Archive for July 15th, 2008
Continue Reading July 15th, 2008
Call it the Indymac massacre. It’s the second largest bank failure in US history. Many of the unfortunate souls who put their hard-earned dough in Indymac’s high-paying cds have been lining up in the hot sun to get their money out over the past two days. We all know the US government insures deposits up to $100,000. But apparently 10,000 folks chose to keep even more than that with them.
It’s interesting to note that Indymac was once a part of now defunct Countrywide. The firm was once called Countrywide Mortgage Investments. It was created as a place to hold the jumbo mortgages that even Countrywide—more conservative at the time—didn’t want to trade in. Countrywide co-founder Angelo Mozilo served at the top of Indymac for years, as did his brother Ralph. The company was spun off officially in 1997.
Eventually Indymac grew completely independent. It acquired a bank charter, used the Internet aggressively, both to gather deposits and make loans. Its specialty was Alt-A loans, those in which the borrower didn’t have to provide the usual documentation.
At their peak a year or so ago, Indymac shares hit $50. Today they’re worthless. At least Countrywide shareholders got a few dollars in Bank of America stock. And they now have one less competitor to worry about! Of course the biggest loser is us taxpayers who may be on the hook for as much as $8 billion.
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Continue Reading July 15th, 2008
Buying a co-op in Manhattan is ridiculously expensive but still affordable for Wall Street employees whose large salaries and bonuses allow them to live a comfortable New York life.
But whether they’ll qualify to buy a co-op is another story.
The layoffs on Wall Street have spooked co-op boards and lenders who now see employees of investment banks and other financial institutions as risky prospects, according to The New York Times.
This could be bad news for Manhattan real estate, one of the only markets in the country that hasn’t yet been hit by the housing slump. Workers in the financial sector make up about 25% to 30% of Manhattan buyers, according to Halstead Property.
In the past, Wall Street workers would count most or all of their year-end bonuses to qualify for mortgages, often borrowing amounts that covered 90 percent or even 100 percent of the purchase price of high-end condos. Now, some lenders allow buyers to count just a third of their bonus. A banker who qualified for a $3.75 million mortgage a year ago based on a $250,000 salary and a $1 million bonus now qualifies for only a $1.8 million mortgage with the same salary and bonus.
At the same time, some lenders are demanding 25 percent down, rather than just 10 percent. Thus, a banker who went to contract on a $4 million apartment a year ago with a $400,000 down payment now has to come up with $600,000 more to close the deal.
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Continue Reading July 15th, 2008
The federal government’s plan to rescue Fannie Mae and Freddie Mac won support from some experts and politicians Monday but did not fully assure investors in the beleaguered mortgage finance giants.
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Continue Reading July 15th, 2008
The fate of Fannie Mae and Freddie Mac may be hanging in the balance but many mortgage borrowers already find themselves struggling to find affordable loans.
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Continue Reading July 15th, 2008
Seattle-based Nordstrom Inc. has signed a letter of intent to open a new Nordstrom store at Santa Monica Place in Santa Monica, Calif. Read more »
Continue Reading July 15th, 2008
New York City Governor David Paterson announced IMB Corp.’s intention to invest $1.5 billion in certain upstate New York projects with the state donating $140 million in development grants, Reuters reported today. The financing is expected to generate 1,000 high-tech jobs, according to the paper. Read more »
Continue Reading July 15th, 2008
CB Richard Ellis has negotiated the sale of The Boardwalk at Andersen Springs, a 92,231-square-foot retail center located at 1949-1989 W. Ray Road in Chandler, Ariz. Read more »
Continue Reading July 15th, 2008
The unfavorable lending market is not holding everyone back. The Macerich Co. recently closed $895 million in financing on five retail properties and secured a commitment for a $150 million loan on a sixth asset. Read more »