‘Exceptional assistance’ to keep institutions running may come with strings
The Associated Press
WASHINGTON - Treasury Secretary Timothy Geithner said Sunday the government may require new faces in executive suites at banks requiring “exceptional assistance” in the future, .
Critics of the Obama administration’s move last weekend to force out the chairman of General Motors Corp., Rick Wagoner, as a condition for possible additional federal loans say that strong government intervention contrasts with measures placed on the financial industry in return for billions in infusions.
Geithner put banks on notice that they may need to change leadership teams in exchange for accepting more money in the future. “If, in the future, banks need exceptional assistance in order to get through this, then we’ll make sure that assistance comes with conditions, not just to protect the taxpayer but to make sure this is the kind of restructuring necessary for them to emerge stronger,” he told “Face the Nation” on CBS. “And where that requires a change of management of the board, we’ll do that.”
The treasury chief said that is what has happened at some big institutions that are getting large amounts of government aid. They include the mortgage companies Fannie Mae and Freddie Mac, which were placed into conservatorship by the government last September, and insurer American International Group Inc., the recipient of more than $170 billion in help since last fall.
“We’ve already seen a substantial number of the largest banks in our country fail or be absorbed by other institutions, no longer existing at independent institutions. And where the government has acted, like in Fannie and Freddie or like in AIG, where we’ve had to do exceptional things to stabilize them, we have replaced the management and the board,” Geithner said.
“And we’ve done that because we want to make sure that taxpayers’ assistance is going to make these companies stronger, make sure there’s accountability, make sure it comes with strong conditions. And we’ll do that in the future if that is necessary,” he added.
“It’s a single standard, a single principle. And our obligation to the American people is to do what’s necessary to try to bring recovery back on track as quickly as possible.”
Asked if chief executives of big banks such as Citibank and Bank of America should worry about their jobs if their companies don’t improve their performance, Geithner said the government would not shy from such a restructuring.
“Where that’s necessary, where it meets the test, where it’s necessary to do what we ... exist to do, which is to make sure that this financial system supports recovery and the banks emerge stronger,” Geithner said.
As part of the new administration’s overhaul of the $700 billion bailout effort, banking regulators are requiring stress tests for the 19 largest banks to see whether they will need additional support to withstand a more severe downturn than the country is experiencing now.
Those tests are scheduled to be completed by the end of April. After that, the banks in need of additional capital will be given time to raise it on their own.
If they are not able to do so, they will be provided with extra support from the bailout fund. But the administration has said the additional support will come with tougher requirements to make sure the banks’ are using the money to increase lending to consumers and businesses.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
URL: http://www.msnbc.msn.com/id/30057099/
MSN Privacy . Legal© 2009 MSNBC.com
May 7, 2009
more than $170 billion in help since last fall.
Our own Treasury Chief has recently expressed concerns about some big institutions who continue to be unwilling to comply and who are getting large amounts of government aid. They include the mortgage companies that were placed into conservatorship by the government last September who are the recipient of more than $170 billion in help since last fall.
Administration expands housing aid plan
Administration expands housing aid plan
Incentives for mortgage lenders to lower bills on second mortgages
The Associated Press
updated 9:28 a.m. PT, Tues., April 28, 2009
WASHINGTON - The Obama administration said Tuesday it is expanding its plan to stem the housing crisis by offering mortgage lenders incentives to lower borrowers’ bills on second mortgages. During the housing boom, lenders readily gave out “piggyback” second loans that allowed consumers to make small down payments or avoid them entirely. While home prices soared, such mortgages were even extended to borrowers with poor credit scores and people who didn’t provide proof of their incomes or assets.
But those loans, which are attached to about half of all troubled mortgages, have been an obstacle to efforts to alleviate the housing crisis. That’s because borrowers who are trying to get their primary mortgage modified at a lower monthly payment need the permission of the company holding the second mortgage.
The new plan aims to get rid of that roadblock, administration officials said.
“With these latest program details, we’re offering even more opportunities for borrowers to make their homes affordable under the administration’s housing plan,” Treasury Secretary Timothy Geithner said in a statement.
The administration initiative, funded out of $50 billion in financial rescue money, relies on a series of payments to mortgage companies as an incentive to modify second loans at lower interest rates. Mortgage companies would get $500 upfront for each modified loan, plus $250 a year for three years as long as the borrower doesn’t default.
Similarly, borrowers would get up to $1,000 over five years applied to the principal balance of their primary mortgage, and the government would pick up part of investors’ costs as well. Lenders would also be given the ability to remove second mortgages entirely in exchange for larger government payouts.
The administration also plans to give mortgage companies $2,500 payments to entice them to participate in the “Hope for Homeowners” program. It was launched by the government last fall but has so far has been a failure, proving unattractive to banks required to absorb large losses.
It was supposed to allow 400,000 troubled homeowners to swap risky loans for traditional 30-year fixed-rate mortgages with lower rates. Instead only a handful of borrowers have been able to qualify, and as of earlier this spring only one loan had completed the program.
Meanwhile, the faltering economy is causing the housing crisis to spread. Nationwide, nearly 804,000 homes received at least one foreclosure-related notice from January through March, up from about 650,000 in the same period a year earlier, according to RealtyTrac Inc., a foreclosure listing firm.
Meanwhile, another key piece of President Barack Obama’s plan to keep borrowers from losing their homes is expected to be defeated this week in the Senate. There does not appear to be enough votes to pass a bill that would allow people to seek mortgage relief in bankruptcy court.
Many lawmakers remain worried that such legislation would unleash a torrent of loan defaults, ultimately driving up mortgage rates and introducing fresh uncertainty to a housing market in crisis.
There were, however, fresh signs Tuesday that the housing recession may be hitting bottom. Home prices have been setting record annual declines, but in February that 25-month cycle was broken.
The Standard & Poor’s/Case-Shiller index of home prices in 20 major cities slid by 18.6 percent from February 2008, slightly better than the 19 percent in January. The 10-city index slid 18.8 percent, also a little better than the month before.
Prices in the 20-city index have plunged 30.7 percent from their peak in the summer of 2006, and the 10-city index has lost more than 31.6 percent.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
URL: http://www.msnbc.msn.com/id/30452823/
MSN Privacy . Legal© 2009 MSNBC.com
Incentives for mortgage lenders to lower bills on second mortgages
The Associated Press
updated 9:28 a.m. PT, Tues., April 28, 2009
WASHINGTON - The Obama administration said Tuesday it is expanding its plan to stem the housing crisis by offering mortgage lenders incentives to lower borrowers’ bills on second mortgages. During the housing boom, lenders readily gave out “piggyback” second loans that allowed consumers to make small down payments or avoid them entirely. While home prices soared, such mortgages were even extended to borrowers with poor credit scores and people who didn’t provide proof of their incomes or assets.
But those loans, which are attached to about half of all troubled mortgages, have been an obstacle to efforts to alleviate the housing crisis. That’s because borrowers who are trying to get their primary mortgage modified at a lower monthly payment need the permission of the company holding the second mortgage.
The new plan aims to get rid of that roadblock, administration officials said.
“With these latest program details, we’re offering even more opportunities for borrowers to make their homes affordable under the administration’s housing plan,” Treasury Secretary Timothy Geithner said in a statement.
The administration initiative, funded out of $50 billion in financial rescue money, relies on a series of payments to mortgage companies as an incentive to modify second loans at lower interest rates. Mortgage companies would get $500 upfront for each modified loan, plus $250 a year for three years as long as the borrower doesn’t default.
Similarly, borrowers would get up to $1,000 over five years applied to the principal balance of their primary mortgage, and the government would pick up part of investors’ costs as well. Lenders would also be given the ability to remove second mortgages entirely in exchange for larger government payouts.
The administration also plans to give mortgage companies $2,500 payments to entice them to participate in the “Hope for Homeowners” program. It was launched by the government last fall but has so far has been a failure, proving unattractive to banks required to absorb large losses.
It was supposed to allow 400,000 troubled homeowners to swap risky loans for traditional 30-year fixed-rate mortgages with lower rates. Instead only a handful of borrowers have been able to qualify, and as of earlier this spring only one loan had completed the program.
Meanwhile, the faltering economy is causing the housing crisis to spread. Nationwide, nearly 804,000 homes received at least one foreclosure-related notice from January through March, up from about 650,000 in the same period a year earlier, according to RealtyTrac Inc., a foreclosure listing firm.
Meanwhile, another key piece of President Barack Obama’s plan to keep borrowers from losing their homes is expected to be defeated this week in the Senate. There does not appear to be enough votes to pass a bill that would allow people to seek mortgage relief in bankruptcy court.
Many lawmakers remain worried that such legislation would unleash a torrent of loan defaults, ultimately driving up mortgage rates and introducing fresh uncertainty to a housing market in crisis.
There were, however, fresh signs Tuesday that the housing recession may be hitting bottom. Home prices have been setting record annual declines, but in February that 25-month cycle was broken.
The Standard & Poor’s/Case-Shiller index of home prices in 20 major cities slid by 18.6 percent from February 2008, slightly better than the 19 percent in January. The 10-city index slid 18.8 percent, also a little better than the month before.
Prices in the 20-city index have plunged 30.7 percent from their peak in the summer of 2006, and the 10-city index has lost more than 31.6 percent.
Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
URL: http://www.msnbc.msn.com/id/30452823/
MSN Privacy . Legal© 2009 MSNBC.com
May 2, 2009
Loan Modifications! Are they are Trap Doors
Beware Those Loan Modifications! They are Trap Doors for “lenders” benefit not yours!!!
By Timothymccandless’s Weblog
"Beware Those Loan Modifications! They are Trap Doors for “lenders” benefit not yours!!! The “lenders’ are holding nothing but worthless or at best questionable paper. As soon as you sign a modification you are validating a debt that you most likely don’t have anymore or at worsthave substantial offsets against and you are validating a security instrument (mortgage) that was destroyed in the securitization process. Check with your local licensed counsel — but my advice is Don’t Sign Any Modification unless you are getting the terms — all the terms —- you want.
And even then EVERY modification must be accompanied by some method to protect the homeowner from later claims on a break in the chain of title caused by securitization. So you either need new title insurance, a quiet title action, or both.
REAL ESTATE WEEKLY
This week’s Real Estate stories
By MarketWatch"
By Timothymccandless’s Weblog
"Beware Those Loan Modifications! They are Trap Doors for “lenders” benefit not yours!!! The “lenders’ are holding nothing but worthless or at best questionable paper. As soon as you sign a modification you are validating a debt that you most likely don’t have anymore or at worsthave substantial offsets against and you are validating a security instrument (mortgage) that was destroyed in the securitization process. Check with your local licensed counsel — but my advice is Don’t Sign Any Modification unless you are getting the terms — all the terms —- you want.
And even then EVERY modification must be accompanied by some method to protect the homeowner from later claims on a break in the chain of title caused by securitization. So you either need new title insurance, a quiet title action, or both.
REAL ESTATE WEEKLY
This week’s Real Estate stories
By MarketWatch"
Piggington's Econo-Almanac | San Diego Housing Bubble News and Analysis
Piggington's Econo-Almanac San Diego Housing Bubble News and Analysis: "In reaction to the latest Case-Shiller home price graphs, a few readers have asked how a property worth not much more than $400,000 can be considered a member of the 'high-priced tier.'
The answer is that there is no considering about it. Each month, the Case-Shiller price tiers are calculated by separating all sold homes into thirds by price. The high-priced tier represents not someone's subjective idea of what comprises a high-priced San Diego home, but rather the most expensive one-third of homes sold during the measurement period.
For January's Case-Shiller index, the cutoff between the top one-third and the middle one-third was $419,143. The cutoff between the middle one-third and lowest-priced one-third of homes sold was about $284,375.
The tier cutoffs, and especially the one between the high- and mid-priced tiers, used to be a lot higher."
The answer is that there is no considering about it. Each month, the Case-Shiller price tiers are calculated by separating all sold homes into thirds by price. The high-priced tier represents not someone's subjective idea of what comprises a high-priced San Diego home, but rather the most expensive one-third of homes sold during the measurement period.
For January's Case-Shiller index, the cutoff between the top one-third and the middle one-third was $419,143. The cutoff between the middle one-third and lowest-priced one-third of homes sold was about $284,375.
The tier cutoffs, and especially the one between the high- and mid-priced tiers, used to be a lot higher."
May 1, 2009
Format Document
Format Document: "A. By virtue of his position, a power of sale is conferred upon the trustee of a trust deed under which the trust property may be sold, in the manner provided in this chapter, after a breach or default in performance of the contract or contracts, for which the trust property is conveyed as security, or a breach or default of the trust deed. At the option of the beneficiary, a trust deed may be foreclosed in the manner provided by law for the foreclosure of mortgages on real property in which event the provisions of chapter 6 of this title govern GOVERNS the proceedings. The beneficiary or trustee shall constitute the proper and complete party plaintiff in any action to foreclose a deed of trust. The power of sale may be exercised by the trustee without express provision therefor in the trust deed.
B. The trustee or beneficiary may file and maintain an action to foreclose a deed of trust at any time before the trust property has been sold under the power of sale. A sale of trust property under the power of sale shall not be held after an action to foreclose the deed of trust has been filed unless the foreclosure action has been dismissed.
C. The trustee or beneficiary may file an action for the appointment of a receiver according to sections 12-1241 and 33-702. The right to appointment of a receiver shall be independent"
B. The trustee or beneficiary may file and maintain an action to foreclose a deed of trust at any time before the trust property has been sold under the power of sale. A sale of trust property under the power of sale shall not be held after an action to foreclose the deed of trust has been filed unless the foreclosure action has been dismissed.
C. The trustee or beneficiary may file an action for the appointment of a receiver according to sections 12-1241 and 33-702. The right to appointment of a receiver shall be independent"
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