Archive for April, 2011

Who gets the Golden Ticket? Charlie or the Banks?

Friday, April 29th, 2011

Who gets the Golden Ticket? Charlie or the banks?Financial Times Headline: Caution urged on US bank foreclosure fines

Who gets the golden ticket? We all remember the deserving Charlie Bucket inside the chocolate factory of the eccentric chocolatier, Willy Wonka. In the end, Charlie gets the Chocolate Factory and the golden ticket.

This week’s Financial Times writer Tom Braithwaite reported a story: Caution urged on US bank foreclosure fines. The story focuses on how banks will be fined for failures that led to the foreclosure debacle. BUT…there is some sympathy and sugar coating happening. It seems regulators are pressing to avoid “dangerously large” penalties, according to one of the top officials participating in fractious settlement talks.

John Walsh, acting comptroller of the currency, told the Financial Times that he supported financial penalties for mortgage servicers, led by Bank of America and Wells Fargo, whose shoddy paperwork and improperly signed affidavits caused the repossession of delinquent borrowers’ homes to come to a grinding halt.

Here’s another BUT….

But the Office of the Comptroller of the Currency has differed with some state attorneys-general, the Federal Deposit Insurance Corporation and the new Consumer Financial Protection Bureau, which all want a more far-reaching settlement, with $20b in fines and at least some of the money used to reduce the debt owed by struggling homeowners.

The fact is this: if the government goes too light on banks; it will be an invitation for banks to continue to skirt the law and continue to believe that they are not just too big to fail, but too big to be regulated or stopped.
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Foreclosure Aid Makes Headlines, Roy Oppenheim Calls it No Quick Fix, Heartbreaking in Sun Sentinel Cover Story

Thursday, April 28th, 2011

Really just a band-aid, Florida’s Hardest Hit Program comes at a time of desperate resuscitation. With Florida’s $1 billion foreclosure prevention program just getting underway, South Florida counties lead the state in the amount of applications received, according to numbers released this week by Florida Housing officials.

In the program’s first week, 9,439 homeowners across the state applied for funds from the “Hardest Hit” program, with Broward County well ahead with 1.638, well ahead of all other counties. Miami-Dade was 2nd with just over 1,000 and Palm Beach County came in 4th with 939. Orange County was the only non-South Florida county among the top 4, and after those 4 the amount of applications drops off considerably.

Foreclosure attorney Roy Oppenheim told the South-Florida Sun-Sentinel in a cover story this week he was not shocked by those numbers.

It’s not surprising that Broward and Miami-Dade lead in applications for aid, according to Oppenhein, because those are Florida’s most populated counties.

“I hear one story after another,” he added. “It’s heartbreaking. And I don’t have a quick fix.”

However the Florida Hardest Hit Fund, which was launched April 18th by Florida Housing Finance Corp., does help homeowners get back on the right track.

You can apply for financial assistance at their official website, Flhardesthithelp.org

So what exactly does the Florida’s Hardest Hit program do?

If you’re unemployed, or don’t make enough money to cover basic living expenses, the Unemployed Mortgage Assistance Program will give you up to $12,000 to pay your mortgage and escrowed mortgage related-costs. The plan will cover you for up to six months or until you are able to start paying your mortgage, whichever comes first.
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“Welfare for the Rich” – Matt Taibbi Exposes Disgusting Practices at the Federal Reserve

Tuesday, April 26th, 2011

Roy Oppenheim and Matt Taibbi ask, why isn't Wall Street in jail?The question of the decade: Why isn’t Wall Street in jail?

In a typical jaw-dropping article for Rolling Stone Magazine The Real Housewives of Wall Street, Matt Taibbi reveals the shocking practices of the Federal Reserve during the Great Recession.

With the nation staggering, the Federal Reserve took it upon itself to lend trillions of dollars at nearly zero percent interest. Then, as collateral, the Fed took the securities that were bought with the loans. The arrangement meant that if the securities lost money, the Fed would be stuck with the losses but if the securities made money, then the investors would pay back the loans and keep the higher priced security. Privatizing gains, socializing losses, all in an effort to stimulate the economy. Such loans were not made available to everyday folks; only to the important pillars of our economy: Japanese car companies (while bailing out their competitors), Middle Eastern banks (including one later bought by Muammar Gaddafi), tax dodgers in the Cayman Islands (imagine, subsidizing tax evasion), and the spouses of Wall Street executives. No, that isn’t a typo, the wives of Wall Street executives were offered risk free loans guaranteed by you, the taxpayer.

Taibbi looks at the case of Christy Mack and Susan Karches, the wife and widow respectively of the CEO and the late president of investment banking at Morgan Stanley. While Morgan Stanley itself received over $2 trillion in Federal Reserve risk free, subsidized loans, Christy and Susan also received $220 million for their company, Waterfall TALF Opportunity. With the money, the duo bought student loans and commercial mortgages. If the loans or mortgages ever decrease in value, Waterfall effectively will not have to pay back the Fed and let the Fed keep the devalued securities.
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Media Optimism. Spring Good Time to Buy and Sell Florida Real Estate

Monday, April 25th, 2011

Will April flowers bring May showers for Florida real estate sales? While some U.S. economists are still singing doom and gloom when it comes to the real estate market, TODAY show contributor and real estate mogul Barbara Corcoran sees some positive signs for prospective buyers and sellers, South Florida Law Blog shares this optimistic outlook.

During a recent appearance on the Today Show, Corcoran talked about her optimism, and why she thinks the spring season could be a great time to buy that dream home.

She sternly disagrees with some economists opinions that real estate prices will fall another 15 to 20 percent. Well, the jury is still out on that one, but let’s look at her glass half full.

Barbara Corcoran on the Today Show

“I think they’re dead wrong,” she told host Matt Lauer, “If you actually look at all the major markets in the U.S., more than half have already come off the bottom and prices are rising.”

For buyers who are thinking of playing the waiting game hoping for lower home prices, Corcoran says don’t. While interest rates are below 5% now, she feels with the anticipated demise of Fannie Mae and Freddie Mac, they won’t stay that low for long.

The reality is, prices will likely not increase for years considering about nine months of shadow inventory that the banks must still unload! In fact, if the banks did not manage the inventory prices would indeed still be dropping.

Tips for buying and selling in today’s competitive spring market
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