bubbleinfo.com

DOB sent in this latest bank-speak which was seen in a few media outlets, like the SFBT:

CEO Brian Moynihan said Tuesday that the pace of selling its foreclosed home inventory is picking up as “tons” of investor cash comes into the market.

“Where you’ve had the ability to get a hold of properties … get them cleaned up, back on the market, they have moved,” Moynihan said at a conference put on by the bank in New York. “It moves as fast now as it’s ever moved.”

“You’ve seen this thing improve slowly but surely,” he said. “There’s tons of investor money coming in” to the housing market.

BofA’s top brass has been eager to resolve its bad loans by speeding up the foreclosure process, which varies by state. USA Today reported last week that at the current pace of foreclosures moving through the system, it could take decades for the market to clear all that property in some states like New York.

In August, Bank of America picked up the pace of issuing default notices, the first step in the foreclosure process, according to ForeclosureRadar.com, a research firm in Discovery Bay.  Moynihan said today that home prices are “bouncing along a bottom.”

And on a positive note, Moynihan says the bank’s mortgage delinquencies continue to decline.

From HW:

A group of 131 members of Congress sent a letter to House leaders this week, pressing for a restoration of higher limits for mortgages guaranteed by the government.

Congress elevated the conforming loan limits in 2008 to allow the Federal Housing Administration, Fannie Mae, and Freddie Mac to insure and guarantee more mortgages when the credit markets froze.

On Oct. 1, the elevated limits dropped to $625,500 from $729,750 in the most expensive neighborhoods. In each area, the cap dropped to 115% from 125% of the area’s median home price. Previous legislation introduced in the House to extend the limits never made it out of committee.

But the Senate approved an amendment to a spending bill Oct. 20 that would extend the conforming loan limits through 2013.  A joint appropriations committee is scheduled to begin meeting this week and will consider the spending bill.

“Forcing this transition in a weak market, before the private market has shown the willingness to take on additional mortgage risk is not wise policy during a housing crisis,” said Rep. Gary Ackerman (D-N.Y.), echoing calls for restoring from major trade groups from the mortgage and real estate industries.

The effect of the conforming loan limit drop remains in question. A study from the Federal Reserve shows a very small effect from the drop, while a separate study from the National Association of Homebuilders claims millions of homebuyers could be shut out of financing.

The Obama administration and top House Republicans have supported allowing the conforming loan limits to expire as the first step to getting private capital back into the market.

But in their letter to Speak of the House John Boehner (R-Ohio) and Rep. Nancy Pelosi (D-Calif.), the group of lawmakers said there is no evidence of that happening.

“Many of us have hoped that private lenders would be ready to return to the housing markets and enable us to reduce the federal role, but this has not yet happened,” the letter reads. “The reluctance of private lenders to lend coupled with the lower current limits will adversely impact the housing market.”

From Originator News:

Bank of America is working “very hard” on a short sale-to-lease program for distressed borrowers who don’t qualify for government-backed refinance programs.

But the much-maligned bank won’t move forward until it gains assurance from regulators that borrowers are being treated fairly.

As outlined late this week by B of A executive Ron Sturzenegger at the Urban Land Institute’s fall conference in Los Angeles, the bank would regain title to mortgaged properties under a short sale arrangement, and then lease the houses back to their occupants for three years for rents that approximate the average for their particular areas.

At the end of the 36-month lease, Sturzenegger said during a panel session on capital markets, the institution would re-sell the houses to renters who wanted to buy them back. He did not say what price buyers would have to pay to reclaim ownership from the bank.

Sturzenegger, who is managing director of legacy asset servicing at B of A, said investors are interested in the program, as are borrowers. But two obstacles still need to be overcome before the program becomes operational, he said: governmental clearance and finding someone with the ability to run it.

Excerpts from the nytimes.com:

Cutting to the chase: if you thought this was the deal that would hold banks accountable for filing phony documents in courts, foreclosing without showing they had the legal right to do so and generally running roughshod over anyone who opposed them, you are likely to be disappointed.

As things stand, the settlement, said to total about $25 billion, would cost banks very little in actual cash — $3.5 billion to $5 billion. A dozen or so financial companies would contribute that money.

The rest — an estimated $20 billion — would consist of credits to banks that agree to reduce a predetermined dollar amount of principal owed on mortgages that they own or service for private investors. How many credits would accrue to a bank is unclear, but the amount would be based on a formula agreed to by the negotiators. A bank that writes down a second lien, for example, would receive a different amount from one that writes down a first lien.

Sure, $5 billion in cash isn’t nada. But government officials have held out this deal as the penalty for years of what they saw as unlawful foreclosure practices. A few billion spread among a dozen or so institutions wouldn’t seem a heavy burden, especially when considering the harm that was done.

The banks contend that they have seen no evidence that they evicted homeowners who were paying their mortgages. Then again, state and federal officials conducted few, if any, in-depth investigations before sitting down to cut a deal.

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From dsnews.com:

HUD has approved a program aimed at putting foreclosed homes back into the hands of owner-occupant buyers.

In select states, from now into October of next year, buyers need a down payment of only $100 to purchase a HUD-owned REO home.

The buyer must be an owner-occupant, utilizing financing insured by the Federal Housing Administration (FHA). Standard FHA underwriting guidelines apply, and the sale must be for the full amount of the current list price.

The $100 down payment incentive program has been approved for two of HUD’s four national regions – the regions managed by the Denver Homeownership Center and the Atlanta Homeownership Center. HUD homes in the states listed, as well as the Caribbean are currently eligible for the program.

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From the latimes.com:

Delinquent borrowers who think they’ve been treated unfairly by their mortgage lenders and the companies that service their loans will soon have their day in court.

Well, not court, per se. But within the next few weeks, federal regulators will announce a new complaint procedure for borrowers who think they’ve been unjustly harmed by errors, misrepresentations or other deficiencies in the foreclosure process.

Under the process, which is being spearheaded by the Office of the Comptroller of the Currency, aggrieved borrowers whose primary residence was in any stage of the foreclosure process between January 2009 and December 2010 will be eligible to have their cases reviewed by an independent consultant.

The new complaint procedure isn’t universal. It covers just 14 servicing companies and banks, but they include some of the largest in the field — household names such as Bank of America, Wells Fargo, Citigroup and JPMorgan Chase. An estimated 4.5 million loans are in the pool.

“We are looking not just at those foreclosures that resulted in foreclosure sales, but at foreclosures that were pending at any point” during the two-year review period, acting Comptroller John Walsh said. In other words, a foreclosure action that might have been canceled for one reason or another. Or, given how long the process takes these days — a borrower in foreclosure has gone an average of 599 days since making a payment, according to Lender Processing Services — an action that could still be pending.

Either way, cases would be eligible for review by an independent consultant unaffiliated with the lender or servicer if the borrower thinks he’s been given the runaround, been given wrong information or not been afforded due process under the law.

The process is intended to fix what is wrong in the loan servicing arena. That includes the issue of so-called robo-signing, in which employees and sometimes machines signed off on foreclosure documents they hadn’t read or verified as accurate.

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Excerpted from this article in  ProPublica:

For HAMP’s first two years, the government offered very little public detail about its oversight efforts. It was virtually impossible for the public – or even Congress – to know how well the banks and mortgage servicers were complying with the government’s effort to prevent struggling homeowners from losing their homes. Those years were crucial, because that’s when the vast majority of homeowners eligible for a modification – about three million – were evaluated by servicers.

The documents obtained by ProPublica show auditors finding serious problems at a major servicer during that time. Instead of publicly revealing the findings, Treasury chose to privately request that GMAC fix the problems.

“For two years, they’ve known how abysmal servicers were performing and decided to do nothing,” said Neil Barofsky, the former special inspector general for the Troubled Asset Relief Program, better known as TARP or the bank bailout, which provided the money for HAMP.

“It demonstrates that if you have a set of rules for which compliance is completely voluntary and no meaningful consequences for those who violate them, having all the audits and reviews in the world are not going to make a bit of difference,” he continued. “It’s why the program has been a colossal failure.”

Treasury continued to release few details about its audits until this June, when it began publishing quarterly reports based on the audits’ results. The public report showed what Treasury called “substantial” problems at four of the ten largest servicers – Bank of America, JPMorgan Chase, Wells Fargo, and Ocwen – and Treasury for the first time withheld taxpayer subsidies from three of them.

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