Archive for February, 2010
The unabated foreclosure crisis has spawned soaring mortgage relief scams and related complaints from consumers, according to law enforcement and consumer protection authorities.
The most telling statistic was released by the Federal Trade Commission yesterday in its annual review, which reported that nearly 1 million fraud and identity theft complaints were filed last year.
In the category of “mortgage modification/foreclosure relief,” only 1 complaint was filed in 2008. That number rocketed to 7,927 last year, the FTC said. And those likely represent a fraction of all such scams or other issues with foreclosure rescue services, since more cases than not go unreported.
Despite another expected increase in total U.S. timeshare ABS delinquencies and monthly defaults, total delinquencies fell compared to the same period last year for the first year-over-year (YOY) improvement since August 2007, according to the latest timeshare ABS index from Fitch Ratings.
"Delinquency and default levels are still above historical norms and figure to weaken further throughout the rest of the winter," said Director Brad Sohl. "As such, Fitch expects continued declines in asset performance, though ratings should remain stable."
Fourth quarter-2009 (4Q'09) total delinquencies were up to 4.89% from 4.64% at the end of 3Q'09, following seasonal patterns typically seen in timeshare ABS. However, delinquencies decreased by approximately 5% from 5.13% in 4Q'08.
Morgan Stanley’s John Klopp taught commercial property financing a decade before Wall Street tied its fortunes to mortgage securities.
Klopp, who took over as Morgan Stanley’s head of investing in Americas real estate and global property debt Feb. 1, introduced Columbia University students to hedging risk and using short-term debt to finance commercial property deals as early as 1991.
It would be another 13 years before packaging commercial property loans into bonds became a $100 billion-a-year business that produced profits for Wall Street and lowered borrowing costs for real estate investors. In 2007, the easy credit that fueled a doubling of commercial property prices over five years slammed to a halt as part of a worldwide recession.
The meltdown sent interest rates soaring and availability shrinking, but rates are declining and lenders are more willing to make loans that top the limits for Freddie Mac, Fannie Mae and the FHA.
Rates on jumbo mortgages — loans of more than $729,750 in counties with the highest-cost housing — shot up during the financial crisis as lenders and loan investors shunned anything tainted with even a whiff of higher risk. Rates on big mortgages were especially high relative to those on smaller loans.
But in a boon for borrowers in California's expensive housing markets, the jumbo-loan market is starting to return to normal.
Imagine leather furniture, wide-screen plasma televisions, pools, beach volleyball courts, day spas, tanning booths, theaters and concierges.
Were you thinking resort hotel? Nope. This is today's college crash pad.
There's an investment opportunity here. The recession is grinding on painfully for owners of apartments office properties, hotels and shopping malls. But owners of student housing face far less distress. What's more, two of the biggest players in student housing are publicly traded real estate investment trusts.
The economy is showing signs of life around the world and in Great Britain, but risks to the outlook are still weighted to the downside, Bank of England Governor Mervyn King told a parliamentary committee Tuesday.
"There have been some signs of a recovery in demand around the world, and also at home," King told the House of Commons Treasury Committee in prepared remarks. "But this nascent recovery is fragile."
Mortgage rates, which many feared would rise sharply when the Federal Reserve stops propping up the market at the end of March, may actually not budge much at all, analysts say.
But the longer-term impact of the Fed's pullback from the mortage market is less certain, they add.
