Wednesday October 6 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Bank Of America Debt Collectors Called Borrowers "F___ing N__ger" And "Punk" To Get Them To Pick Up The Phone - (www.businessinsider.com) Bank of America has been busted using some seriously outrageous tactics to try to collect debts so small they're barely worth the paper they're written on. It wasn't until ABC News ambushed BOFA CEO Brian Moynihan Michael-Moore style outside his office that the firm finally responded by firing its debt-collection firm.

Third world America - (www.macleans.ca) Collapsing bridges, street lights turned off, cuts to basic services: the decline of a superpower. In February, the board of commissioners of Ohio’s Ashtabula County faced a scene familiar to local governments across America: a budget shortfall. They began to cut spending and reduced the sheriff’s budget by 20 per cent. A law enforcement agency staff that only a few years ago numbered 112, and had subsequently been pared down to 70, was cut again to 49 people and just one squad car for a county of 1,900 sq. km along the shore of Lake Erie. The sheriff’s department adapted. “We have no patrol units. There is no one on the streets. We respond to only crimes in progress. We don’t respond to property crimes,” deputy sheriff Ron Fenton told Maclean’s. The county once had a “very proactive” detective division in narcotics. Now, there is no detective division. “We are down to one evidence officer and he just runs the evidence room in case someone wants to claim property,” said Fenton. “People are getting property stolen, their houses broken into, and there is no one investigating. We are basically just writing up a report for the insurance company.” If a county without police seems like a weird throwback to an earlier, frontier-like moment in American history, it is not the only one. “Back to the Stone Age” is the name of a seminar organized in March by civil engineers at Indiana’s Purdue University for local county supervisors interested in saving money by breaking up paved roads and turning them back to gravel. While only some paved roads in the state have been broken up, “There are a substantial number of conversations going on,” John Habermann, who manages a program at Purdue that helps local governments take care of infrastructure, told Maclean’s. “We presented a lot of talking points so that the county supervisors can talk logically back to elected officials when the question is posed,” he said. The state of Michigan had similar conversations. It has converted at least 50 miles of paved road to gravel in the last few years.

Government tries to prevent falling prices, but prevents true price and growth - (online.wsj.com) The more the government tries to prevent prices from finding an equilibrium, the longer it will take for the economy to begin growing again. A decent house has long been a symbol of middle-class American family life. Practically, it has been a secure shelter for the children and provided access to a good public education. And financially, it has been regarded as a safe store of value, a shield against the vagaries of the economy and a long-term retirement asset. All that seems a distant memory for the millions of American families who must confront the decline in the value of their homes. The pressure to meet mortgage payments on properties that have lost value has been especially shocking for those who have lost their jobs in the Great Recession. Their houses have become a ball and chain, restricting their ability to seek employment elsewhere. They cannot afford to abandon the remaining equity they have in their houses—and they can't sell in this miserable market. New home sales, pending home sales, and mortgage applications are down to a 13-year low, despite long-term mortgage rates that plummeted recently to an average 4.3% before rising slightly. New home prices have fallen by an average of 30%. According to David Rosenberg, chief economist at Gluskin Sheff, this has reduced home occupancy cost to 15% of family incomes, down from the conventional 25%. The fall in house prices has eaten away at the equity Americans have in their homes. About 11 million residential properties have mortgage balances that exceed the home's value, notes Mr. Rosenberg.

GMAC Spotlight on 'Robo-Signer' - (online.wsj.com) They are called robo-signers, putting their names on thousands of documents tied to mortgages facing foreclosure. Now, under pressure from borrowers, banks are halting foreclosures where the documents are signed by these employees. This week, mortgage-servicing giant GMAC Mortgage Co. halted foreclosures in 23 states due to questions about documents signed by one of its robo-signers, Jeffrey Stephan. Until now, Mr. Stephan was an anonymous middle manager whose job is to sign affidavits, assignments of mortgages and other documents that establish a bank's ownership of a mortgage, thus giving the bank the right to foreclose. But, as revelations come to light about how Mr. Stephan and other robo-signers do their jobs, a picture is emerging of a foreclosure process that critics say is just as flawed as the lax lending and perverse incentives that created the lending crisis. In two sworn depositions given by Mr. Stephan over the last 10 months, he said that assistants brought as many as 500 documents a day to this desk at GMAC's office in Fort Washington, Pa. Some months, he would sign more than 10,000 documents related to home foreclosures. By signing the documents, he was stating that he had personally reviewed the details of each case. The problem is, according to depositions Mr. Stephan gave in December and June, he didn't really look at each case. In fact, he assumed that all the details were correct, and just signed off on each one. Mr. Stephan also noted that, when he joined GMAC in 2004, he went through a training program that lasted three days.

Federal Reserve Destroying Your Savings For Your Own Good - (finance.yahoo.com) It might seem like prices are rising wherever you look, from medical care to college tuition. Yet to the Federal Reserve, they might not be going up fast enough. The Fed says a little more inflation might be just the thing to start a chain reaction that would ultimately create jobs -- and avoid a spiral of falling prices that could damage the economy. In a statement Tuesday, the Fed avoided directly mentioning the dreaded word "deflation." But it signaled its concern that today's very low inflation might lead to actual price drops. The Fed, meeting for the last time before the midterm elections, said its measures show inflation is "somewhat below" desirable levels for the economy. That may sound strange, because inflation is often made out to be an economic evil. And it can be, when it gets out of control. But its opposite can be even worse. Once deflation takes hold, it can wreck an economy. Workers suffer pay cuts. Corporate profits shrivel. Stock values fall. People, businesses and the government find it costlier to pare debt. Foreclosures and bankruptcies rise.

Foreclosure, REO sales account for 67% of Phoenix house buying - (www.housingwire.com) In August, the greater Phoenix area witnessed the second highest level of foreclosure home sales activity this year, according to research by the Arizona State University W.P. Carey School of Business. Out of the 8,790 total resales, 3,990 (or 45%) homes were foreclosure sales —where the transaction occurred at a county auction. There were 3,865 foreclosure sales in July and 3,085 in August 2009. Coupled with REO sales, foreclosure activity made up 67% of recorded home buying activity for the month of August, according to the report.

Irish Government Loses Another Supporter, Collapse Imminent - (www.businessinsider.com) Some quick Ireland news to bring you. The ruling coalition has lost another supporter (via Lorcan Roche Kelly), MP Mattie McGrath of Tipperary South, bringing the coalition's majority to a razor thin 82-80. Once again, as with when it lost a supporter on Friday, it comes down to spending decisions. A collapse of the government seems imminent, which is exactly what the country (and all of Europe) doesn't need right now.

OTHER STORIES:

Krugman: We're Going To Have To Default On Our Debt One Way Or Another - (www.businessinsider.com)

Here's Where All That Government Spending Is REALLY Going - (www.businessinsider.com)

Shadow Inventory Signals Three Years of Falling Prices - (www.irvinehousingblog.com)

On the GMAC Foreclosure Stories - (www.calculatedriskblog.com)
No. There's no life at MERS - (www.stopforeclosurefraud.com)

Housing isnt even close to stabilizing - (www.marketwatch.com)

Foreclosures nearly 50% of Phoenix existing-house activity - (www.nationalmortgageprofessional.com)

Houses Lost To Foreclosure Jump 25% - (www.collectionscreditrisk.com)

More cracks in Toronto housing market - (business.financialpost.com)

Reserve Bank of Australia plays down obvious housing bubble - (www.businessspectator.com.au)

Housing bubble in Malaysia - (www.mysinchew.com)

The Most Affordable and Most Expensive Housing Markets - (blogs.wsj.com)

If The Market Gains 6.2%, Then It Will Officially Look Nothing Like Japan - (www.businessinsider.com)

PUTTING THE RECESSION IN PERSPECTIVE - (www.businessinsider.com)

County foreclosures increase - (www.coloradoan.com)

Foreclosure - Top Ten Things NOT To Do - (www.staugustine.com)

Ally Financial Robo-Signer may affect other mortgage companies - (www.washingtonpost.com)

Housing Kills Stock Rally - (www.bloggingstocks.com)

Tuesday October 5 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

IMF fears 'social explosion' from world jobs crisis - (www.telegraph.co.uk) America and Europe face the worst jobs crisis since the 1930s and risk "an explosion of social unrest" unless they tread carefully, the International Monetary Fund has warned. "The labour market is in dire straits. The Great Recession has left behind a waste land of unemployment," said Dominique Strauss-Kahn, the IMF's chief, at an Oslo jobs summit with the International Labour Federation (ILO). He said a double-dip recession remains unlikely but stressed that the world has not yet escaped a deeper social crisis. He called it a grave error to think the West was safe again after teetering so close to the abyss last year. "We are not safe," he said. A joint IMF-ILO report said 30m jobs had been lost since the crisis, three quarters in richer economies. Global unemployment has reached 210m. "The Great Recession has left gaping wounds. High and long-lasting unemployment represents a risk to the stability of existing democracies," it said. The study cited evidence that victims of recession in their early twenties suffer lifetime damage and lose faith in public institutions. A new twist is an apparent decline in the "employment intensity of growth" as rebounding output requires fewer extra workers. As such, it may be hard to re-absorb those laid off even if recovery gathers pace. The world must create 45m jobs a year for the next decade just to tread water. Olivier Blanchard, the IMF's chief economist, said the percentage of workers laid off for long stints has been rising with each downturn for decades but the figures have surged this time.

Fannie and Freddie: guilty? - (www.economist.com) AS A general rule of thumb, the answer to the question, "Did x cause the crisis?" is no, for all x. No one factor caused the crisis, and that's as true of the involvement of Fannie Mae and Freddie Mac in mortgage markets as it is of anything else. The right question to ask is to what extent various factors contributed to the crisis. Where Fannie and Freddie are concerned, the answer would seem to be: some, but less than many may imagine. The latest round of debate over Fannie and Freddie began with Raghu Rajan, whose book "Fault Lines" argues that government action to support housing markets was one of the major economic forces underlying the development of the crisis (alongside things like global imbalances and easy money). Responding to a review of the book by Paul Krugman, Mr Rajan wrote: Clearly, Fannie and Freddie did not originate sub-prime mortgages directly — they are not equipped to do so. But they fuelled the boom by buying or guaranteeing them.

I actually think that the evidence for Mr Rajan's argument here is somewhat weak. For a collection of responses to this particular critique, see this post by Mark Thoma. The thing is, Mr Thoma's post contains references to an alternative contributory path for Fannie and Freddie, to which I haven't heard as good an answer. He quotes Jim Hamilton on the issue, saying:

Recession's over, economists say to a skeptical public - (www.latimes.com) A declaration that the turning point came in June 2009 gets an indignant reaction, showing that many Americans see little difference between the recession and current conditions. This just in: The recession ended more than a year ago — in June 2009. That may seem perplexing, given the sour state of the economy, but the panel of experts designating when serious economic downturns begin and end typically takes a year or so to make the calls. Even so, minutes after the experts announced Monday that the worst recession in more than half a century had officially ended 15 months ago, its members felt the sting of indignant reaction from a public for whom economic pain continues to be an everyday reality. "Hallucinatory news," one blogger snapped in response to the report by the National Bureau of Economic Research, a private nonprofit research group that is considered the official arbiter of economic contractions and expansions. "I'll start believing the recession is over when I stop seeing endless numbers of people sleeping on the streets," said another.

How Serious is the GMAC Problem? Pretty Serious and Not Just GMAC - (www.nakedcapitalism.com) The news reports on GMAC Mortgage’s decision to halt evictions and foreclosure sales in 23 states, as originally reported by Bloomberg News, has generated keen interest in the mortgage and securitizaion communities. One reason is the oddly abrupt and broad nature of GMAC Mortgage’s action. GMAC Mortgage subsequently issued a rebuttal of sorts to the article. Not only did it fail to clairify matters, it is inconsistent with the actual notice it sent last week. Various accounts have described how one officer of GMAC Mortgage’s servicing unit has admitted during testimony that, while he signs thousands of affidavits each month in order to affect steps in the foreclosure process, he does not have personal knowledge of certain critical facts in the affidavit which he asserts to be true. Reader Stupendous Man provided the text of Federal Rule 56 on affidavits (although the cases in question are in state courts, the same principles no doubt apply). Boldface ours: A supporting or opposing affidavit must be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant is competent to testify on the matters stated. The key here is you can’t delegate creating affidavits to parties who weren’t close to relevant matter out of administrative convenience; you need to find people who were directly involved. And evidence in a number of foreclosure suits indicates that this problem not only extends well beyond GMAC, and is not a matter of matter of officers providing affidavits based on a review of copies of the paperwork in a transaction. As one attorney wrote:

Wall Street's greatest heist: the Tarp - (www.guardian.co.uk) The notion that without the $700bn bailout we would be reduced to bartering was a ruse by the banks to get taxpayers' money. Two years ago, the top honchos at the Fed, Treasury and the Wall Street banks were running around like Chicken Little warning that the world was about to end. This fear-mongering, together with a big assist from the elite media (thatis, NPR, the Washington Post, the Wall Street Journal, etc), earned the banks their $700bn Troubled Asset Relief Programme (Tarp) blank cheque bailout. This money, along with even more valuable loans and loan guarantees from the Fed and FDIC, enabled them to survive the crisis they had created. As a result, the big banks are bigger and more profitable than ever. Now, the same crew that tapped our pockets two years ago is eagerly pitching the line that their bailout was good for us. It may be the case that the history books are written by the winners, but that doesn't prevent the rest of us from telling the truth. Let's step back to where we were two years ago. The huge investment bank Bear Stearns had collapsed. So had Fannie Mae and Freddie Mac, the mortgage giants. Lehman Brothers, the fourth largest investment bank had also gone down. AIG, the country's largest insurer, had been put on life support by the government. At this point, Merrill Lynch, Morgan Stanley and Goldman Sachs, the three remaining independent investment banks, all faced runs that would quickly sink them without government intervention. Citigroup and Bank of America, two of the three largest commercial banks, were also almost certainly insolvent. Many other banks also faced insolvency, especially if they took big losses on their loans to other institutions that were about to go bankrupt.

OTHER STORIES:

Berkshire Hathaway's Munger approves of bailouts for the rich, but not for you - (www.Mish)
The Bush tax cuts: an entrepreneur's perspective - (www.latimes.com)
Beijing will burst its own bubble - (www.businessspectator.com.au)

A Cool Summer for Housing - (www.nytimes.com)
Government seizes 3 middle-man credit unions - (money.cnn.com)

$1,300? Some say gold may hit $2,300! - (money.cnn.com)

22% of private mortgage mods redefault - (money.cnn.com)

Foreclosures, repossessed houses still flood market - (www.savannahnow.com)
Prices coming down faster in prime California cities - (www.doctorhousingbubble.com)

Recession's end means relapse - (www.marketwatch.com)
Dow on track for the best September since 1939 - (money.cnn.com)

Flat-screen TV prices set to plunge - (money.cnn.com)

6 tech giants settle DOJ hiring lawsuit - (money.cnn.com)

GMAC Mortgage Mishandled Affidavits on Foreclosures - (www.bloomberg.com)
GMAC Halts Foreclosures in 23 States for Review - (www.nytimes.com)
What Obamacare Delivers, This Week - (www.dvorak.org)
Patient Protection and Affordable Care Act - (www.en.wikipedia.org)

Monday October 4 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Credit Union Fix May Be $9.2 Billion, Regulator Says - (www.bloomberg.com) Credit unions in the U.S. may absorb as much as $9.2 billion in losses over the next decade as the industry strives to recover from sour investments in real estate and consumer loans, U.S. regulators said today. Part of the plan to resolve the credit unions’ financial problems includes the National Credit Union Administration packaging $50 billion in distressed securities for sale as $35 billion in bonds carrying government guarantees, the agency said today. The debt will be backed primarily by bonds tied to home loans, with the first sale scheduled for next month. The NCUA already sold more liquid securities from two credit unions that failed last year: U.S. Central Federal Credit Union in Lenexa, Kansas and Western Corporate Federal Credit Union in San Dimas, California. The administration said today that it assumed control of Members United Corporate Federal Credit Union of Warrenville, Illinois; Southwest Corporate Federal Credit Union of Plano, Texas; and Constitution Corporate Federal Credit Union of Wallingford, Connecticut. “Up until this point we’ve been doing stabilizing actions,” Larry Fazio, NCUA’s deputy executive director, said in a telephone interview. “We’ve pumped some liquidity into these institutions. Our resolution is going to be the exit from these government programs.”

Lawmakers question Fannie Mae on use of 'foreclosure mills' - (www.washingtonpost.com) A trio of congressional Democrats is demanding to know why government-backed mortgage giantFannie Mae has entrusted many of its foreclosure cases to Florida law firms that stand accused of fabricating or backdating numerous court documents. These so-called "foreclosure mills," essentially law firms that specialize in representing lenders while churning out foreclosure suits quickly and efficiently, are under investigation by the Florida attorney general and are running into legal challenges in other parts of the country. According to the letter from three House Democrats - Financial Services Committee Chairman Barney Frank of Massachusetts and Corrine Brown and Alan Grayson of Florida - several firms facing scrutiny represent Fannie Mae both in foreclosure suits and in the company's pre-filing mediation program, which is designed to help borrowers and lenders talk through possible alternatives to foreclosure. "In other words, Fannie Mae seems to specifically delegate its foreclosure avoidance obligations out to lawyers who specialize in kicking people out of their homes," the group wrote Friday in a letter to the company's chief executive. "The legal pressure to foreclose at all costs is leading to a situation where servicers are foreclosing on properties on which they do not even own the note," they added. "This practice is blessed by a legal system overwhelmed with foreclosure cases and unable to sort out murky legal details, and a set of law firms who mass produce filings to move foreclosures as quickly as possible."

Banks devise new fees - (money.cnn.com) Bank fees: They're like a game of Whac-a-Mole. The minute one set is banned, a whole new set pops up. In August, the Card Act banned a variety of fees -- including certain overdraft and excessive late charges. But one month later, banks are increasing existing fees and finding creative new ways to charge customers more for credit cards, so-called "free" checking accounts and banking services. Already this year cash-advance fees and balance transfer fees have risen to 4%, up from 3% in July last year, according to a study conducted by the Pew Health Group's Safe Credit Cards Project. "It's like you've got a sinking boat, where you plug one hole and another one springs up," said Curtis Arnold, founder of CreditRatings.com. "You can shut down one egregious fee, but that doesn't mean other fees aren't just going to start popping up elsewhere." Here's a bank-by-bank look of what to expect. Bank of America: Just last week, Bank of America said it plans to raise minimum balance requirements over the next 12 months and charge a monthly account fee for customers who can't maintain those balances.

GMAC’s Errors Leave Foreclosures in Question - (www.nytimes.com) The recent admission by a major mortgage lender that it had filed dubious foreclosure documents is likely to fuel a furor against hasty foreclosures, which have prompted complaints nationwide since housing prices collapsed. Lawyers for distressed homeowners and law enforcement officials in several states on Friday seized on revelations by GMAC Mortgage, the country’s fourth-largest home loan lender, that it had violated legal rules in its rush to file many foreclosures as quickly as possible. Attorneys general in Iowa and North Carolina said they were beginning separate investigations of the lender, and the attorney general in California directed the company to suspend all foreclosures in that state until it “proves that it’s following the letter of the law.” The federal government, which became the majority owner of GMAC after supplying $17 billion to prevent the lender’s failure, said Friday that it had told the company to clean up its act. Florida lawyers representing borrowers in default said they would start filing motions as early as next week to have hundreds of foreclosure actions dismissed.

On the Secret Committee to Save the Euro, a Dangerous Divide - (online.wsj.com) Two months after Lehman Brothers collapsed in the fall of 2008, a small group of European leaders set up a secret task force—one so secret that they dubbed it "the group that doesn't exist." Its mission: Devise a plan to head off a default by a country in the 16-nation euro zone. When Greece ran into trouble a year later, the conclave, whose existence has never before been reported, had yet to agree on a strategy. In a prelude to a cantankerous public debate that would later delay Europe's response to the euro-zone debt crisis until the eleventh hour, the task force struggled to surmount broad disagreement over whether and how the euro zone should rescue one of its own. It never found the answer. A Wall Street Journal investigation, based on dozens of interviews with officials from around the EU, reveals that the divisions that bedeviled the task force pushed the currency union perilously close to collapse. In early May, just hours before Germany and France broke their stalemate and agreed to endorse a trillion-dollar fund to rescue troubled euro-zone members, French Finance Minister Christine Lagarde told her delegation the euro zone was on the verge of breaking apart, according to people familiar with the matter.

OTHER STORIES:

Iran's Nuclear Agency Trying to Stop Computer Worm - (www.cnbc.com)

US Seizes 3 Failing Corporate Credit Unions - (www.cnbc.com)

Bond holders on collision course with QE2 - (www.ft.com)

China Allows Banks to Sell Loans on Interbank Market - (www.bloomberg.com)

Malware Hits Computerized Industrial Equipment - (www.cnbc.com)

Looking Behind the Decline in Credit Card Debt - (www.cnbc.com)

Bernanke Says Financial Crisis Damage Inhibiting U.S. Recovery - (www.bloomberg.com)

China Currency Measure Set for Vote in U.S. House - (www.bloomberg.com)

Regulators shut 2 banks in U.S. - (www.reuters.com)

Obama Skewers 'Pledge to America' in Radio Address - (www.cnbc.com)

Pakistan Jet Evacuated in Sweden After Bomb Threat - (www.cnbc.com)

Sunday October 3 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Now scavengers have started stealing bricks from houses - (www.nytimes.com) By the time Raymond Feemster awoke to the pounding of firefighters at his door, flames were already licking his shotgun-style home. The vacant house next door, which neighbors said was frequented by squatters, had burst into flames and was now threatening to engulf houses on each side. Mr. Feemster, who gets around on an electric scooter, had to be carried out of the burning building, but today he considers himself lucky that the damage was contained to just two rooms. “My neighbor’s house was completely destroyed,” said Mr. Feemster, 58. “I guess it was one of the crackheads in that vacant house.” Perhaps. But the blaze, one of 391 fires at vacant buildings in the city over the past two years, may have had a more sinister cause. Law enforcement officials, politicians and historic preservationists here have concluded that brick thieves are often to blame, deliberately torching buildings to quicken their harvest of St. Louis brick, prized by developers throughout the South for its distinctive character.

Middle class running as fast as it can - (www.marketwatch.com) This recession has strangled the American middle class, but it was in a weakened state long before anyone heard of subprime mortgages. The great middle of American society has been falling for 30 years or more, a product of vast economic, social and political forces, both foreign and domestic. It won’t be restored with one congressional election, or even a presidential one. Its troubles are much more serious than that. The Census Bureau reported this week that the inflation-adjusted median household income had fallen 0.7% in 2009 to the lowest level since 1997. The typical household earned just under $50,000 a year. Read more about the increase in poverty last year. The Great Recession has taken away the small gains made during the 1980s and 1990s and ripped open wounds that were festering for 30, 35, or 40 years. The middle class is more anxious now than at any time in generations. The worries aren’t new; they are just on another level.

Defaults Account for Most of Pared Down Debt - (blogs.wsj.com) 0.08% — The annual rate at which U.S. consumers have pared down their debts since mid-2008, not counting defaults. U.S. consumers might not be quite as virtuous as they seem. The sharp decline in U.S. household debt over the past couple years has conjured up images of people across the country tightening their belts in order to pay down their mortgages and credit-card balances. A closer look, though, suggests a different picture: Some are defaulting, while the rest aren’t making much of a dent in their debts at all. First, consider household debt. Over the two years ending June 2010, the total value of home-mortgage debt and consumer credit outstanding has fallen by about $610 billion, to $12.6 trillion, according to theFederal Reserve. That’s an annualized decline of about 2.3%, which is pretty impressive given the fact that such debts grew at an annualized rate in excess of 10% over the previous decade.

GMAC denies reports of foreclosure moratorium - (www.marketwatch.com) GMAC Mortgage on Monday denied reports that it was instituting a mortgage foreclosure moratorium in 23 states. "The speculation likely emanates from a direction previously given by GMAC Mortgage to certain of its outsource vendors to allow time to address a potential issue that was raised in a number of existing foreclosures challenging the internal procedure we used for executing one or more judicially required forms," GMAC said in a statement. GMAC said that "all new residential foreclosures are continuing in the ordinary course of business with no interruption in our usual practice."

GMAC's Full Letter To Agents... Something Does Not Add Up - (www.zerohedge.com) Zero Hedge has obtained the GMAC Letter referred to earlier by Bloomberg, and contrary to subsequent reports by the bailed out lender that this is merely a procedural adjustment, something does not add up. To wit, note statements such as: Do not proceed with evictions, cash for keys transactions, or lockouts. All files should be placed on hold, regardless of occupant type. Do not proceed with REO sale closings. GMAC Mortgage will communicate instructions to the assigned agent regarding the management of the properties in Pending status. If the contract has already been executed by both parties, the Asset Manager will request an amendment to extend the closing date by 30 days or as otherwise designated by the Asset Manager. Please provide appropriate notice to the REO purchaser that, pursuant to Section 1 of the GMAC Mortgage Addendum to Standard Purchase Contract, GMAC Mortgage is exercising its sole discretion to extend the Expiration Date of the Agreement by 30 days at this time. If the REO purchaser wishes to cancel the contract, GMAC Mortgage will terminate the Agreement and return the earnest money deposit. And mostly: "There could be asset level exceptions and you will receive direct communication from GMAC on the handling of those exceptions."

In other words, the new revision is the de facto new standard, and not the exception to the rule, as GMAC's subsequent refutation would like to make it seem.

OTHER STORIES:

SF Bay Area House Sales Hit 18 Year Low - (www.sfappeal.com)

More than half of Reno-area mortgages underwater - (www.sfgate.com)

More foreclosures reason for fewer upside-down houses in Reno - (www.rgj.com)

Good News: The Great Recession is Over; Bad News: It Doesn't Feel Like It - (www.Mish)

Recession is over? Not for the housing market - (www.money.cnn.com)

Latest prices, sales figures show that US real estate market stagnating - (www.propertywire.com)

U.S. house prices will resume decline - (www.mybudget360.com)

House Equity Lines of Credit, the Next Looming Disaster? - (www.realestatechannel.com)

GMAC and Foreclosure Fraud Mess: Shit Hitting Fan - (www.nakedcapitalism.com)

Consumer debt decline because banks give up on collecting - (www.contracostatimes.com)

US Government hiding true amount of debt - (www.news.com.au)

Of Course We're Not Going To Pay Back The Chinese - (www.dailybail.com)

How Will Foreclosures Play Out in Midterms Elections? - (www.pbs.org)

House Bill Would Force Lenders to Decide on Short Sales in 45 Days - (www.dsnews.com)

Walking away from mortgage gets easier when neighbors do it - (www.tbo.com)

Their house was sold by mistake - (www.mortgage.ocregister.com)

Wall Street Bankers and the Reptiles They Resemble - (www.dailyfinance.com)

Saturday October 2 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Wells will dump soon - (www.piggington.com) email I took of an investors forum post today that is pretty interesting: "Hello, If you are receiving this email, I currently am working on your short sale file or have worked on your file in the past few months. PLEASE READ THIS WHOLE EMAIL AND FORWARD TO ANY PARTIES WHO MAY BE WORKING ON A SHORT SALE FOR WELLS FARGO.

Due to recent industry changes, we at Wells Fargo will no longer be granting any extensions for short sale close dates or postponing foreclosure/trustee sale dates. If you were issued an extension letter dated 9/14 or earlier, those extension letters will be honored, but no further extensions will be granted. Files must close by expiration date on the original approval letter or they will be removed. If your approval expires 9/15 or 9/16, you will have 48 hours to get me the final HUD for approval and close. Please let me know if you have any questions! Thank you!

Timothy A. Williams, Wells Fargo Home Mortgage Liquidation"

State, Bay Area lose more jobs in August - (www.contracostatimes.com) Fresh rounds of statewide employment cuts were reported Friday by state officials, which unleashed warnings of a double-dip downturn for the California and Bay Area job markets. "We're getting a double-dip recession in the job market," said Jeffrey Michael, director of the Business Forecasting Center at University of the Pacific. "It's not a huge dip. But it is a dip." California employers jettisoned 33,500 jobs during August, while the Bay Area lost 3,800 jobs, the state's Employment Development Department reported Friday. The numbers were adjusted for seasonal changes. "The state jobs report was surprising and disappointing," said Stephen Levy, director of the Center for Continuing Study of the California Economy. The dismal economy triggered a rise in the California jobless rate, which reached 12.4 percent in August, up from 12.3 percent in July. Even worse, the August employment erosion can't be blamed on the disappearance of Census Bureau jobs. Private sector employment losses undermined the job market more than any other factor last month, the EDD report showed. Private-industry employers chopped 24,300 jobs in California.

More Delinquent Mortgages Entering Foreclosure Pipeline - (www.realestatechannel.com) According to Jacksonville-based Lender Processing Services' (NYSE: LPS) latest First Look Mortgage Report, mortgage performance statistics derived from their database of nearly 40 million mortgage loans showed an acceleration of U.S. home loan delinquencies entering the foreclosure process in August 2010. "The fact that we're seeing foreclosure inventories rising is more a factor of process than increasing deterioration," explains Herb Blecher, Senior Vice President of LPS Applied Analytics, "Loans that have been delinquent for a historically long period of time are just now beginning to move through the pipeline. As of July 2010, the average length of time a loan in foreclosure had been delinquent was nearly 470 days." Blecher further commented, "Now, after the intensive efforts of the last year or two, remaining home retention options appear to be exhausted and servicers are beginning to process more of these seriously delinquent loans."

The Secret Election - (www.nytimes.com) For all the headlines about the Tea Party and blind voter anger, the most disturbing story of this year’s election is embodied in an odd combination of numbers and letters: 501(c)(4). That is the legal designation for the advocacy committees that are sucking in many millions of anonymous corporate dollars, making this the most secretive election cycle since the Watergate years. As Michael Luo reported in The Timeslast week, the battle for Congress is largely being financed by a small corps of wealthy individuals and corporations whose names may never be known to the public. And the full brunt of that spending — most of it going to Republican candidates — has yet to be felt in this campaign.

Banks win delay over bid to raze abandoned condo complex - (www.sun-sentinel.com) Big banking won out Thursday over a neighborhood's hopes that the city would order the demolition of an abandoned condo complex that's become a haven for crime. Debris is strewn across the 58-unit complex along the north fork of the New River. The doors and windows have been stripped away. Vandals have destroyed walls and ripped out copper wiring and plumbing. The city has been paying for metal shutters to keep away squatters. City inspectors declared the New River Condominium to be a health and fire hazard, but banks won two delays over the summer to prevent its demolition. Residents of the River Gardens/Sweeting Estates neighborhood had hoped Thursday would bring an end to the delay, but instead a city board gave banks another 32 days to try to come up with a plan to salvage the property.

OTHER STORIES:

Bernanke: Economists Haven't Delivered Recovery - (www.cnbc.com)

Bank Robbers Strap Bomb to Abducted BofA Teller - (www.cnbc.com)

Defaults Account for Most of Pared Down Debt - (blogs.wsj.com)

Wants government out of way to let housing market recover - (www.newstimes.com)

Psychology of a housing market - (www.thirdwavegroup.com.au)

The Bottom Is Still Years Away - (www.dailyfinance.com)

Housing data not expected to sparkle - (www.marketwatch.com)

Where's the Foreclosure Flood? - (www.blogs.wsj.com)

Wells Fargo Dumping Title Risk of Forclosures on Hapless Buyers - (www.nakedcapitalism.com)

Lowered price from $3.15 million to $2.6 million, to no avail - (www.baycitizen.org)

Some in China ready to drop US debt and pour money into own nation - (www.dallasnews.com)

The American economy: The great debt drag - (www.economist.com)

Why housing bubbles aren't good for you - (www.yourhome.ca)

Household Net Worth off $12.3 Trillion from Peak - (www.calculatedriskblog.com)

Middle class bailed out banks, got nothing in return - (www.Mish)

Middle class running as fast as it can - (www.marketwatch.com)

The Tax-Cut Racket: Socialism For The Very Rich - (www.nytimes.com)