One Million Homeowners May Get Mortgage Writedowns - News and Current Events | futures trading

Go Back

> Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events

One Million Homeowners May Get Mortgage Writedowns
Started:January 19th, 2012 (05:24 PM) by kbit Views / Replies:160 / 0
Last Reply:January 19th, 2012 (05:24 PM) Attachments:0

Welcome to

Welcome, Guest!

This forum was established to help traders (especially futures traders) by openly sharing indicators, strategies, methods, trading journals and discussing the psychology of trading.

We are fundamentally different than most other trading forums:
  • We work extremely hard to keep things positive on our forums.
  • We do not tolerate rude behavior, trolling, or vendor advertising in posts.
  • We firmly believe in openness and encourage sharing. The holy grail is within you, it is not something tangible you can download.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community. It's free and simple, and we will never resell your private information.

-- Big Mike

Thread Tools Search this Thread

One Million Homeowners May Get Mortgage Writedowns

Old January 19th, 2012, 05:24 PM   #1 (permalink)
Elite Member
Aurora, Il USA
Futures Experience: Advanced
Platform: TradeStation
Favorite Futures: futures
kbit's Avatar
Posts: 5,839 since Nov 2010
Thanks: 3,275 given, 3,321 received

One Million Homeowners May Get Mortgage Writedowns

About one million American homeowners would get writedowns in the size of their mortgages under a proposed deal with banks over shady foreclosure practices, U.S. Housing and Urban Development Secretary Shaun Donovan said Wednesday.

The deal, which could be struck within weeks, would mark the largest cut in the mortgage load since the start of the credit crisis.

"We're very close to a settlement that would both fix the servicing problems, but also help over a million families around the country stay in their homes and get help," Donovan said at a U.S. Conference of Mayors meeting in Washington.

Talks involving federal officials, state attorneys general and major banks to resolve allegations of "robo-signing" and other misconduct in foreclosures have dragged into their second year.

Donovan's announcement came the same day that two big regional U.S. banks disclosed they had set aside funds related to mortgage servicing matters, a sign that lenders beyond the five largest mortgage servicers may join the expected settlement.

In exchange for between $20 billion to $25 billion in relief to distressed homeowners, the banks — Bank of America
Please register on to view futures trading content such as post attachment(s), image(s), and screenshot(s).
] — will put behind them potential government lawsuits about improper foreclosures and abuses in originating and servicing the loans.

Using Donovan's estimate, the settlement could provide roughly a $20,000 reduction each for the one million borrowers.

Prior administration efforts to jumpstart the housing recovery have fallen short of how they were promoted. Some states, including California and New York, have criticized negotiators as being too lenient on the banks and suggested the proposed settlement would not provide enough relief to the housing market.

The Obama administration has seen the broader foreclosure settlement as an opportunity to help reach more borrowers struggling financially as the five-year collapse in home prices persists.
Currently, banks have granted at-risk borrowers principal reductions on a limited basis.

"Principal reduction can have a substantial impact on the housing market nationally," Donovan said.
With more than a 30-percent decline in home prices since 2007 and a huge number of vacant, foreclosed homes flooding the market, the housing sector has struggled to rebuild itself. About 22 percent of U.S. homes have negative equity totaling about $750 billion, according to CoreLogic.

Donovan said the deal would be "far and away the largest principal reduction of the crisis" and a number families would also "get direct compensation as a result of the settlement."

Limited Impact
Any settlement would not apply to mortgages owned by Fannie
Please register on to view futures trading content such as post attachment(s), image(s), and screenshot(s).
, which together own or guarantee most of the U.S. mortgage market.
The regulator that controls the two government-sponsored enterprises has resisted cutting their loans, arguing it would cost U.S. taxpayers more money than other options would.

But lawmakers and top administration officials have pushed for a broader principal reduction program, and this settlement could lay the groundwork for that if Fannie Mae and Freddie Mac are swayed to test it out themselves as an alternative to the costly process of foreclosing on struggling borrowers.

Earlier Wednesday, House Democrats sought to force the housing regulator, the Federal Housing Finance Agency, to explain its calculations in deciding not to offer principal reductions.

In addition, the Federal Reserve said in a rare 26-page white paper delivered to Congress this month that lawmakers need to do more to stabilize the housing market.
But it stopped short of endorsing any plans to have Fannie and Freddie slash borrowers' loan balances.

Obama Strategy
The Obama administration in coming weeks will step up its efforts to help the ailing housing market by expanding current policies aimed at helping communities plagued by high unemployment and widespread foreclosures, the housing secretary said.

"You will hear a president who is going to be aggressive on housing, on the issues of refinancing and principal writedown," Donovan said.
The White House will lay out a strategy that includes pilot programs to test new initiatives, such as a government plan to convert foreclosures into rentals.

Donovan said the White House is aiming to get more creative in how it contends with the excess inventory of unsold foreclosed homes on the books of government-run Fannie Mae and Freddie Mac.
Regulators have been seeking ways to reduce the number of foreclosed properties by pooling them together for bulk sales to investors. The goal is for investors to then rent them out.

The administration also wants to move ahead with a plan dubbed "Project Rebuild," which is a piece of Obama's American Jobs Act that aims to get construction workers to rehabilitate vacant properties.

Donovan said the $15 billion neighborhood stabilization program would create 200,000 jobs and be used to renovate thousands of vacant homes and properties around the country.

News Headlines

Reply With Quote

Reply > Futures Trading, News, Charts and Platforms > Traders Hideout > News and Current Events > One Million Homeowners May Get Mortgage Writedowns

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Upcoming Webinars and Events (4:30PM ET unless noted)

NinjaTrader 8: Programming Profitable Trading Edges w/Scott Hodson

Elite only

Anthony Drager: Executing on Intermarket Correlations & Order Flow, Part 2

Elite only

Adam Grimes: Five critically important keys to professional trading

Elite only

Machine Learning Concepts w/FIO member NJAMC

Elite only

MarketDelta Cloud Platform: Announcing new mobile features

Dec 1

NinjaTrader 8: Features and Enhancements

Dec 6

Similar Threads
Thread Thread Starter Forum Replies Last Post
JPMorgan sued for $95 million over mortgage securities kbit News and Current Events 0 January 3rd, 2012 02:18 PM
More than 1 in 4 homeowners now 'underwater' kbit News and Current Events 0 November 8th, 2011 08:41 PM
Some Homeowners Get Break On Mortgage—Without Asking Quick Summary News and Current Events 0 July 3rd, 2011 10:20 AM
Delinquent Homeowners to Get Mortgage Aid from Government Quick Summary News and Current Events 0 June 4th, 2011 06:30 PM
More Homeowners Underwater on Their Mortgages Quick Summary News and Current Events 0 May 9th, 2011 11:30 AM

All times are GMT -4. The time now is 07:19 PM.

Copyright © 2016 by All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts

Page generated 2016-10-26 in 0.09 seconds with 19 queries on phoenix via your IP