KeNo's Housing and Economic Portal: Thursday May 13 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Bill to close confidential license plate loophole advances‎ - (www.mercurynews.com) Public service union workers again screwing the public and not having to live with the laws they are serving on us…. Peace officers and certain state workers no longer would be able to blow past traffic cameras with impunity under a bill approved Monday by the Assembly Transportation Committee. A law allowing police officers to obtain confidential license plates — so the public cannot access information about the plate's owner — has expanded over time to include many other state workers, from county supervisors to police dispatchers to museum guards. Assemblyman Jeff Miller, R-Corona, says that more than a million such workers' home mailing addresses are not displayed in the Department of Motor Vehicles' public-access records. So when they and their families run a red light or a toll plaza and are caught on a private contractor's camera, there's no address to send the traffic tickets and not enough time to have the DMV do a manual check within the 15 days that state law gives police to mail red-light camera citations. The Orange County Register in 2008 reported that 3,722 protected plate holders had used the 91 Express Lanes toll road — a 10-mile stretch in the Riverside Freeway's median — without paying on 14,535 occasions over five years. That totals about $29,500 in tolls, but about $5 million in fines for the traffic violations. Miller introduced AB2097 in February to address this loophole; it would require confidential plate holders to submit a current employment address to which tickets can be mailed. He said it will raise more money for badly needed transportation projects.

Hulu - Saturday Night Live: Public Employee of the Year - (www.hulu.com) Very funny video from Last week's Saturday Night Live skit on public unions… Probably somewhat of an exaggeration but not by much.

Anaheim businessman collects rent on Southern California houses - (www.ocregister.com) California's foreclosure crisis has spawned an unusual operation by a bankrupt Orange County businessman who takes control of vacant homes and rents them out, according to police, property records and neighbors. From an office at an Anaheim massage clinic, Blair Hanloh has recorded deeds on at least 12 vacant houses in Southern California that he does not own. Property records show no evidence that the owners deeded interest to him—and five owners interviewed by The Orange County Register said that they had not. Hanloh uses his deeds, to homes in Orange, Los Angeles, San Bernardino and San Diego counties, to line up tenants and to placate police, who are inevitably called by neighbors to oust new residents they believe to be squatters.(Click to learn more about the properties.) Hanloh's scheme has rattled neighbors, befuddled police and frustrated the properties' real owners – who say they must spend thousands of dollars in legal fees to evict the tenants. "I feel it's a sign of the times," said Erika Chowaiki, whose house for sale in San Dimas was seized without her knowledge by Hanloh. "People are out there desperate, trying to figure out a way to make money." Mark Bellinger, an investor in an Anaheim Hills home taken over by Hanloh, fretted that he might lose the property. "It'll take a year to get (the tenants) out. Who's going to pay the mortgage for a year?" Bellinger said. "It's the equivalent of kiss your home goodbye." Hanloh twice declined comment, saying only that he is doing everything legally.

'Strategic Defaulters' Skip Mortgage Payments as House Values Tumble - (www.pbs.org) As part of his continuing series of reports making sense of economic news, Paul Solman tells the story of some homeowners who have stopped paying their mortgages even though they can still afford them. Transcript:

MARGARET WARNER: Next: moving from the failings of Wall Street to homeowners in Florida who have decided to walk away from their mortgages. Our story comes from "NewsHour" economics correspondent Paul Solman. It's part of his ongoing reporting on Making Sense of financial news.

PAUL SOLMAN: Meet 28-year-old Josh Bartlett, West Virginia native, now a restaurant manager in Fort Myers, Florida. He lives in a condo he bought in 2005 for $210,000, with a mortgage of $190,000.

And what's this place worth today?

JOSH BARTLETT, homeowner: Forty-five thousand. I can go across the street, pay cash, and never have to worry ever again about a mortgage payment.

PAUL SOLMAN: Across the street, around the corner, with a 60 percent vacancy rate, Bartlett could buy at least four units in this development for what his place cost. But, as for never worrying about a mortgage payment again, well, it's not as if he's sweating over his current obligations.

City of Oakland placing liens for profit? - (www.auditoaklandceda.com) AOC acknowledges that many who review this report are concerned with blight abatement as a priority for our community. AOC agrees. AOC's biggest finding is that CEDA Code Enforcement's practices inhibit, rather than promote, the elimination of blight in our City. They do this by placing liens, which render property owners creditless and which inhibit/prevent foreclosed properties from selling. Most loans contain specific language stating, "Except as permitted by federal law, Borrower shall not allow any lien inferior to the Security Instrument to be perfected against the Property without Lender's prior written permission." Therefore, a lender may foreclose as soon as the CEDA lien is placed. They are contributing to the foreclosure crisis by forfeiting property owner's deposits and permit fees, rendering property owners cashless and causing foreclosure in multiple cases. Other cities around Alameda County have found more effective ways of combating blight; Oakland appears to prefer the opportunity to profit from the controversy created by the liens on bank owned properties in the form of large payments out of escrow at the point of sale. If CEDA were merely attempting to recover the costs of blight abatement, AOC may have no finding in this regard. However, AOC finds that time after time, CEDA's liens are disproportionate to the value of services rendered and, worse, CEDA's liens must be paid regardless of whether the property owner abates the condition on their own. AOC also finds that CEDA Code Enforcement inspectors are unfamiliar with Oakland Building Code, California Code, or other relevant codes. Inspectors issue Notices, essentially "tickets" since they are Officers of the Law according to OMC, and act as judge and jury, preventing property owners from appealing the allegations according to due process provided for in OMC and the State. AOC finds that CEDA routinely sites property owners for non-abateable conditions: pre-existing non-conforming units/structures; permitted work that CEDA staff claims was not permitted in spite of CEDA records to the contrary; alleged unpermitted work that has been disproved and still the property owner is liened; destruction/removal of private property.

Geithner and NY Fed Accused of Willfully Ignoring Fraud - (Mish at globaleconomicanalysis.blogspot.com) Black Accuses Geithner and the NY Fed of Willfully Ignoring Fraud: It was a painful, as a former regulator, to read the Valukas report’s discussion of the FRBNY staff’s open disdain for working cooperatively with the SEC to protect the public. The Valukas report exposes the sick relationship between the country's main regulatory bodies and the systemically dangerous institutions (SDIs) they are supposed to be policing.The FRBNY, led by President Geithner, had a clear statutory mission -- promote the safety and soundness of the banking system and compliance with the law – stood by while Lehman deceived the public through a scheme that FRBNY officials likened to a “three card monte routine”. ... Translation: The FRBNY knew that Lehman was engaged in fraud designed to overstate its liquidity and, therefore, was unwilling to loan as much money to Lehman. The FRBNY did not, however, inform the SEC, the public, or the OTS (which regulated an S&L that Lehman owned) of the fraud. The Fed official doesn’t even make a pretense that the Fed believes it is supposed to protect the public. The FRBNY remained willing to lend to a fraudulent systemically dangerous institution (SDI). This is an egregious violation of the public trust, and the regulatory perpetrators must be held accountable. ....

OTHER STORIES:

Greece Nears Aid by May, Warns Against Default Bets - (www.cnbc.com)

Officials Bragged of Subprime Gains - (www.cnbc.com)

Los Angeles Among Forbes' Top 10 U.S Cities In Freefall - (www.huffingtonpost.com)

Foreclosures moving to mid-to-high end - (www.calculatedriskblog.com)

Bank of Canada Signals G-7s First Interest Rate Increases - (www.bloomberg.com)

Fannie Mae Moving on Property in Mid-tier Markets - (www.doctorhousingbubble.com)

Florida Retirees See Hope in Unfinished Housing Project - (www.cnbc.com)

Goldman's Defense: We Lost Money on Subprime Market - (www.cnbc.com)

Hope rises for real financial reform - (www.washingtonpost.com)

Why Government Regulation Fails - (online.wsj.com)

United-Continental Merger Talks Hit Snag Over Price - (www.cnbc.com)