over the next few years. Thanks to Fred Pilot for this link.
Saturday, August 27, 2011
Online petition to Congress: Declare HOAs governments -- or outlaw them as rackets
Make Home Owner Associations legitimate by holding them to the same standards as our state and federal government, or end them as racketeering.
These privatized corporate goverments are judge, jury, and executioner against homeowners' basic rights. They require no oversight as they target, bully, and foreclose for profit, and just because they can. This multi-billion dollar a year industry uses oblivious HOA boards to extort billions from homeowners while proporting to "protect property values." Nothing could be further from the truth. Tragically, Senator Carona from Dallas owns the largest HOA management company in the country, and he writes the legislation against homeowners to protect his empire.
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The petition can be viewed and signed here.
These privatized corporate goverments are judge, jury, and executioner against homeowners' basic rights. They require no oversight as they target, bully, and foreclose for profit, and just because they can. This multi-billion dollar a year industry uses oblivious HOA boards to extort billions from homeowners while proporting to "protect property values." Nothing could be further from the truth. Tragically, Senator Carona from Dallas owns the largest HOA management company in the country, and he writes the legislation against homeowners to protect his empire.
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The petition can be viewed and signed here.
Foreclosures made up 31 pct. of home sales in 2Q - Yahoo! Finance
Foreclosures made up 31 pct. of home sales in 2Q - Yahoo! Finance
The share of the market would likely have been larger this spring if not for a state and federal investigation into faulty paperwork by banks and servicers. The probe has led many banks to delay foreclosure sales. Once that is complete, foreclosures will likely surge later this year.
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I guess the real policy we are adopting de facto is just to bail out the banksters and let people lose their homes. All this talk about helping out the owners seems like empty rhetoric.
The share of the market would likely have been larger this spring if not for a state and federal investigation into faulty paperwork by banks and servicers. The probe has led many banks to delay foreclosure sales. Once that is complete, foreclosures will likely surge later this year.
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I guess the real policy we are adopting de facto is just to bail out the banksters and let people lose their homes. All this talk about helping out the owners seems like empty rhetoric.
Friday, August 26, 2011
Borrowers claim lender knowingly made bad loans, depressing their property values
This is a case in which nearly 250 California customers of Countrywide Financial allege that the mortgage lender knowingly failed to practice diligent underwriting, generating bad loans that led to a liquidity crisis that cratered California's housing market -- and their property values:
The Second District California Court of Appeal isn't buying the argument. It granted Countywide's petition to overturn a trial court ruling overruling its demurrer to the plaintiffs' fraudulent concealment allegation:
In other words, the court is saying, the conduct of a single lender -- even one like Countrywide that had a major segment of the pre-meltdown residential mortgage market in California -- can't be blamed for popping the real estate bubble. It's also impliedly stating that lots of lenders threw underwriting standards to the wind, so no single mortgage lender can be blamed for the resulting crash.
The full ruling can be viewed here.
As a proximate result of the foregoing concealment by Defendants, California property values have precipitously declined and continue to decline, gravely damaging Plaintiffs by materially reducing the value of their primary residences, depriving them of access to equity lines, second mortgages and other financings previously available based upon ownership of a primary residence in California, in numerous instances leading to payments in excess of the value of their properties
The Second District California Court of Appeal isn't buying the argument. It granted Countywide's petition to overturn a trial court ruling overruling its demurrer to the plaintiffs' fraudulent concealment allegation:
We conclude the plaintiffs/borrowers cannot state a cause of action against Countrywide for fraudulent concealment of an alleged scheme to bilk investors by selling them pooled mortgages at inflated values, the demise of which scheme led to devastated home values across California. Due to the generalized decline in home values which affects all homeowners (borrowers of Countrywide, borrowers who dealt with other lenders, and homeowners who owned their homes free and clear), there is no nexus between Countrywide‘s alleged fraudulent concealment of its scheme to bilk investors and the diminution in value of the instant borrowers‘ properties.
In other words, the court is saying, the conduct of a single lender -- even one like Countrywide that had a major segment of the pre-meltdown residential mortgage market in California -- can't be blamed for popping the real estate bubble. It's also impliedly stating that lots of lenders threw underwriting standards to the wind, so no single mortgage lender can be blamed for the resulting crash.
The full ruling can be viewed here.
Thursday, August 25, 2011
Walmart Is Dying Because Its Business Model Is Strangling Itself - The Consumerist
Walmart Is Dying Because Its Business Model Is Strangling Itself - The Consumerist
Make sure you read this in a spooky voice in your head: Wal-Mart is dooooomed! At least, the business model it relied on to reach such astronomical growth is now probably putting a choke hold on the company's ability to grow and compete.
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Human institutions often collapse right after a period of explosive growth.
Make sure you read this in a spooky voice in your head: Wal-Mart is dooooomed! At least, the business model it relied on to reach such astronomical growth is now probably putting a choke hold on the company's ability to grow and compete.
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Human institutions often collapse right after a period of explosive growth.
US May Back Mortgage Refinancing for Millions - CNBC
US May Back Mortgage Refinancing for Millions - CNBC
The Obama administration is considering further actions to strengthen the housing market, but the bar is high: plans must help a broad swath of homeowners, stimulate the economy and cost next to nothing.
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I feel as though Obama has waited far too long to seriously address the housing market and the unemployment situation. And if he is thinking about next year's election, it may be too late for these initiatives to make any difference.
The Obama administration is considering further actions to strengthen the housing market, but the bar is high: plans must help a broad swath of homeowners, stimulate the economy and cost next to nothing.
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I feel as though Obama has waited far too long to seriously address the housing market and the unemployment situation. And if he is thinking about next year's election, it may be too late for these initiatives to make any difference.
Wednesday, August 24, 2011
Homeowner Groups Sue to Force Foreclosures - Bloomberg
Homeowner Groups Sue to Force Foreclosures - Bloomberg
Members of the Vintage East Condominium Association in Miami Beach got tired of waiting for JPMorgan Chase & Co. (JPM) to foreclose on unit 9, so they sued the bank in February to take control of the property.
In June, more than four years after the owner stopped making payments, a judge ruled that JPMorgan lost its claim to the $144,000 mortgage. The apartment is now on the market for $87,500, and the association may stave off insolvency with proceeds from the sale and a new owner who pays monthly dues, said Jane Losson, a board member at the complex. Four of the 11 other owners at the property are also behind on dues.
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Thanks to Doug Selby for this link. Maybe it's time to stop coddling the banksters. Just a thought.
Members of the Vintage East Condominium Association in Miami Beach got tired of waiting for JPMorgan Chase & Co. (JPM) to foreclose on unit 9, so they sued the bank in February to take control of the property.
In June, more than four years after the owner stopped making payments, a judge ruled that JPMorgan lost its claim to the $144,000 mortgage. The apartment is now on the market for $87,500, and the association may stave off insolvency with proceeds from the sale and a new owner who pays monthly dues, said Jane Losson, a board member at the complex. Four of the 11 other owners at the property are also behind on dues.
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Thanks to Doug Selby for this link. Maybe it's time to stop coddling the banksters. Just a thought.
New York Attorney General Kicked Off Government Group Leading Foreclosure Probe
New York Attorney General Kicked Off Government Group Leading Foreclosure Probe
WASHINGTON -- New York Attorney General Eric Schneiderman on Tuesday was kicked off the committee leading the 50-state task force charged with probing foreclosure abuses and negotiating a possible settlement agreement with the nation's five largest mortgage firms, according to an email reviewed by The Huffington Post.
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Why? Apparently because he is too aggressive about it: "He's leading his own investigation into mortgage improprieties, subpoenaing documents from the nation's largest financial institutions and reviewing court records for possible illegal home repossessions."
WASHINGTON -- New York Attorney General Eric Schneiderman on Tuesday was kicked off the committee leading the 50-state task force charged with probing foreclosure abuses and negotiating a possible settlement agreement with the nation's five largest mortgage firms, according to an email reviewed by The Huffington Post.
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Why? Apparently because he is too aggressive about it: "He's leading his own investigation into mortgage improprieties, subpoenaing documents from the nation's largest financial institutions and reviewing court records for possible illegal home repossessions."
Monday, August 22, 2011
AM Alert: Beware the (privatization) beast
A beast is on the loose at the Capitol today -- and we're not talking about Sutter Brown.
A "privatization beast" will be roaming Capitol Park as librarians gather on the south steps to warn of what they say are the perils of privatizing public libraries across the state.
The 11 a.m. presser is being staged in support of Assembly Bill 438, a union-backed bill that would establish a series of hurdles for cities and counties looking to hand over their library operations to private companies. Several California libraries have already signed on with a national contractor called Library Systems & Services.
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Privatizing libraries? That's nothing compared to local government, where entire towns and communities have been privatized into HOA-governed common interest developments in many parts of the nation.
Sunday, August 21, 2011
City of Aurora, CO Proposes Giving Corporation Right to Vote | Move to Amend
City of Aurora, CO Proposes Giving Corporation Right to Vote | Move to Amend
And...the Libertarian Party is opposing it!
And...the Libertarian Party is opposing it!
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