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STORIES:
Lenders
will target near-equity squatters for future foreclosures - (www.ochousingnews.com) Banks are letting delinquent
borrowers squat rather than foreclosing on them and booting them out. At first,
it was a self-preservation measure by the banks taken out of desperation when
the first wave of foreclosures caused prices to crash. However, now the banks
are content to allow squatting, even for years, because squatters do not become
MLS supply weighing down prices. The houses occupied by squatters are
effectively removed from the market creating an artificial shortage. The lack
of MLS homes for sale and high affordability is causing prices to rise, and as
prices go up, banks have collateral backing on their bad loans. Rising prices
due to rampant delinquent mortgage squatting creates an unusual set of
circumstances for lenders. When prices were falling, banks chose to foreclose
on the least desirable properties and a random mix of nicer properties. The
random selection of properties was intended to frighten underwater borrowers
who were still paying their mortgages into continued payment. This terrorist
tactic is the only real option they had short of widespread foreclosure
processing. However, now that prices are going up, they have a new option. They
can foreclose on underwater squatters as they hit the surface.
Growing
numbers of Valley residents want walkable neighborhoods - (www.centralvalleybusinesstimes.com)
If a study released Wednesday
by a nonprofit that promotes in-fill development pans out, living in the eight
counties of the San Joaquin could look surprisingly different by mid-century. The
Council of Infill Builders is forecasting housing demand through 2050 that
shows that the San Joaquin Valley will need significantly more walkable homes
in cities and towns to meet future demand. The new data come as the California
Air Resources Board sets to meet in Bakersfield on Thursday, to address how the
eight counties from Kern in the south to San Joaquin in the north, are
coordinating their land use and transportation policies and adapting to serve
the region’s changing population and market forces.
Wells Fargo sued by German agency for $160 million in CDO
losses - (www.reuters.com) Wells Fargo Bank, N.A. was sued
Wednesday by a German government agency that accused it of mismanaging a
collateralized debt obligation, resulting in more than
$160 million in losses. Wells Fargo and Collineo Asset
Management GMBH, a German financial services company, allowed investments of
overly risky assets not permitted under the contracts governing House of Europe
Funding I Ltd, a Cayman Islands CDO issuer, according to the lawsuit filed in
Manhattan federal court.
Moody's warns European banks need more cash - (www.reuters.com) Banks in Spain, Italy, Ireland and
Britain need to set aside much more money to cover potentially bad loans,
credit ratings agency Moody's said on Thursday, meaning European taxpayers may
again be tapped for cash. European banks have already raised hundreds of
billions of euros to cover possible losses from loans that soured in property
and financial market crises. Much of the funding has come from governments. "We
believe that many banks, in particular in Spain, Italy, Ireland, and the UK, require
material amounts of additional provisions to fully clean up their balance
sheets," Moody's said in its global banking outlook for 2013.
Investors grow cagey as Italy election nears - (www.reuters.com) As Silvio Berlusconi's
pre-election media blitz intensifies, so do fears of a costly detour from
Italy's road back to economic strength. Yields on short-term Italian debt,
which have fallen sharply, are creeping up again, reflecting concerns that the
billionaire tycoon, who lost power at the peak of Italy's fiscal woes in 2011,
could have a big influence on the election outcome. Some overseas investors are
selling up now, rather than waiting to find out.
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