Sunday, July 22, 2007

13,878 Homes Offered For Sale on Countrywide Financial's Website

Total REO Asking Price: $2,469,313,620
(As of July 22, 2008)


Click on state below for detailed listings
State Count Total Asking
Average Asking

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Wednesday, July 18, 2007

The Mortgage Lender Implode-O-Meter reaches 100!

100 173 Major U.S. Lenders Have ‘Imploded’

From Implode-O-Meter (A popular web site that tracks failing or "imploded" lenders): “This is our list of lending operations that have ‘imploded’ (see also ailing lenders). ‘Imploded’ is somewhat subjective and does not necessarily mean operations are ceased permanently: it can mean bankruptcy filing, temporary but open-ended halting of major operations, or ‘firesale’ acquisition. Important: All information here is provisional. If you are planning on doing business with any of these companies you should inquire with them on whether they can still meet your needs. Many are still operating in some capacity.

“The Companies include all types (prime, subprime, or a mix of both; retail or wholesale; subsidiaries and entire companies). The list, with links to stories and whatever details we have available (most recent first) follows:”

Number 100: CIT Home Lending

“CIT Group, a major conglomerate lending and investment shop, is exiting the home lending business entirely, after taking an ‘unexpected’ (hah!) loss of $127 million in the second quarter.” read more >>

Update: 173

Bear Stearns hedge funds worthless

The Telegraph reports: “Two struggling Bear Stearns hedge funds that ran into difficulties after making large bets on the troubled US sub-prime mortgage market now contain ‘very little’ or ‘effectively no value’ for investors, according to the Wall Street firm.”

“In a letter to clients, Bear Stearns, which had to pump $1.6bn (£800m) into the funds last month to stop them collapsing, said that it was seeking ‘an orderly wind-down of the funds over time’.”

“In what it described as ‘a difficult development for investors’, the bank said ‘there is effectively no value left’ for investors in its Enhanced Leverage Fund and ‘very little value left’ for investors in its High-Grade Fund.” read more >>

Letter sent to investors: Dear Client of Bear, Stearns & Co. Inc, ... read letter >>

Bear Stearns shifted the blame from subprime mortgage to “unprecedented declines in the valuations of highly-rated securities.” The two funds have been in the news for weeks after suffering heavy losses. Bear sent the letter to investors yesterday.

Monday, July 16, 2007

Two-Thirds of Americans Believe Mortgage Product Advertising and Marketing Lacks Credibility

A report from Harris Interactive: “Given all the negativity surrounding the sub-prime mortgage marketplace, it is no surprise that consumers have questioned the credibility of the current marketing and advertising for mortgage products. Just one-third of US adults (34%) view the advertising and marketing of mortgage products as credible, with the majority (66%) viewing it as not credible. In fact, one in five adults (22%) report that they view the advertising and marketing of these products as ‘not at all credible.’”

These numbers have significant implications for the type of trust the American public has in financial institutions. When probed further about their perceptions of the financial institutions that provide mortgages, only one-quarter (27%) of U.S. adults report favorable perceptions, with just three percent saying their perceptions are very favorable. ‘Given the large proportion of consumers who are riding the fence, now more than ever would be a good time for these institutions to examine their mortgage product advertising and marketing messages,’ says Sanford Brumley, Vice President of Client Development for the Harris Interactive Financial Services Group.” read more >>

Harris Interactive is the 12th largest and fastest-growing market research firm in the world. The company provides innovative research, insights and strategic advice to help its clients make more confident decisions which lead to measurable and enduring improvements in performance. Harris Interactive is widely known for The Harris Poll, one of the longest running, independent opinion polls and for pioneering online market research methods.”

Friday, July 13, 2007

GE bails out of subprime market

GE confirmed today that it is selling WMC Mortgage as the subprime sector is at a near collapse from massive increases in defaults . GE bought WMC just three years ago, and since then has gone from 1,200 to 700 employees.

From Bloomberg: “‘The mortgage industry has greatly changed since the purchase of WMC,’ Laurent Bossard, chief executive officer of the division, said in an e-mail to employees yesterday. ‘The current subprime market environment has made a significant negative impact on the business.’”

“GE's decision to divest WMC comes as more than 60 mortgage companies have halted operations, gone bankrupt or sought buyers since the start of 2006, according to Bloomberg data. The contraction in the subprime industry caused the near- collapse last month of two hedge funds run by Bear Stearns Cos. and the downgrading of almost $12 billion of mortgage securities by ratings companies.”

“‘GE's been in and out of the mortgage business before,’ said Angelo Mozilo, chief executive officer of Countrywide Financial Corp. His Calabasas, California-based company, the country's largest home lender, has said it expects to benefit as weaker rivals or competitors less dedicated to mortgages disappear during a difficult period for the cyclical business.” read more >>

Thursday, July 12, 2007

NAACP Sues 14 Subprime Mortgage Lenders

The Lenders: Ameriquest, Wells Fargo, Fremont, Option One, WMC Mortgage, Countrywide, Long Beach Mortgage, CitiGroup, BNC Mortgage, Accredited Home Lenders, Encore, First Franklin, HSBC, Washington Mutual

* This lawsuit is designed to stop these lenders from engaging in systematic, institutionalized racism in making home mortgage loans.
* In a 2006 study, the Center for Responsible Lending found that when creditworthiness and credit risk were equal, African-Americans were still 31 percent to 34 percent more likely to receive higher rate, more expensive subprime loans than Caucasians.
* The National Community Reinvestment Coalition revealed that lenders on average made high-cost subprime loans to higher-qualified African-Americans 54% of the time, compared to 23% of the time for Caucasians, even when the Caucasian applicants were less qualified.
* These and other studies demonstrate that African-American homeowners are paying higher mortgage interest rates than their Caucasian counterparts.


RealtyTrac: Foreclosures up 87% from June 2006

A report from RealtyTrac. “ A total of 164,644 foreclosure filings -- default notices, auction sale notices and bank repossessions -- were reported during the month, down 7 percent from the previous month but still up 87 percent from June 2006. The report also shows a national foreclosure rate of one foreclosure filing for every 704 U.S. households for the month.”

“‘Foreclosure activity subsided somewhat in June after hitting a 30-month high in May,’ said James J. Saccacio, chief executive officer of RealtyTrac. ‘And the drop in activity was fairly broad, with 33 states reporting month- over-month decreases. Still, the foreclosure rates in most states remained substantially above last year's levels.’” read more >>

The top 5 by rank according to RealtyTrac:

Rank State 1 for every #HH %Change from May 07 %Change from June 06
1 Nevada 175 -9.80 279.58
2 California 315 -2.16 286.81
3 Colorado 317 -9.75 54.40
4 Florida 347 -3.08 144.45
5 Arizona 383 -3.50 168.00

Tuesday, July 10, 2007

12,799 Homes Offered For Sale on Countrywide Financial's Website

Total REO Asking Price: $2,286,683,889
(As of July 10, 2008)


Click on state below for detailed listings.
State Count Total Asking
Average Asking

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Monday, July 9, 2007

Foreclosures up 41% percent in first half of 2007

A press release from “The foreclosure pox continues to spread unchecked across the country despite efforts by government and industry to stop it.”

“3 out of every 1,000 homeowners in the United States lost their homes to foreclosure in the first half of the year. That’s up 41 percent compared to the same period last year, according to the latest numbers from, a California-based real estate investment advisory firm and longtime publisher of foreclosure and property information.”

“These per capita numbers translate to almost a quarter-million residential properties (247,907) that ended up in the hands of banks or lenders this year because homeowners couldn’t get their mortgage default problems solved, according to, which tracks and analyzes foreclosure filing through its database of more than 3.2 million listings nationwide. Per capita reflects the number of filings as a percent of the number of households in an area.”

“‘Hundreds of thousands of more homeowners won’t be able to escape foreclosure for most of the rest of the year either unless stagnating housing prices and markets pick up, and the nation’s economy rebounds, too,’ says Alexis McGee.”


--In other words, hundreds of thousands more will be losing their homes to foreclosure.

Credit Suisse: CDO Losses, A $52 Billion Problem For Investors

From Bloomberg: “Credit Suisse Group said losses on bonds backed by U.S. subprime mortgages will total as much as $52 billion, less than estimates of the fallout from Deutsche Bank and Pacific Investment Management Co.”

“Subprime defaults are ‘clearly a huge problem’ for investors in collateralized debt obligations, Credit Suisse analysts led by Ivan Vatchkov in London wrote in a report. ‘But we do not think that they are a systemic one.”

“No one knows how much money is at risk from subprime defaults because CDOs made up of the loans aren't required to publicly disclose holdings. Deutsche Bank AG says losses from subprime mortgages issued last year may reach $90 billion. Pacific Investment Management Co. in Newport Beach, California, in April estimated the fallout at as much as $75 billion.”

“‘Investment banks operate in this market day and night and they know it better than most,’ Vatchkov said in an interview today. ‘The market's been turning for the past 12 months, so I think they saw it coming.’” read article >>


Saturday, July 7, 2007

Hudson & Marshall To Auction Off 400+ Homes In Northern California

From Hudson & Marshall. “Dallas based Hudson & Marshall will auction the northern California homes in various cities on the following days: July 17 in Fresno; July 18 in Salinas; July 19 in Modesto; July 21 in San Francisco; and July 22 in Sacramento. Valued from $100,000 to more than $800,000, the homes come with guaranteed title insurance paid by the seller, ensuring all properties are free of any back taxes or liens.

“All properties are sold ‘as is’ and potential buyers should inspect homes prior to auction, so they know what they are bidding on. Interested buyers can visit properties during open house events scheduled for July 14th and 15th from 1:00pm-3:00pm. Winning bidders will be required to make a down payment of 5% of the selling price or $2500, whichever is greater, in the form of cash or check.”

Real estate auctions are gaining popularity among sellers as a quick way to dispose of property in a slow housing market. According to the National Auctioneers Association, the fastest growing sector of the $257.2 billion auction industry is residential real estate auctions, which jumped 12.5% in 2006, generating $16 billion.


Thursday, July 5, 2007

Ohio A.G. building a case to investigate credit-rating agencies like Moody's

Fortune via CNN: “While Bear Stearns is the most recent financial institution to find itself caught up in the subprime-mortgage quagmire, the three credit-rating agencies - Standard & Poor's, Moody's (Charts), and Fitch - may be the next ones to see their good names dragged through the mud.”

“The reason? Ohio attorney general Marc Dann is building a case against them based on the role he believes their ratings played in the marketing of risky mortgage-related securities.”

“The ratings agencies cashed a check every time one of these subprime pools was created and an offering was made,’ Dann told Fortune, referring to the way the bond issuers paid to get their asset-backed securities (ABSs) and collateralized debt obligations (CDOs) rated by the agencies. These ratings run from AAA for debt with the lowest risk of default all the way down to noninvestment- grade bonds, which many pension funds are prohibited from purchasing in their charters. ‘[The agencies] continued to rate these things AAA . [So they are] among the people who aided and abetted this continuing fraud," adds Dann.’”

“Ohio has the third-largest group of public pensions in the United States, and they've got exposure: The Ohio Police & Fire Pension Fund has nearly 7 percent of its portfolio in mortgage- and asset-backed obligations.”

“Moody's says that Dann's accusations are nonsense. ‘We perform a very significant but extremely limited role in the credit markets. We issue reasoned, forward-looking opinions about credit risk,’ says Fran Laserson, vice president of corporate communications at Moody's. ‘Our opinions are objective and not tied to any recommendations to buy and sell.’ She further points out that while some securities have lost significant value, none have actually defaulted. (S&P and Fitch declined to comment.) ” read more >>


Defaults To Keep Rising As Consumers Struggle With Debt

Bloomberg: “Delinquencies and defaults on U.S. subprime mortgages will keep rising as problems in the housing market persist, said Robert Parker, vice chairman of Credit Suisse Asset Management.”

“The share of U.S. subprime mortgages entering default in the first quarter was the highest in almost five years, according to the U.S. Mortgage Bankers Association, as the country suffers its worst house-price decline since the 1930s.”

“‘It's na├»ve to assume the worst is past us in the U.S. subprime market,’ Parker said at a bond market conference today in Hong Kong. ‘At least over the balance of this year, the subprime default rate will rise.’” read more >>

MarketWatch: The signs of stress are all around:
“Prices are rising, but incomes and wealth aren't. With most households already overburdened with debt, consumers are being squeezed. There's only one thing to do, even though it goes against every fiber of their being: Cut back on expenses.

“Realtors are feeling it, retailers are feeling it, and so are automakers and bankers.”

- Sales at retail chain stores continued to weaken in the last week of June. The International Council of Shopping Centers index barely grew week-over-week, while the Redbook index fell to a cyclical low, with same-store sales up just 1.2% compared with a year earlier.
- Vehicle sales declined for the sixth straight month in June. In the past six years, sales have been weaker on only two occasions. At the same time, the automakers have stepped up their production, setting up the industry for another round of layoffs and production cutbacks.
- Home sales fell again in May. The National Association of Realtors said the number of contracts signed on previously owned homes fell 3.5% to the lowest level since the recession.
- More consumers fell behind on their debt payments in the first quarter. The percentage of loans that were 30-days past due rose to the highest level since the recession of 2001. read more >>


Monday, July 2, 2007

A ‘Perfect Storm’ in Massachusetts

Foreclosure Filings Hit Record High in Massachusetts for Eighth Consecutive Month

From “The report shows that 2,136 foreclosures were initiated statewide during the month of May 2007, 32.34% higher than the number recorded in May 2006. Over the past 12 months, lenders initiated foreclosure proceedings against 23,638 homeowners, representing a 74.14% increase over the same period a year earlier. May 2007 posted high foreclosure numbers indicating that some homeowners continue to struggle making their mortgage payments.”

‘May continues to be a record month for foreclosures affecting Massachusetts homeowners and the trends suggest that we may continue experiencing these historical numbers throughout 2007,’ said Jeremy Shapiro, president and co-founder of ‘The fact that the housing market has remained relatively flat means its still difficult for homeowners to refinance or sell their property contributing to the high number of foreclosures.’ attributed the increase to a ‘perfect storm’ of factors. The pressures put on property owners include rising interest rates over the past few years, an increase in sub-prime and other exotic loans, the affect of adjustable rate mortgages, rising home heating costs, substantially increased gasoline prices, and the slumping Massachusetts housing market, which leaves homeowners trapped in houses they cannot afford. read more >>

Founded in 2003, is the industry leader in providing online Massachusetts foreclosure data to investors, consumer homebuyers, bankruptcy and real estate counsel, mortgage originators, real estate agents and lenders.

Be sure to check out for up-to-date news on the housing meltdown in Massachusetts .


Sunday, July 1, 2007

Federal banking regulators set guidelines to limit subprime mortgage lending

Federal banking regulators issued a final Statement on Subprime Mortgage Lending [PDF] on Friday, turning aside banking industry efforts to weaken them. The most important change is that financial institutions are advised that adjustable-rate mortgages should only be given to borrowers who qualify to meet the loan terms even after the rate resets higher.

“The statement describes the prudent safety and soundness and consumer protection standards that institutions should follow to ensure borrowers obtain loans they can afford to repay. These standards include a fully indexed, fully amortized qualification for borrowers and cautions on risk-layering features, including an expectation that stated income and reduced documentation should be accepted only if there are documented mitigating factors that clearly minimize the need for verification of a borrower’s repayment capacity. Consumer protection standards include clear and balanced product disclosures to customers and limits on prepayment penalties that allow for a reasonable period of time, typically at least 60 days, for customers to refinance prior to the expiration of the initial fixed interest rate period without penalty.” read more >>

The L.A. Times. “In a statement Friday, Federal Reserve Gov. Randall S. Kroszner said the guidelines were designed to ensure that borrowers could afford their mortgages after the low-cost period expired. "It's only good business sense for the lenders, and it's the right thing to do for the borrowers' sake,’ he said.”

“Members of Congress and consumer advocates have criticized U.S. bank regulators for lax oversight as problems emerged in the industry of marketing high-cost, sub-prime loans to borrowers with weak credit.”

“Nonetheless, lenders cautioned that regulatory overreaction would have a chilling effect that could make credit unavailable to deserving borrowers.”

“A representative of the mortgage-banking industry suggested Friday that regulators might have gone overboard with the latest standards. ‘This is a strong statement that will help curb abuses but will likely also constrain consumer credit choices,’ John M. Robbins, chairman of the Mortgage Bankers Assn., said in a statement.”

From Bloomberg: “‘We clearly have a profound problem,’ FDIC Chairman Sheila Bair said in an interview today. ‘It is going to get worse before it gets better, and decisive action was required,’ she added. ‘Everybody was asleep at the switch.’”

“The guidelines come too late to repair the growing crisis in subprime mortgages. The effort also didn't satisfy lawmakers, who want regulators to complement the guidelines with enforceable rules. While bank examiners can strong-arm banks with the recommendations, consumers can't file lawsuits based on them because they aren't laws.”

“Focus now turns to the Fed, which is reviewing whether there's a need to codify the standards. While central bank policy makers have preferred to rely on guidance and disclosures, Fed Governor Randall Kroszner said they will ‘seriously consider’ using its rule-making authority to prevent abuses.” read article >>

From the Housing Bubble Blog,
Will These New Standards Have Any Teeth?