Case-Shiller Index: Home Prices Increase in Q4 2013

first_img May 13, 2014 674 Views  Print This Post Servicers Navigate the Post-Pandemic World 2 days ago in Daily Dose, Featured, Headlines, Market Studies, News Demand Propels Home Prices Upward 2 days ago Demand Propels Home Prices Upward 2 days ago Case-Shiller CoreLogic Home Prices Housing Starts Housing Supply 2014-05-13 Tory Barringer Servicers Navigate the Post-Pandemic World 2 days ago Tagged with: Case-Shiller CoreLogic Home Prices Housing Starts Housing Supply Previous: FHA Program Aims to Expand Credit; Lower Risk Next: FHFA Announces Future Plans for Fannie Mae and Freddie Mac With 2014 nearing its halfway point, a broad spectrum look at more than 380 markets nationwide confirms home prices jumped 11.3 percent in 2013’s final quarter compared to the year prior.CoreLogic released Tuesday its own quarterly Case-Shiller Indexes, assembled using the company’s proprietary data supplemented with statistics from the Federal Housing Finance Agency (FHFA). The analysis differs from the monthly S&P/Dow Jones Case Shiller Indices in that it covers a wider range of markets over a different time frame.While price percentages nationwide were up by double-digits in Q4, seven cities managed to shoot up into the 20 percent range year-over-year, with Las Vegas leading at 25.6 percent growth. The remaining six cities were all in California: Riverside (+23.8 percent), Oakland (+23.3 percent), Sacramento (+23.0 percent), Los Angeles (+20.3 percent), San Jose (+20.1 percent), and San Francisco (+20.0 percent).The sharp increase comes as no surprise for the region, which has suffered from low inventory levels throughout the recovery.“Limited construction of new homes and low inventories of existing homes for sale contributed to the jump in prices,” said Dr. David Stiff, principal economist for CoreLogic Case-Shiller. “Developers remain cautious about building too many new houses until they see stronger demand in their markets.”Additionally, prices climbed up to new peaks in a number of metros, including Houston, Dallas, Denver, Honolulu, and Pittsburgh.“These cities have never achieved price levels quite this high, not even in the record year of 2006,” Stiff said.Even with so many markets remaining hot, CoreLogic is among those industry analysts calling for a drop-off in price gains this year. Through December 2014, the company predicts price appreciation will slow to 5.3 percent nationally, though that still comes in above the long-term annual average of 4.5 percent.“For the remainder of 2014, investor demand and sales of foreclosed properties should drop off quickly. Traditional buyers are returning slowly to the market, but cannot replace demand from investors who led the market in recent years,” Stiff said. The Week Ahead: Nearing the Forbearance Exit 2 days ago Related Articlescenter_img The Best Markets For Residential Property Investors 2 days ago The Best Markets For Residential Property Investors 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Sign up for DS News Daily Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Case-Shiller Index: Home Prices Increase in Q4 2013 Share Save Data Provider Black Knight to Acquire Top of Mind 2 days ago Home / Daily Dose / Case-Shiller Index: Home Prices Increase in Q4 2013 Data Provider Black Knight to Acquire Top of Mind 2 days ago Subscribelast_img read more

Trulia: Undervalued Homes Squash Housing Bubble Concerns

first_img Home Prices Housing Bubble Trulia Undervalued Homes 2014-06-26 Krista Franks Brock The Best Markets For Residential Property Investors 2 days ago Previous: HUD: Allegations Settled over Maternity Leave Discrimination Next: Survey: Realtors Continue to Invest in Mobile Technology The Best Markets For Residential Property Investors 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago June 26, 2014 2,205 Views Trulia: Undervalued Homes Squash Housing Bubble Concerns Tagged with: Home Prices Housing Bubble Trulia Undervalued Homes About Author: Krista Franks Brock Sign up for DS News Daily While persistent price gains continue to dominate headlines, homes in a majority of major markets across the country remain slightly undervalued, quashing any concerns of a rising housing bubble, according to the latest data from Trulia.Nationally, homes remain undervalued by 3 percent compared with long-term fundamentals, according to Trulia’s Bubble Watch.Market-level data reveals 76 of the 100 largest metros remain undervalued, and most of the overvalued markets are less than 10 percent overvalued.”While the number of overvalued markets is rising, there remains little reason to worry about a new, widespread bubble forming,” said Trulia chief economist Jed Kolko.Just seven of the 100 largest metro markets are currently overvalued by more than 10 percent.Furthermore, Trulia points out even today’s most overvalued markets are nowhere near their bubble levels of overvaluation. For example, Orange County, California, the most overvalued market, is currently overvalued by 17 percent. This compares to 71 percent at the height of the bubble in 2006.Honolulu and Los Angeles tie for second place on Trulia’s list of overvalued markets. Homes in both metros are overvalued by 15 percent. However, in the first quarter of 2006, Honolulu homes were overvalued by 41 percent, and Los Angeles homes were overvalued by 79 percent, according to Trulia.The trend reads similarly down the list of top 10 overvalued markets, with the exception of Austin, Texas. Prices in Austin are currently overvalued by 13 percent, compared to just 8 percent at the height of the bubble. Trulia explains, “that’s because Austin (and Texas generally) avoided the worst of last decade’s bubble and bust.”Overall, Trulia expects national home prices to rise to a neutral level—neither undervalued nor overvalued—by the end of this year or the start of next year. Slowing price gains at the national level leave no concerns for a rising bubble, according to Trulia.Currently, three of the top five undervalued markets are in Ohio, with Akron and Cleveland topping the list with homes currently undervalued by 21 percent.Detroit, Michigan, and Dayton, Ohio, follow. Homes are undervalued by 19 percent and 16 percent, respectively, in these two markets. However, both markets are experiencing double-digit price gains, so Trulia does not expect them to linger on the most undervalued list for long.Trulia determines whether a market is overvalued or undervalued by comparing home prices to price-to-income ratio, price-to-rent ratio, and long-term price trends. The Week Ahead: Nearing the Forbearance Exit 2 days ago Demand Propels Home Prices Upward 2 days ago Demand Propels Home Prices Upward 2 days agocenter_img Servicers Navigate the Post-Pandemic World 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Related Articles Share Save Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia.  Print This Post in Daily Dose, Featured, Headlines, Market Studies, News Home / Daily Dose / Trulia: Undervalued Homes Squash Housing Bubble Concerns Data Provider Black Knight to Acquire Top of Mind 2 days ago Subscribelast_img read more

Senator Bob Menendez Wants Answers From FHFA Director Watt

first_img Demand Propels Home Prices Upward 2 days ago Tagged with: FHFA Freddie Mac Senator Bob Menendez U.S. Senator Bob Mendendez (D-New Jersey) has written a letter to FHFA Director Mel Watt seeking answers regarding Freddie Mac’s failure to meet two lending goals for low-income buyers in 2014.Menendez, Ranking Member of the Senate Subcommittee on Housing, Transportation, and Community Development, cited preliminary findings in the FHFA’s annual housing report. The Senator noted that Freddie Mac had failed to meet its single-family low- and very low-income home purchase goals last year and asked Watt what the agency is going to do to make corrections in these two areas.“This means that fewer low-income households were able to secure homeownership opportunities in 2014,” Menendez said. “At a time when access to mortgage credit remains tight, particularly for those low-income and minority households, it is more important than ever that the GSEs meet the affordable housing goals.”The national homeownership rate has been on the decline since peaking at 69 percent in 2004; during the summer of 2015, it dropped to its lowest level in nearly 50 years, 62.4 percent. It recently increased—for the first time in two years—up to 64.5 percent, although that is still the lowest homeowership rate in the country since 1994.“Homeownership is a critical tool for lower income and minority families to build wealth [and] for many…, their home is their singular source of equity,” Menendez said. “In communities where lending and access to credit is inadequate, many families rely on the equity in their homes to start a small business, to pay for a child’s higher education, or to finance the care of an elderly parent. Affordable housing goals continue to play a crucial role in facilitating access to credit for underserved markets, and I urge you to hold the GSEs accountable for any failures to meet such goals.”“Affordable housing goals continue to play a crucial role in facilitating access to credit for underserved markets, and I urge you to hold the GSEs accountable for any failures to meet such goals.”Senator Bob MenendezThe above table shows Freddie Mac’s Single-Family Housing Goals and Performance Results for 2014. For each housing goal, the percentage shown reflects the proportion of mortgages that met the criteria for that goal. The proportion of Freddie Mac’s mortgages that met the low-income purchase goal and very low-income purchase goal fell short of both the benchmark and market levels for 2014.Menendez asked Watt to “provide detailed responses” to the following three questions in the letter:What factors, circumstances, or policy decisions led to Freddie Mac falling short of its affordable housing goals in 2014?Should FHFA make a final determination that Freddie Mac failed to meet its affordable housing goals for 2014, what remedial actions will FHFA take to address the deficiency?Should FHFA make a final determination that Freddie Mac failed to meet its affordable housing goals for 2014, what steps will the agency take to ensure that Freddie Mac complies with affordable housing goals in the future?When contacted by DS News, an FHFA spokesperson acknowledged that the Agency has received Menendez’s letter and said the Agency plans to issue a response. In a letter regarding the preliminary determination of Freddie Mac’s housing goals performance for 2014 from Watt to Freddie Mac CEO Donald Layton, Watt said that “Under the Safety and Soundness Act, Freddie Mac has 30 days to submit any documentation it wishes FHFA to consider in making a final determination about Freddie Mac’s compliance with the housing goals for 2014.”Click here to read the entire text of Menendez’s letter.Click here to see FHFA’s report. Subscribe November 19, 2015 1,002 Views The Best Markets For Residential Property Investors 2 days ago Sign up for DS News Daily Share Save About Author: Brian Honea in Daily Dose, Featured, Government, News Related Articles Servicers Navigate the Post-Pandemic World 2 days ago Home / Daily Dose / Senator Bob Menendez Wants Answers From FHFA Director Watt  Print This Postcenter_img Data Provider Black Knight to Acquire Top of Mind 2 days ago Senator Bob Menendez Wants Answers From FHFA Director Watt FHFA Freddie Mac Senator Bob Menendez 2015-11-19 Brian Honea The Week Ahead: Nearing the Forbearance Exit 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Demand Propels Home Prices Upward 2 days ago Previous: Shrinking REO Inventory Drives Down Cash Sales Share Next: SouthLaw, P.C., Attorney Named to Super Lawyers Rising Star List Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Brian Honea’s writing and editing career spans nearly two decades across many forms of media. He served as sports editor for two suburban newspaper chains in the DFW area and has freelanced for such publications as the Yahoo! Contributor Network, Dallas Home Improvement magazine, and the Dallas Morning News. He has written four non-fiction sports books, the latest of which, The Life of Coach Chuck Curtis, was published by the TCU Press in December 2014. A lifelong Texan, Brian received his master’s degree from Amberton University in Garland. Data Provider Black Knight to Acquire Top of Mind 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago The Best Markets For Residential Property Investors 2 days agolast_img read more

Re-examining Data Privacy Under the FCRA

first_img Re-examining Data Privacy Under the FCRA Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Borrowers consumers data FinTech GAO Lending Predatory Lending Practices Senate Banking Committee Technology World Privacy Forum 2019-06-11 Radhika Ojha June 11, 2019 3,370 Views Share Save The Best Markets For Residential Property Investors 2 days ago Previous: How Best to “Age in Place” Next: U.S. Real Estate is a Hot Commodity for Foreign Buyers in Daily Dose, Featured, Government, News About Author: Radhika Ojha  Print This Post Servicers Navigate the Post-Pandemic World 2 days ago The structure and practices of the data broker industry and technology companies, such as large social media platforms and the gaps that exist in federal privacy law as well as the changes to federal law, including the Fair Credit Reporting Act (FCRA), that should be considered to give individuals real control over their data were the focus of discussion at a Senate Banking Committee hearing on Tuesday.Dr. Alicia Cackley, Director of Financial Markets and Community Investment at the Government Accountability Office (GAO); and Pam Dixon, Executive Director of the World Privacy Forum answered the committee’s questions at this hearing titled, “Data Brokers and the Impact on Financial Data Privacy, Credit, Insurance, Employment, and Housing.”Opening the proceedings, Sen. Mike Crapo, Chairman of the Senate Banking Committee said that more personal information was available to companies than ever before “as a result of an increasingly digital economy.”“In particular, data brokers and technology companies, including large social media platforms and search engines, play a central role in gathering vast amounts of personal information, and often without interacting with individuals, specifically in the case of data brokers,” Crapo said.Giving an example of how fintech was impacting unregulated credit scores, Cackley said, “Fintech lenders offer a variety of loans such as consumer and small business loans and operate almost exclusively online. In our 2018 report, we noted that while these lenders may still assess borrowers’ creditworthiness with credit scores, they also may analyze large amounts of additional or alternative sources of data to determine creditworthiness.” Additionally, she said that the report also found that some fintech firms collected more consumer data than traditional lenders. “For example, fintech lenders may have sensitive information such as consumers’ educational background or utility payment information, and according to certain stakeholders, these data may contain errors that cannot be disputed by consumers under FCRA,” Cackley told the committee.Dixon offered four observations about this subject during her testimony:Credit scores and predictions are being sold that are not regulated by the FCRAThe technology environment is facilitating more scores being used in more places in consumers’ lives, and not all uses are positiveThese scores are created without due process for consumers These scores can cause consumers exceptional harmShe also offered two solutions to Congress to overcome these challenges by expanding the Fair Credit Reporting Act to regulate the “currently unregulated financial scores that affect consumers” and enacting a standards law that “will provide due process and fair standard setting in the area of privacy.” Answering a question on whether all consumer scores were covered under the FCRA so that there’s a similar appeals process to resolve inaccuracies, Dixon said, “No consumer credit scores that are currently unregulated covered under the FCRA. Unless it is a formal credit score that is articulated by the FCRA and used under an eligibility circumstance it’s not covered.”Answering a question by Sen. Crapo on how unregulated credit scores that were created for people and managed by artificial intelligence (AI) impacted consumer credit and their financial decisions, Cackley said that while these scores may not be the official credit scores taken from the credit bureaus that were regulated by FCRA, “they can be applied to decisions that companies make about the kind of products they offer to people, and the price those products are offered.” Cackley added that the products were offered “based on a score that a consumer doesn’t necessarily see and can’t even tell if it is correct or can’t make any attempt to improve the score even if they know it exists.”Speaking about how predatory lenders tend to take advantage of these scores, Dixon, answering a question by Ranking Member Sen. Sherrod Brown, said that her organization often got calls from people who received advertisements for financial products they didn’t understand “that they could have gone out in the market and affirmatively looked for the best offer.”“So these predatory marketing devices based on unregulated scores are very significant. Other significant scores are those that predict repayment of the debt,” she said. “For example, the poorest of consumers are targeted the most for debt repayment by companies that use [unregulated data] like the consumer lifetime value scores that impact how well you’re treated by businesses.” Similarly, she added that companies and education institutions also used a score called the “neighborhood risk scores that decide the way forward for a kid’s education.”“This is a modern way of redlining because if we are going to be scored by where we live how have we advanced and how have all the laws that are meant to protect from such things operating if such things are still happening?” Dixon asked.Click here to read Dixon and Cackley’s testimonies and watch the hearing. Related Articles Home / Daily Dose / Re-examining Data Privacy Under the FCRAcenter_img Demand Propels Home Prices Upward 2 days ago Demand Propels Home Prices Upward 2 days ago Tagged with: Borrowers consumers data FinTech GAO Lending Predatory Lending Practices Senate Banking Committee Technology World Privacy Forum Data Provider Black Knight to Acquire Top of Mind 2 days ago The Best Markets For Residential Property Investors 2 days ago Radhika Ojha is an independent writer and copy-editor, and a reporter for DS News. She is a graduate of the University of Pune, India, where she received her B.A. in Commerce with a concentration in Accounting and Marketing and an M.A. in Mass Communication. Upon completion of her masters degree, Ojha worked at a national English daily publication in India (The Indian Express) where she was a staff writer in the cultural and arts features section. Ojha, also worked as Principal Correspondent at HT Media Ltd and at Honeywell as an executive in corporate communications. She and her husband currently reside in Houston, Texas. Data Provider Black Knight to Acquire Top of Mind 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Subscribe Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Sign up for DS News Daily The Week Ahead: Nearing the Forbearance Exit 2 days agolast_img read more

Non-QM Mortgage Bond Market Misconceptions

first_img Servicers Navigate the Post-Pandemic World 2 days ago  Print This Post Previous: How Europe’s Example Could Help Address America’s Housing Crisis Next: Hazards Ahead for the National Flood Insurance Program Seth Welborn is a Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer. Sign up for DS News Daily Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Share Save The Week Ahead: Nearing the Forbearance Exit 2 days ago Non-QM Mortgage Bond Market Misconceptions About Author: Seth Welborn Home / Daily Dose / Non-QM Mortgage Bond Market Misconceptions Non-QM bond issuances have been on the rise, Bloomberg reports. But even amidst this positive move, some skeptics worry about non-QM’s performance along the road ahead. With misconceptions and negative pre-recession associations lingering, how is non-QM paving the way for responsible lending to borrowers who don’t fit within the QM bucket, without the pitfalls of subprime?According to Barclays, this surge comes as initial indications of delinquency rates on the loans are starting to emerge, about 3% to 5% in some bonds. However, Bloomberg states that the non-QM bond market is too small for now to cause the kind of broader disruptions that subprime bonds did before the recession. The bonds themselves also have more safeguards for investors than they used to. According to a Fitch Ratings analysis, an average of 36% of principal would have to be lost before the top-rated slice took a hit. The cushion in crisis-era “alt-A” bonds with the same rating was just 6%.Speaking with MReport, Denis G. Kelly, SVP of Sprout Mortgage, recently noted that non-QM loans are a different breed.”Non-QM loan performance is very strong right now,” Kelly said. “That’s the number one. Are you making responsible loans? The misconception may be that they equate it to what was happening in 2006, 2007, 2008—those were a very different type of loan.”Aaron Samples, CEO of First Guaranty Mortgage, echoed this sentiment, noting the misconceptions surrounding non-QM loans as “sub-prime.”“The biggest challenges lenders face today are around the stigma of the product being misunderstood as a sub-prime product,” Samples told MReport.According to the American Enterprise Institute, the non-QM market is the fastest-growing segment of non-agency residential mortgage-backed securities in the U.S., despite still being a relatively small slice of the pie. The non-QM market is on track to double, or even triple, last year’s securitization issuance within this year.S&P found that there have been 20 odd transactions year-to-date, totaling over $6 billion in issuance, which is already almost double 2017’s full-year volume. S&P also notes that, when compared to other RMBS categories, non-QMs have prepaid quicker, often soon after loan origination. The report found a conditional prepayment rate (CPR) 35%.“It’s not the subprime we remember from 2006 to 2007,” said Mario Rivera, Managing Director of the Fortress Credit Funds business, which has bought non-QM bonds. “It’s more of a second or third inning of non-QM. We’re getting the best collateral before the more aggressive lending comes in.” November 5, 2019 3,099 Views Demand Propels Home Prices Upward 2 days ago The Best Markets For Residential Property Investors 2 days ago The Best Markets For Residential Property Investors 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago 2019-11-05 Seth Welborn Data Provider Black Knight to Acquire Top of Mind 2 days ago Related Articles Demand Propels Home Prices Upward 2 days ago in Daily Dose, Featured, News, Secondary Market Subscribelast_img read more

Rising Rates for Minority Homeownership

first_img Share Save Rising Rates for Minority Homeownership The Week Ahead: Nearing the Forbearance Exit 2 days ago Home / Daily Dose / Rising Rates for Minority Homeownership November 19, 2019 1,269 Views Demand Propels Home Prices Upward 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Tagged with: Housing Market 2019 Minority Homebuyers Data released by the Census Bureau’s Housing Vacancies and Homeownership Survey found the minority homeownership rate rose 0.9% to 48.3% during Q3 2019. This year-over-year increase is higher than the overall U.S. homeownership rate, which rose 0.4 percentage points to 64.8% during the quarter. The Hispanic homeownership rate saw the highest increase, rising 1.6 percentage points to 47.9% during the quarter. Homeownership for African-Americans gained 0.8 percentage points for a rate of 43.3%—the largest gain in African-American homeownership since Q3 2017. Five of the prior six quarters saw declines in African-American homeownership. A report by USA Today, with information by Redfin, reported the median-income African-American households could afford just 25% of the homes on the market last year—a decline from 39% in 2012. The median-income white households could afford 57% of homes for sale in 2018, which is also a decline from 69% seven years ago. “African Americans who haven’t been able to buy a home since the recovery began have only seen prices rise further and further out of budget,” says Daryl Fairweather, Redfin’s Chief Economist.Las Vegas, Nevada, saw the largest decline in affordability for the average African-American household, with just 14.7% of home affordable last year. This is a steep decline from 61.2% in 2012.Other markets that saw large drops were: Orlando, Florida; Riverside, California; and Phoenix, Arizona. All markets listed saw affordability fall by at least 30%. The California cities of San Jose, San Francisco, San Diego, and Los Angeles are the most financially out of reach, as African-Americans could afford must 0.3% to 1.3% of homes on the market. Census Bureau states that minorities listed as “Other households” (Asian, Pacific-Islander, Native American, and other races) saw its homeownership rate drop to 58.9%. White homeownership grew by just 0.3 percentage points to 73.4% during Q3 2019. Data says the White homeownership rate has not witnessed a year-over-year decline since Q1 2017.  The Best Markets For Residential Property Investors 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago  Print This Postcenter_img Data Provider Black Knight to Acquire Top of Mind 2 days ago Previous: A Major Factor Behind Mortgage Delinquencies Next: Senator Warren Unveils Updated Housing Plan in Daily Dose, Featured, News The Best Markets For Residential Property Investors 2 days ago About Author: Mike Albanese Housing Market 2019 Minority Homebuyers 2019-11-19 Mike Albanese Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Demand Propels Home Prices Upward 2 days ago Sign up for DS News Daily Related Articles Mike Albanese is a reporter for DS News and MReport. He is a University of Alabama graduate with a degree in journalism and a minor in communications. He has worked for publications—both print and online—covering numerous beats. A Connecticut native, Albanese currently resides in Lewisville. Subscribelast_img read more

Fed Chair Discusses Administering Additional Stress Tests

first_img in Daily Dose, Featured, Government, News  Print This Post Tagged with: Federal Reserve House Financial Services Committee Treasury Department Governmental Measures Target Expanded Access to Affordable Housing 2 days ago The Best Markets For Residential Property Investors 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Related Articles July 1, 2020 1,159 Views Previous: Could COVID-19 Impact How Housing is Perceived? Next: Assisting Homeowners Coming Out of Forbearance Subscribe Servicers Navigate the Post-Pandemic World 2 days ago Demand Propels Home Prices Upward 2 days ago Federal Reserve House Financial Services Committee Treasury Department 2020-07-01 Mike Albanese The Week Ahead: Nearing the Forbearance Exit 2 days agocenter_img Servicers Navigate the Post-Pandemic World 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago The Best Markets For Residential Property Investors 2 days ago Fed Chair Discusses Administering Additional Stress Tests During a hearing Tuesday, several members of the House Committee on Financial Services commended the Treasury and the Federal Reserve’s response to the COVID-19 pandemic as they discussed next steps in response to the pandemic’s economic impact, including additional aid and further stress testing of financial institutions.Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin testified before the committee, discussing their separate and joint actions during the pandemic and future steps in economic aid.Mnuchin was optimistic about the state of the economy moving forward, while Powell portrayed the future of the economy as “extraordinarily uncertain,” noting that it “will depend in large part on our success in containing the virus” as well as on the “policy actions taken at all levels of government to provide relief to support the recovery for as long as needed.”“While recent economic data offer some positive signs, we are keeping in mind that more than 20 million Americans have lost their jobs, and that the pain has not been evenly spread,” Powell said, noting that women, African Americans, and Hispanics have been disproportionately impacted.Mnuchin said the economy is “in a strong position to recovery.” He focused on recent positive signs for the economy, especially the May employment report, which included a gain of 2.5 million jobs.“While the unemployment rate is still historically high, we are seeing additional signs that conditions will improve significantly in the third and fourth quarters this year,” Mnuchin said.He highlighted the positive impact of the Paycheck Protection Program.Mnuchin said he believes any additional aid should be earmarked for the businesses and industries hardest hit by the crisis, including restaurants, with a focus on “jobs and putting all American workers who lost their jobs, through no fault of their own, back to work.”“We will be beginning to have conversations about supplemental relief legislation. We look forward to working with Congress on a bipartisan basis in July on any further legislation that may be necessary,” Mnuchin said.Powell spoke on the issue of stress testing at financial institutions saying that the pandemic materialized during the stress tests. As such, the Fed added three new scenarios to its tests. The 33 institutions tested all proved adequately capitalized.Powell said the Fed would be asking banks to submit more information with another round of potential stress scenarios as the impacts of the pandemic continue to unfold.When asked why the Fed is requiring additional stress testing and “why lock up additional capital now,” Powell responded, “We’re not looking to raise capital standards during a crisis. That’s not what’s going on here.”Also, during the hearing, Powell highlighted the Federal Reserve’s actions to stabilize markets during the pandemic. When the markets for Treasury securities and mortgage-backed securities began to “experience strains” in mid-March, the Fed purchased Treasury securities and agency MBS.With markets more stable, the Fed began to ease their purchases, but Powell said the Fed “will increase our holdings of Treasury securities and agency MBS over the coming months at least at the current pace” while continuing to monitor markets. Krista Franks Brock is a professional writer and editor who has covered the mortgage banking and default servicing sectors since 2011. Previously, she served as managing editor of DS News and Southern Distinction, a regional lifestyle publication. Her work has appeared in a variety of print and online publications, including Consumers Digest, Dallas Style and Design, DS News and DSNews.com, MReport and theMReport.com. She holds degrees in journalism and art from the University of Georgia. Governmental Measures Target Expanded Access to Affordable Housing 2 days ago About Author: Krista F. Brock Demand Propels Home Prices Upward 2 days ago Share Save Sign up for DS News Daily Home / Daily Dose / Fed Chair Discusses Administering Additional Stress Testslast_img read more

Is Chapter 7 Bankruptcy Broken?

first_imgAccording to the U.S. Courts website, the fundamental goal of the Federal bankruptcy laws enacted by Congress is to give debtors a financial “fresh start” from burdensome debts and provides for “liquidation” in a Chapter 7 filing—the sale of a debtor’s property and the distribution of the proceeds to creditors.The Question Is, Does It?Bankruptcy was created to give individuals a legal vehicle to settle debts or negotiate manageable terms. In general, trustees do a great job working with debtors to resolve the vast majority of their debt. However, when real estate is involved, the options outlined in the federal bankruptcy laws are rarely followed, creating greater burden, hampering, or making it impossible for debtors to truly receive a “fresh start.”Bankruptcy law is well defined and offers several solid solutions for both the debtors and creditors, but in most cases, these options are never allowed. It seems hard to believe, but if you dive into the process and the structure of how cases are administered, both the law and the intent of the law take a back seat to reality.In Chapter 7 bankruptcy, a trustee is appointed to administer the case. The primary role of the U.S. Trustee Program is to serve as the “watchdog over the bankruptcy process.”As stated in the Mission Statement: The mission of the United States Trustee Program is to promote the integrity and efficiency of the bankruptcy system for the benefit of all stakeholders—debtors, creditors, and the public. For this service, the trustee receives a fee for administering the estate and a percentage of any assets sold.Although the Trustee must be fair to the debtor, their interests aren’t always aligned.The Trustee Handbook states: “The Chapter 7 Trustee is the representative of the estate. 11 U.S.C. § 323(a). The Trustee is a fiduciary charged with protecting the interests of all estate beneficiaries—namely, all classes of creditors, including those holding secured, administrative, priority, and non-priority unsecured claims, as well as the debtor’s interest in exemptions and any possible surplus property.”The statement seems pretty straightforward and relatively simple, but where does everything go wrong?Let’s Break It DownWhen an individual files Chapter 7 bankruptcy and they own real estate, they either “retain” or “surrender” the property.If the individual elects to “retain,” they intend to keep their home and negotiate or eliminate the other debts. However, if they chose to surrender, this is where things go astray.When a debtor surrenders a property, the trustee becomes the legal administrator/seller and has a fiduciary to sell the property or give it back to the secured creditor to settle the debt. In most cases, this does not happen.If the trustee sells the property, then they are fulfilling their duty to both secured and unsecured creditors, and will apply proceeds from the sale to unsecured creditors (medical bills, credit cards, etc.) in the estate.Alternatively, the trustee can choose to abandon the property, which removes it from the bankruptcy estate. There are several reasons why a trustee might decide to abandon a property from the bankruptcy. Suppose the property sale didn’t bring enough meaningful value to the estate, the property had title issues, or they could not generate meaningful compensation for the trustee’s time spent working on the case.Often a trustee shies away to avoid scrutiny from governing authorities such as the United States Trustees’ office, which regulates the trustees’ activities. Also, their local judge in the district may have a different view on selling assets because they may be over-encumbered assets.These are all valid issues which stem from a broken system. Trustees, creditors, and even creditors’ counsel become adversarial rather than working together to align all parties’ interests for a positive outcome.Most debtors and their legal counsel believe that once an asset is surrendered, they are off the hook. The onus to resolve the lien falls back on the debtor. The secured creditor has few options when this happens, and if the debtor does not workout financial arrangements with the creditor, they mainly file foreclosure and eventually take possession of the property.This creates emotional turmoil and long-lasting financial hardship on the debtor when their intent was to work out a solution for the surrendered property.To make matters worse, a foreclosure has a much more significant impact on a debtor’s credit future. Bankruptcy or a short sale will impact a credit score about 85–160 points (higher scores have the most significant impact), but this is only short-term, providing the debtors the ability to reestablish their credit in 18-24 months and the ability to buy another home.Foreclosure, on the other hand, stays as a negative mark on a credit report for seven years, preventing the debtor from housing credit and much more. Even after that time passes, a new mortgage will still be at a much higher rate.If a trustee abandons the property and the real estate lien is not resolved while in bankruptcy, the debtor loses the benefit of bankruptcy, suffering total financial hardship, and robbing the debtor of the ability to receive that “fresh start” that is the goal of a bankruptcy.For the secured creditor, selling property in bankruptcy versus foreclosing saves an average of $49,000 on a $250,000 home—a preferable outcome for a creditor to save money and complete a non-foreclosure outcome, but when the secured creditor is denied their right to have the home sold in bankruptcy the mortgage creditor suffers that loss. The courts will argue that they have remediation options outside of bankruptcy.However, since selling in bankruptcy is a much better option and elected by the debtor to have the home sold; not allowing this sale to occur creates significant financial hardship for both the debtor and creditor. This is not the intention bankruptcy law was intended to provide.Why does this happen?Well, several issues lead to this result.The Role of the TrusteeThe trustee is commissioned to administer the debtor’s estate and receives $60 for this service plus a percentage of funds distributed to other creditors in the estate.Trustees are appointed by and report to “The Office of the United States Trustee” (UST). The UST is an executive branch agency that is part of the Department of Justice. Its responsibilities include monitoring the administration of bankruptcy cases and detecting bankruptcy fraud.Trustees are under constant examination from the UST’s office and can be sanctioned for any malfeasance, both real or perceived. The focus is primarily on potential fraud from the trustee receiving fees for the services they provide and rarely is the focus on the benefits to the debtors and creditors. This perceived scrutiny that comes with the sale of an asset often discourages a Trustee from completing their fiduciary duty.Court DistrictsBankruptcy law is federal law; however, it is governed by approximately 94 court districts across the country and differs on its application from district to district.Bankruptcy law clearly defines how real estate assets are sold in section 11 U.S.C. §363. The law goes into great detail for over-encumbered assets, giving the trustee several options depending on the circumstances and the consent of all stakeholders. Today, there are several districts that “do not allow” the sale of “short sales” (over-encumbered assets) either by the UST’s office or the judge.The reasons that short sales are not allowed in certain districts range from differing applications of the law on the transactions. The most common misconceptions are that these transactions are fraudulent and don’t help the debtor, short sales never help the creditor, or that these transactions will only benefit paying professionals and the trustees. These misconceptions by the courts and the trustees are at the heart of the issue. In a proper 11 U.S.C. § 363 transaction, none of these generalizations are founded.This makes you question if the law allows debtors and creditors their rights under section 11 U.S.C. § 363, why are they denied court approval for the sale if they abide by the rules governed by the law?Good Question?Where this doesn’t make much sense is when a debtor elects to surrender their property to be sold and the Secured Creditor (mortgage servicer) has agreed to accept a short payoff, and they agree to pay the trustee a carve-out fee to administer the sale, creating meaningful value to the estate and unsecured creditors.This follows Bankruptcy Code, yet the UST or judge denies the sale. Doesn’t that violate their rights?The law is also clear that when selling fully encumbered property, the trustee must administer the sale to avoid a diminution of funds otherwise available for unsecured creditors, 11 U.S.C. § 704, 28 U.S.C. § 586. The trustee has a fiduciary duty to ensure the law is followed and should sell an asset to settle the debt to protect and preserve funds available to the unsecured creditors. However, this rarely ever happens as the system is broken. Bridging the gap between mortgage servicers, their counsel, and trustees results in a far better outcome for all parties involved.So, how do we fix the process to ensure debtors and creditors can exercise their rights and utilize bankruptcy for the benefits it is intended to provide? It seems this is never a topic for discussion and why most creditors consider bankruptcy as a “black hole.”It might be time to reassess and improve the process.Some potential solutions might be:Modifying the bankruptcy trustee’s compensation to ensure the requirements in bankruptcy are fulfilled.Having a different focus from governing authorities to ensure the law is followed and not focused only on fees and compensation.Ensuring that when all parties consent and are within the law, they have the legal right to proceed with a sale.Bankruptcy is one of our legal rights and one of the greatest benefits of our financial, legal system. Over time, regulation, process, and interpretation have turned the bankruptcy process into a black hole for creditors and the end of the road for debtors, resulting in a lose-lose for all stakeholders.Is It Time to Fix the Process and Restore the Rights of Debtors and Creditors?We have come a long way since we started on this mission, but there is still a long, long way to go. Today, there is a large portion of the country where trustees will not entertain a “short sale” in bankruptcy even though the trustee has a fiduciary responsibility to administer the sale. Ultimately, the debtors and creditors should have the legal right to request the sale.  Print This Post Demand Propels Home Prices Upward 1 day ago Demand Propels Home Prices Upward 1 day ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Servicers Navigate the Post-Pandemic World 1 day ago Data Provider Black Knight to Acquire Top of Mind 1 day ago Share Save Tagged with: Bankruptcy Bankruptcy Code Brad Geisen Chapter 7 Creditors Foreclosure Brad Geisen, CEO of BK Global, is a 35-year veteran of the default real estate industry and a serial entrepreneur, always focusing on creating smart solutions with better outcomes. He is known for creating online real estate solutions such as Foreclosure.com, HomePath.com, HomeSteps.com, TaxLiens.com, HUDHouses.com, and many more. He developed and ran a pilot program forHUD, which became the highly effective HUD M&M Program. Geisen created the first online offer management platform, which has become the industry standard used by mortgage servicers and the GSEs. in Daily Dose, Featured, Government, Journal, News Sign up for DS News Daily The Best Markets For Residential Property Investors 2 days ago Is Chapter 7 Bankruptcy Broken?center_img Subscribe The Best Markets For Residential Property Investors 2 days ago Servicers Navigate the Post-Pandemic World 1 day ago 18 days ago 755 Views The Week Ahead: Nearing the Forbearance Exit 2 days ago About Author: Brad Geisen Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Related Articles Data Provider Black Knight to Acquire Top of Mind 1 day ago Previous: Sky’s the Limit for SFR Market  Next: Are Smaller Homes the Cure to Inventory Concerns? Home / Daily Dose / Is Chapter 7 Bankruptcy Broken? Bankruptcy Bankruptcy Code Brad Geisen Chapter 7 Creditors Foreclosure 2021-05-12 Eric C. Pecklast_img read more

Donegal may benefit from new investment fund

first_img Google+ 450 jobs are expected to be created across Ireland as a 70 million dollar transatlantic investment fund is announced.Smart-Invest will provide funding for Irish companies to expand into the U.S, and for U.S companies to establish bases here in Ireland.30 technology-led companies will be supported, with counties Louth, Donegal, Meath, Roscommon and Antrim highlighted as key areas for investment.Gerry Moan, CEO of SmartInvest explains how the fund works……..Audio Playerhttp://www.highlandradio.com/wp-content/uploads/2014/10/moansmartinvest.mp300:0000:0000:00Use Up/Down Arrow keys to increase or decrease volume. By News Highland – October 6, 2014 Pinterest RELATED ARTICLESMORE FROM AUTHOR Donegal may benefit from new investment fund Facebook NPHET ‘positive’ on easing restrictions – Donnelly Help sought in search for missing 27 year old in Letterkenny 448 new cases of Covid 19 reported today Google+ Twittercenter_img Three factors driving Donegal housing market – Robinson WhatsApp Calls for maternity restrictions to be lifted at LUH Facebook Twitter WhatsApp Pinterest News Previous articleAppeal after reports of attempted child abduction in DerryNext articleMan due in court on rape charge following Derry attack News Highland Guidelines for reopening of hospitality sector publishedlast_img read more

Inishowen briefing on Derry City of Culture opportunities

first_img Twitter Inishowen briefing on Derry City of Culture opportunities Google+ Facebook 448 new cases of Covid 19 reported today Calls for maternity restrictions to be lifted at LUH Business representatives and community groups from around Inishowen are being invited to attend a 2013 City of Culture Briefing on Monday 25th June at the Inishowen Gateway Hotel in Buncrana,The briefing is being organised by Inishowen Tourism, Buncrana Town Council and the City of Culture Team.The event is aimed at informing businesses and community groups about the programme of events being organised for 2013 and potential social and economic opportunities they present for Inishowen.Inishowen Tourism also intends in the coming weeks to hold three community group workshops throughout the peninsula to identify possible community projects that will compliment the City of Culture offering.Inishowen Tourism have already appointed Jennifer O’Donnell as City of Culture & Trade Liaison Officer, a dedicated resource that will strengthen communication and the working partnership with Derry in the run up to and throughout 2013 for the maximum benefit of Inishowen. Pinterest WhatsApp Facebook Three factors driving Donegal housing market – Robinson Google+center_img Newsx Adverts WhatsApp Previous articleFF councillor takes mayoral chain in BuncranaNext articleGAA – Derry Name Team To Face Donegal News Highland By News Highland – June 14, 2012 NPHET ‘positive’ on easing restrictions – Donnelly RELATED ARTICLESMORE FROM AUTHOR Twitter Pinterest Help sought in search for missing 27 year old in Letterkenny Guidelines for reopening of hospitality sector publishedlast_img read more