Wednesday, December 19, 2012

Thursday December 20 Housing and Economic stories


Owner walks away from his loft, then sees someone living inside - ( The owner had walked away, expecting a foreclosure that never came. The other man says a real estate agent let him move in and told him where to mail rent. A battle for the loft begins. Jeffrey Cote was driving home from work one evening this spring when he noticed a light on inside Unit 312 of the Little Tokyo Lofts. This was the industrial loft he had bought in downtown Los Angeles for $647,000 — with no money down — at the top of the market in 2007. He thought it would be a great investment. It was also the loft he had abandoned less than two years later, after filing for bankruptcy and expecting the bank to foreclose. The loft was still in Cote's name, so the light surprised him. A few weeks later, he and his girlfriend decided to investigate. They got off the elevator and saw a new welcome mat outside Unit 312. When his key didn't work, Cote knocked on the door.

Europe’s property loans go unpaid - ( More than 70 per cent of the European commercial property loans that were at the heart of securitisation deals structured before the subprime crisis and that reached maturity this year have not been repaid. Fresh figures from Fitch Ratings point to the continued difficulties facing issuers and investors involved in European commercial mortgage-backed securities deals that were structured in the securitisation boom between 2004 and 2006. While the market for CMBS has bounced back in the US, there have been only a scattering of new issues in Europe. But bondholders in existing European CMBS are in some cases facing the prospect of lengthy workouts and restructurings. As property valuations have fallen and banks have offloaded their real estate portfolios in the face of a tough economic and regulatory environment, it has become increasingly difficult to refinance European commercial property loans, including those contained in CMBS vehicles. According to Fitch, only 24 of 122 CMBS loans that matured in the first 11 months of 2012 were fully paid at maturity, although another 12 paid after maturity. The rest are either in a workout, at a standstill or have had their loan maturity extended.

Europe's banking union ambitions under strain - ( Germany and France clashed publicly on Tuesday over plans to put the European Central Bank in charge of supervising banks, deepening a dispute over the scope of ECB powers that threatens to derail one of Europe's boldest reforms. With time running out to meet a pledge to complete the legal framework for an EU-wide banking union by the end of the year, Germany's Wolfgang Schaeuble told a meeting of EU finance ministers he could not support a plan that would give the ECB the final say on supervision. France's Pierre Moscovici and the ECB protested against any watering down of a plan central to Europe's response to a five-year banking crisis and which promises to unify the way it deals with problem lenders, ending a previously haphazard approach.

Spain's jobless near 5 million as banks await cash - ( The number of people officially registered as unemployed in Spain has edged up toward 5 million as the country's recession shows few signs of abating and its struggling banks await crucial bailout cash. Spain's Labor Ministry said Tuesday that unemployment rose a monthly 74,296 in November, or 1.5 percent, to a record 4.9 million. The country's unemployment rate is released separately and quarterly. It stood at 25 percent at the end of the third quarter, with the youth unemployment rate standing well above 50 percent.

Older homeowners falling more into foreclosure - ( Homeowners more than 50 years old are falling into foreclosure faster than any other age group, particularly widows whose husbands held the mortgage, said the New York Times. Foreclosures among homeowners over 50 increased by 23% over the past five years, resulting in 1.5 million foreclosures. The main reason for the rise in foreclosures is due to women outliving their spouses and not being able to cop with ballooning, medical costs, mortgage and pension cuts. Advocates are petitioning the Consumer Financial Protection Bureau to create guidelines for lenders in scenarios involving surviving relatives. Banks have also stated that they will work with widows. For example, JPMorgan Chase allows for surviving relatives to complete a mortgage assumption and loan modification simultaneously. About 6% of loans held by persons over 50 were delinquent in 2011, up from 1% in 2007, according to a study by AARP.

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