Margert in the News
U.S. Housing Crisis also
Hitting the Wealthy
The Full Story
Sun Dec 7, 2008 11:31am EST, By Nick Carey
HINSDALE, Illinois (Reuters) - Less than a year ago, few people in this
affluent Chicago suburb expected the subprime U.S. housing crisis would hit
close to home.
"We thought Hinsdale was virtually immune and we wouldn't see any foreclosures,
but we have," said Dave Hanna, managing partner of Chicago-based Prudential
Preferred CRE and president of the Chicago Association of Realtors. "Nowhere is
immune."
With a pretty red-brick downtown lined with stores, good schools and a railway
line to nearby Chicago, Hinsdale has been popular among wealthy doctors, lawyers
and executives.
It has also seen a 37 percent jump in foreclosure filings this year, according
to research firm RealtyTrac, and local data shows the average home sale price
has fallen to $1.07 million from $1.15 million in September 2007.
The consequences of years of devil-may-care mortgage lending during the U.S.
housing boom were first felt among America's poorer home owners. But if that is
where it started, it did not stop there.
"People think this is just a lower-income problem," said Mabel Guzmann, a
Century 21 realtor in Chicago. "It's not."
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Fannie Mae to End Tenant
Evictions in Foreclosures
The Full Story
The Wall Street Journal, December 15, 2008
By Kelly Evans
Fannie Mae is finalizing a national policy that will allow tenants to remain in
their homes even if their landlord goes into foreclosure -- a landmark decision
for tenants.
The policy will be in effect Jan. 9, Fannie Mae said Sunday, and reflects
growing pressure on the mortgage company from a legal-aid group that threatened
to sue over recent evictions. The company said it will also ensure its current
holiday moratorium on new evictions is being followed until the new policy takes
effect.
"We're delighted that Fannie Mae has agreed
to change their policy," said Amy Marx, an attorney with New Haven Legal
Assistance in Connecticut. "And we're hopeful others will follow suit."
In late November Fannie Mae and Freddie Mac said they would suspend tenant
evictions temporarily during the year-end holidays. New Haven Legal Assistance
said that despite the pledge, Fannie Mae was proceeding with more than a dozen
new eviction cases in Connecticut. The advocacy group said the evictions would
violate legislation passed earlier this year to rescue the two mortgage-finance
giants that required them "to permit bona fide tenants who are current on their
rent to remain in their homes under the terms of their lease."
In his letter Sunday to the New Haven group,
Fannie Mae General Counsel Curtis Lu wrote: "As far as we know, this will be the
first nationwide program of its kind." Copies of the letter were sent to
Christopher Dodd (D., Conn.), chairman of the Senate Banking committee and
Barney Frank (D., Mass.), House Financial Services Committee chairman.
Freddie Mac hasn't announced a similar policy reversal, though a spokesperson
said they are "currently evaluating additional actions."
The decision by the government-backed mortgage giants represents just a slice of
the market and excludes many properties purchased with riskier loans that are
now falling into foreclosure. Fannie Mae and Freddie Mac, however, are uniquely
structured to be able to address the issue, which effectively now has them
acting as a type of landlord or property-management company to administer
month-to-month leases to renters of their foreclosed properties.
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Regulators Adopt New
Credit Card Rules
The Full Story
By MARCY GORDON, Associated Press
Last updated: 6:35 p.m., Thursday, December 18, 2008
WASHINGTON -- Federal regulators on Thursday adopted sweeping new rules for
the credit card industry that will shield consumers from increases in interest
rates on existing account balances among other changes.
The rules, which take effect in July 2010, will allow credit card companies to
raise interest rates only on new credit cards and future purchases or advances,
rather than on current balances.
Amid the economic crisis and rising job losses, consumers -- even those with
strong credit records -- have been defaulting at high levels on their credit
cards. Banks already battered by the mortgage and credit crises have been
bleeding tens of billions in red ink from the losses.
The rules were approved by the Federal Reserve, the Treasury Department's Office
of Thrift Supervision and the National Credit Union Administration. The changes
mark the most sweeping clampdown on the credit card industry in decades and are
aimed at protecting consumers from arbitrary hikes in interest rates or
inadequate time provided to pay the bills.
"The revised rules represent the most comprehensive and sweeping reforms ever
adopted by the (Federal Reserve) for credit card accounts," Fed Chairman Ben
Bernanke said in a statement. "These protections will allow consumers to access
credit on terms that are fair and more easily understood."
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New FHFA Mortgage Modification Program Announced
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Act Now to Prevent Foreclosure
The Federal Housing Finance Agency, the regulator of Fannie Mae and Freddie
Mac, recently announced a new Streamlined Modification Program that is designed
to help struggling borrowers avoid foreclosure by having Fannie Mae work with
mortgage servicers to modify loans into more affordable terms.
You may qualify if all of the following are true:
*
Your mortgage loan is owned by Fannie Mae or Freddie Mac.
*
Your mortgage loan is 90 or more days past due.
*
You occupy the property as your primary residence.
*
You are not in bankruptcy.
To achieve a more affordable mortgage payment, your loan servicer may:
*
extend the term of your loan to as much as 40 years
*
reduce your mortgage interest rate for a period of time
*
defer payment of part of your principal, or
*
offer a combination of all three.
What You Can Do Today
If you are about to fall behind, or have fallen behind on your mortgage
payments, or if your loan has been referred to an attorney, the most important
step you can take is to get help early from your mortgage lender, servicer, or
housing
counselor.
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