Bad news: Check this out at Calculated Risk:

Moodys: 8.8 Million Homeowners Underwater

Mass. foreclosures rise 128% in January

Good News: T.G.I.F. (sorry, that's all I got... enjoy your weekend).

Posted by Bill McLeod at 7:42 AM | Permalink | Comments (0) | TrackBacks (0)

The Mortgage Bankers Association which represents the real estate finance industry is apparently not pleased with a report by the Center for Responsible Lending which urges reforms to the US Bankruptcy Code. According to David Kittle, the Chairman Elect of the MBA:

Policymakers should ignore this report as it is more rhetoric than fact. Bankruptcy reform is not the answer for consumers having trouble making their mortgage payments. It will drive up the cost of credit in the form of higher rates, larger down payments and greater closing costs.

Further, bankruptcy is a logistical and financial nightmare for consumers. Filing for bankruptcy is expensive and approximately two-thirds of all bankruptcy plans fail. Nobody should be holding it out as a better alternative to working with your lender to try to find a mutually agreeable resolution.

But the CRL is responding with a report that shows that voluntary loan modification fall short. You'll find a link to the PDF report, and the statistics here.

As for Kittle’s comments, I have no idea where the uncited reference to “two-thirds of all bankruptcy plans fail.” Where does that factoid come from? There are lots of reasons why bankruptcy cases fail, but there is no magical statistic that I am aware of. That's flat-out misleading. And as for a "nightmare", oh come on now. While none of my clients want to be in bankruptcy, they would rather keep their home and put food on the table, than live with the proposed "resolutions" offered by their lender.

And unfortunately, for Mr. Kittle, the sad news is that for an increasing number of homeowners, filing bankruptcy is the better alternative to working “with your lender.” The fact is, some lenders are unwilling (or for their own reasons unable) to “work” with a homeowner. When there can be no “mutually agreeable resolution”, bankruptcy is the better alternative. And until lenders start getting serious about modifications, and about their lending practices that got the country into this mess, that alternative will only appear better and better.

Posted by Bill McLeod at 5:11 PM | Permalink | Comments (1) | TrackBacks (0)

If the Federal Reserve cuts rates, mortgage payments should decline, right? Perhaps not.

Today's Boston Globe also reports on foreclosure rescue scams.

And finally, may Bostonians have noticed the number of new condominium construction projects that have sprung up over the last few years...and the building boom continues. But if you build it, the buyers will not necessarily come. Today's Boston Herald reports that some new condominium projects are finding that it is easier to rent the units rather than sell them.

Posted by Bill McLeod at 12:39 PM | Permalink | Comments (0) | TrackBacks (0)

The Washington Post reports that

At the [real estate] loan closing, [Treasury Secretary Henry M. Paulson Jr.] wrote, "the most critical facts, including potential future monthly payments, should be on a single page in clear, easy-to-understand language."

In addition, he said the United States should consider replacing the disparate state rules that govern mortgage brokers with a national system.

Between predatory lending and complicated disclosure, "some of the conduct and practices I have learned about are shameful," Paulson said. "The development of a uniform national licensing, education and monitoring system for all mortgage brokers is worth considering."

Read more here

Source

Posted by Bill McLeod at 6:39 PM | Permalink | Comments (0) | TrackBacks (0)

This morning's Worcester Telegram is reporting that from January 1, 2006 through June 30, 2007 a total of 1,370 foreclosure notices were filed by lenders against Worcester homeowners. It also does not appear it will get better anytime soon:

Trouble could continue for the next two years, according to Mr. [Clark Ziegler, executive director of the Massachusetts Housing Partnership]. ARMs on about 200 more Worcester homes are scheduled to reset before the end of this year, he said. About 1,000 more ARMs reset in Worcester next year, followed by 1,000 more in 2009, he said.

Posted by Bill McLeod at 11:06 AM | Permalink | Comments (0) | TrackBacks (0)

Today the The Wall Street Journal reports that the bankruptcy of American Home Mortgage Investment Corporation puts thousands of homeowners in “imminent risk” of losing their homes.

From the New York Post: Countrywide reportedly continues its struggle in this mortgage and housing meltdown.

And finally, USA Today reports that there should be no assumptions that the Federal Reserve will cut interest rates.

Dallas Federal Reserve Bank President Richard Fisher said the U.S. economy appears to be weathering troubles in housing and financial markets, but it is uncertain how things will play out.

"Our economy appears to be weathering the storm thus far. The future path of that storm and the appropriate policy course, however, are still to be determined," Fisher said in remarks prepared for delivery to a community forum in Laredo, Texas.

Last summer, I questioned whether we were heading into a Perfect Storm. If you read the news close enough, it would appear that we are. Are you prepared?

Posted by Bill McLeod at 1:41 PM | Permalink | Comments (0) | TrackBacks (0)

I am thrilled to hear that Massachusetts Attorney General Martha Coakley has announced the establishment of a Pro Bono Foreclosure Assistance Hotline. The hotline is designed to steer low income Massachusetts residents to professionals who can offer them the help they need. (I am also pleased to let you know that both Roy and I are among the volunteer lawyers).

The numbers are (800) 342-5297 or (617) 603-1700.

Read more here.

Posted by Bill McLeod at 2:46 PM | Permalink | Comments (0) | TrackBacks (0)