Archive for December, 2010
The Obama administration has begun monitoring the high-level board meetings of nearly 20 banks that received emergency taxpayer assistance but repeatedly failed to pay the required dividends, according to Treasury Department officials and documents. And it may soon install new directors on some of their boards.
The moves come as the number of banks that failed to make at least one dividend payment to the government rose to 132 in the last quarter. These "deadbeats," as they are sometimes called, are virtually all community lenders and collectively received billions of dollars in taxpayer assistance.
In addition to those firms, seven others have failed, resulting in the total loss of the government's investment.
In the midst of the holiday season, no one wanted to be here.
Yet hundreds of people — homeowners, tenants, landlords — mobbed the fifth floor of Boston Housing Court on a recent Thursday, shuffling into courtrooms on what is unofficially known as eviction day.
The homeowners facing eviction have already lost their houses to foreclosure but will not move willingly, clinging to a desperate hope that they can stave off eviction and find a way to buy back their homes.
The prospects are dim. Few, if any, can even afford a lawyer.
If foreclosure is the final chapter of homeownership, a court eviction hearing is the weary epilogue.
America's community banking crisis may go down as one of the biggest nonevents of the current financial crisis.
This is, perversely, both an indictment and a testimony to the regulatory system charged with overseeing our financial institutions and protecting consumers.
"FDIC Friday" has been a fixture on the calendar since 2008. That's the day dark-suited staff from the Federal Deposit Insurance Corp. quietly swoop into a city to shut down a troubled bank. It's happened almost 300 times during the past two years, with 2010 seeing the most bank failures in almost two decades.
The average interest rate on a 30-year, fixed mortgage fell to 4.38% in November from 4.5% the prior month, according to the Federal Housing Finance Agency.
The average for an adjustable-rate mortgage declined to 4.42% last month from 4.49% in October. The agency bases its average rates on purchase mortgages of $417,000 or less that closed the week ended Nov. 30. Rates typically are set a month to a month and a half before close, so these FHFA average rates indicate market conditions of mid to late October.
The rate on the composite of all home loans in November slid to 4.35% from 4.44% the month earlier, according to the FHFA. The effective rate, including amortization of fees and charges, declined to 4.46% from 4.57% in October.
The average home loan declined to $214,800 last month from $215,000 in October. The FHFA said 28% of purchase mortgages in November didn't have any points, down from one-third of all purchase loans the prior month. The average loan-to-price rose 2.6% in November to 74.8% from 72.2% in October.
Write to Jason Philyaw.
The average price of a single-family home fell 0.8% in October from a year earlier, and prices dropped in all 20 largest metropolitan areas during the month, according to the Standard & Poor's/Case-Shiller index.
The ratings agency's benchmark 20-city composite index has declined for five consecutive months and prices are now back at levels comparable to the middle of 2003.
The 20-city composite index declined 0.7% in September and was down 1.5% for the third quarter. The 10-city composite index inched up 0.2% for October from the year ago, buoyed by increases in Los Angeles, San Diego, San Francisco and Washington. Meanwhile, prices in six markets — Atlanta, Charlotte, Miami, Portland, Ore., Seattle and Tampa — dipped to the lowest level since the current declines began in 2006 and 2007, according to Standard & Poor's.
"The double-dip is almost here, as six cities set new lows for the period since the 2006 peaks. There is no good news in October’s report. Home prices across the country continue to fall," said David Blitzer, chairman of the index committee. "The trends we have seen over the past few months have not changed. The tax incentives are over and the national economy remained lackluster in October."
The 10-city index fell 1.2% on a non-seasonally adjusted basis in October from September and 20-city composite index dropped 1.3%, with declines in all 20 metropolitan areas month over month. Atlanta saw the steepest decline at 2.9% and three-fourths of the areas experienced decreases of more than 1%, according to Standard & Poor's.
"Existing homes sales and housing starts have been reported for both October and November, and neither is giving any sense of optimism," Blitzer said. "On a year-over-year basis, sales are down more than 25% and the months’ supply of unsold homes is about 50% above where it was during the same months of last year. Housing starts are still hovering near 30-year lows. While delinquency rates might have seen some recent improvement, it is only on a relative basis. They are still well above their historic averages, in both the prime and sub-prime markets."
Write to Jason Philyaw.
