Congresswoman Maxine Waters, D-Calif., sent a letter Tuesday to Christy Romero, Special Inspector General for the Troubled...
Private-label residential mortgage-backed securities are failing to trade at investor auctions at the fastest pace this year as...
Monday Morning Cup of Coffee takes a look at news crossing HousingWire's weekend desk.
Things are shaking up as the Federal Deposit Insurance Corp. civil lawsuit against IndyMac gets under way. Three former executives of the Pasadena, Calif.-based housing lender are being charged with negligence in approving 23 ill-advised homebuilder loans.
Scott Van Dellen, Richard Koon and Kenneth Shellem oversaw IndyMac’s homebuilder division. The former executives approved loans that were never repaid by homebuilders or developers, which cost the bank about $170 million.
"They violated their duties to the bank," said Patrick J. Richard, the lawyer representing the FDIC. "They violated standards of safe and reasonable banking."
However, the former IndyMac executives protested and said that during the time, regulators and their superiors approved the loans.
The trial represents the continued actions of federal authorities pursuing civil damages against key companies and institutions. A previous example was the Securities and Exchange investigation of Countrywide Financial Corp.
Several state and federal prosecutors have also filed civil lawsuits against other big bank companies in the home lending sector including Bank of America, Wells Fargo, Citigroup and JPMorgan Chase for fraud and recklessness, which costs investors and taxpayers billions of dollars.
To read the full LA Times article click here.
The US Department of Treasury continues to aid those left in the aftermath of Hurricane Sandy. The Treasury provided support to individuals and businesses effected by the hurricane with services such as existing mortgage forbearance, activated and authorized housing, and tax relief programs.
Under the Making Home Affordable Program guidelines, servicers must provide eligible homeowners and businesses at least three months of forbearance if requested.
The tax relief program also offers various services, including postponed filing deadlines, leave-based donation programs and low-income housing.
This week, Fannie Mae and Freddie Mac will also put their hurricane relief guidelines into action. The government-sponsored enterprises are providing similar Treasury guidelines including mortgage forbearance and waiving fees.
Bay Area real estate investors are snatching up as many homes as possible before rising housing prices beat them to the punch. The nine counties in the area have seen an increase in affordable, foreclosed homes. As a result, investors are buying the distressed residences to fix and flip or hold and rent out.
Investors are focusing on areas affected most by the downturn, such as Solano County.
"There is a tsunami of money coming into the market, billions of dollars to buy distressed single-family homes," said Jeff Lerman, a San Rafael real estate lawyer. "The window of opportunity is rapidly closing (as prices rise). Over the next 18 months, profit margins in single-family opportunistic buying will be compressed quite a bit."
DataQuick researchers found that absentee buyers – those who have their property tax bills sent to a different mailing address then the home recently purchased – account for about 25% of home purchases in the Bay Area this year.
Speaking of property investors....
The IPD U.S. Quarterly Property Index produced a consistent return of 2.5% for the third quarter. This continues the stable return trend for the past three quarters. The steady return is a result of progressive appreciation throughout the year, with 1.2% for the quarter.
Retail and residential sectors outperformed the IPD Index, with 2.7% in retail and 2.6% in residential. Total returns for 3Q12 was 10.8%, compared to 16.5% a year prior.
The Federal Deposit Insurance Corp. recorded no new bank failures this past week.
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