From Inman News:
With an industry database showing a 30 percent increase in loans involving suspected mortgage fraud in 2006, the Mortgage Banker’s Association is asking Congress to set aside $31.25 million over five years to hire more FBI investigators and prosecutors.
In its annual mortgage fraud report, the Mortgage Asset Research Institute (MARI) said the sharp increase in mortgage fraud is partially because lenders are finding more cases of fraud in loans originated in 2006. But the slowdown in the housing market has also helped reveal fraud cases previously masked by strong price appreciation.
After a loan is approved, it’s unlikely to be reported as fraudulent as long as borrowers continue making payments. But a slowdown in home-price appreciation has fueled delinquencies and defaults nationwide, as borrowers find themselves unable to refinance loans with balances that approach or exceed the value of their homes.
Once a loan becomes delinquent, a lender may discover that it was made under false pretenses.
The most common type of fraud in 2006 originations involved falsified employment histories and exaggerated income, MARI said.
Florida topped the MARI fraud index, followed by California, Michigan, Georgia, Utah, New York, Illinois, Minnesota, Colorado and Nevada.
…
In a letter to members, MBA president and chief executive officer Jonathan Kempner said that suspicious activity reports to federal regulators related to mortgage fraud have risen from 3,515 per year in 2000 to more than 28,000 in 2006, representing losses of about $1 billion.Those numbers likely represent “only the tip of the iceberg,” Kempner wrote, because the Treasury Department’s Financial Crimes Enforcement Network (FinCEN) collects reports only from federally insured lenders, not independent mortgage lenders.
…
States with the fastest growth in mortgage fraud reports during the first quarter of 2006 were New Jersey (up 250 percent from the same period in 2005), California (214 percent), Arizona (213 percent) and New York (187 percent).
From Bloomberg:
Foreclosures Spur Ohio-Led States to Rescue Homes From Default
Willis Blackshear combs through Ohio mortgage filings looking for time bombs to defuse.
The Montgomery County recorder, who oversees real estate filings in Dayton, is searching for loans with balloon payments, or interest rates that may soon rise to unaffordable levels. He has found more than 3,100 in Montgomery where 540,000 residents possessed the state’s second-highest foreclosure rate last year.
“It’s crazy,” said the 46-year-old Blackshear. “I knew it was bad, but I didn’t know it was this bad.”
The worst housing slump since the Great Depression is driving Ohio and 20 other states to propose consumer protection laws and bond sales that would help homeowners stem the escalating defaults. Ohio, with the third-highest foreclosure total in the U.S. last month, is raising $100 million to help homeowners refinance risky mortgages. New York, New Jersey and Pennsylvania are planning similar sales.
Was a bit surprised to read:
“The worst housing slump since the Great Depression”
Off topic, but interesting nonetheless. From Bloomberg:
China’s Stocks `Must Be a Bubble,’ Li Ka-shing Says
China’s stock valuations are “too high” at 50 to 60 times earnings and prices are likely to decline, according to Li Ka-shing, the world’s ninth-richest man.
“There must be a bubble,” Li, 78, said at a press briefing in Hong Kong following the annual general meeting of Cheung Kong Holdings Ltd., his flagship property company. “As a Chinese, I’m worried about the stock market in China.”
Consumer Spending Could Be Out of Gas
Rising gas prices finally are prompting some to cut spending. Could too much thrift hurt the economy?
http://www.businessweek.com/bwdaily/dnflash/content/may2007/db20070517_636305.htm?chan=rss_topStories_ssi_5
We’re starting to see a more subdued consumer,” says Gary Drenik, BIGresearch’s president and CEO. “A lot of households have a fixed income and no savings, and rising gas prices are a shock to the system. It’s wreaking havoc with their budgets, so they’re hunting for ways to cut back.”
yes, now lets bail out the deadbeats
from the blowout, with , yu got it, taxpayers money. NJ , the leading welfare
state. NJ is now the gateway for the
new arrivals.
The first stop is the welfare station to
get on the arm.
KL,
Now I know what you were talking about when you asked about iGoogle. Noticed it for the first time this morning when I was doing some news hunting.
jb
pesche (5)-
Why don’t you move to Idaho? Your Aryan Nation brethren need you.
Clotpoll Says:
May 17th, 2007 at 7:30 am
pesche (5)-
Why don’t you move to Idaho? Your Aryan Nation brethren need you.
THis is typical NJ-sian snobbish behaviour – Idaho is beautiful, IF i could find a semi-decent job there I’d move from NJ in a heart beat – I might in a future.
Cheaper To Rent
http://www.forbes.com/home/personalfinance/2007/05/16/real-estate-buy-rent-pf-ii-in_dp_0516realestate_inl.html
Sorry if a repost
Speaking of Aryan Nation, I have a bizarre story.
I was driving home from work on Tuesday, and as I was heading north up 1&9 past Newark airport I got stuck behind a minivan. After a few seconds I realized that draped in the back of the car was a Confederate Flag! Long story short….when I finally had a chance to pass the car, I checked out the driver – African-American!!??
JB [2],
That damn D word keeps popping up.
From MarketWatch:
U.S. jobless claims fall to lowest level since early Jan.
First-time claims for state unemployment benefits declined again in the latest week, the Labor Department reported Thursday. The number of initial claims in the week ending May 5 fell 5,000 to 293,000. It’s the lowest level since the week ended Jan. 13. The consensus forecast of Wall Street economists was for claims to rise to 310,000. Claims in the previous week were revised to a decrease of 8,000 to 298,000 compared with the initial estimate of a fall of 9,000 to 297,000. The four-week average of initial claims fell 12,000 to 305,500. This is the lowest level since April 2006. Meanwhile, the number of Americans receiving state jobless benefits fell 78,000 to 2.47 million in the week ending April 28. The four-week moving average of continuing claims fell 14,000 to 2.53 million.
Bernanke speaking on subprime at 9:30am eastern.
jb
pesche # 5,
Yes, and if you change your status to “illegitimate émigré”, you get even more freebees!!
Off Topic
From the Bergen Record:
Random drug tests expanding in schools
River Dell and Lakeland regional high schools are expected to adopt sweeping random drug testing programs next week, joining a growing number of New Jersey districts with similar policies.
Under the programs, any student who participates in a club, plays for a team or has a parking permit at the school is subject to testing for a variety of illegal substances, including alcohol, marijuana, steroids, cocaine, ecstasy and amphetamines, among others.
This is the first I’ve heard of ANY school drug tests. I have to read the papers slower. More at the link above, Rich
people who lied about their incomes are going to get bailed out by the gubmint? is fraud no longer a crime?
10Y yield up sharply this morning.
jb
well, i might be wrong on many issues (pc word) but i am right on NJ being a welfare
state.
and oh, by the way, for all you libs out
their , the nj taxpayers have had their
pockets picked .
Housing in NJ, good luck. It’s still priced
to high. Tax relief will save it.
#15 Rich it is true, and I have already said my child will not be tested.
If they are going to do drug testing, than test everybody, including teachers and administrators.
But then this is the Peoples Republic of NJ.
From MarketWatch:
Bernanke: Limited impact from subprime on economy
Bernanke: Fed looking at new rules for mortgage lenders
Bernanke: Markets allocate credit better than regulators
Bernanke sees further downside in housing market
From MarketWatch:
Benanke sees limited impact of subprime mess on economy
The slowdown in the housing market probably has further to run, but it won’t have a significant impact on the rest of the economy, Federal Reserve Chairman Ben Bernanke said Thursday. Addressing a conference on bank structure at the Chicago Federal Reserve Bank, Bernanke promised that the Fed and other federal bank regulators have actively looking at tightening up the rules for mortgage lending to prevent the kinds of abuses that have been seen in the past few years. “Combating bad lending practices, including deliberate fraud or abuse, may require additional measures,” he said. However, “in the long run, markets are better than regulators at allocating credit.”
Market allocates credit better than regulators? Really? When did that happen?
Full text of Bernanke’s speech can be found here:
The Subprime Mortgage Market
Didn’t get a chance to read it yet..
jb #17,
Is China diversifying their assets?
#15 Rich: The articel states that River Dell according to an annoymous survey has a higher incidence of alcohol, pot an cocaine use than the national average; the realtors are not going to like that.
Bernanke Promises Fed Crackdown on Abusive Mortgage Lending Practices
http://biz.yahoo.com/ap/070517/bernanke_mortgages.html?.v=6
Bernanke is still talking. I wonder if he’s taking questions afterwards.
from 23
Credit market innovations have expanded opportunities for many households. Markets can overshoot, but, ultimately, market forces also work to rein in excesses. For some, the self-correcting pullback may seem too late and too severe.
pesche (18)-
My disagreement with you is not over NJ’s being a welfare state. It is.
My objection is to your constant rush to lay all the associated problems at the feet of one of a selection of non-white ethnic groups. It takes two to tango, and it’s a dead-on fact that the out-of-control illegal immigration problem has been fueled by tens of thousands of extremely white people- from small business owners to CEOs- who profit greatly from a cheap, undocumented source of labor.
I also get the sense that you’d be the first to complain about $7 heads of lettuce at Shoprite if we could round up all the illegals and send them away.
bernanke.. rough quote..
sales peaked september 2005.. significant drop since then.. subprime lending increased in late 2005 and early 2006 which caused sales to remain moderately high early 2006..
From Bloomberg:
Bernanke Says Subprime Lending Curbs Will `Restrain’ Housing
Federal Reserve Chairman Ben S. Bernanke said the housing market is likely to remain restrained in coming quarters as tighter lending standards limit mortgage financing to subprime borrowers and foreclosures rise.
“Curbs on this lending are expected to be a source of some restraint on home purchases and residential investment in coming quarters,” Bernanke said at the Chicago Fed Bank’s annual conference on bank structure and competition. “We are likely to see further increases in delinquencies and foreclosures this year and next as many adjustable-rate loans face interest-rate resets.”
Stop boggarting the fatty, pass it around.
“Long story short….when I finally had a chance to pass the car, I checked out the driver – African-American!”
Or perhaps Jamaican or Haitian?
Looks like the housing investment money is getting diverted to Stocks. In absence of an external shock, no real signs of recession yet for the overall economy…
CNBC analyst – bernanke downgrading housing market
.. there’s still a ways to go to the bottom.
“Is China diversifying their assets?”
Gary,
They have been, are and will continue to do so.
Lots of Bernanke stories hitting the wires, some with very interesting titles..
From the AP:
Bernanke: Mortgage Crackdown Coming
Bernanke Promises Fed Crackdown on Abusive Mortgage Lending Practices
Federal Reserve Chairman Ben Bernanke said Thursday that he did not believe the growing number of mortgage defaults would seriously harm the economy.
Facing criticism from members of Congress about lax regulation, Bernanke also promised that the Fed would do everything possible to crack down on abuses that have put millions of homeowners in jeopardy of defaulting on their mortgages.
Federal Reserve Chairman Ben Bernanke said Thursday that he did not believe the growing number of mortgage defaults would seriously harm the economy.
Facing criticism from members of Congress about lax regulation, Bernanke also promised that the Fed would do everything possible to crack down on abuses that have put millions of homeowners in jeopardy of defaulting on their mortgages.
“We at the Federal Reserve will do all that we can to prevent fraud and abusive lending and to ensure that lenders employ sound underwriting practices and make effective disclosures to consumers,” Bernanke said in remarks prepared for a financial conference in Chicago.
India’s central bank, which bought dollars for a fifth month, slowed purchases to $2.3 billion in March from a record $11.9 billion in the prior month, according to central bank data.
The currency has surged almost 8 percent this year on speculation the Reserve Bank of India is reluctant to stem gains as a stronger rupee will help in its battle with inflation.
Growth in import costs for Asia’s fourth-biggest economy slowed to 14.5 percent from an average 31 percent in the prior six months, data provided by the trade ministry show. Gains in the rupee helped moderate the cost of imported goods, including crude oil, even as the price of the commodity climbed almost 25 percent from a 20-month low reached on Jan. 18.
“We at the Federal Reserve will do all that we can to prevent fraud and abusive lending and to ensure that lenders employ sound underwriting practices and make effective disclosures to consumers,”
[37],
Ben, the horse has left the barn.
From Bloomberg:
U.S. Leading Economic Indicators Index Fell 0.5% Last Month
A measure of the U.S. economy’s future course unexpectedly fell in April, the third decline in four months, dragged down by slumping home construction.
The Conference Board’s index of leading economic indicators decreased 0.5 percent after a 0.6 percent increase in March that was greater than previously reported. The New York-based group’s gauge points to the direction of the economy over the next three to six months.
A plunge in building permits and a jump in unemployment claims dragged the index down last month. Recent declines in the index underscore evidence that the economy is having difficulty overcoming weakness in the housing market and in manufacturing.
“The data may be pointing to slower economic conditions this summer,” said Ken Goldstein, labor economist at the Conference Board, in a statement. “With the industrial core of the economy already slow, and housing mired in a continued slump, there are some signs that these weaknesses may be beginning to soften both consumer spending and hiring this summer.”
Freddie Mac reporting mortgage rates on the rise over the past week. If the 10Y yield continues it’s upward trend, we’ll likely see rates rising into the near future.
jb
Freddie Mac: 30-yr mortgage averages 6.21% vs 6.15%
Freddie Mac: 1-yr ARM averages 5.48% vs 5.48%
Freddie Mac: 15-yr mortgage averages 5.92% vs 5.87%
Two of the ten indicators that make up the leading index increased in April. The positive contributors — beginning with the largest positive contributor — were stock prices and real money supply*. The negative contributors — beginning with the largest negative contributor — were building permits, average weekly initial claims for unemployment insurance (inverted), manufacturers’ new orders for nondefense capital goods*, index of consumer expectations, vendor performance, average weekly manufacturing hours, and interest rate spread. The manufacturers’ new orders for consumer goods and materials* held steady in April.
http://www.conference-board.org/economics/bci/pressRelease_output.cfm?
>>
Helicopter Ben & the disconnected stock market were the only positives.
Some idiot just paid $71 million for this. The dollar is truly worthless
Warhol work sets record at NYC auction
http://news.yahoo.com/s/ap/20070517/ap_en_ot/art_auction
njrebear Says:
May 17th, 2007 at 10:40 am
…..the disconnected stock market were the only positives.
NJB: I disagree strongly. This comment is not factually supported.
Shatner never lets you down……
http://www.gofish.com/channel.gfp?gfid=50-68
x-underwriter 44,
Yup, I agree. I wonder how people with that kind of money actually made it in the first place. It just reeks of stupidity that someone would spend that kind of money on absolute nonsense.
Gary/X,
On the flip side, suppose someone paid in another currency, say BP. It actually cost them approx $36 mil, in pounds. Going forward, say the rate,BP, declines from approx 2 to 1.5. Nifty 25% gain on a currency play.
Crack-Smoker-of-the-Day Award goes to:
http://tinyurl.com/2pcrwq
$649,000 for a 3BR, 2Bath “colonial” cape in Cranford on a colossal 0.17 acres of land.
Do look this one up on the GSMLS #2407311 so you can see it has “river views” from the front porch, which in Cranford means there is a better than 50% chance your house is going to flood with a decent rainstorm.
The home is described as “deceptively large”.
Please, if anyone from Cranford reads this blog, PLEASE explain the asking price on this one. It seems to defy the $500k POS label by about 30%.
BC Bob,
With $71,000,000, I would place into conservative investments and call it a day. 71 million at 3.5% a year tax free will get you 25% return in 5.5 years without the fret.
Geez, after one stinkin’ year, you gain $2,485,000. Oofaaaa…
Gary,
I agree. However, when you get into that stratosphere, it takes on a world of its own. Who knows, they may have bought for a flip.
Who knows, they may have bought for a flip.
Anyone know where the buyer was from? Individual or institution? Hedgies or one of those new art funds? Dollar hedge maybe?
jb
From Bloomberg:
Philadelphia-Area Manufacturing Accelerated in May
Manufacturing in the Philadelphia region accelerated this month as orders and shipments increased, adding to evidence of a rebound in production.
The Federal Reserve Bank of Philadelphia’s general economic index rose to 4.2 in May from 0.2 the prior month, the bank said today. A positive number signals expansion. The index averaged 8.1 last year.
Manufacturers, responding to rising overseas orders, are ramping up again after reducing excess stockpiles in recent months. Expansion at the nation’s factories may help soften the blow to the economy from the housing slump.
“Manufacturing has worked its way through an inventory adjustment,” Ethan Harris, chief economist at Lehman Brothers Holdings Inc. in New York, said before the report. “It will be a slow growing part of the economy, but it won’t join the housing sector in recession.”
Economists expected the Philadelphia index to rise to 3.5, the median of 59 forecasts in a Bloomberg News survey. Estimates ranged from minus 1 to 8.
personal taste aside, Warhol is dead, is probably the most important artist from the 2d half of the 20th Century, and that is one of his most important works. it is an irreplaceable object and about as blue chip a piece of contemporary art as you can find
I guess in that world they don’t have to worry about low-ball offers
“It takes two to tango, and it’s a dead-on fact that the out-of-control illegal immigration problem has been fueled by tens of thousands of extremely white people- from small business owners to CEOs- who profit greatly from a cheap, undocumented source of labor.”
Clotpoll, bless you. This is exactly correct. And all the folks that matter will go on pretending not to know.
Seneca (49) – that’s a horrifying listing. It will rot before it sells.
X, # 55,
LOL. Also, I imagine not subprime.
“Preserving purchasing power should be in the interest of every policy maker, and in particular be in the interest of the Federal Reserve. But policy makers allow eroding purchasing power to act as a substitute to finding solutions on how to pay for obligations ranging from government debt to social security. Once a country is hooked on growth through inflation, it is difficult to change bad habits. Italy is still struggling to cope with the rigidity of the euro after decades of inflationary policies.”
“The Fed has allowed an unprecedented credit expansion to take place. Bernanke seems to believe there is no need to impose tighter credit to fight excesses that have been building up in the economy. However, if one allows a credit bubble to take place, one must also be willing to allow a severe recession or depression to take place to rid the economy of excesses that have been built up. Those who are most concerned about the dollar do not believe the Fed will allow such a correction to take its full course; there is already talk of a Fed interest rate cut in a few months. In our assessment, the Fed is rather concerned that a credit contraction combined with high levels of consumer debt could create a Japanese style deflationary spiral; to avoid having to deal with deflation, the Fed rather induce inflation.”
http://www.financialsense.com/fsu/editorials/merk/2007/0517.html
Jumping back to post #2
JB,
For the last year or so I have been on the lookout for phrases like “since the
Great Depression,” “since 1929,” or Since 1932,” and it’s come up far more than you might think.
If you do a google news search right now (TBW, I’m digging the igoogle, I’ve been using it for a few weeks now.) you get 123 hits over the last month or so for “since the Great Depression.”
Among the things it is connected to:
negative savings rate
housing
unregulated credit market
Standard of Living
Wage differential
Stock Market activity
Every time it comes up, it makes me think about how unsustainable a path we are on. You simply can’t pull on anything with increasing force forever, sooner or later it’s going to break, and when it does, there are going to be a lot of people in for a rude awakening.
On the topic of tightening lending standards, I know Chuck Schumer proposed to basically eliminate no docs/stated income loans for primary residences.
What is the purported legitimate use for a no docs/stated income loan? It seems to me that they are either:
1) Used to overstate income to borrow more than one can demonstrate an ability to repay or;
2) One is truthful about one’s income on the loan application, but cheating the IRS and therefore can’t prove one’s income for the loan.
What am I missing except maybe the guy who has so much money he doesn’t want to bothered with putting together the paperwork?
#59
the unsustainable path we are on is called “the middle class.” hate to get all lou dobbsian, but the only way the majority of americans are maintaining their standard of living is through debt. only so long people can avoid the reality of international wage arbitrage. we are going through a traumatic upheaval of the class structure in this country and it increasingly seems like the massive middle class of the mid 20th century was an aberration historically
Chifi, (post #10)
Maybe the driver was thinking he might save himself from a DWB stop?
51 BC Bob,
Maybe they’ll paste a picture of a granite countertop on the picture of the dashboard and flip it for $100M!!!
New reality show on A&E:
Flip that Painting
#56 Everybody that I know that complains about illegals, has a cleaning lady, a guy that mows theri lawn, and in some cases a woman who watches their children
I belive illegal immigration is wrong, too, but if people wnat to do something on their own about it, than simply clen your own house, mow your own lawn, and where applicable raise you own kid.
Lots of wannabe rich people like to talk about how they have their own house cleaner and lawn service, makes them feel wealthy
#29 Clotpoll –
agree with what you say – but it’s also domestic help. sometimes i read the help wanted under “childcare” or “domestic” just to see what they are. the people demand so much, and pay so little! Last week I read one that needed someone for 11 hours a day and half day saturday in short hills for a tiny amount of money. i thought to myself, who in the world would take such a job (they may as well have advertised for a slave), and then i realized, it would probably be an illegal immigrant. pretty sad.
one question though, when you say extremely white, are you referring to albinos?
#53 JB We still have factories?
bbb [67],
Can’t help myself. From Bruce, written about a different topic;
Now main streets whitewashed windows and vacant stores
Seems like there aint nobody wants to come down here no more
Theyre closing down the textile mill across the railroad tracks
Foreman says these jobs are going boys and they aint coming back to
Your hometown, your hometown, your hometown, your hometown
#68 BC: I know the song well. I leave you with whats done is done, whats won is won, and whats lost, is lost and gone froever.
#53 JB We still have factories?
“Expansion at the nation’s factories may help soften the blow to the economy from the housing slump.”
Probably refering to the Cheescake Factory. They are going up everywhere. When your ARM resests, you can get a second job there to help pay the bills.
Senators strike deal on immigration overhaul
http://www.reuters.com/article/newsOne/idUSWAT00751720070517?src=051707_1352_TOPSTORY_deal_on_immigration
TCM
extremely white
That is an attitude not a color.
KL
JB, I sent you an email.. hope you got it.
Seneca Says:
May 17th, 2007 at 12:01 pm
Crack-Smoker-of-the-Day Award goes to:
http://tinyurl.com/2pcrwq
$649,000 for a 3BR, 2Bath “colonial” cape in Cranford on a colossal 0.17 acres of land.
******
Seneca, I’d guess the price is justified by it being “waterfront.” Those views of the river in Cranford can be lovely and may command a premium. If it’s not in the NE Quad, it may not flood, though the backyard might take on water in a good storm.
It probably is in a flood zone, anything on the river in Cranford usually is, which means big bucks for flood insurance, not to mention other headaches.
Anyway, just my amateur opinion. This one might be a good one to lowball if you’re the gambling type.
hi cf (45),
I don’t know. Majority of M&A rumors never happen. Hope that the fed will cut rates with a 0.4 CPI. Ignoring negative retail sales numbers. Repeated housing bottom rallies. Talk about global economy making up for weak US GDP [US is the top export destination for almost all developed countries. Lower than estimated payroll numbers even with massive Birth and Death model adjustments. No discount for risky mortgage lenders (Bear Sterns wants to do an IPO for its sub prime division).
I’m making money with this rally but i don’t feel comfortable.
njrebear Says:
May 17th, 2007 at 2:20 pm
hi cf (45),
I’m making money with this rally but i don’t feel comfortable.
NJB: feel comfortable….pare your overweights, underweight small/mid and risky, underweight company that do not have any non-U.S. revenue streams, shift to large global, don’t go out the curve
Bill Gross on Bloomberg with Tom Keene this evening
Chi [77],
Any truth to the rumor that Greenspan was hired to be their chief market timer?
SIFMA Conference on Tuesday, June 19. Conference is the annual high tech event for the securities industry, but this is the lunch-time featured speaker on the first day:
Noon – 1:30 p.m.
Luncheon Meeting
Trianon Ballroom, 3rd Floor
The Future of Mortgage-Backed Securities and the Sub-Prime Loan Situation
Lewis S. Ranieri
Chairman
CA, Inc.
http://www.ca.com
Much has been going on relating to mortgage-backed securities and sub-prime loans…The man who first created mortgage backed securities when he was at Salomon many years ago, will give his perspective on their current state and what the future holds.
From Reuters:
Senator says Fed failed in subprime oversight
The chairman of the U.S. Senate Banking Committee took issue on Thursday with Federal Reserve Chairman Ben Bernanke’s defense of the Fed’s oversight of the subprime mortgage sector, arguing the central bank failed to fulfill its regulatory duty.
The criticism from Democratic Sen. Christopher Dodd of Connecticut came after Bernanke outlined the steps the Fed had taken to try to protect borrowers and promised to review ways to improve consumer protections.
In a statement, Dodd said federal law “requires the Federal Reserve to write rules to protect home borrowers from unfair or deceptive practices,” taking issue with Bernanke’s characterization that the Fed was “authorized” to write such rules.
“For far too many years, far too many risky and abusive subprime loans were made without a reasonable analysis of the borrower’s ability to repay the loan,” Dodd, a Democratic presidential candidate, said.
From Reuters:
Moody’s cuts Long Beach Mortgage subprime issues
Moody’s Investors Service cut 12 Long Beach Mortgage Loan Trust’s certificates backed by subprime second-lien mortgage loans on Thursday, citing low credit enhancement levels relative to current rating levels.
“The bonds’ current credit enhancement levels, including excess spread, are low in light of the current charge-offs compared to the current projected loss numbers for the rating levels,” said Moody’s in a press release.
From the APP:
OceanFirst shutting down subprime mortgage subsidiary
OceanFirst Financial Corp. has begun to shut down a subsidiary that made millions of dollars in subprime loans, John Garbarino, chief executive officer, told shareholders at the company’s annual meeting today.
The decision to close Valhalla, N.Y.- based Columbia Home Loans LLC., comes two months after Garbarino said he and other executives first learned that OceanFirst would have to buy back mortgages that had turned sour.
Toms River-based OceanFirst is the largest bank based in Ocean County. Garbarino spent this morning explaining to about 50 shareholders how the problem happened and how the company was responding.
“comes two months after Garbarino said he and other executives first learned that OceanFirst would have to buy back mortgages that had turned sour.”
Who’s the captain of the ship?
The whole debate of illegal immigration – whether good or bad for the US – is a double-edged sword. On one hand, they do work which no US citizen would ever do (try working 60 hrs a week picking fruits in scorching heat for a pittance). The US citizen can collect a welfare check instead. Get the US citizen to go pick fruits or work in a factory slaughtering and cleaning chickens and cows, and expect to pay $15/lb. for that hormone-pumped piece of meat.
Rich/middle class folks use them for landscaping, house cleaning, baby sitting… all domestic chores, and pay cash. Would you hire a US citizen and pay nanny tax? No! So you’re also the source of the problem too, by creating a demand for the service.
On the other hand regarding legal immigrants, there is a huge globalization of the work force. There are a lot of legal immigrants here, who work their way to becoming a US resident. For many of them, their quality of life vastly improves in the US. This quality of life and happiness is not necessarily because they spend more.
FOr people, happiness is a function of either saving more, rather than consuming more. For people who are incurring debt to trade-in their 2 yr car, or buy a flat-screen, and not contribute to a 401k, I have absolutely no sympathy when they’ll eat cat food during retirement. For those beset by a medical catastrophe, the incurred debt is understandable.
Is living below one’s means really that hard? People have no concept of margin of safety whatsoever, and have become consumaholics.
#66 t c m Says:
…sometimes i read the help wanted under “childcare” or “domestic” just to see what they are. the people demand so much, and pay so little! … (they may as well have advertised for a slave)
tcm, hard to make a judgment call if the posting you read qualifies as ‘slave’ labor without knowing what the hourly rate was but while I agree that many child care and elder care workers are in fact illegals, the people I know who hire them are paying a tax-free (tax-free to the caretaker) wage far in excess of what one can earn working the register at a Quick-Check or putting produce out for display at the Shoprite. In fact, accounting for the tax-free / union-dues-free income, I don’t know anyone who is paying less than 40% more than most starting wages a legal worker can find and 50-60% more than NJ minimum wage.
Lots of room for debate here as to how at least someone earning minimum wage is entitled to health care (not always the case), legal protections, etc. I just don’t know anyone who isn’t paying at least $10 an hour and more likely $12.50 or more an hour for this type of help. I would have thought that Short Hills wages for nannies would be competitive but I have no evidence to support that theory.
dreamtheaterr Says:
May 17th, 2007 at 3:00 pm
….I have absolutely no sympathy when they’ll eat cat food during retirement.
Yan: what if it is REALLY GOOD cat food?
This is crazy! read below from http://www.cnnfn.com
6 ways to improve your credit score.
TIP #3
Be too thin
When it comes to your credit record, fat is good, emaciated bad.
Even if you’re the most responsible, on-time, in-full bill payer on the planet, your credit score won’t be as high as it could be if you have just one credit account.
The reason: Your credit profile is too thin and lenders ideally like to see a potential borrower responsibly managing a mix of revolving debt (such as credit cards, where you can reuse the credit after paying it back) and installment debt (such as a car loan or most mortgages, where you pay the same amount every month for a certain period).
To boost your score: Consider opening another credit-card account or two, or taking out a car loan or small bank loan.
sorry the title was actually
6 ways to kill your credit score
tcm (66)-
Speaking of albinos, here’s my favorite albino of all time:
http://www.robinsonarchive.com/viewImage.asp?pid=1635
His brother, Edgar, was no slouch either.
bear (75)-
Is the money worth less because you feel uncomfortable?
I think ChiFi pegged it for you. Enjoy the ride while it lasts; even with some of the recent multiple expansion, we’re nowhere near the valuations of the late ’90s (unless, that is, you have an entirely-Chinese portfolio).
BC (78)-
I think he was hired to be Gross’ butler.
Clotpoll Says:
Speaking of albinos, here’s my favorite albino of all time:
I saw that guy down at the stone pony a few years ago. He appeared nearly dead
x (92)-
But can he still shred?
We’d all look dead, too…if our skin had no pigment.
ok , boys and girls , lets go get our
z visa’s
folded like a cheap suit.
But can he still shred?
Went to his web-site and he’s still touring. Awesome guitar player. I’m an old Blues Rock fan myself. Ever hear of the band Indigenous?
x (95)-
Yep. In small doses, though. I get a little tired of the Stevie Ray knock-off thing.
Makes John Mayer hard to listen to as well.
Yeah, I’ve seen them a few times. That kid can play but by the end of the show, you’re ready for it to be over.
A new FICO calculation on the horizon?
As FICO Score Passes 100 Billion Mark, Fair Isaac Announces Plans to Launch More Powerful FICO Score
The company plans to begin delivering the new FICO score innovations starting in September. This initiative is part of the company’s periodic refreshment of the Classic FICO scoring model installed at the three national credit reporting agencies. While each FICO score refreshment over the years has resulted in a more predictive tool to help lenders keep pace with the constantly changing dynamics of consumer credit behavior, Fair Isaac expects the next FICO score version to deliver greater performance upgrades than any previous redevelopment.
“We have continuously improved our Classic FICO score since we first introduced it with our credit bureau partners, and we believe this latest research is our best work yet,” said Ron Totaro, vice president of Scoring Solutions for Fair Isaac. “We are confident that this update to the Classic FICO scoring model will provide superior risk performance across the entire spectrum of credit risk. Also, it has been designed to be easy for lenders to adopt the new models without making major operational adjustments.”
Fair Isaac’s development tests indicate that the new Classic FICO score research model increases predictive strength by 5-15 percent, with the largest increases coming in three important consumer segments:
Originations and new accounts
Borrowers who pose higher risk, often referred to as subprime borrowers
Borrowers with thin or young credit bureau files
Lenders will be able to use FICO scores developed from Fair Isaac’s newest research with minimal changes to their own operating systems. To make lender adoption easier and faster, the new research model retains the same scoring range, score reason codes, minimum scoring criteria, inquiry treatment, and related model parameters.
Did somebody say albino?
Jackie Rogers Jr., FTW
http://www.youtube.com/watch?v=e8bytZyUNyE
“Los Angeles-based KB Home said Thursday it was in exclusive talks to sell its controlling stake in a French homebuilder for 600 million euros ($813 million), moving quickly to sell an operation that’s outperforming its U.S. activities.”
http://www.marketwatch.com/news/story/kb-home-talks-sell-french/story.aspx?guid=%7BE58A86AE%2DD1B4%2D40B3%2DA9BC%2DF5F947001ADC%7D
Yan: what if it is REALLY GOOD cat food?
Chifi, all I know is that my wife is feeding our dog really good food. He’s her first and only love….. :)
Grim (98)-
“…new Classic FICO score”????
What do they call the old one now? “Crummy, inflated FICO score”?
Beware claims of new and improved.
85 Seneca,
I pay my nanny $1,300 a month off the books. My youngest is 2. My oldest is 6, and he is in school most of the day. Considering that the nanny is was a stay home mom and takes care of her child at the same time as mine, I think she is making out like a bandit. Now if I had to put them up in a day care center, I’d be looking at close to $1,800 a month.
cf(76) & clot(90)
thanks :)
Don’t mess with the Realtors? So is this anticompetitive or business as usual?
Redfin fined $50,000, forced to alter blog
The Northwest Multiple Listing Service has fined Redfin $50,000 and asked them to stop publishing a popular blog in which contractors for the online real estate brokerage posted reviews of Seattle area homes.
Redfin is appealing the fine, though it took steps this week to shut down the reviews on its “Sweet Digs” blog. With about 3,000 e-mail and online subscribers, the blog was written by 15 freelance reviewers who over the past five months posted reviews on about 1,000 homes in Seattle and San Francisco. The company says it plans to maintain the blog as a source of information on pricing trends and recently sold homes.
Redfin Chief Executive Glenn Kelman said he had no choice but to comply, noting that the NWMLS had threatened to shut off its daily feed of for sale listings.
“Access to listing data is our lifeblood and we just can’t afford to mess around,” said Kelman. “We have gone back and forth with the Northwest Multiple Listing Service and according to their rules you can’t advertise another broker’s listing. We argued that it was in no way an advertisement, it was really a review.”
#85 Seneca-
You make good points – and “slave” a little strong.
I don’t remember the quoted rate, but it was probably in that range- and the person got room and board. I guess I’d rather work in Shop-Rite as a cashier and pay taxes than live in someone else’s house and serve them. Even if I ended up with less money in the end, at least I would have health ins. and a chance for advancement. I’d also feel that once I left work, my time was my own.
(105)-
Wonder how Kelman would feel if a homeowner asserted- in a lawsuit- that disparaging comments on Redfin’s blog adversely affected the market value of his home…
Discretion is the better part of valor. The reason good agents aren’t out there publicly pointing fingers at competitors’ listings is that it’s all too easy to play tit-for-tat.
Of course, Redfin is a company that is totally buyer-biased and has no interest in helping sellers market their homes for more. It’d be a lot less disingenuous if they’d stop listing homes and just practiced buyer brokerage.
Last month: “The gap between rich and poor just keeps on getting wider.”
Now: “Let’s invite more poor/uneducated/unskilled people!”
Insanity.
#98
FICO score is joke, with all the illegals stealing SSN and credit linking, you can buy yourself any FICO you want.
When I was very young, my parents both worked. This was somewhat unusual in the 50s. We had a housekeeper though we were barely middle class.
What is it about this country that it is considered unethical to provide or accept employment in domestic service? Elsewhere this position seems ludicrous and almost immoral. How are those with no skills supposed to make a living if those better off shirk their responsibility to assist by offering this honorable work?
Check out the dummies in your town:
http://www.njpforeclosures.com
I’m seeing loans taken out only 4-5 months ago, and people are going into foreclosure.
On one, an interest rate of 9% on a $600K loan.
On another, someone will lose their house over a $25K HELOC.
You can search towns using the form on the right-hand side of the page.
Another, 10% on a $500K loan — like buying a house with Mastercard.
Another, $1.7M loan taken out in 2005 — two years later foreclosure city.
@ [49]
Seneca Says:
May 17th, 2007 at 12:01 pm
Crack-Smoker-of-the-Day Award goes to:
http://tinyurl.com/2pcrwq
$649,000 for a 3BR, 2Bath “colonial” cape in Cranford on a colossal 0.17 acres of land.
It says that the lot is over 7300 Sqft as well. I think the math has been done wrong all around.
UnRealtor Says:
May 18th, 2007 at 12:25 am
Check out the dummies in your town:
http://www.njpforeclosures.com
I’m seeing loans taken out only 4-5 months ago, and people are going into foreclosure.
On one, an interest rate of 9% on a $600K loan.
On another, someone will lose their house over a $25K HELOC.
You can search towns using the form on the right-hand side of the page.
Yikes…$650,000 loan taken out in 1/06…13.99%!!!! Chatham. I’d rather rent for the rest of my life than make this kind of mistake.
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