The Florida Home Builders Association is concerned that, if the Supreme Court upholds the appellate-level decision, builders could be forced to fix a subdivision's problematic streets and common areas even though engineering firms and other contractors designed, constructed and inspected them.
"In the home, if something breaks, the builder has to fix it," said David Carter, president of the builders' trade group, which has filed briefs in the case. "But now, with all the entities that are involved, there's an effort to push the blame and responsibility to the builder/developer [for things outside the house] when there are other professionals who have responsibility for what they designed, inspected and certified."
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Local governments been privatizing public infrastructure for decades by requiring residential projects be under the jurisdiction of a mandatory membership homeowners association. Now Florida's top court will decide whether developers who build that infrastructure are responsible when it turns out to be defective.
This case has wide implications and as the story indicates could require developers to spend more on infrastructure. Frequently when there are problems with roads and storm water systems, property owners turn to local governments to take them over or impose property tax assessments to pay for maintenance and repairs, so they also have an interest in the outcome.
Sunday, December 04, 2011
How unemployment is tearing America apart
Having such a large army of semi-permanent unemployed workers will leave Americans poorer for years to come. “It not only affects your social fabric and creates social tensions, but it also has a fundamental impact on the long-term potential economic growth of the country,” he says. “What that means over time is a lower standard of living for everybody.” The downgrade in living standards is already underway in some unlikely places: America’s decaying suburbs. For decades the ’burbs represented the American dream for the middle class—white picket fences, two cars in the garage and a quiet cul-de-sac for the kids to play in. Yet today poverty in the suburbs is growing twice as fast as in cities, according to a recent analysis by the Brookings Institution.
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As go the burbs, so goes Privatopia. Having only been around in significant numbers since the 1970s, HOAs have never had to weather a long economic storm. As the good perfessor recently noted, consequently they aren't prepared to cope with such adversity. Foreclosure and job loss strangle the lifeblood of assessment revenue. Adding to the pain is HOAs have far fewer households to pick up the slack like larger municipalities and counties.
This article points out the speculation and leverage led downturn that began in 2008 that shaved eight percent off the U.S. economy cannot be directly compared to the Great Depression of the 1930s, in which the economy contracted by nearly one third and far in excess of the 10 percent drop in GDP that defines a depression. But anemic recovery since 2009 has been so weak for so long that it is transfiguring the economy because so many have been out of work for six months or longer.
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As go the burbs, so goes Privatopia. Having only been around in significant numbers since the 1970s, HOAs have never had to weather a long economic storm. As the good perfessor recently noted, consequently they aren't prepared to cope with such adversity. Foreclosure and job loss strangle the lifeblood of assessment revenue. Adding to the pain is HOAs have far fewer households to pick up the slack like larger municipalities and counties.
This article points out the speculation and leverage led downturn that began in 2008 that shaved eight percent off the U.S. economy cannot be directly compared to the Great Depression of the 1930s, in which the economy contracted by nearly one third and far in excess of the 10 percent drop in GDP that defines a depression. But anemic recovery since 2009 has been so weak for so long that it is transfiguring the economy because so many have been out of work for six months or longer.
Postal cuts to slow delivery of first-class mail - Yahoo! News
Postal cuts to slow delivery of first-class mail - Yahoo! News
WASHINGTON (AP) — Facing bankruptcy, the U.S. Postal Service is pushing ahead with unprecedented cuts to first-class mail next spring that will slow delivery and, for the first time in 40 years, eliminate the chance for stamped letters to arrive the next day.
The estimated $3 billion in reductions, to be announced in broader detail on Monday, are part of a wide-ranging effort by the cash-strapped Postal Service to quickly trim costs, seeing no immediate help from Congress.
The changes would provide short-term relief, but ultimately could prove counterproductive, pushing more of America's business onto the Internet. They could slow everything from check payments to Netflix's DVDs-by-mail, add costs to mail-order prescription drugs, and threaten the existence of newspapers and time-sensitive magazines delivered by postal carrier to far-flung suburban and rural communities.
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Congress caused this by ordaining in 2006 that the Postal Service had to prepay 50 years of its future pension obligations. Obviously the internet cut into postal revenues as well, but this present crisis was induced in order to justify privatizing the postal service entirely. A large segment of the American public is so ignorant, and determined to stay that way, that this strategy may work. Thanks to Fred Pilot for the link.
WASHINGTON (AP) — Facing bankruptcy, the U.S. Postal Service is pushing ahead with unprecedented cuts to first-class mail next spring that will slow delivery and, for the first time in 40 years, eliminate the chance for stamped letters to arrive the next day.
The estimated $3 billion in reductions, to be announced in broader detail on Monday, are part of a wide-ranging effort by the cash-strapped Postal Service to quickly trim costs, seeing no immediate help from Congress.
The changes would provide short-term relief, but ultimately could prove counterproductive, pushing more of America's business onto the Internet. They could slow everything from check payments to Netflix's DVDs-by-mail, add costs to mail-order prescription drugs, and threaten the existence of newspapers and time-sensitive magazines delivered by postal carrier to far-flung suburban and rural communities.
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Congress caused this by ordaining in 2006 that the Postal Service had to prepay 50 years of its future pension obligations. Obviously the internet cut into postal revenues as well, but this present crisis was induced in order to justify privatizing the postal service entirely. A large segment of the American public is so ignorant, and determined to stay that way, that this strategy may work. Thanks to Fred Pilot for the link.
Saturday, December 03, 2011
A Credit Score That Tracks You More Closely
This week, a company called CoreLogic introduced a new type of credit file, which is based on the giant repository of consumer data it maintains on just about everything that most of the traditional credit bureaus do not: missed rental payments that have gone into collection, any evictions or child support judgments, as well as any applications for payday loans, along with your repayment history.
The new report also includes any property tax liens and whether you’ve fallen behind on your homeowner’s association dues. It may reflect that you now owe more than your house is worth or if you own any other real estate properties outright. It also is supposed to catch mortgages made by smaller lenders that the big credit bureaus may have missed.
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Delinquent HOA and property tax assessment payments will make you less creditworthy under this new credit scoring scheme.
Homeowner's Association May Consider Private Hearing In Wake Of Playhouse Controversy | LEX18.com | Lexington, Kentucky
Homeowner's Association May Consider Private Hearing In Wake Of Playhouse Controversy | LEX18.com | Lexington, Kentucky
An official for the Andover Forest Homeowner's Association in Lexington said Friday that the association is considering a private hearing concerning a playhouse for a three-year-old with cerebral palsy. The story stirred controversy after it was revealed the association told the homeowners they had to remove the playhouse.
The story of the family fighting to keep their son's playhouse has received a lot of attention since LEX 18 first reported it on Thursday's 6 p.m. newscast. Three-year-old Cooper Veloudis has cerebral palsy and uses that house as part of his therapy, but the neighborhood homeowner's association says it has to go.
Despite an overwhelming output of support for Cooper, Ernie Stamper, one of seven people who represent the Andover Forest Subdivision, says the playhouse violates association rules, and they are fining the family every day the playhouse remains.
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Another unbelievable but true story from HOA Hell, as it is sometimes called. Thanks to Shu for the link.
An official for the Andover Forest Homeowner's Association in Lexington said Friday that the association is considering a private hearing concerning a playhouse for a three-year-old with cerebral palsy. The story stirred controversy after it was revealed the association told the homeowners they had to remove the playhouse.
The story of the family fighting to keep their son's playhouse has received a lot of attention since LEX 18 first reported it on Thursday's 6 p.m. newscast. Three-year-old Cooper Veloudis has cerebral palsy and uses that house as part of his therapy, but the neighborhood homeowner's association says it has to go.
Despite an overwhelming output of support for Cooper, Ernie Stamper, one of seven people who represent the Andover Forest Subdivision, says the playhouse violates association rules, and they are fining the family every day the playhouse remains.
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Another unbelievable but true story from HOA Hell, as it is sometimes called. Thanks to Shu for the link.
Friday, December 02, 2011
The Greatest Hoax in the History of Money: The Fed, The Banks, The Lies | Crooks and Liars
The Greatest Hoax in the History of Money: The Fed, The Banks, The Lies | Crooks and Liars
It took the journalists at Bloomberg News two years - and presumably lots of legal fees - to pry information out of the Federal Reserve that should have been made public long ago. We now know that the Fed's secret $7.7 trillion lending program wasn't just the most massive bank bailout ever seen, and it wasn't just free money for mega-bankers - though it was certainly both of those things. It was also the greatest hoax in stock market history.
No, scratch that. It was the greatest hoax in the history of money. And it was built on lies. How many? Let us count the ways.
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The Fed printed trillions of dollars so they could lend it to the banks that crashed our economy at 0.01% interest (also to foreign banks and a number of very wealthy individuals). I think I could make a profit with that money. Don't you? How hard would it be to find somebody who wanted to borrow it at, oh, say 2.0%? Then the Fed kept it a secret. Not even Congress knew about it. When Bernie Sanders and a few other members of the US Congress had the temerity to ask for an audit of the Fed, they were told that such an idea was horrifying and would compromise the independence of the Fed. But a partial audit was ordered and done and it turned up this gigantic stinking obscenity.
But even so, what percentage of the public has read the news coverage of this? Compare that number with the percentage who know all the remaining contestants on the most popular reality show (whatever that is), or who know the current win-loss records of all NFL teams?
Thanks to Mystery Reader for this link.
It took the journalists at Bloomberg News two years - and presumably lots of legal fees - to pry information out of the Federal Reserve that should have been made public long ago. We now know that the Fed's secret $7.7 trillion lending program wasn't just the most massive bank bailout ever seen, and it wasn't just free money for mega-bankers - though it was certainly both of those things. It was also the greatest hoax in stock market history.
No, scratch that. It was the greatest hoax in the history of money. And it was built on lies. How many? Let us count the ways.
---------------------------
The Fed printed trillions of dollars so they could lend it to the banks that crashed our economy at 0.01% interest (also to foreign banks and a number of very wealthy individuals). I think I could make a profit with that money. Don't you? How hard would it be to find somebody who wanted to borrow it at, oh, say 2.0%? Then the Fed kept it a secret. Not even Congress knew about it. When Bernie Sanders and a few other members of the US Congress had the temerity to ask for an audit of the Fed, they were told that such an idea was horrifying and would compromise the independence of the Fed. But a partial audit was ordered and done and it turned up this gigantic stinking obscenity.
But even so, what percentage of the public has read the news coverage of this? Compare that number with the percentage who know all the remaining contestants on the most popular reality show (whatever that is), or who know the current win-loss records of all NFL teams?
Thanks to Mystery Reader for this link.
Wednesday, November 30, 2011
Reporter Investigating Foreclosure Fraud Finds Out He's A Victim Of Foreclosure Fraud - The Consumerist
Reporter Investigating Foreclosure Fraud Finds Out He's A Victim Of Foreclosure Fraud - The Consumerist
Three years ago reporter George Knapp of KLAS-TV purchased a foreclosed-upon house. Or at least he thought he'd purchased the home. As part of his interview with a local lawyer, Knapp gave the attorney his home address to see what, if any, mistakes had been made during the foreclosure and subsequent sale.
Turned out it was a a little more than a mistake. After the attorney quickly discovered an error in the chain of title for the property, Knapp contacted the Nevada Attorney General's office, which confirmed he did not actually own the house because of fake signatures and improper filings.
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Thanks to Mystery Reader for this ironic tale. I have been reading a number of books and reports on the subprime meltdown and the foreclosure tsunami, and there is a consistent theme in all of these accounts. For about five or six years, nobody in the financial sector was doing things by the book. It was rampant criminality. Financial institutions large and small, from the world's biggest investment banks all the way down to the smallest mortgage originators, were cheating people, cutting corners, falsifying documents, lying, claiming they believed things they knew were lies, and then lying again in order to blame it all on poor people while expecting the taxpayers to bail them out one way or another. Now the mortgage servicers are lying and cheating so they can foreclose without even proving they own the note, and former subprime lenders have become "mortgage rescue" specialists who take people's money for nothing or steal the title to their homes.
And the rule of thumbs seems to be that you don't go to jail for any of this.
Three years ago reporter George Knapp of KLAS-TV purchased a foreclosed-upon house. Or at least he thought he'd purchased the home. As part of his interview with a local lawyer, Knapp gave the attorney his home address to see what, if any, mistakes had been made during the foreclosure and subsequent sale.
Turned out it was a a little more than a mistake. After the attorney quickly discovered an error in the chain of title for the property, Knapp contacted the Nevada Attorney General's office, which confirmed he did not actually own the house because of fake signatures and improper filings.
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Thanks to Mystery Reader for this ironic tale. I have been reading a number of books and reports on the subprime meltdown and the foreclosure tsunami, and there is a consistent theme in all of these accounts. For about five or six years, nobody in the financial sector was doing things by the book. It was rampant criminality. Financial institutions large and small, from the world's biggest investment banks all the way down to the smallest mortgage originators, were cheating people, cutting corners, falsifying documents, lying, claiming they believed things they knew were lies, and then lying again in order to blame it all on poor people while expecting the taxpayers to bail them out one way or another. Now the mortgage servicers are lying and cheating so they can foreclose without even proving they own the note, and former subprime lenders have become "mortgage rescue" specialists who take people's money for nothing or steal the title to their homes.
And the rule of thumbs seems to be that you don't go to jail for any of this.
HARP's Dirty Little Secret: Most HARP Refis are of Positive Equity Mortgages - Credit Slips
HARP's Dirty Little Secret: Most HARP Refis are of Positive Equity Mortgages - Credit Slips
. As of 2Q 2011, 92% of HARP refinancings (776,009 of 838,441) were of loans between 80% LTV and 105% LTV. Only 62,432 refis were between 105% and 125% LTV. In other words, HARP has provided very little help for underwater borrowers.
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But on the bright side, the federal government has provided trillions to the big banks to help them out. Too bad homeowners aren't "too big to fail."
. As of 2Q 2011, 92% of HARP refinancings (776,009 of 838,441) were of loans between 80% LTV and 105% LTV. Only 62,432 refis were between 105% and 125% LTV. In other words, HARP has provided very little help for underwater borrowers.
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But on the bright side, the federal government has provided trillions to the big banks to help them out. Too bad homeowners aren't "too big to fail."
Notary who blew whistle on foreclosure fraud found dead - My News 3 - KSNV, Las Vegas, NV
Notary who blew whistle on foreclosure fraud found dead - My News 3 - KSNV, Las Vegas, NV
LAS VEGAS (KSNV MyNews3) -- The notary who signed tens of thousands of false documents in a massive robo-signing scandal case was found dead in her home on Monday.
The notary, 43-year-old Tracy Lawrence, was supposed to be in court at 8:30 Monday morning for her sentencing hearing.
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LAS VEGAS (KSNV MyNews3) -- The notary who signed tens of thousands of false documents in a massive robo-signing scandal case was found dead in her home on Monday.
The notary, 43-year-old Tracy Lawrence, was supposed to be in court at 8:30 Monday morning for her sentencing hearing.
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Homeowners Association Won't Allow Blinking Or Colored Holiday Lights
Homeowners Association Won't Allow Blinking Or Colored Holiday Lights
The dispute is happening right now in Doylestown around Avalon Court and Rolling Hill Boulevard.
Jennifer Brown's development, Doylestown Station, bans colored lights and even blinking lights. That's why she started a petition with the minimum 62 signatures the homeowner's association requires to even discuss the issue.
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Every year you can count on some association around the nation putting on its Grinch outfit and trying to steal Christmas. Thanks to Shu for the link.
The dispute is happening right now in Doylestown around Avalon Court and Rolling Hill Boulevard.
Jennifer Brown's development, Doylestown Station, bans colored lights and even blinking lights. That's why she started a petition with the minimum 62 signatures the homeowner's association requires to even discuss the issue.
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Every year you can count on some association around the nation putting on its Grinch outfit and trying to steal Christmas. Thanks to Shu for the link.
Monday, November 28, 2011
Social Market Housing for the USA: Dream or Nightmare? | Newgeography.com
Social Market Housing for the USA: Dream or Nightmare? | Newgeography.com
Imagine a future America where the home ownership rate climbs from the current 65%1 to 87%2. Libertarians as well as many social democrats would be cheering. Imagine that this rate was achieved by the state itself acting as the builder of 88%3 of the housing. Imagine also that the state imposes rules on home purchases to favor first time buyers and young families. “Progressives”, increasingly tilted towards the unmarried and childless, would bristile. Imagine racial diversity rules that restrict who you can sell your home to. Time for libertarians to shudder.
Most Americans would probably say such a concept is “Utopian” but serious policy makers should reflect that the word “Utopia” literally means “nowhere”. But Social Market Housing is alive and well in Singapore...There is no problem with runaway maintenance fees. HDB owners do not pay associations dues...you can build an HDB block next to a private condominium and you cannot tell which is which...
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When you step outside the American way of doing things you see that there are some alternative approaches being tried in other nations.
Imagine a future America where the home ownership rate climbs from the current 65%1 to 87%2. Libertarians as well as many social democrats would be cheering. Imagine that this rate was achieved by the state itself acting as the builder of 88%3 of the housing. Imagine also that the state imposes rules on home purchases to favor first time buyers and young families. “Progressives”, increasingly tilted towards the unmarried and childless, would bristile. Imagine racial diversity rules that restrict who you can sell your home to. Time for libertarians to shudder.
Most Americans would probably say such a concept is “Utopian” but serious policy makers should reflect that the word “Utopia” literally means “nowhere”. But Social Market Housing is alive and well in Singapore...There is no problem with runaway maintenance fees. HDB owners do not pay associations dues...you can build an HDB block next to a private condominium and you cannot tell which is which...
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When you step outside the American way of doing things you see that there are some alternative approaches being tried in other nations.
Sunday, November 27, 2011
Tennessee constables aren't salaried, but they can make money » Knoxville News Sentinel
Tennessee constables aren't salaried, but they can make money » Knoxville News Sentinel
Constables are elected officials who operate as officers at no cost to the county. But they get a kickback from the state for writing citations, making arrests and serving court summonses. The state-based fees for each service are $1 per citation, $40 per arrest and $20 per summons. The money comes out of court costs paid by a defendant or party.
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What could possibly go wrong with this creative privatization scheme, that enlists the wonderful power of The Market to solve yet another problem?
Constables are elected officials who operate as officers at no cost to the county. But they get a kickback from the state for writing citations, making arrests and serving court summonses. The state-based fees for each service are $1 per citation, $40 per arrest and $20 per summons. The money comes out of court costs paid by a defendant or party.
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What could possibly go wrong with this creative privatization scheme, that enlists the wonderful power of The Market to solve yet another problem?
HOA scheme victims say plea deals ignore them - News - ReviewJournal.com
HOA scheme victims say plea deals ignore them - News - ReviewJournal.com
I have a policy of never linking to the Las Vegas Review Journal because of their contemptible and now destroyed relationship with the ruined copyright troll firm RightHaven, but the work of the LVJR reporters on the Las Vegas HOA fraud case is so good and so important that I have to reconsider. No quotations--links only.
I have a policy of never linking to the Las Vegas Review Journal because of their contemptible and now destroyed relationship with the ruined copyright troll firm RightHaven, but the work of the LVJR reporters on the Las Vegas HOA fraud case is so good and so important that I have to reconsider. No quotations--links only.
Examining the big lie: How the facts of the economic crisis stack up | The Big Picture
Examining the big lie: How the facts of the economic crisis stack up | The Big Picture
You may have heard people blame the economic crash of 2008 on government policies that "forced" banks to give mortgage loans to low-income people who couldn't afford to make the payments. New York Mayor Bloomberg said it a couple of weeks ago. This is a "big lie," as Barry Ritholtz, author of Bailout Nation, explains once and for all, in this long and devastating piece.
You may have heard people blame the economic crash of 2008 on government policies that "forced" banks to give mortgage loans to low-income people who couldn't afford to make the payments. New York Mayor Bloomberg said it a couple of weeks ago. This is a "big lie," as Barry Ritholtz, author of Bailout Nation, explains once and for all, in this long and devastating piece.
Hudson Reporter - Website revels in condo controversies Guttenberg man butts heads with Galaxy Towers board
Hudson Reporter - Website revels in condo controversies Guttenberg man butts heads with Galaxy Towers board
Mike Deluca, a resident and former board member at the Galaxy Towers condominiums – which contain most of the population of the tiny waterfront town of Guttenberg – is fully aware of the extent of the controversy his community website encounters.
A computer programmer, Deluca says he created GalaxyFacts.com in 2006 after he felt that he wasn’t given the chance to defend himself at Galaxy Towers Condo Association board meetings.
Read more: Hudson Reporter - Website revels in condo controversies Guttenberg man butts heads with Galaxy Towers board
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Thanks to Shu Bartholomew for this link.
Mike Deluca, a resident and former board member at the Galaxy Towers condominiums – which contain most of the population of the tiny waterfront town of Guttenberg – is fully aware of the extent of the controversy his community website encounters.
A computer programmer, Deluca says he created GalaxyFacts.com in 2006 after he felt that he wasn’t given the chance to defend himself at Galaxy Towers Condo Association board meetings.
Read more: Hudson Reporter - Website revels in condo controversies Guttenberg man butts heads with Galaxy Towers board
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Thanks to Shu Bartholomew for this link.
How Online Learning Companies Bought America's Schools | The Nation
How Online Learning Companies Bought America's Schools | The Nation
The frenzy to privatize America’s K-12 education system, under the banner of high-tech progress and cost-saving efficiency, speaks to the stunning success of a public relations and lobbying campaign by industry, particularly tech companies.
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Think of the money to be made by privatizing public education. And that's being pushed very hard across the nation, in an organized campaign.
The frenzy to privatize America’s K-12 education system, under the banner of high-tech progress and cost-saving efficiency, speaks to the stunning success of a public relations and lobbying campaign by industry, particularly tech companies.
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Think of the money to be made by privatizing public education. And that's being pushed very hard across the nation, in an organized campaign.
Kamala Harris is key in mortgage settlement with banks - latimes.com
Kamala Harris is key in mortgage settlement with banks - latimes.com
Even as Occupy Wall Street protests have turned America's attention to the economic inequality that has soared as banks have come to dominate our economy, those banks have been quietly working to cut themselves still one more sweet deal. Whether they get away with it may ultimately depend on California Atty. Gen. Kamala D. Harris.
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Good article that explains the nature of the proposed settlement and the politics behind Harris' refusal to go along with it.
Even as Occupy Wall Street protests have turned America's attention to the economic inequality that has soared as banks have come to dominate our economy, those banks have been quietly working to cut themselves still one more sweet deal. Whether they get away with it may ultimately depend on California Atty. Gen. Kamala D. Harris.
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Good article that explains the nature of the proposed settlement and the politics behind Harris' refusal to go along with it.
Saturday, November 26, 2011
Meet with HOA? That'll be $650 for our legal counsel
For years, the simple cedar birdhouses that Gregg Harcus hung in the trees behind his town home in Eden Prairie attracted wrens and other small birds.
Now they've landed him $650 in legal fees.
The homeowner's association that oversees Bluff Country Village Townhomes, where Harcus has lived with his wife since 2002, notified Harcus that his birdhouses violated association rules and had to be removed.
Harcus, who resigned in protest from the association's board of directors earlier this year, was surprised that his birdhouses ruffled someone's feathers. He said they have been in place for at least seven years and no neighbors have complained. Harcus said the violation notice came amid a simmering conflict between him and the new management company.
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So much for the notion that private HOA government is superior to municipal government because it's closer to and more responsive to constituents. Who ever heard of getting a bill from the city attorney to discuss an ordinance compliance matter? And all of this over a few birdhouses? This HOA has gone bananas.
Thursday, November 24, 2011
US Judge Calls Harrisburg Bankruptcy Filing Illegal - US Business News - CNBC
US Judge Calls Harrisburg Bankruptcy Filing Illegal - US Business News - CNBC
While admitting that she typically doesn't consider matters of state and constitutional law, France had questioned Wednesday whether a four-month-old state law designed to temporarily prohibit a bankruptcy filing by Harrisburg had met state constitutional standards that demand transparency in the passage of legislation.
In the end, she said it did.
She also questioned whether a divided Harrisburg City Council indeed had the authority to go over the mayor's head and file for bankruptcy. After the arguments, she said it didn't.
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This whole debacle goes back to a botched effort to rehab an ancient incinerator. The city went $300 million in debt over this project.
While admitting that she typically doesn't consider matters of state and constitutional law, France had questioned Wednesday whether a four-month-old state law designed to temporarily prohibit a bankruptcy filing by Harrisburg had met state constitutional standards that demand transparency in the passage of legislation.
In the end, she said it did.
She also questioned whether a divided Harrisburg City Council indeed had the authority to go over the mayor's head and file for bankruptcy. After the arguments, she said it didn't.
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This whole debacle goes back to a botched effort to rehab an ancient incinerator. The city went $300 million in debt over this project.
Wednesday, November 23, 2011
President of homeowners association accused of embezzlement
President of homeowners association accused of embezzlement
NORTH FORT MYERS, Fla.- Board members of the Sabal Springs Golf and Raquet Club filed charges Wednesday against the former president of the homeowners association, claiming he embezzled more than a $1 million over the last 3 years.
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Another isolated example. I am shocked. Shocked!
NORTH FORT MYERS, Fla.- Board members of the Sabal Springs Golf and Raquet Club filed charges Wednesday against the former president of the homeowners association, claiming he embezzled more than a $1 million over the last 3 years.
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Another isolated example. I am shocked. Shocked!
Texas Couple Fined $7,000 for Posting Sign in Yard
When Johnnie and Clara Russell posted a small yard sign on their own North Texas property outside Ft. Worth several years ago, they did not expect that they would have to seek government permission first. The sign, which promoted an event called “Wake Up America” for conservative pundit Glenn Beck’s “9/12 Project,” provoked the ire of one of their neighbors, who complained to authorities.
The Blaze reports:
Apparently the sign violated the rules of the Homeowners Association (HOA) that governed the subdivision where the Russells lived. And although Mr. & Mrs. Russell claim they never joined the association, never paid dues to the association, and never signed any papers acknowledging the association as a governing body with rules over their property, they were sued for violating the rules.
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Read the story. Another HOA inmate ground to fine dust in the courts.
Tuesday, November 22, 2011
As the World Crumbles: the ECB spins, FED smirks, and US Banks Pillage - Thoughts - Nomi Prins
As the World Crumbles: the ECB spins, FED smirks, and US Banks Pillage - Thoughts - Nomi Prins
The US subprime crisis wasn’t so much about people defaulting on loans, but the mega-magnified effects of those defaults on a $14 trillion asset pyramid created by the banks. (Those assets were subsequently sold, and used as collateral for other borrowing and esoteric derivatives combinations, to create a global $140 trillion debt binge.) As I detail in It Takes Pillage, the biggest US banks manufactured more than 75% of those $14 trillion of assets. A significant portion was sold in Europe – to local banks, municipalities, and pension funds – as lovely AAA morsels against which more debt, or leverage, could be incurred. And even thought the assets died, the debts remained.
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Which is why the European sovereign debt crisis is yet another stage in the unfolding catastrophe that started with the US mortgage market.
The US subprime crisis wasn’t so much about people defaulting on loans, but the mega-magnified effects of those defaults on a $14 trillion asset pyramid created by the banks. (Those assets were subsequently sold, and used as collateral for other borrowing and esoteric derivatives combinations, to create a global $140 trillion debt binge.) As I detail in It Takes Pillage, the biggest US banks manufactured more than 75% of those $14 trillion of assets. A significant portion was sold in Europe – to local banks, municipalities, and pension funds – as lovely AAA morsels against which more debt, or leverage, could be incurred. And even thought the assets died, the debts remained.
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Which is why the European sovereign debt crisis is yet another stage in the unfolding catastrophe that started with the US mortgage market.
Monday, November 21, 2011
Foreclosure law firm famed for mocking the foreclosed-on will close; world's tiniest violin plays sad song - Boing Boing
Foreclosure law firm famed for mocking the foreclosed-on will close; world's tiniest violin plays sad song - Boing Boing
The firm last month agreed to pay a $2 million fine and change its practices to settle a federal investigation by the U.S. Justice Department, but it's also under investigation by New York Attorney General Eric Schneiderman, who has subpoenaed the firm and people associated with it. Most recently, Cong. Elijah Cummings, D-Md., and ranking member of the House Oversight and Government Reform Committee, launched an investigation into Baum, and wrote to the firm to request documents.
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Allegations of robo-signing, bogus assignments, sloppy work, mocking the people they were making miserable...good riddance. Thanks to Mystery Reader for the link.
The firm last month agreed to pay a $2 million fine and change its practices to settle a federal investigation by the U.S. Justice Department, but it's also under investigation by New York Attorney General Eric Schneiderman, who has subpoenaed the firm and people associated with it. Most recently, Cong. Elijah Cummings, D-Md., and ranking member of the House Oversight and Government Reform Committee, launched an investigation into Baum, and wrote to the firm to request documents.
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Allegations of robo-signing, bogus assignments, sloppy work, mocking the people they were making miserable...good riddance. Thanks to Mystery Reader for the link.
Why cities should dismantle highways | SmartPlanet
Why cities should dismantle highways | SmartPlanet
Interesting set of examples. Obviously we need highways to connect cities with each other and span the country, but is it a good idea to plan for commuting and other routine transportation within a metro area premised on millions of individuals driving gasoline-powered private vehicles?
Interesting set of examples. Obviously we need highways to connect cities with each other and span the country, but is it a good idea to plan for commuting and other routine transportation within a metro area premised on millions of individuals driving gasoline-powered private vehicles?
Sunday, November 20, 2011
Chickens stir up legal trouble between Round Rock homeowners association and residents
Chickens stir up legal trouble between Round Rock homeowners association and residents
First, Andrea and Martin Feher, residents of Round Rock Ranch, filed suit in September against PS Property Management Co., saying it violated their privacy by taking pictures of them, their five children and their chickens in their backyard as it investigated reports of the rule-breaking fowl.
The Round Rock Ranch Phase One Homeowners Association, which employs PS Property Management, then sued the Fehers this month, saying the family was refusing to get rid of their chickens even though they had been told it was a violation of the bylaws to keep them.
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They had one third of a turducken dinner all lined up, but the family got rid of their chickens. Thanks to Bill Davis for the link.
Saturday, November 19, 2011
MF Global Is Said to Have Used Customer Cash Improperly - NYTimes.com
MF Global Is Said to Have Used Customer Cash Improperly - NYTimes.com
MF Global, like other brokers, can use customer cash if it puts up sufficient collateral. But the firm did not provide enough backing in late October, essentially taking free loans, said the people briefed on the investigation, who spoke on the condition of anonymity because the inquiry was continuing.
As customers rushed to withdraw money while the firm was teetering on the brink of bankruptcy, that questionable borrowing worsened a liquidity crisis at the firm.
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That seems to be why $600 million is missing. You can call this a free loan if you like, but it looks a lot more like stealing to me. If I take a bag of apples out the door of Target and get caught, nobody will buy it if I say, "I intended to replace them with an equivalent number of apples at a later date." People say there was a time when the term "business ethics" wasn't a laughable oxymoron.
MF Global, like other brokers, can use customer cash if it puts up sufficient collateral. But the firm did not provide enough backing in late October, essentially taking free loans, said the people briefed on the investigation, who spoke on the condition of anonymity because the inquiry was continuing.
As customers rushed to withdraw money while the firm was teetering on the brink of bankruptcy, that questionable borrowing worsened a liquidity crisis at the firm.
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That seems to be why $600 million is missing. You can call this a free loan if you like, but it looks a lot more like stealing to me. If I take a bag of apples out the door of Target and get caught, nobody will buy it if I say, "I intended to replace them with an equivalent number of apples at a later date." People say there was a time when the term "business ethics" wasn't a laughable oxymoron.
Fannie, Freddie executives score $100M payday post bailout - Nov. 15, 2011
Fannie, Freddie executives score $100M payday post bailout - Nov. 15, 2011
Mortgage finance giants Fannie Mae and Freddie Mac received the biggest federal bailout of the financial crisis. And nearly $100 million of those tax dollars went to lucrative pay packages for top executives, filings show.
The top five executives at Fannie Mae received $33.3 million in 2009 and 2010, while the top five at Freddie Mac received $28.1 million. And each company has set pay targets of as much as $17 million for its top managers for 2011.
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This "overpay the executives" nonsense goes back to when they privatized Fannie and Freddie and put them on the stock exchange, and it created the incentive to compete with the banking industry wolves. Now they are in federal government conservatorship, and supposedly headed for some sort of extinction down the road, but I will be believe that when I see it.
Mortgage finance giants Fannie Mae and Freddie Mac received the biggest federal bailout of the financial crisis. And nearly $100 million of those tax dollars went to lucrative pay packages for top executives, filings show.
The top five executives at Fannie Mae received $33.3 million in 2009 and 2010, while the top five at Freddie Mac received $28.1 million. And each company has set pay targets of as much as $17 million for its top managers for 2011.
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This "overpay the executives" nonsense goes back to when they privatized Fannie and Freddie and put them on the stock exchange, and it created the incentive to compete with the banking industry wolves. Now they are in federal government conservatorship, and supposedly headed for some sort of extinction down the road, but I will be believe that when I see it.
Homeowners' association forcing man to take down 9-11 flag Owner: 'That flag will remain up'
Bill Sugarman, the president of Benchmark Property Management, which represents the association, said he received complaints.
The rules say there can only be one flag per home.
"The only flag that is allowed is an American flag. The problem is he is flying two flags, and until someone changes that there is a problem," Sugarman said.
Wentz refuses to take it down.
"I will not take that flag down. That flag will remain up. I don't care how many fines they want to give me, how many notices they want to give me, I refuse to take that down," Wentz said.
The American Civil Liberties Union weighed in, saying that although homeowners associations are constitution-free zones, it has asked the state to limit what associations can do.
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HOA Flag Flap No. 1,386,592. The ACLU is getting involved. Film at 11.
At planned Sunny Isles Beach condo, cars and drivers ride elevator home - Business - MiamiHerald.com
At planned Sunny Isles Beach condo, cars and drivers ride elevator home - Business - MiamiHerald.com
Pull over into the designated space. Turn off the engine. And enjoy the oceanfront view as you escalate in a glass elevator that takes you, while you are sitting in your car, to the front door of your apartment.
No, this is not the latest Disney ride.
The $560 million Jetsonesque tower will rise in Sunny Isles Beach as part of a collaboration between Germany-based Porsche Design Group and a local developer, Gil Dezer. It likely will be the world’s first condominium complex with elevators that will take residents directly to their units while they are sitting in their cars.
Read more: http://www.miamiherald.com/2011/11/17/2507333/at-planned-miami-beach-condo-cars.html#ixzz1eAJGJqYt
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Here's the best part: "Residents will be able to see their cars from their living rooms. “So people with fancy cars and antiques, they will actually have a really nice view of them,’’ Dezer said. Units will range from 3,800 to 9,500 square feet and could cost up to $9 million.
I can see my car, too. All I have to do is look out the living room window. But I don't spend much time watching it because it just sits there looking blue. I gather the market for these units would be limited to people like Charles Montgomery Burns from The Simpsons
Boston Review — Lawrence Lessig and David V. Johnson: Reclaiming the Republic
Boston Review — Lawrence Lessig and David V. Johnson: Reclaiming the Republic
Before 2008, the zeitgeist was deregulation, and Wall Street succeeded in getting deregulation. Frank Partnoy calculated for me that in 1980, 98 percent of financial assets traded in our economy were traded subject to the normal rules of transparency, anti-fraud requirements, basic exchange-based rules of the New Deal. By 2008, 90 percent of the assets traded were traded invisibly because they were not subject to any of these basic requirements of transparency and anti-fraud exchange-based obligations.
But the really astonishing thing is that after 2008, after we suffered the biggest collapse since the Depression, after every independent analyst had said there was a link between the structure of deregulation and the collapse, after the dean of deregulation—Alan Greenspan—confessed he made a mistake in assuming that the self-interest of the banks would lead them to behave virtuously rather than behave in a way that would drive to their maximum profit, after all of that, even then, Wall Street was able to blackmail the Democrats and the Republicans into handing them essentially a “Get Out of Jail Free” card and effect no fundamental change in the architecture of our financial system. That is, frankly, terrifying.
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Well put, Professor Lessig.
Before 2008, the zeitgeist was deregulation, and Wall Street succeeded in getting deregulation. Frank Partnoy calculated for me that in 1980, 98 percent of financial assets traded in our economy were traded subject to the normal rules of transparency, anti-fraud requirements, basic exchange-based rules of the New Deal. By 2008, 90 percent of the assets traded were traded invisibly because they were not subject to any of these basic requirements of transparency and anti-fraud exchange-based obligations.
But the really astonishing thing is that after 2008, after we suffered the biggest collapse since the Depression, after every independent analyst had said there was a link between the structure of deregulation and the collapse, after the dean of deregulation—Alan Greenspan—confessed he made a mistake in assuming that the self-interest of the banks would lead them to behave virtuously rather than behave in a way that would drive to their maximum profit, after all of that, even then, Wall Street was able to blackmail the Democrats and the Republicans into handing them essentially a “Get Out of Jail Free” card and effect no fundamental change in the architecture of our financial system. That is, frankly, terrifying.
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Well put, Professor Lessig.
Friday, November 18, 2011
Insight: The Wall Street disconnect | Reuters
Insight: The Wall Street disconnect | Reuters
David Mooney, chief executive officer of Alliant Credit Union in Chicago, one of the nation's larger credit unions, used to work at one of Wall Street's top banks, JPMorgan Chase. There's a vast cultural gap between Wall Street and his new world, he says: Old friends from the Street, he says, now jokingly refer to him as a "socialist." A credit union is supposed to be run in the interests of all members, he says, while commercial bankers tend to see consumers as customers who can be "exploited" by layering on more fees.
Says Mooney: "I don't say this lightly, but the consumer is simply an income stream and exploiting that is the purpose of the banking organization."
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Thanks for the honesty.
David Mooney, chief executive officer of Alliant Credit Union in Chicago, one of the nation's larger credit unions, used to work at one of Wall Street's top banks, JPMorgan Chase. There's a vast cultural gap between Wall Street and his new world, he says: Old friends from the Street, he says, now jokingly refer to him as a "socialist." A credit union is supposed to be run in the interests of all members, he says, while commercial bankers tend to see consumers as customers who can be "exploited" by layering on more fees.
Says Mooney: "I don't say this lightly, but the consumer is simply an income stream and exploiting that is the purpose of the banking organization."
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Thanks for the honesty.
Stephens Media Completely Capitulates In Democratic Underground/Righthaven Case | Techdirt
Stephens Media Completely Capitulates In Democratic Underground/Righthaven Case | Techdirt
The key Righthaven case, in which the details of the strategic agreement between Righthaven and Stephens Media were finally released, was Righthaven's lawsuit against the Democratic Underground. DU, with help from lawyers at the EFF and Fenwick and West, countersued Stephens Media, arguing that it, not Righthaven, was really behind the lawsuits. That resulted in the release of the agreement between the two companies, and the court dismissed Righthaven from the proceedings... while keeping Stephens Media in the case. The Democratic Underground filed a motion for summary judgment... and in its response, Stephens Media has almost totally capitulated -- admitting that the Democratic Underground's use was "fair use"
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You can read the court documents yourself.
The key Righthaven case, in which the details of the strategic agreement between Righthaven and Stephens Media were finally released, was Righthaven's lawsuit against the Democratic Underground. DU, with help from lawyers at the EFF and Fenwick and West, countersued Stephens Media, arguing that it, not Righthaven, was really behind the lawsuits. That resulted in the release of the agreement between the two companies, and the court dismissed Righthaven from the proceedings... while keeping Stephens Media in the case. The Democratic Underground filed a motion for summary judgment... and in its response, Stephens Media has almost totally capitulated -- admitting that the Democratic Underground's use was "fair use"
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You can read the court documents yourself.
Mayor's last-ditch effort to save Detroit would privatize 88,000 streetlights - CSMonitor.com
Mayor's last-ditch effort to save Detroit would privatize 88,000 streetlights - CSMonitor.com
Privatization is a murky option because city councils can be pressured to sign deals that prove detrimental in the long run, says Evan McKenzie, a political scientist at the University of Illinois at Chicago.
“Inevitably the details are buried, and the details are everything,” Professor McKenzie says.
He points to the deal former Chicago Mayor Richard M. Daley made with Morgan Stanley to sell off the city’s 36,000 parking meters. The city council was given little time to review the contract, which promised the city an immediate payment of $1.15 billion in exchange for owning and operating the parking meters until 2083.
It was only in the deal’s wake that the public learned the meters were grossly undervalued. Today, the city does not benefit from or control the continued rate hikes imposed by Morgan Stanley, and the situation is considered one of the greatest blunders of Mr. Daley’s legacy.
McKenzie warns that Detroit should learn the lesson from Chicago and “not grasp at straws.” “The history of these short-term fixes is very dismal,” he says. “If you privatize a previous public function, people no longer have political control over it. Then you have a monopoly.”
Privatization is a murky option because city councils can be pressured to sign deals that prove detrimental in the long run, says Evan McKenzie, a political scientist at the University of Illinois at Chicago.
“Inevitably the details are buried, and the details are everything,” Professor McKenzie says.
He points to the deal former Chicago Mayor Richard M. Daley made with Morgan Stanley to sell off the city’s 36,000 parking meters. The city council was given little time to review the contract, which promised the city an immediate payment of $1.15 billion in exchange for owning and operating the parking meters until 2083.
It was only in the deal’s wake that the public learned the meters were grossly undervalued. Today, the city does not benefit from or control the continued rate hikes imposed by Morgan Stanley, and the situation is considered one of the greatest blunders of Mr. Daley’s legacy.
McKenzie warns that Detroit should learn the lesson from Chicago and “not grasp at straws.” “The history of these short-term fixes is very dismal,” he says. “If you privatize a previous public function, people no longer have political control over it. Then you have a monopoly.”
Fannie Mae; Freddie Mac; California; subpoena - latimes.com
Fannie Mae; Freddie Mac; California; subpoena - latimes.com
The subpoenas ask the government-controlled finance companies to answer a series of questions about their activities in California, including their roles as landlords who own thousands of foreclosed properties. The attorney general's office is also seeking details of Fannie and Freddie's mortgage-servicing and home-repossession practices, according to a person familiar with the matter.
In addition, investigators want to learn more about the companies' purchases and sponsorship of securities holding "toxic mortgages" in the Golden State, said the person, who was not authorized to speak on the matter and requested anonymity.
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Must be nice having an attorney general (Kamala Harris) who dares to take on these behemoths. She is resisting Obama administration pressure to sign off on the ridiculous multi-state slap on the wrist settlement with the big banks that have committed millions of cases of mortgage fraud and perjury from coast to coast.
The subpoenas ask the government-controlled finance companies to answer a series of questions about their activities in California, including their roles as landlords who own thousands of foreclosed properties. The attorney general's office is also seeking details of Fannie and Freddie's mortgage-servicing and home-repossession practices, according to a person familiar with the matter.
In addition, investigators want to learn more about the companies' purchases and sponsorship of securities holding "toxic mortgages" in the Golden State, said the person, who was not authorized to speak on the matter and requested anonymity.
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Must be nice having an attorney general (Kamala Harris) who dares to take on these behemoths. She is resisting Obama administration pressure to sign off on the ridiculous multi-state slap on the wrist settlement with the big banks that have committed millions of cases of mortgage fraud and perjury from coast to coast.
North Highlands Residents Angered By Broken Street Lights « CBS Sacramento
North Highlands Residents Angered By Broken Street Lights « CBS Sacramento
Copper thieves shut down street lights across North Highlands in recent weeks, and residents who have been living in darkened neighborhoods for nearly two months are losing patience with city officials.
Two North Highlands residents, Dorothy McEachern and Dauna Garton said their street has remained without lighting for seven weeks, and the fear that the darkened neighborhood could attract criminals is building.
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Chicago and its old inner-ring suburbs have thousands of homes with solid copper gutters and downspouts, and I have heard of people stealing them. Seems like a hard crime to get away with, though.
Copper thieves shut down street lights across North Highlands in recent weeks, and residents who have been living in darkened neighborhoods for nearly two months are losing patience with city officials.
Two North Highlands residents, Dorothy McEachern and Dauna Garton said their street has remained without lighting for seven weeks, and the fear that the darkened neighborhood could attract criminals is building.
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Chicago and its old inner-ring suburbs have thousands of homes with solid copper gutters and downspouts, and I have heard of people stealing them. Seems like a hard crime to get away with, though.
A Failed Social Model: Providing Basic Goods Through Crushing Consumer Debt » New Deal 2.0
A Failed Social Model: Providing Basic Goods Through Crushing Consumer Debt » New Deal 2.0
We have been living in a society where debts, rather than rights, have been the major means for accessing basic social goods like housing, education, and health care. That social model was built around the assumption that while real incomes stagnated and the state did not directly provide many basic goods through universal entitlements, cheap credit would do the trick instead.
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And in the case of housing, I think many more people will opt for being permanent renters rather than borrow hundreds of thousands of dollars to purchase an asset that doesn't appreciate and is very costly to maintain--whether you do it individually or collectively, with CID housing.
We have been living in a society where debts, rather than rights, have been the major means for accessing basic social goods like housing, education, and health care. That social model was built around the assumption that while real incomes stagnated and the state did not directly provide many basic goods through universal entitlements, cheap credit would do the trick instead.
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And in the case of housing, I think many more people will opt for being permanent renters rather than borrow hundreds of thousands of dollars to purchase an asset that doesn't appreciate and is very costly to maintain--whether you do it individually or collectively, with CID housing.
Thursday, November 17, 2011
Foreclosure Fraud: First Criminal Charges Filed In Nevada Over Robo-Signing
Foreclosure Fraud: First Criminal Charges Filed In Nevada Over Robo-Signing
The Nevada attorney general has indicted two midlevel staffers at a mortgage document company, Lender Processing Services, on a whopping 606 counts of felony and gross misdemeanor for directing employees to forge signatures and falsely notarize documents used to illegally foreclose on Nevada homeowners.
Nevada's is the first criminal indictment since last year's discovery of the nationwide "robo-signing" scandal, in which mortgage servicing companies and banks were processing foreclosures en masse at lightning speed by signing documents they neglected to review and falsifying information.
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This has been going on all over the nation, thousands of times per day, and this is the first time anybody has been charged with a crime. Absolutely unbelievable. I know somebody is going to comment that the defrauding of HOA/condo residents is infinitely worse, but it isn't. You have to get some sense of proportion here. The scope of mortgage foreclosure fraud is on a different order of magnitude. Millions of people--not hundreds, or thousands--millions of people have been tossed out on the street over the last three few years, and the evidence shows that an enormous percentage of these cases involved perjured affidavits, nonexistent original notes, and kangaroo "rocket docket" courts. There are millions more foreclosures waiting to be filed.
And this comes after the subprime mortgage racket that produced all the toxic mortgage backed securities that wrecked the financial sector, crashed the economy, and tanked housing prices for a decade. And then there is the mortgage rescue fraud racket, run by some of the same crooks who used to run the subprime racket.
The Nevada attorney general has indicted two midlevel staffers at a mortgage document company, Lender Processing Services, on a whopping 606 counts of felony and gross misdemeanor for directing employees to forge signatures and falsely notarize documents used to illegally foreclose on Nevada homeowners.
Nevada's is the first criminal indictment since last year's discovery of the nationwide "robo-signing" scandal, in which mortgage servicing companies and banks were processing foreclosures en masse at lightning speed by signing documents they neglected to review and falsifying information.
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This has been going on all over the nation, thousands of times per day, and this is the first time anybody has been charged with a crime. Absolutely unbelievable. I know somebody is going to comment that the defrauding of HOA/condo residents is infinitely worse, but it isn't. You have to get some sense of proportion here. The scope of mortgage foreclosure fraud is on a different order of magnitude. Millions of people--not hundreds, or thousands--millions of people have been tossed out on the street over the last three few years, and the evidence shows that an enormous percentage of these cases involved perjured affidavits, nonexistent original notes, and kangaroo "rocket docket" courts. There are millions more foreclosures waiting to be filed.
And this comes after the subprime mortgage racket that produced all the toxic mortgage backed securities that wrecked the financial sector, crashed the economy, and tanked housing prices for a decade. And then there is the mortgage rescue fraud racket, run by some of the same crooks who used to run the subprime racket.
Hercules Affordable Housing Initiative Spent Nearly $50 Million, Produced Almost Nothing
Hercules Affordable Housing Initiative Spent Nearly $50 Million, Produced Almost Nothing
HERCULES, Calif. -- There are 918 names on 'the list.'
People from every walk of life are on it, with one thing in common: They all wanted the chance to take advantage of affordable housing offers in the small city of Hercules.
Many have been waiting more than five years for a call that would have given them entrée to sparkling new digs in Sycamore North, a $70 million mixed-use housing development in this struggling community of 24,000 residents northeast of San Francisco.
They're still on hold, waiting for a project that looms over a mostly barren downtown, its only occupant a security guard living in a small trailer.
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Hercules has been teetering on the brink of bankruptcy for a year or so.
HERCULES, Calif. -- There are 918 names on 'the list.'
People from every walk of life are on it, with one thing in common: They all wanted the chance to take advantage of affordable housing offers in the small city of Hercules.
Many have been waiting more than five years for a call that would have given them entrée to sparkling new digs in Sycamore North, a $70 million mixed-use housing development in this struggling community of 24,000 residents northeast of San Francisco.
They're still on hold, waiting for a project that looms over a mostly barren downtown, its only occupant a security guard living in a small trailer.
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Hercules has been teetering on the brink of bankruptcy for a year or so.
Selling More CDS on Europe Debt Raises Risk for U.S. Banks - Bloomberg
Selling More CDS on Europe Debt Raises Risk for U.S. Banks - Bloomberg
U.S. banks increased sales of insurance against credit losses to holders of Greek, Portuguese, Irish, Spanish and Italian debt in the first half of 2011, boosting the risk of payouts in the event of defaults.
Guarantees provided by U.S. lenders on government, bank and corporate debt in those countries rose by $80.7 billion to $518 billion, according to the Bank for International Settlements. Almost all of those are credit-default swaps, said two people familiar with the numbers, accounting for two-thirds of the total related to the five nations, BIS data show.
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This is amazing. US banks are going long on European debt by writing $500 billion in credit default swaps on it. The "too big to fail" US banks, having been told by Dodd-Frank that there is no more "too big to fail," are setting themselves up to demand another bailout if they have to pay gazillions to holders of European debt. This redefines the word "arrogance."
U.S. banks increased sales of insurance against credit losses to holders of Greek, Portuguese, Irish, Spanish and Italian debt in the first half of 2011, boosting the risk of payouts in the event of defaults.
Guarantees provided by U.S. lenders on government, bank and corporate debt in those countries rose by $80.7 billion to $518 billion, according to the Bank for International Settlements. Almost all of those are credit-default swaps, said two people familiar with the numbers, accounting for two-thirds of the total related to the five nations, BIS data show.
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This is amazing. US banks are going long on European debt by writing $500 billion in credit default swaps on it. The "too big to fail" US banks, having been told by Dodd-Frank that there is no more "too big to fail," are setting themselves up to demand another bailout if they have to pay gazillions to holders of European debt. This redefines the word "arrogance."
Wednesday, November 16, 2011
Minnesota town privatizing police force
Hard times forcing desperate measures
The central Minnesota town of Foley tried having its own police department and contracting with the county sheriff's department for law enforcement.
Now, in an effort to save money, the town with a population of 2600 is making a controversial move: it plans to employ a private security company to patrol its streets.
Nationwide, other cities have supplemented traditional police with contracted officers, said John Firman, director of research for the International Association of Chiefs of Police.
Read more: http://www.theage.com.au/world/hard-times-forcing-desperate-measures-20111115-1nh3o.html#ixzz1dvPbytSS
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What I find amusing about all these "effort to save money" schemes is that they have a peculiar way of costing a whole lot of money down the road. Ask Jefferson County, Alabama, where they tried to pay for the most expensive sewer system in the galaxy through some neat money-saving tricks recommended to them by JP Morgan Chase. The county just filed for bankruptcy.
The central Minnesota town of Foley tried having its own police department and contracting with the county sheriff's department for law enforcement.
Now, in an effort to save money, the town with a population of 2600 is making a controversial move: it plans to employ a private security company to patrol its streets.
Nationwide, other cities have supplemented traditional police with contracted officers, said John Firman, director of research for the International Association of Chiefs of Police.
Read more: http://www.theage.com.au/world/hard-times-forcing-desperate-measures-20111115-1nh3o.html#ixzz1dvPbytSS
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What I find amusing about all these "effort to save money" schemes is that they have a peculiar way of costing a whole lot of money down the road. Ask Jefferson County, Alabama, where they tried to pay for the most expensive sewer system in the galaxy through some neat money-saving tricks recommended to them by JP Morgan Chase. The county just filed for bankruptcy.
Newt Gingrich Freddie Mac Fees: Former House Speaker Reportedly Received At Least $1.6 Million From Housing Giant
Newt Gingrich Freddie Mac Fees: Former House Speaker Reportedly Received At Least $1.6 Million From Housing Giant
In recent months, GOP presidential candidate Newt Gingrich has strongly criticized Freddie Mac and sister company Fannie Mae, as well as Democrats in Congress that he claims played a key role in the collapse of the housing market. And yet two former Freddie Mac officials recently told Bloomberg that Gingrich made between $1.6 million and $1.8 million in consulting fees from the mortgage company.
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Does that make the Pillsbury Doughboy a hypocrite? Actually that horse ran out of the barn back in the 1990s, when he was cheating on his wife while persecuting Bill Clinton for cheating on his wife.
In recent months, GOP presidential candidate Newt Gingrich has strongly criticized Freddie Mac and sister company Fannie Mae, as well as Democrats in Congress that he claims played a key role in the collapse of the housing market. And yet two former Freddie Mac officials recently told Bloomberg that Gingrich made between $1.6 million and $1.8 million in consulting fees from the mortgage company.
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Does that make the Pillsbury Doughboy a hypocrite? Actually that horse ran out of the barn back in the 1990s, when he was cheating on his wife while persecuting Bill Clinton for cheating on his wife.
High-rise Chicago condo goes bankrupt
Hard sell for high-end senior living projects - Chicago Sun-Times
The Clare at Water Tower, a high-rise that opened in 2008 at 55 E. Pearson, filed for bankruptcy Monday. Its owner, the nonprofit Franciscan Sisters of Chicago Service Corp., defaulted on about $216 million in debt because only about a third of its 248 independent living condos are occupied. A spokeswoman said the sisters hope to keep control of the project. The bankruptcy filing said the sisters have secured about $12 million in financing for interim operations. Judy Amiano, president of the corporation, said “resident and health care services will continue uninterrupted” during the bankruptcy.
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I am compiling a list of all the condo projects and HOAs in the US that have filed for bankruptcy. If any of you out there in cyberspace have the names and locations of any such associations, please send them to me at ecmlaw@gmail.com or send them in a comment.
The Clare at Water Tower, a high-rise that opened in 2008 at 55 E. Pearson, filed for bankruptcy Monday. Its owner, the nonprofit Franciscan Sisters of Chicago Service Corp., defaulted on about $216 million in debt because only about a third of its 248 independent living condos are occupied. A spokeswoman said the sisters hope to keep control of the project. The bankruptcy filing said the sisters have secured about $12 million in financing for interim operations. Judy Amiano, president of the corporation, said “resident and health care services will continue uninterrupted” during the bankruptcy.
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I am compiling a list of all the condo projects and HOAs in the US that have filed for bankruptcy. If any of you out there in cyberspace have the names and locations of any such associations, please send them to me at ecmlaw@gmail.com or send them in a comment.
Tuesday, November 15, 2011
Dennis Blackmon: Georgia Judge Mocks U.S. Bank Over Denied Mortgage Modification
Dennis Blackmon: Georgia Judge Mocks U.S. Bank Over Denied Mortgage Modification
Georgia Judge Dennis Blackmon is fed up with bailed-out banks refusing to help strapped homeowners.
"Sometimes, only the courts of law stand to protect the taxpayer. Somewhere, someone has to stand up," Blackmon wrote in a five-page Nov. 2 order in Carroll County Superior Court. "Well, sometimes is now, and the place is the Great State of Georgia. The defendant's motion to dismiss is hereby denied."
Blackmon's order shot down U.S. Bank's request to throw out a complaint from Georgia homeowner Otis Wayne Phillips, who had tried to get a mortgage modification from the bank. Phillips could not be reached for this story.
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Here and there you can see signs that some judges are just fed up with the perjury, fraud, and arrogance of the mortgage foreclosure firms.
Georgia Judge Dennis Blackmon is fed up with bailed-out banks refusing to help strapped homeowners.
"Sometimes, only the courts of law stand to protect the taxpayer. Somewhere, someone has to stand up," Blackmon wrote in a five-page Nov. 2 order in Carroll County Superior Court. "Well, sometimes is now, and the place is the Great State of Georgia. The defendant's motion to dismiss is hereby denied."
Blackmon's order shot down U.S. Bank's request to throw out a complaint from Georgia homeowner Otis Wayne Phillips, who had tried to get a mortgage modification from the bank. Phillips could not be reached for this story.
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Here and there you can see signs that some judges are just fed up with the perjury, fraud, and arrogance of the mortgage foreclosure firms.
Monday, November 14, 2011
A Town in New York Creates Its Own Department Store - NYTimes.com
A Town in New York Creates Its Own Department Store - NYTimes.com
Shares in the store, priced at $100 each, were marketed to local residents as a way to “take control of our future and help our community,” said Melinda Little, a Saranac Lake resident who has been involved in the effort from the start. “The idea was, this is an investment in the community as well as the store.”
It took nearly five years — the recession added to the challenge — but the organizers reached their $500,000 goal last spring. By then, some 600 people had chipped in an average of $800 each. And so, on Oct. 29, as an early winter storm threatened the region, the Saranac Lake Community Store opened its doors to the public for the first time. By 9:30 in the morning, the store, in a former restaurant space on Main Street opposite the Hotel Saranac, was packed with shoppers, well-wishers and the curious.
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This is what "voluntary" looks like. Real people make a real decision to commit $100 per share to start their own real community department store. It is essentially the 180 degree opposite of the corporate paternalism that brings so-called "community associations" into existence. Without the paternalism, we would have a much smaller number of common interest housing developments, but they would be real.
Shares in the store, priced at $100 each, were marketed to local residents as a way to “take control of our future and help our community,” said Melinda Little, a Saranac Lake resident who has been involved in the effort from the start. “The idea was, this is an investment in the community as well as the store.”
It took nearly five years — the recession added to the challenge — but the organizers reached their $500,000 goal last spring. By then, some 600 people had chipped in an average of $800 each. And so, on Oct. 29, as an early winter storm threatened the region, the Saranac Lake Community Store opened its doors to the public for the first time. By 9:30 in the morning, the store, in a former restaurant space on Main Street opposite the Hotel Saranac, was packed with shoppers, well-wishers and the curious.
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This is what "voluntary" looks like. Real people make a real decision to commit $100 per share to start their own real community department store. It is essentially the 180 degree opposite of the corporate paternalism that brings so-called "community associations" into existence. Without the paternalism, we would have a much smaller number of common interest housing developments, but they would be real.
Sunday, November 13, 2011
Occupy Homes: New Coalition Links Homeowners, Activists in Direct Action to Halt Foreclosures | Truthout
Occupy Homes: New Coalition Links Homeowners, Activists in Direct Action to Halt Foreclosures | Truthout
A loose-knit coalition of activists known as "Occupy Homes" is working to stave off pending evictions by occupying homes at risk of foreclosure when tenants enlist its support.
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This could get interesting.
A loose-knit coalition of activists known as "Occupy Homes" is working to stave off pending evictions by occupying homes at risk of foreclosure when tenants enlist its support.
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This could get interesting.
Robo-signed mortgage docs date back to late 1990s - Yahoo! Finance
Robo-signed mortgage docs date back to late 1990s - Yahoo! Finance
Companies that process mortgages said they were so overwhelmed with paperwork that they cut corners.But now, as county officials review years' worth of mortgage paperwork, in some cases combing through one page at a time, they are finding suspect signatures -- either signed with the same name by dozens of different people, improperly notarized or signed without a review of the facts in the paperwork -- on all sorts of mortgage documents, dating as far back as 1998, The Associated Press has found."Because of these bad titles, property owners can't prove they own the properties they think they bought, and banks can't prove they had the right to sell them," says Jeff Thigpen, the registrar of deeds in Guilford County, N.C.In Guilford County, where Greensboro is located, a sample of 6,100 mortgage documents filed since 2006 turned up 74 percent with questionable signatures.
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Isn't this special? Turns out perjury and falsification of evidence were standard operating procedure long before the subprime explosion.
Companies that process mortgages said they were so overwhelmed with paperwork that they cut corners.But now, as county officials review years' worth of mortgage paperwork, in some cases combing through one page at a time, they are finding suspect signatures -- either signed with the same name by dozens of different people, improperly notarized or signed without a review of the facts in the paperwork -- on all sorts of mortgage documents, dating as far back as 1998, The Associated Press has found."Because of these bad titles, property owners can't prove they own the properties they think they bought, and banks can't prove they had the right to sell them," says Jeff Thigpen, the registrar of deeds in Guilford County, N.C.In Guilford County, where Greensboro is located, a sample of 6,100 mortgage documents filed since 2006 turned up 74 percent with questionable signatures.
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Isn't this special? Turns out perjury and falsification of evidence were standard operating procedure long before the subprime explosion.
Homework and Jacuzzis as Dorms Move to McMansions in California - NYTimes.com
Homework and Jacuzzis as Dorms Move to McMansions in California - NYTimes.com
Here in Merced, a city in the heart of the San Joaquin Valley and one of the country’s hardest hit by home foreclosures, the downturn in the real estate market has presented an unusual housing opportunity for thousands of college students. Facing a shortage of dorm space, they are moving into hundreds of luxurious homes in overbuilt planned communities.
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This is better than having drug dealers grow pot in them (see below)...although with college students living in these units, that is probably going on as well.
Here in Merced, a city in the heart of the San Joaquin Valley and one of the country’s hardest hit by home foreclosures, the downturn in the real estate market has presented an unusual housing opportunity for thousands of college students. Facing a shortage of dorm space, they are moving into hundreds of luxurious homes in overbuilt planned communities.
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This is better than having drug dealers grow pot in them (see below)...although with college students living in these units, that is probably going on as well.
Vacant House Targeted by Squatters, Scammers and Thieves | AOL Real Estate
Vacant House Targeted by Squatters, Scammers and Thieves | AOL Real Estate
Empty houses -- those either awaiting foreclosure or where the owners have moved out for other reasons -- might as well have a "kick me" sign on them. Actually, make that "vandalize me" sign. They are frequently the targets of squatters who move in illegally, scammers who claim they own them and rent them out to unsuspecting tenants, or just plain old garden variety thieves who break in and steal the valuables right down to the copper plumbing and refrigerator.
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The foreclosure tsunami has caused many neighborhoods to collapse socially, taking down many a condo association or HOA with it. These neighborhoods are now disaster areas.
Empty houses -- those either awaiting foreclosure or where the owners have moved out for other reasons -- might as well have a "kick me" sign on them. Actually, make that "vandalize me" sign. They are frequently the targets of squatters who move in illegally, scammers who claim they own them and rent them out to unsuspecting tenants, or just plain old garden variety thieves who break in and steal the valuables right down to the copper plumbing and refrigerator.
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The foreclosure tsunami has caused many neighborhoods to collapse socially, taking down many a condo association or HOA with it. These neighborhoods are now disaster areas.
Dramatic uptick in Sarasota foreclosure filings | November 7, 2011 | Michael Braga | Inside Real Estate
Dramatic uptick in Sarasota foreclosure filings | November 7, 2011 | Michael Braga | Inside Real Estate
Top lenders in Sarasota county filed 102 more early stage or lis pendens filings in October than filed the month before – a whopping 46 percent increase and clear sign that lenders are putting their robo-signing problems behind them.
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This came from foreclosure defense attorney April Charney by way of Shu Bartholomew. It appears that the foreclosure mill is about to crank itself back into high gear. If it is happening in Florida, it will soon be happening everywhere else.
Top lenders in Sarasota county filed 102 more early stage or lis pendens filings in October than filed the month before – a whopping 46 percent increase and clear sign that lenders are putting their robo-signing problems behind them.
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This came from foreclosure defense attorney April Charney by way of Shu Bartholomew. It appears that the foreclosure mill is about to crank itself back into high gear. If it is happening in Florida, it will soon be happening everywhere else.
Pot growers see opportunity in empty Las Vegas homes - latimes.com
Pot growers see opportunity in empty Las Vegas homes - latimes.com
Las Vegas has a pot home problem. And like many of the region's maladies, it's tied to the housing slump.
Last year, authorities took down 153 indoor grow sites in Nevada and seized more than 13,000 plants, compared with 18 sites and 1,000 plants in 2005, the U.S. Drug Enforcement Administration said. (By comparison, California busted 791 indoor sites last year.)
"You can't have crime without opportunity," said William Sousa, a criminologist at the University of Nevada, Las Vegas. "And all those empty homes present an opportunity for criminal activity."
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You have to admire that American entrepreneurial spirit. When life gives you lemons, make lemonade. When the subprime mortgage crash gives you thousands of empty foreclosed homes, turn them into marijuana greenhouses.
Las Vegas has a pot home problem. And like many of the region's maladies, it's tied to the housing slump.
Last year, authorities took down 153 indoor grow sites in Nevada and seized more than 13,000 plants, compared with 18 sites and 1,000 plants in 2005, the U.S. Drug Enforcement Administration said. (By comparison, California busted 791 indoor sites last year.)
"You can't have crime without opportunity," said William Sousa, a criminologist at the University of Nevada, Las Vegas. "And all those empty homes present an opportunity for criminal activity."
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You have to admire that American entrepreneurial spirit. When life gives you lemons, make lemonade. When the subprime mortgage crash gives you thousands of empty foreclosed homes, turn them into marijuana greenhouses.
Saturday, November 12, 2011
U.S. Will Remain a Nation of Homeowners...OH RILLY??
U.S. Will Remain a Nation of Homeowners
That's what the National Association of Realtors would like you to believe. Follow the link and see for yourself.
I don't buy that. Here is a different perspective. At a recent Americatalyst conference they had real experts who are NOT directly trying to sell you a home, and who DO NOT constantly, relentlessly claim that NOW is the perfect time to buy...and they came up with this nugget:
Over the past two years, increasing demands for a national rental housing policy finally gained traction in Washington in 2010 with a groundbreaking conference supported by the White House and the Departments of HUD, Treasury and Agriculture. On Aug. 10 of this year, FHFA issued a public Request for Information to solicit ideas for sales, joint ventures or other strategies to augment or enhance the current and future disposition of REO properties, including their transition to rental housing. While the public dialogue moves toward balance between homeownership and rental policies, the debate over the definition, models, incentives and implementation of rental policy has only just begun
I think the federal government's role in promoting home ownership is in serious retrenchment. Permanently. And the banks who made those mortgage-backed loans are in major trouble--all of them. And the market for mortgage-backed securities is basically just the GSEs now. Nobody wants to buy private ones anymore, for good reason. So who is going to pay for all those homes that the realtors claim we are going to buy, because real estate is SUCH a great deal?
It is more likely that we are going to see plans for turning condos into apartment buildings.
Thanks to Fred Pilot for this link.
That's what the National Association of Realtors would like you to believe. Follow the link and see for yourself.
I don't buy that. Here is a different perspective. At a recent Americatalyst conference they had real experts who are NOT directly trying to sell you a home, and who DO NOT constantly, relentlessly claim that NOW is the perfect time to buy...and they came up with this nugget:
Over the past two years, increasing demands for a national rental housing policy finally gained traction in Washington in 2010 with a groundbreaking conference supported by the White House and the Departments of HUD, Treasury and Agriculture. On Aug. 10 of this year, FHFA issued a public Request for Information to solicit ideas for sales, joint ventures or other strategies to augment or enhance the current and future disposition of REO properties, including their transition to rental housing. While the public dialogue moves toward balance between homeownership and rental policies, the debate over the definition, models, incentives and implementation of rental policy has only just begun
I think the federal government's role in promoting home ownership is in serious retrenchment. Permanently. And the banks who made those mortgage-backed loans are in major trouble--all of them. And the market for mortgage-backed securities is basically just the GSEs now. Nobody wants to buy private ones anymore, for good reason. So who is going to pay for all those homes that the realtors claim we are going to buy, because real estate is SUCH a great deal?
It is more likely that we are going to see plans for turning condos into apartment buildings.
Thanks to Fred Pilot for this link.
Alabama county files biggest municipal bankruptcy | Reuters
Alabama county files biggest municipal bankruptcy | Reuters
Alabama's Jefferson County filed for bankruptcy court protection on Wednesday in the biggest municipal bankruptcy in U.S. history.
Commissioners for the county, which is home to Birmingham, the state's biggest city and economic powerhouse, voted 4-1 to declare bankruptcy after meeting behind closed doors for two days in a last ditch-attempt to restructure its debt out of court.
A tentative deal reached with creditors in September to settle $3.14 billion in red ink had been widely expected to avert bankruptcy. But the deal fell apart over what the commission described as creditors' refusal to meet the terms of previously agreed economic concessions.
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The creditors, who are JP Morgan and other investors, want the county to sewer-charge the living daylights out of the citizens and that's the sticking point. What happened? JP Morgan Chase arranged some really neat financial deals for Jefferson County to finance their sewer system, including linking the county's floating rate securities to interest rate swaps. When the subprime meltdown happened, those clever investment ideas proved disastrous. The county's interest charges went way up and then investors started demanding to be paid off early. The county didn't have the money and defaulted. The cost of refinancing was enormous.
Oh...and two former JP Morgan bankers are facing court allegations over paying $8 million to "friends" of the commissioners in order to get the deal, in addition to JP Morgan itself settling with the SEC for $722 million, without admitting to bribery, you understand...JP Morgan even charged the $8 mill back to the county. Is that nerve, or what?
Alabama's Jefferson County filed for bankruptcy court protection on Wednesday in the biggest municipal bankruptcy in U.S. history.
Commissioners for the county, which is home to Birmingham, the state's biggest city and economic powerhouse, voted 4-1 to declare bankruptcy after meeting behind closed doors for two days in a last ditch-attempt to restructure its debt out of court.
A tentative deal reached with creditors in September to settle $3.14 billion in red ink had been widely expected to avert bankruptcy. But the deal fell apart over what the commission described as creditors' refusal to meet the terms of previously agreed economic concessions.
------------------
The creditors, who are JP Morgan and other investors, want the county to sewer-charge the living daylights out of the citizens and that's the sticking point. What happened? JP Morgan Chase arranged some really neat financial deals for Jefferson County to finance their sewer system, including linking the county's floating rate securities to interest rate swaps. When the subprime meltdown happened, those clever investment ideas proved disastrous. The county's interest charges went way up and then investors started demanding to be paid off early. The county didn't have the money and defaulted. The cost of refinancing was enormous.
Oh...and two former JP Morgan bankers are facing court allegations over paying $8 million to "friends" of the commissioners in order to get the deal, in addition to JP Morgan itself settling with the SEC for $722 million, without admitting to bribery, you understand...JP Morgan even charged the $8 mill back to the county. Is that nerve, or what?
OCC: Correcting Foreclosure Practices
OCC: Correcting Foreclosure Practices
On April 13, 2011, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Office of Thrift Supervision announced enforcement actions against 14 large residential mortgage servicers and two third-party vendors for unsafe and unsound practices related to residential mortgage servicing and foreclosure processing.
Independent Foreclosure Review
As part of those consent orders, federal regulators required servicers to engage independent firms to conduct a multi-faceted review of foreclosure actions in process in 2009 and 2010. Under the orders, independent consultants are charged with evaluating whether borrowers suffered financial injury through errors, misrepresentations, or other deficiencies in foreclosure practices and determining appropriate remediation for those customers. Where a borrower suffered financial injury as a result of such practices, the agencies’ orders require financial remediation to be provided.
As part of that program, the 14 mortgage servicers covered by the enforcement actions will begin mailings November 1, 2011 that will continue through the end of the year. The mailings are intended to provide information to potentially eligible borrowers on how to request a review of their case if they believe they suffered financial injury as a result of errors, misrepresentations, or other deficiencies in foreclosure proceedings related to their primary residence between January 1, 2009 and December 31, 2010. The mailings will include a request for review form.
Borrowers may also visit www.IndependentForeclosureReview.com for more information about the review and claim process. Assistance with the form and answers to questions about the process are available at 1-888-952-9105, Monday through Friday from 8 a.m. to 10 p.m. (ET) and Saturday from 8 a.m. to 5 p.m. (ET).
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On April 13, 2011, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Office of Thrift Supervision announced enforcement actions against 14 large residential mortgage servicers and two third-party vendors for unsafe and unsound practices related to residential mortgage servicing and foreclosure processing.
Independent Foreclosure Review
As part of those consent orders, federal regulators required servicers to engage independent firms to conduct a multi-faceted review of foreclosure actions in process in 2009 and 2010. Under the orders, independent consultants are charged with evaluating whether borrowers suffered financial injury through errors, misrepresentations, or other deficiencies in foreclosure practices and determining appropriate remediation for those customers. Where a borrower suffered financial injury as a result of such practices, the agencies’ orders require financial remediation to be provided.
As part of that program, the 14 mortgage servicers covered by the enforcement actions will begin mailings November 1, 2011 that will continue through the end of the year. The mailings are intended to provide information to potentially eligible borrowers on how to request a review of their case if they believe they suffered financial injury as a result of errors, misrepresentations, or other deficiencies in foreclosure proceedings related to their primary residence between January 1, 2009 and December 31, 2010. The mailings will include a request for review form.
Borrowers may also visit www.IndependentForeclosureReview.com for more information about the review and claim process. Assistance with the form and answers to questions about the process are available at 1-888-952-9105, Monday through Friday from 8 a.m. to 10 p.m. (ET) and Saturday from 8 a.m. to 5 p.m. (ET).
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Friday, November 11, 2011
The Multistate Foreclosure Settlement - Credit Slips
The Multistate Foreclosure Settlement - Credit Slips
The housing market is too-big-to-fail. It's true. The problem is that it has failed, and the proposed multi-state deal doesn't fix the market. The deal simply isn't broad enough to put all the housing market concerns to rest. The deal doesn't buy peace for the banks or stability for the US housing market. It just blows the government's last wad on a sideshow issue, robosigning. Consider all the critical issues the settlement does not (and cannot) address:
The $700B in negative equity in the US.
Clouded title from MERS
Clouded title from wrongful foreclosrues
Billions in investor putback and securities fraud claims
Investor suits against trustee banks
Disposal of the REO inventory and the shadow REO inventory
Foreclosures
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I think this is about right. Here is one example of a major unresolved issue that is now in the courts. The putback litigation is practically unknown to the public, but it has been described by knowledgeable insiders as a "systemic risk" to Bank of America, the other major banks, and by extension the entire financial system. I have read some of the complaints in the putback cases and the facts and the numbers are stunning. How big is the risk? Bank of America's entire market capitalization is $63 billion. In other words, with that much money you could buy every single share of their stock. But BOA bought Countrywide Mortgage, once upon a time the nation's leading subprime lender, and a company that appears to have committed systematic, serious violations of their securitization agreements. The institutional investors (Fannie and Freddie, pension funds, unions, hedge funds, whoever) who bought those mortgage backed securities (much of which is utterly worthless) have sued BOA and other big banks to force them to buy back those securities at full value (hence the term "putback"). That could end up costing hundreds of billions of dollars. I could go, but the point is that the housing market is a disaster area, not just at the bottom where we little folks have seen our equity vanish and watched our neighbors get foreclosed on, but at the very top where the "too big to fail" institutions roam. There are policies all over the place that smart people have come up with to fix things, but they aren't on the radar screen of Congress or the President, it seems.
The housing market is too-big-to-fail. It's true. The problem is that it has failed, and the proposed multi-state deal doesn't fix the market. The deal simply isn't broad enough to put all the housing market concerns to rest. The deal doesn't buy peace for the banks or stability for the US housing market. It just blows the government's last wad on a sideshow issue, robosigning. Consider all the critical issues the settlement does not (and cannot) address:
The $700B in negative equity in the US.
Clouded title from MERS
Clouded title from wrongful foreclosrues
Billions in investor putback and securities fraud claims
Investor suits against trustee banks
Disposal of the REO inventory and the shadow REO inventory
Foreclosures
-------------------
I think this is about right. Here is one example of a major unresolved issue that is now in the courts. The putback litigation is practically unknown to the public, but it has been described by knowledgeable insiders as a "systemic risk" to Bank of America, the other major banks, and by extension the entire financial system. I have read some of the complaints in the putback cases and the facts and the numbers are stunning. How big is the risk? Bank of America's entire market capitalization is $63 billion. In other words, with that much money you could buy every single share of their stock. But BOA bought Countrywide Mortgage, once upon a time the nation's leading subprime lender, and a company that appears to have committed systematic, serious violations of their securitization agreements. The institutional investors (Fannie and Freddie, pension funds, unions, hedge funds, whoever) who bought those mortgage backed securities (much of which is utterly worthless) have sued BOA and other big banks to force them to buy back those securities at full value (hence the term "putback"). That could end up costing hundreds of billions of dollars. I could go, but the point is that the housing market is a disaster area, not just at the bottom where we little folks have seen our equity vanish and watched our neighbors get foreclosed on, but at the very top where the "too big to fail" institutions roam. There are policies all over the place that smart people have come up with to fix things, but they aren't on the radar screen of Congress or the President, it seems.
The US's Missing Housing Policy - Credit Slips
The US's Missing Housing Policy - Credit Slips
From Adam Levitin:
Once upon a time, the US had a housing policy. It was focused on increasing homeownership. It might have been a misguided policy or at least a policy taken too far, but it was a policy and everyone understood that. It meant that programs were designed to work toward that goal.
Today, 4 years into a housing crisis, we still have no housing policy. There's no plan to clean up the legacy of the housing bubble and no plan to build the future of housing finance. This sad state reflects a singular failure of political leadership. It also reflects a deeply fragmented housing finance world in which no one is in a position to call the shots.
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This is true. And there seems to be no inclination to develop one. But I would say this is because the policy of expanding home ownership (starting in 1935) was not really developed by legislators or bureaucrats. It was invented by the real estate industry. That is, it was never really a public policy to begin with. It was a massive subsidy program aimed at the financial and real estate development industries. It was premised on having all of us go deeply into debt to benefit those industries. And now there is so much debt, private and public, that the economy is strangling on it. So...where do we go from here?
My vote: forgive massive amounts of debt. Write down mortgages, credit card debt, and student loan debt by about 25%.
From Adam Levitin:
Once upon a time, the US had a housing policy. It was focused on increasing homeownership. It might have been a misguided policy or at least a policy taken too far, but it was a policy and everyone understood that. It meant that programs were designed to work toward that goal.
Today, 4 years into a housing crisis, we still have no housing policy. There's no plan to clean up the legacy of the housing bubble and no plan to build the future of housing finance. This sad state reflects a singular failure of political leadership. It also reflects a deeply fragmented housing finance world in which no one is in a position to call the shots.
----------------------
This is true. And there seems to be no inclination to develop one. But I would say this is because the policy of expanding home ownership (starting in 1935) was not really developed by legislators or bureaucrats. It was invented by the real estate industry. That is, it was never really a public policy to begin with. It was a massive subsidy program aimed at the financial and real estate development industries. It was premised on having all of us go deeply into debt to benefit those industries. And now there is so much debt, private and public, that the economy is strangling on it. So...where do we go from here?
My vote: forgive massive amounts of debt. Write down mortgages, credit card debt, and student loan debt by about 25%.
CAI criticizes FHA standards for condo loans
From a recent CAI Press Release:
CAI Applauds Congressional Input on Mortgage Issues
FALLS CHURCH, VA, NOV. 10, 2011—Congressional leaders are expressing serious reservations about Federal Housing Administration’s (FHA) mortgage-approval policies for condominiums—policies that are the source of mounting confusion and angst for condominium boards, homeowners and real estate agents nationwide.
Community Associations Institute (CAI) says these policies are preventing many potential buyers from obtaining FHA-backed loans to purchase homes in those communities, putting entire condominium associations at risk and further worsening the already dismal residential real estate market.
While acknowledging the need for thoughtful and financially sound lending criteria, the 31,000-member organization has expressed public concern about past FHA lending guidance that has created continued “confusion and frustration” in the marketplace. That’s why CAI sought to bring Congressional attention to the issue.
“There seems to be an invisible barrier between FHA and condominium associations,” Sen. Scott Brown (D-Mass.) said in a recent letter to Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development (HUD). FHA falls under HUD’s jurisdiction.
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I think there is no doubt that FHA, and Fannie and Freddie, are taking a harder look at loans to buy condos. Why wouldn't they? Many projects are in big financial trouble due to owners being in foreclosure and not paying assessments, and banks holding units and simply refusing to pay assessments. Add to that the fact that these building need maintenance and the reserves are not there, typically, and even more so now that solvent owners are getting squeezed harder than ever. But if FHA is going to guarantee the loan, or if Fannie or Freddie are going to buy the loan, they have to be careful. The taxpayers have already sunk a fortune into Fannie and Freddie since 2008 to pay for their purchase of bad mortgage backed securities. They don't want to get stuck with bailing out the nation's condo associations, especially if the entire institution is of questionable sustainability (as I have been arguing for years.)
Oh, and one suggestion for CAI: Scott Brown is not a Democrat. He is a Republican. Maybe you should correct that.
CAI Applauds Congressional Input on Mortgage Issues
FALLS CHURCH, VA, NOV. 10, 2011—Congressional leaders are expressing serious reservations about Federal Housing Administration’s (FHA) mortgage-approval policies for condominiums—policies that are the source of mounting confusion and angst for condominium boards, homeowners and real estate agents nationwide.
Community Associations Institute (CAI) says these policies are preventing many potential buyers from obtaining FHA-backed loans to purchase homes in those communities, putting entire condominium associations at risk and further worsening the already dismal residential real estate market.
While acknowledging the need for thoughtful and financially sound lending criteria, the 31,000-member organization has expressed public concern about past FHA lending guidance that has created continued “confusion and frustration” in the marketplace. That’s why CAI sought to bring Congressional attention to the issue.
“There seems to be an invisible barrier between FHA and condominium associations,” Sen. Scott Brown (D-Mass.) said in a recent letter to Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development (HUD). FHA falls under HUD’s jurisdiction.
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I think there is no doubt that FHA, and Fannie and Freddie, are taking a harder look at loans to buy condos. Why wouldn't they? Many projects are in big financial trouble due to owners being in foreclosure and not paying assessments, and banks holding units and simply refusing to pay assessments. Add to that the fact that these building need maintenance and the reserves are not there, typically, and even more so now that solvent owners are getting squeezed harder than ever. But if FHA is going to guarantee the loan, or if Fannie or Freddie are going to buy the loan, they have to be careful. The taxpayers have already sunk a fortune into Fannie and Freddie since 2008 to pay for their purchase of bad mortgage backed securities. They don't want to get stuck with bailing out the nation's condo associations, especially if the entire institution is of questionable sustainability (as I have been arguing for years.)
Oh, and one suggestion for CAI: Scott Brown is not a Democrat. He is a Republican. Maybe you should correct that.
Property manager pleads guilty in Vegas HOA fraud scheme - FOX5 Vegas - KVVU
Property manager pleads guilty in Vegas HOA fraud scheme - FOX5 Vegas - KVVU
LAS VEGAS (FOX5) -
A tenth person has pleaded guilty to a Las Vegas condominium homeowner association fraud scheme.
44-year-old Denise Keser entered her guilty plea to one count of conspiracy to commit mail and wire fraud Thursday.
Keser and her co-conspirators attempted to gain control of the condo homeowner associations in order to steer business to certain construction companies and a law firm.
Keser was a property manager at the Chateau Nouveau condominium complex and used her position to send email messages to homeowners to smear HOA board members in an attempt to take control of those boards.
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Another one bites the dust. How many more will fall, and how high will this go? Thanks to Shu for the link.
LAS VEGAS (FOX5) -
A tenth person has pleaded guilty to a Las Vegas condominium homeowner association fraud scheme.
44-year-old Denise Keser entered her guilty plea to one count of conspiracy to commit mail and wire fraud Thursday.
Keser and her co-conspirators attempted to gain control of the condo homeowner associations in order to steer business to certain construction companies and a law firm.
Keser was a property manager at the Chateau Nouveau condominium complex and used her position to send email messages to homeowners to smear HOA board members in an attempt to take control of those boards.
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Another one bites the dust. How many more will fall, and how high will this go? Thanks to Shu for the link.
Wednesday, November 09, 2011
GOP Rep. Joe Walsh Melts Down, Screams At Constituents: 'Dont Blame Banks!...I Am Tired Of Hearing That Crap!' | ThinkProgress
GOP Rep. Joe Walsh Melts Down, Screams At Constituents: 'Dont Blame Banks!...I Am Tired Of Hearing That Crap!' | ThinkProgress
Freshman Rep. Joe Walsh (R-IL) is known for his anti-Obama rhetoric on cable television and his inability to pay his child support payments. But during a recent meeting with constituents in his Chicago-area suburban district, Walsh lost his cool when several attendees asked about why banks have so much power in government. At one point, Walsh even threatened to eject a man who asked Walsh about the revolving door of bank lobbyists infiltrating Congress and financial regulatory agencies.
Walsh at one point screamed, “don’t blame the banks … this pisses me off!”
----------------
That's today's Republican Party for you. The nation's most famous deadbeat dad, who just got an award from the Family Research Council for his "unwavering support" of families. Except his own--he is being sued for over $100,000 in unpaid child support. Now he is defending the banks that crashed our economy against constituents who raised the entirely reasonable question of why these banks have so much political power. The answer, of course, is simple: they have purchased the entire Republican congressional delegation and many of the Democrats.
Freshman Rep. Joe Walsh (R-IL) is known for his anti-Obama rhetoric on cable television and his inability to pay his child support payments. But during a recent meeting with constituents in his Chicago-area suburban district, Walsh lost his cool when several attendees asked about why banks have so much power in government. At one point, Walsh even threatened to eject a man who asked Walsh about the revolving door of bank lobbyists infiltrating Congress and financial regulatory agencies.
Walsh at one point screamed, “don’t blame the banks … this pisses me off!”
----------------
That's today's Republican Party for you. The nation's most famous deadbeat dad, who just got an award from the Family Research Council for his "unwavering support" of families. Except his own--he is being sued for over $100,000 in unpaid child support. Now he is defending the banks that crashed our economy against constituents who raised the entirely reasonable question of why these banks have so much political power. The answer, of course, is simple: they have purchased the entire Republican congressional delegation and many of the Democrats.
Vacant House Yields Late Owner's Stash of Cash | AOL Real Estate
Vacant House Yields Late Owner's Stash of Cash | AOL Real Estate
A plumber in Florida who found $20,000 in a vacant home and turned the money over to police is being credited for his honesty.
Jerry LaLiberte, 62, of Holmes Beach, was working in the home last month when he discovered two foil-wrapped packets of cash that were hidden in an air duct, WFTS-TV Tampa reports.
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I hear that a lot of people do this "packets of cash" thing. I, on the other hand, have "packets of bills" scattered around the house. I keep hoping somebody will find them and pay them, but so far nobody has. Not event the plumber.
A plumber in Florida who found $20,000 in a vacant home and turned the money over to police is being credited for his honesty.
Jerry LaLiberte, 62, of Holmes Beach, was working in the home last month when he discovered two foil-wrapped packets of cash that were hidden in an air duct, WFTS-TV Tampa reports.
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I hear that a lot of people do this "packets of cash" thing. I, on the other hand, have "packets of bills" scattered around the house. I keep hoping somebody will find them and pay them, but so far nobody has. Not event the plumber.
Tuesday, November 08, 2011
Proposal could ban condos from assessing paying owners extra
State law requires shared communities — including homeowners and co-operatives — to pay the bills that keep a community operating. That includes paying vendors, such as security, landscapers and cable companies, so it not uncommon for boards to raise regular assessments to cover the difference of owners who stop paying fees.
But Smith contends pushing the financial burden to owners already doing the right thing by paying their fees is unfair and reckless.
"My bill came from a Lauderhill constituent who is getting pummeled by these assessments because her community has a lot of foreclosures and vacancies," Smith said. "Those who are not in foreclosure are having to pay for those who are not paying assessments and the price is getting high on them."
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Things are tough all over...especially if you live in a Florida condo.
Retirement Crisis Closes In on Baby Boomers
"Florida has always counted on a big chunk of the baby boomers retiring down here and buying property over the next 20 years," said Jack McCabe, a veteran Florida-based real estate analyst.
"We're not going to see this big influx of full-time senior citizen residents," McCabe said. "Home builders may need to re-analyze what they see as demand over the next five to 10 years."
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Florida has served as one of Privatopia's most important states in the five-decade-old boom of privatized local government in the form of mandatory membership HOAs. According to this account, that boom may no longer be sustainable as Baby Boomers can't be counted on to retire to a Florida HOA.
Chris Brown -- Neighbors Say He's a Nightmare | TMZ.com
Chris Brown -- Neighbors Say He's a Nightmare | TMZ.com
Chris Brown is at war with his fellow West Hollywood condo owners, who claim the rapper is the neighbor from hell, parking in handicapped spaces, blasting music, and racing dogs in hallways.
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Is Mr. Brown one of those people who thinks his home is his castle and he should be able to do whatever he wants without his Nazi condo board bossing him around?
Chris Brown is at war with his fellow West Hollywood condo owners, who claim the rapper is the neighbor from hell, parking in handicapped spaces, blasting music, and racing dogs in hallways.
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Is Mr. Brown one of those people who thinks his home is his castle and he should be able to do whatever he wants without his Nazi condo board bossing him around?
Chicago area home values at 2000 levels, report says - Lake County News-Sun
Chicago area home values at 2000 levels, report says - Lake County News-Sun
A new report shows 46.2 percent of single-family homeowners in the Chicago metropolitan area in the third quarter had negative equity, meaning homeowners owed more on their mortgages than their homes were worth.
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Eleven years down the drain?
A new report shows 46.2 percent of single-family homeowners in the Chicago metropolitan area in the third quarter had negative equity, meaning homeowners owed more on their mortgages than their homes were worth.
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Eleven years down the drain?
Mortgage delinquencies rise unexpectedly in Q3 – USATODAY.com
Mortgage delinquencies rise unexpectedly in Q3 – USATODAY.com
The rate at which mortgage holders were late with their payments by 60 days or more rose in the June-to-September period for the first time since the last three months of 2009, according to TransUnion. The credit reporting agency said 5.88% of homeowners missed two or more payments, an early sign of possible foreclosure. That was up from 5.82% in the second quarter. The increase surprised TransUnion researchers, who had expected late payments, or delinquencies, to fall for the quarter.
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The experts are surprised because delinquencies to up when housing prices go down and/or unemployment goes up. But during that quarter neither of those things happened. So why are delinquencies up, even though housing prices went up a little, and unemployment went down a little? Likely explanation: many people who are underwater on their homes, but have been dutifully paying their mortgage in the expectation that prices would head back up, are looking at the overall economy and giving up on that hope. They have decided to walk.
The rate at which mortgage holders were late with their payments by 60 days or more rose in the June-to-September period for the first time since the last three months of 2009, according to TransUnion. The credit reporting agency said 5.88% of homeowners missed two or more payments, an early sign of possible foreclosure. That was up from 5.82% in the second quarter. The increase surprised TransUnion researchers, who had expected late payments, or delinquencies, to fall for the quarter.
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The experts are surprised because delinquencies to up when housing prices go down and/or unemployment goes up. But during that quarter neither of those things happened. So why are delinquencies up, even though housing prices went up a little, and unemployment went down a little? Likely explanation: many people who are underwater on their homes, but have been dutifully paying their mortgage in the expectation that prices would head back up, are looking at the overall economy and giving up on that hope. They have decided to walk.
Sunday, November 06, 2011
Out of Balance: Homeowner Rights vs. Responsibilities | jrogerwoodlaw.com
Out of Balance: Homeowner Rights vs. Responsibilities | jrogerwoodlaw.com
Attorney Roger Wood, formerly of the firm of Carpenter Hazelwood, has now declared his independence and presents himself an advocate of the homeowner. This is producing some controversy, as one might expect. Scott Carpenter's firm figures prominently in many of the Arizona stories of owners crushed to a pulp by the industry, and in the minds of many owners' rights advocates there is no stronger advocate of absolute board authority over owners than Scott Carpenter. So--this is quite a defection.
Attorney Roger Wood, formerly of the firm of Carpenter Hazelwood, has now declared his independence and presents himself an advocate of the homeowner. This is producing some controversy, as one might expect. Scott Carpenter's firm figures prominently in many of the Arizona stories of owners crushed to a pulp by the industry, and in the minds of many owners' rights advocates there is no stronger advocate of absolute board authority over owners than Scott Carpenter. So--this is quite a defection.
Sprawl's spread speeds up - Sacramento Business, Housing Market News | Sacramento Bee
Sprawl's spread speeds up - Sacramento Business, Housing Market News | Sacramento Bee
All told, more than half the population growth in the region during the last decade occurred in freshly converted farmland. The region's urban footprint – areas with at least 1,000 people per square mile – nearly doubled from 1980 to 2010. Only 1 percent of last decade's population growth took place in the urban core that existed before 1980.
Regional planners expect the next census report in 2020 to be different. They have spent years hammering out a blueprint that would encourage high-density growth in already-established areas. Local governments across the region back the plan.
"We project a land-use pattern that's going to flip the old pattern on its head," said Mike McKeever, executive director of the Sacramento Area Council of Governments. "Seventy percent of new housing will be attached or small lot."
Read more: http://www.sacbee.com/2011/11/05/4033576/sprawls-spread-speeds-up.html#ixzz1czcNDCzd
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And of course "attached or small lot" means condos, townhomes, and HOAs. In other words, that high-density land-use pattern will be entirely dependent on the institution of common interest housing. That is the plan. So, while CID owners' rights advocates make their case to state legislators, and while condo associations and HOAs face impending collapse due to foreclosures, local governments are planning a new era of growth based on condos and HOAs and townhomes. Think that one over.
Thanks to Fred Pilot for this link.
All told, more than half the population growth in the region during the last decade occurred in freshly converted farmland. The region's urban footprint – areas with at least 1,000 people per square mile – nearly doubled from 1980 to 2010. Only 1 percent of last decade's population growth took place in the urban core that existed before 1980.
Regional planners expect the next census report in 2020 to be different. They have spent years hammering out a blueprint that would encourage high-density growth in already-established areas. Local governments across the region back the plan.
"We project a land-use pattern that's going to flip the old pattern on its head," said Mike McKeever, executive director of the Sacramento Area Council of Governments. "Seventy percent of new housing will be attached or small lot."
Read more: http://www.sacbee.com/2011/11/05/4033576/sprawls-spread-speeds-up.html#ixzz1czcNDCzd
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And of course "attached or small lot" means condos, townhomes, and HOAs. In other words, that high-density land-use pattern will be entirely dependent on the institution of common interest housing. That is the plan. So, while CID owners' rights advocates make their case to state legislators, and while condo associations and HOAs face impending collapse due to foreclosures, local governments are planning a new era of growth based on condos and HOAs and townhomes. Think that one over.
Thanks to Fred Pilot for this link.
Saturday, November 05, 2011
A Creditor’s Playland, or: Cato on Housing Crisis Policy | Rortybomb
A Creditor’s Playland, or: Cato on Housing Crisis Policy | Rortybomb
Mike Konczal demolishes the right-wing think tank Cato Institute for their unique brand of free-market capitalism: "I like this form of libertarianism, where policy is simply the things that defend the power and hierarchy of creditors, the rich and the elite, much better than the normal 'gee whiz markets are cool' kind. There’s almost a Nietzschean zeal for the wonk world to first and foremost accept creditors as a master class to whom all policy bends."
In this piece, Konczal is taking apart Cato's bank-friendly, consumer-hostile prescriptions for the housing market. Predictably, Cato wants to rush all the foreclosures to conclusion, never mind the fraudulent or nonexistent proof, and the banks should get deficiency judgments against people who strategically default. Public policy needs to be concerned about moral hazard you see...unless it is the banks who have the moral problems.
Mike Konczal demolishes the right-wing think tank Cato Institute for their unique brand of free-market capitalism: "I like this form of libertarianism, where policy is simply the things that defend the power and hierarchy of creditors, the rich and the elite, much better than the normal 'gee whiz markets are cool' kind. There’s almost a Nietzschean zeal for the wonk world to first and foremost accept creditors as a master class to whom all policy bends."
In this piece, Konczal is taking apart Cato's bank-friendly, consumer-hostile prescriptions for the housing market. Predictably, Cato wants to rush all the foreclosures to conclusion, never mind the fraudulent or nonexistent proof, and the banks should get deficiency judgments against people who strategically default. Public policy needs to be concerned about moral hazard you see...unless it is the banks who have the moral problems.
Thursday, November 03, 2011
Freddie Mac CEO to Step Down - WSJ.com
Freddie Mac CEO to Step Down - WSJ.com
Freddie and its larger sibling Fannie Mae face growing scrutiny as the government's cost of the 2008 takeovers mounts and the housing market faces prolonged weakness. The FHFA's inspector general, along with several lawmakers, have criticized several key decisions made by Freddie, Fannie and their regulator. Current and former employees have said that has led to a difficult work environment, where decision-making is often frustrated by second guessing. Last month, for example, the inspector general alleged that Freddie Mac had left money on the table when it agreed to a $1.3 billion settlement with Bank of America Corp. over faulty mortgages. It also issued a report criticizing the FHFA's decision to award multi-million-dollar pay packages to senior executives...Freddie Mac has taken nearly $52 billion in government aid to stay afloat, though for the past four quarters it has returned more money to the Treasury than it has taken. Fannie has cost taxpayers $89 billion. The firms own or guarantee nearly half of all U.S. home loans outstanding.
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Fannie and Freddie have received over $140 billion from the taxpayers since they were placed in conservatorship. That was done, you will recall, after the debacle that ensued while they were privatized, when their CEO's tried to compete with a private mortgage securitization market that was in the process, we know know, of committing suicide. But the problems with the GSE's conduct these days are different. They are coddling the big banks and playing the hardest of hardball with struggling homeowners. Read Maureen Tkacik's two part series on this. See Jennifer Dixon's three-part series on how Fannie and Freddie are encouraging foreclosure in Detroit.
As part of Obama's pre-election shift to the ever-so-slightly left of center, he is trying to address criticisms that his housing policies have been a flop. Changes of leadership at the top might be part of that. But Tkakic thinks Ed DeMarco, the conservator of the GSE's, may be fired for his own sudden shift toward holding banks accountable. The putback litigation by the GSEs and a host of private investors in mortgage-backed securities could be a huge blow to Bank of America and perhaps other huge banks. B of A bought Countrywide, a company that engaged in horrifically shoddy securitization practices, and under the pooling and securitization agreements the remedy for their transgressions is forced buyback of the (now largely worthless) loans. The exposure is potentially in the hundreds of billions of dollars.
Freddie and its larger sibling Fannie Mae face growing scrutiny as the government's cost of the 2008 takeovers mounts and the housing market faces prolonged weakness. The FHFA's inspector general, along with several lawmakers, have criticized several key decisions made by Freddie, Fannie and their regulator. Current and former employees have said that has led to a difficult work environment, where decision-making is often frustrated by second guessing. Last month, for example, the inspector general alleged that Freddie Mac had left money on the table when it agreed to a $1.3 billion settlement with Bank of America Corp. over faulty mortgages. It also issued a report criticizing the FHFA's decision to award multi-million-dollar pay packages to senior executives...Freddie Mac has taken nearly $52 billion in government aid to stay afloat, though for the past four quarters it has returned more money to the Treasury than it has taken. Fannie has cost taxpayers $89 billion. The firms own or guarantee nearly half of all U.S. home loans outstanding.
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Fannie and Freddie have received over $140 billion from the taxpayers since they were placed in conservatorship. That was done, you will recall, after the debacle that ensued while they were privatized, when their CEO's tried to compete with a private mortgage securitization market that was in the process, we know know, of committing suicide. But the problems with the GSE's conduct these days are different. They are coddling the big banks and playing the hardest of hardball with struggling homeowners. Read Maureen Tkacik's two part series on this. See Jennifer Dixon's three-part series on how Fannie and Freddie are encouraging foreclosure in Detroit.
As part of Obama's pre-election shift to the ever-so-slightly left of center, he is trying to address criticisms that his housing policies have been a flop. Changes of leadership at the top might be part of that. But Tkakic thinks Ed DeMarco, the conservator of the GSE's, may be fired for his own sudden shift toward holding banks accountable. The putback litigation by the GSEs and a host of private investors in mortgage-backed securities could be a huge blow to Bank of America and perhaps other huge banks. B of A bought Countrywide, a company that engaged in horrifically shoddy securitization practices, and under the pooling and securitization agreements the remedy for their transgressions is forced buyback of the (now largely worthless) loans. The exposure is potentially in the hundreds of billions of dollars.
Compton finds itself in full financial meltdown - latimes.com
Compton finds itself in full financial meltdown - latimes.com
Compton's finances are in such disarray that the city amassed $369,000 in late fees over the last year because it could not pay its policing contract with the Los Angeles County Sheriff's Department on time. The city has already laid off about 15% of its workforce, and city leaders warn that more cuts may be on the way. City Hall has slashed spending, even canceling the city's popular gospel concert. But most disconcerting is the city's looming deficit of $39 million, a sum that represents about 80% of its annual general fund budget. Standard & Poor this summer lowered the rating of some of Compton's bonds to just above junk status. City officials said they're hoping for a short-term loan or line of credit to get through the year and vowed not to file for bankruptcy.
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Short term loan? Can you imagine what the interest rate would be on that?
Compton's finances are in such disarray that the city amassed $369,000 in late fees over the last year because it could not pay its policing contract with the Los Angeles County Sheriff's Department on time. The city has already laid off about 15% of its workforce, and city leaders warn that more cuts may be on the way. City Hall has slashed spending, even canceling the city's popular gospel concert. But most disconcerting is the city's looming deficit of $39 million, a sum that represents about 80% of its annual general fund budget. Standard & Poor this summer lowered the rating of some of Compton's bonds to just above junk status. City officials said they're hoping for a short-term loan or line of credit to get through the year and vowed not to file for bankruptcy.
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Short term loan? Can you imagine what the interest rate would be on that?
Wednesday, November 02, 2011
Forcing Banks to Secure Foreclosed Homes - Housing - The Atlantic Cities
Forcing Banks to Secure Foreclosed Homes - Housing - The Atlantic Cities
It is unusual to see any public official at any level demanding anything of banks, so Chicago Alderman Robert Fioretti has distinguished himself.
It is unusual to see any public official at any level demanding anything of banks, so Chicago Alderman Robert Fioretti has distinguished himself.
US Marshals turned loose to collect $63,720.80 from Righthaven
US Marshals turned loose to collect $63,720.80 from Righthaven
Looks like it's time to turn out the lights on Righthaven. The US Marshal for the District of Nevada has just been authorized by a federal court to use "reasonable force" to seize $63,720.80 in cash and/or assets from the Las Vegas copyright troll after Righthaven failed to pay a court judgment from August 15.
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Thanks to Tom Skiba for this piece of good news. Bye bye Righthaven, good riddance, don't let the door hit you where the dog should have bit you.
Looks like it's time to turn out the lights on Righthaven. The US Marshal for the District of Nevada has just been authorized by a federal court to use "reasonable force" to seize $63,720.80 in cash and/or assets from the Las Vegas copyright troll after Righthaven failed to pay a court judgment from August 15.
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Thanks to Tom Skiba for this piece of good news. Bye bye Righthaven, good riddance, don't let the door hit you where the dog should have bit you.
Cary News | Attempted board change roils HOA
Cary News | Attempted board change roils HOA
I wouldn't even attempt to summarize this situation. Thanks to Fred Pilot for the link.
I wouldn't even attempt to summarize this situation. Thanks to Fred Pilot for the link.
Dolphin Tower board criticized for its handling of building crisis | HeraldTribune.com
Dolphin Tower board criticized for its handling of building crisis | HeraldTribune.com
Dolphin Towers in downtown Sarasota has structural problems that forced all residents out in 2010. The residents have been in a legal fight with their insurer, which has denied claims for money to repair the building. Meanwhile, the number of owners refusing to pay the assessments needed to keep up the fight and pay for repair costs at the 117-unit tower is now up to about three dozen.
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What an awful situation these folks are in. And now they are fighting among themselves. Thanks to Fred Pilot for the link.
Dolphin Towers in downtown Sarasota has structural problems that forced all residents out in 2010. The residents have been in a legal fight with their insurer, which has denied claims for money to repair the building. Meanwhile, the number of owners refusing to pay the assessments needed to keep up the fight and pay for repair costs at the 117-unit tower is now up to about three dozen.
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What an awful situation these folks are in. And now they are fighting among themselves. Thanks to Fred Pilot for the link.
Feds: Mafia Affiliates Took Over, Looted $12 Million From Texas Mortgage Company | TPMMuckraker
Feds: Mafia Affiliates Took Over, Looted $12 Million From Texas Mortgage Company | TPMMuckraker
Law enforcement officials charged 13 people — including an alleged member and another associate of the Lucchese family — on racketeering and related offenses in an alleged scheme to take over and loot the Texas-based FirstPlus Financial Group Inc. (FPFG) through extortion. Ten defendants are already in custody, one is expected to surrender and two are still at large.
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I wonder how the FBI was able to distinguish between organized crime and the normal course of business for the mortgage industry. If you made a Venn diagram the two circles would be one on top of the other.
Law enforcement officials charged 13 people — including an alleged member and another associate of the Lucchese family — on racketeering and related offenses in an alleged scheme to take over and loot the Texas-based FirstPlus Financial Group Inc. (FPFG) through extortion. Ten defendants are already in custody, one is expected to surrender and two are still at large.
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I wonder how the FBI was able to distinguish between organized crime and the normal course of business for the mortgage industry. If you made a Venn diagram the two circles would be one on top of the other.
Tuesday, November 01, 2011
Investors place big bets on Buy Here Pay Here used-car dealers - latimes.com
Investors place big bets on Buy Here Pay Here used-car dealers - latimes.com
Loans on decade-old clunkers are being bundled into securities, just as subprime mortgages were a few years ago. In the last two years, investors have bought more than $15 billion in subprime auto securities.
Although they're backed mainly by installment contracts signed by people who can't even qualify for a credit card, most of these bonds have been rated investment grade. Many have received the highest rating: AAA.
That's because rating firms believe that with tens of thousands of loans lumped together, the securities are safe even if some of the loans prove worthless.
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This is not from The Onion. It's the Los Angeles Times. This is really happening. They are securitizing subprime auto loans. But don't worry--some of them are rated AAA. That means...nothing could possibly go wrong!!
Loans on decade-old clunkers are being bundled into securities, just as subprime mortgages were a few years ago. In the last two years, investors have bought more than $15 billion in subprime auto securities.
Although they're backed mainly by installment contracts signed by people who can't even qualify for a credit card, most of these bonds have been rated investment grade. Many have received the highest rating: AAA.
That's because rating firms believe that with tens of thousands of loans lumped together, the securities are safe even if some of the loans prove worthless.
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This is not from The Onion. It's the Los Angeles Times. This is really happening. They are securitizing subprime auto loans. But don't worry--some of them are rated AAA. That means...nothing could possibly go wrong!!
Romney Tells State With Country's Highest Foreclosure Rate 'Don't Try And Stop The Foreclosure Process' | ThinkProgress
Romney Tells State With Country's Highest Foreclosure Rate 'Don't Try And Stop The Foreclosure Process' | ThinkProgress
I may have posted this before, but it is worth repeating. The likely Republican presidential nominee is on record saying the government should do nothing about foreclosures. Just let them happen.
I may have posted this before, but it is worth repeating. The likely Republican presidential nominee is on record saying the government should do nothing about foreclosures. Just let them happen.
Home prices heading for triple-dip - Oct. 31, 2011
Home prices heading for triple-dip - Oct. 31, 2011
Naples, Fla., for example, is expected to take the biggest hit of any metro area, a price drop of another 18.9% by the end of next June, according to Fiserv. Home prices in the area have already fallen 61% from the peak.
Other cities expected to be hit hard include the not-so-lucky Las Vegas, which is expected to see home prices fall another 15.9% for a total loss of 66%; Riverside, Calif., is projected to fall another 14.8% (for a total decline of 61%); Miami is expected to decline by 13.2% (total loss: 57%), and Salinas, Calif. could drop by another 13% (for a total loss of 66%).
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What we are experiencing is not a recession. It is a mortgage debt-driven collapse of the financial and housing industries that is far from over. Before it is finished, it will wreak havoc with state and local governments and the nation's HOAs and condo associations. Thanks to Fred Pilot for the link.
Naples, Fla., for example, is expected to take the biggest hit of any metro area, a price drop of another 18.9% by the end of next June, according to Fiserv. Home prices in the area have already fallen 61% from the peak.
Other cities expected to be hit hard include the not-so-lucky Las Vegas, which is expected to see home prices fall another 15.9% for a total loss of 66%; Riverside, Calif., is projected to fall another 14.8% (for a total decline of 61%); Miami is expected to decline by 13.2% (total loss: 57%), and Salinas, Calif. could drop by another 13% (for a total loss of 66%).
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What we are experiencing is not a recession. It is a mortgage debt-driven collapse of the financial and housing industries that is far from over. Before it is finished, it will wreak havoc with state and local governments and the nation's HOAs and condo associations. Thanks to Fred Pilot for the link.
Sunday, October 30, 2011
Washington Supreme Court: Honking at neighbor who reported poultry to HOA is free speech
When you drive past another vehicle with a bumper sticker that urges you to honk if you love Jesus or the Zags or any number of other potential objects of affection, you might honk if so moved.
In all cases, you are exercising your First Amendment rights. At least in Washington state.
That’s what the state Supreme Court said last week in the somewhat interesting, somewhat bizarre case of State v. Helen Immelt, a Snohomish County woman who was ticketed for honking her horn in anger at her neighbor in 2006, in a dispute over chickens.
Immelt lived in a cul-de-sac that was part of a homeowners association, although she reportedly was unaware of the association’s covenants that banned the raising of chickens. She had some chicks in her garage; her neighbor, the association president, saw them and the group sent her a letter to get rid of the birds.
She figured out the neighbor was the one who turned her in, and the next morning drove by his house around 6 a.m. and blew her horn for a period of time described in court papers as five to 10 minutes. The honked-off neighbor called the sheriff’s office, which sent out a deputy to take the complaint and happened to be there when Immelt drove by again, and honked three times more. He gave chase, pulled her over and gave her a ticket for violating the county’s noise ordinance, which bans “noise which is a public disturbance” including “sounding of vehicle horns for purposes other than public safety.”
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This isn't an HOA case per se, but has its origins in a petty Privatopian dispute.
Saturday, October 29, 2011
Morgan Stanley predicts foreclosed homeowners will pay $72B in rent annually « HousingWire
Morgan Stanley predicts foreclosed homeowners will pay $72B in rent annually « HousingWire
The millions of homeowners facing default on their mortgages will likely become renters once their home is foreclosed. Investment bank Morgan Stanley (MS: 19.31 -0.52%) crunched the numbers and said the boost to the multifamily segment, that arm of commercial real estate that includes apartment buildings, will most likely see a multibillion-dollar boost from the looming migration.
Oliver Chang, a housing and securitized products analyst at Morgan Stanley, the lead author of a report released this week, detailed the migration of ownership to rentals. He expects a drop in the U.S. homeownership rate to 60% in the coming years from 69% at its peak.
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That's why the only construction sector showing an increase in activity is "multifamily residential." It isn't condos. It's apartment buildings. The building industry expects these folks who lost their homes in foreclosure to join the ranks of renters...permanently. And with the horrible job market and the crushing burden of student loans, many young people will find it impossible to get financially established and buy anything for many years, if ever.
The millions of homeowners facing default on their mortgages will likely become renters once their home is foreclosed. Investment bank Morgan Stanley (MS: 19.31 -0.52%) crunched the numbers and said the boost to the multifamily segment, that arm of commercial real estate that includes apartment buildings, will most likely see a multibillion-dollar boost from the looming migration.
Oliver Chang, a housing and securitized products analyst at Morgan Stanley, the lead author of a report released this week, detailed the migration of ownership to rentals. He expects a drop in the U.S. homeownership rate to 60% in the coming years from 69% at its peak.
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That's why the only construction sector showing an increase in activity is "multifamily residential." It isn't condos. It's apartment buildings. The building industry expects these folks who lost their homes in foreclosure to join the ranks of renters...permanently. And with the horrible job market and the crushing burden of student loans, many young people will find it impossible to get financially established and buy anything for many years, if ever.
Top US foreclosure law firm threw Halloween party where staff dressed as homeless, foreclosed-upon Americans - Boing Boing
Top US foreclosure law firm threw Halloween party where staff dressed as homeless, foreclosed-upon Americans - Boing Boing
On Friday, the law firm of Steven J. Baum threw a Halloween party. The firm, which is located near Buffalo, is what is commonly referred to as a “foreclosure mill” firm, meaning it represents banks and mortgage servicers as they attempt to foreclose on homeowners and evict them from their homes. Steven J. Baum is, in fact, the largest such firm in New York; it represents virtually all the giant mortgage lenders, including Citigroup, JPMorgan Chase, Bank of America and Wells Fargo.
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Thanks to Mystery Reader for this link. I guess you can tell a lot about people by what they think is hilarious.
On Friday, the law firm of Steven J. Baum threw a Halloween party. The firm, which is located near Buffalo, is what is commonly referred to as a “foreclosure mill” firm, meaning it represents banks and mortgage servicers as they attempt to foreclose on homeowners and evict them from their homes. Steven J. Baum is, in fact, the largest such firm in New York; it represents virtually all the giant mortgage lenders, including Citigroup, JPMorgan Chase, Bank of America and Wells Fargo.
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Thanks to Mystery Reader for this link. I guess you can tell a lot about people by what they think is hilarious.
Friday, October 28, 2011
Why a Mortgage Cramdown Bill Is Still the Best Bet to Save the Economy | Truthout
Why a Mortgage Cramdown Bill Is Still the Best Bet to Save the Economy | Truthout
With the mortgage meltdown showing no signs of abating, it is the time to set the record straight on the best plan we have had for reviving the housing market: the 2009 bankruptcy reform bill known as the cram-down bill. That controversial piece of legislation would have given bankruptcy judges the authority to write down mortgages on a primary residence to the current fair-market price of the property. In addition, cram-downs would have enabled bankruptcy judges to monitor and stop some of the widespread robo-signing abuses—where banks have been using fraudulent documents to foreclose on homeowners.
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See below--this policy would allow BK judges to reduce the principal on mortages in Chapter 13 proceedings.
With the mortgage meltdown showing no signs of abating, it is the time to set the record straight on the best plan we have had for reviving the housing market: the 2009 bankruptcy reform bill known as the cram-down bill. That controversial piece of legislation would have given bankruptcy judges the authority to write down mortgages on a primary residence to the current fair-market price of the property. In addition, cram-downs would have enabled bankruptcy judges to monitor and stop some of the widespread robo-signing abuses—where banks have been using fraudulent documents to foreclose on homeowners.
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See below--this policy would allow BK judges to reduce the principal on mortages in Chapter 13 proceedings.
It's Time for Debt Forgiveness, American-Style | The Nation
It's Time for Debt Forgiveness, American-Style | The Nation
Write down the principal they owe on their mortgage to match the current market value of their home, so they will no longer be underwater. Refinance the loan with a reduced interest rate, so the monthly payment is at a level that the struggling homeowner can handle. This keeps families in their homes, with a renewed stake in the future. It gives homeowners incentive to keep up their payments, because once again they have some equity and the opportunity to accumulate much more.
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I think Greider is right. If this doesn't happen, it won't be just owners who suffer. Local governments and CIDs will be under increasing financial stress. There may be another 10 million foreclosures before all this is over, and when people think they are going to be foreclosed on they stop paying property taxes and HOA/condo fees.
Write down the principal they owe on their mortgage to match the current market value of their home, so they will no longer be underwater. Refinance the loan with a reduced interest rate, so the monthly payment is at a level that the struggling homeowner can handle. This keeps families in their homes, with a renewed stake in the future. It gives homeowners incentive to keep up their payments, because once again they have some equity and the opportunity to accumulate much more.
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I think Greider is right. If this doesn't happen, it won't be just owners who suffer. Local governments and CIDs will be under increasing financial stress. There may be another 10 million foreclosures before all this is over, and when people think they are going to be foreclosed on they stop paying property taxes and HOA/condo fees.
If you thought HOAs were bad now, just wait - Friday, Oct. 28, 2011 | 2 a.m. - Las Vegas Sun
If you thought HOAs were bad now, just wait - Friday, Oct. 28, 2011 | 2 a.m. - Las Vegas Sun
“Stuff falls apart. It’s inevitable. And I know we’re not prepared for it.”
That’s Evan McKenzie, lawyer and political scientist at the University of Illinois at Chicago and the foremost expert on HOAs. He wrote the book on them, aptly titled, “Privatopia.”
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“Stuff falls apart. It’s inevitable. And I know we’re not prepared for it.”
That’s Evan McKenzie, lawyer and political scientist at the University of Illinois at Chicago and the foremost expert on HOAs. He wrote the book on them, aptly titled, “Privatopia.”
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Thursday, October 27, 2011
Americans Staying Put More Than At Any Time Since WWII: Census
Americans Staying Put More Than At Any Time Since WWII: Census
Americans are staying put more than at any time since World War II, as the housing bust and unemployment keep young adults at home and thwart older Americans' plans for a beachfront or lakeside retirement.
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Add to that the fact that moving doesn't make a whole lot of sense if you can't sell your house and can't get a new job.
Americans are staying put more than at any time since World War II, as the housing bust and unemployment keep young adults at home and thwart older Americans' plans for a beachfront or lakeside retirement.
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Add to that the fact that moving doesn't make a whole lot of sense if you can't sell your house and can't get a new job.
Wednesday, October 26, 2011
A 53% Surge in Poverty Rate Is Reshaping Suburbs - NYTimes.com
A 53% Surge in Poverty Rate Is Reshaping Suburbs - NYTimes.com
PARMA HEIGHTS, Ohio — The poor population in America’s suburbs — long a symbol of a stable and prosperous American middle class — rose by more than half after 2000, forcing suburban communities across the country to re-evaluate their identities and how they serve their populations.
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Remember the same stories from the 2001-02 recession? And the 1991-92 recession? Periodically the New York Times discovers that there are poor people in suburbia.
PARMA HEIGHTS, Ohio — The poor population in America’s suburbs — long a symbol of a stable and prosperous American middle class — rose by more than half after 2000, forcing suburban communities across the country to re-evaluate their identities and how they serve their populations.
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Remember the same stories from the 2001-02 recession? And the 1991-92 recession? Periodically the New York Times discovers that there are poor people in suburbia.
Tuesday, October 25, 2011
Oklahoma City homeowners association president arrested after argument
A 73-year-old man was arrested on multiple complaints including assault with a dangerous weapon after he and a neighbor got into a dispute about their homeowners association, Oklahoma City police said Monday.
A.B. Simpson was arrested on complaints of assault and battery, assault with a dangerous weapon and pointing a firearm after the altercation Thursday.
According to a police report, Simpson, the president of a homeowners association, got into an argument with another member of the association's board, Bivian Cox, 79, inside Simpson's home.
Cox told police Simpson pulled a silver revolver on him and hit him several times. Cox had minor injuries, including a cut on his right hand.
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A few weeks back, a Philippine HOA prez who made a point of letting one of his unhappy constituents know he packed an AK-47 was mentioned on this blog. "And you thought your HOA president was bad?" the good perfessor asked rhetorically. In at least one HOA, it could indeed be worse if this account is accurate.
Monday, October 24, 2011
Capitol Alert: Report: Cal HFA foreclosing on borrowers current on loans
Capitol Alert: Report: Cal HFA foreclosing on borrowers current on loans
Thanks to Fred Pilot for sending me the strangest link I have seen in years.
Thanks to Fred Pilot for sending me the strangest link I have seen in years.
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