House OKs controversial housing plan
Continue Reading Add comment May 8th, 2008
The House on Thursday passed a contentious foreclosure-prevention package, which still faces a veto threat from the White House and an uncertain fate in the Senate.
Archive for May 8th, 2008
“Mortgage Loan Welfare”
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Figuring out a solution to the foreclosure crisis is turning out to be a divisive issue. Nobody wants to see people get kicked out of their home, but as my wife said reading the paper yesterday “Can I get a reduction in my mortgage too?”
Congress is presently debating Rep. Barney Frank’s proposal and others to offer federal funds to restructure home loans. The Bush Administration says its against such a widespread bailout. FreedomWorks, a Libertarian non-profit with former House majority leader Dick Armey at its head, is busy drumming up opposition to such a bailout. Their AngryRenter.com Web site says its generated 44,000 emails from folks protesting the bailout to the White House.
They’ve got a funny video as well, telling the story of one guy (Bob) who bought more house than he could afford and a woman (Sally) who saved her pennies in the hopes she could buy a home down the road. “Tax Sally to bail out Bob?” the video asks. It’s what the site calls “Mortgage Loan Welfare.”
Americans split on homeowner bailout - poll
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Americans remain split on whether homeowners about to default on their mortgages should receive special treatment to help them keep their houses, according to a new CNN/Opinion Research Poll.
The Painful Cost of Foreclosure
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Everyone knows the price of foreclosure on home owners. They lose a place to live, their credit rating, whatever down payment they made, their hopes, their dreams.
New numbers from ratings agency Standard & Poors spells out the cost to mortgage investors. For the 2006 vintage of subprime loans it’s about 19% of the loan amounts outstanding.
How do they get those numbers? S&P figures an astonishing 42% of the loans made that year to borrowers with bad credit will go into foreclosure. Then it calculates that about 45% of the amount owed on those loans will be lost. Here’s the breakdown on that: 19% is lost due to the decline in the market value of the home. That’s about a $40,000 loss on a typical loan of $210,000.
Then there is the 26% lost to the costs of foreclosure. It can take a year or more to go through the whole process from when a borrower stops paying to when the house is finally sold and the lender recoups whatever money it can. There’s 13.6% of the loan amount lost in interest payments. About 3% of the home value the lender has to pay in property taxes. There’s 1% in legal fees, 6% to real estate agents, about 3% of the loan spent on home maintenance.
Nobody wins.
35 Condos at Phoenix-Area Trammell Crow Project to Hit the Auction Block
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It was only in 2006 that Trammell Crow Residential opened the sales center for the 171 luxury condominiums at The Quarter in Glendale’s $1.5 billion mixed-use Westgate City Center, but just two years later, the company has decided to go with the flow of the housing downturn and auction off the remaining 35 units. Read more »
Pinnacle Commits to 30,000-SF Flex Building
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Pinnacle Wireless will take its headquarters from Montclair to Hackensack, where it has signed a lease to occupy the entire 30,000-square-foot flex building at 80 Commerce Way. Read more »
Denver Office Building Gets Under Way with New 330,000SF
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With a 330,000-square-foot lease agreement from Xcel Energy in hand, Westfield Development Co. has just commenced construction of a 500,000-square-foot office tower in Denver’s central business district. Read more »