The Federal Housing Finance Agency engaged in a little back-patting yesterday for improved HARP figures, which they say are a direct result of their changes to the system to allow for more underwater borrowers to take advantage of low refinancing rates. The truth is a little murkier.
|By: David Dayen Friday July 13, 2012 1:43 pm|
The reason I initially contacted Rep. Brad Miller today was to discuss an issue that has come into vogue this week as a potential solution to the housing crisis. San Bernardino County is considering a partnership with Mortgage Resolution Partners on a scheme that would condemn underwater mortgages through the process of eminent domain, and then refinance those mortgages with the borrower. If it works, this would save the individual borrowers tens of thousands, if not hundreds of thousands, of dollars and remove the vulnerability of being underwater; provide an economic stimulus to struggling municipalities; and provide MRP with a tidy profit on the new mortgage, after buying the old mortgage at a large discount through eminent domain.
|By: David Dayen Wednesday July 4, 2012 7:08 am|
The International Monetary Fund has explicitly called for principal reductions for underwater borrowers to deleverage individual balance sheets and jumpstart a soft recovery.
|By: David Dayen Monday June 18, 2012 1:00 pm|
The Wall Street Journal gets around to noticing that the latest version of HARP, the Home Affordable Refinance Program, has been manipulated by the leading mortgage servicers to trap their borrowers. And they add a bit of a twist. Because servicers set the fees from closings on refinances, this trapping of their borrowers also happens to be quite lucrative.
|By: David Dayen Wednesday May 30, 2012 10:00 am|
A group of over 50 House Democrats are calling out the Obama Administration for their management of the HARP 2.0 program. In a letter to Treasury Secretary Timothy Geithner and Acting Director of the Federal Housing Finance Agency Ed DeMarco, the Democrats point to data showing that the new version of HARP, designed to steer more refinancing to underwater borrowers, simply isn’t meeting those goals.
|By: David Dayen Monday May 21, 2012 9:40 am|
When Ally Financial’s mortgage unit Residential Capital filed for bankruptcy last week, I had an inkling it would spell trouble for the foreclosure fraud settlement the parent company signed with state and federal regulators. How would individuals get loan modifications in the midst of a bankruptcy proceeding? Now it looks like they won’t.
|By: David Dayen Sunday May 13, 2012 7:00 pm|
The design of HARP 2.0 has artificially profited banks at the expense of homeowners. The banks, in a very strange and apparently coordinated manner, have unilaterally decided that they will only perform HARP refis for underwater borrowers on the loans they already service. This eliminates competition for those loans. And the immediate effect of that is higher costs for underwater borrowers, who are trapped and cannot get a refi with anyone but their old servicer. So the servicers raise the interest rates they offer on the refi. In some documented cases, the closing costs, which are almost entirely profit for the bank, are higher than the savings on the refinance.
|By: David Dayen Tuesday May 8, 2012 12:00 pm|
Perhaps showing concern about the softening economic forecasts of recent months, President Obama has provided a to-do list for Congress that would, in his words, “create jobs and help restore middle class security.” The to-do list includes several ideas from the American Jobs Act and subsequent legislation proposals announced in recent months, but there’s a curious omission.
|By: David Dayen Wednesday April 18, 2012 7:32 am|
The Mortgage Bankers Association reports a decrease in mortgage purchase activity last week, but an increase in refinancing activity, led by the new version of HARP. No surprise, since banks are using HARP on their own loans to capture much of the interest spread during the refinancing.
|By: David Dayen Friday April 13, 2012 6:30 pm|
Wells Fargo and JPMorgan Chase, showing no ill effects from a foreclosure fraud settlement that was supposed to penalize them for fraudulent misconduct, both announced robust earnings gains today. Matt Stoller has a good look inside the numbers. But I was intrigued by the fact that both banks attributed stronger mortgage lending numbers for their earnings gains.