The Rush For Fool’s Gold
It’s Friday desk clearing time for this blogger. “A San Francisco woman has broken back into the house she lost in a foreclosure. Neighbors cheered as Carolyn Gage promised to defy a court-ordered eviction in the Bayview neighborhood of San Francisco. Gage says she did everything she could to keep the house her father built. When reporters asked about the particulars of her case, she wouldn’t give any details, but a check of court records show that in November 2006, Gage took out a $525,000 adjustable rate mortgage that started at 11.99 percent.”
“Her first payment was due two months later, but she never made it. She didn’t pay the next month, nor did she pay the following month. Lawyers for the company that owns the mortgage told ABC7 Gage never made a payment, declared bankruptcy multiple times, filed a case in federal court and lost for failing to state a relevant claim.”
“When asked again if she could answer some of the details, she said, ‘at a later date, as I said before, I will speak to you.’”
“Saturday night turned to Sunday morning in lower Manhattan’s Zuccotti Park. Before the protest, Lauren DiGioia, 26 years old, was living with her father in Clifton, N.J., in a home facing foreclosure. ‘My dad was a music teacher in the Jersey City public school system for a long time,’ she continued. ‘He’s a musical genius. He went to Julliard. .. He’s a conservative Republican. .. He was tenured. And they cut funding.’”
“‘He’s 65,’ she said. ‘He’s tried to make money any way he can. He’s tried getting into real estate. He’s tried these get-rich-quick online things. He gives music lessons privately. He plays the organ at churches. He really does whatever he can, but he’s running out of options.’”
“DiGioia has lost dreams, too. She left college after a couple of years. She also sang in a band, and wants to sing in a band again. ‘This occupation is basically a microcosm of our current society,’ she said. ‘Everything that is already wrong with our world is magnified here.’”
“More than 100 Minnesotans from faith, labor and community groups rallied outside of the annual meeting of the Minnesota Chamber of Commerce. Sheronda Orridge has owned her home in St. Paul since 1997 and has stayed current on her mortgage—even when her small business struggled in the economic downturn and even after her payment increased. After she refinanced six years ago she noticed that despite making her payment every month, her loan balance kept going up. She found out that she had a type of loan called a ‘negative amortization.’”
“‘I’ve done everything right and everything they asked me to,’ Orridge said. ‘We need to hold the banks accountable.’”
“More than 500 people packed the auditorium of Eberhart Elementary School. Stepping up to the microphone was Anna Medina. Through a series of events, Bank of America has decided to foreclose on her mortgage. They can afford their mortgage payments but not the amount they are in the arrears. ‘My family has income. We can now pay. We just need a fresh start,’ said Medina.”
“Tens of thousands of homeowners facing short sales or foreclosure may be able to catch a break between now and Saturday at the Tampa Convention Center, where Bank of America is holding a loan modification event. William Pfanakuch says he’s about $100,000 upside-down on his home in Port Charlotte, but he wants to stay in it.”
“‘I haven’t paid in about a year and a half now. I’ve been trying to re-negotiate the loan for about two years now,’ he said, ‘and they’re finally setting up programs like this. It’s a great event.’”
“Housing Counselors at the South Bay Homeownership Fair had encouraging news for homeowners on at a gathering on Saturday. Access to a $2 billion fund called Keep Your Home California is now easier, so more people qualify for federal and state funds that could reduce the amount they owe on their mortgages. ‘If any homeowner ever refinanced their property, took any cash out, again, they were barred from the program. I’m happy to say that as of last Monday, that restriction was removed,’ said Ali Tarzi of Community Housing Works.”
“Taking aim at government housing policies for the poor, Republican presidential candidate Michele Bachmann argued this week that ‘the federal government demanded politically correct loans be made by banks, and they demanded that the lending standards be lowered so that people who lacked credit-worthiness were given loans by banks, not necessarily because the banks wanted to give those loans.’”
“Not everyone agrees with Bachmann’s interpretation. ‘The law doesn’t require lenders to make risky loans,’ said Ed Goetz, director of the Center for Urban and Regional Affairs at the University of Minnesota. ‘The housing crisis was fueled by subprime lending and a lending market that was out of whack.’”
“The majority finding of the bipartisan Financial Crisis Inquiry Commission, appointed by Congress, reported in January that Fannie and Freddie ‘followed rather than led Wall Street and other lenders in the rush for fool’s gold.’ Now, as aftermath of the crash becomes a central fault line in the 2012 elections, voters will have their pick of villains.”
“‘Regarding the housing meltdown,’ said Peter Bell, a TCF Bank board member, ‘no one’s hands are clean.’”
“Sen. Bob Menendez (D., N.J.) and his fellow Democrats — as well as self-proclaimed socialist senator Bernie Sanders — voted unanimously to protect subsidies for millionaires’ mortgages. In fact it was another measure Menendez himself sponsored: an amendment to an appropriations bill that will allow Fannie Mae, Freddie Mac, and the Federal Housing Administration to back home loans as large as $729,750. With help from a handful of Republicans, his measure cleared the Senate 60–38.”
“Menendez proclaimed that Congress must raise the limit back to almost three-quarters of a million dollars in order to save the ‘middle class.’ Not raising the limit ‘makes it harder for middle class homebuyers to get credit when credit is tight,’ Menendez said. A Wall Street Journal editorial noted, ‘the average sales price for existing homes in September was $212,700.’ And even in Menendez’s home state of New Jersey, the median sale price of homes was only $303,100 in August, as calculated by Zillow.”
“If this increased loan limit becomes law, it would mean that purchasers of these expensive homes — millionaires and near-millionaires almost by definition — could save thousands of dollars from below-market interest rates thanks to government guarantees. Yet so far, there have been few if any condemnations of this government privilege for the wealthy from groups involved in the supposedly populist Occupy Wall Street. And this — as well as the movement’s general silence on the government-sponsored enterprises Fannie and Freddie’s outsized role in the financial crisis - exposes the stink of hypocrisy (on top of the many other reported scents) from much of the OWS movement.”
“In a February white paper, the Obama administration had commendably recommended letting the loan limit expire so ‘larger loans for more expensive homes will once again be funded only through the private market.’”
“A San Francisco mansion has sold for $29.5 million. Nearby properties listed for $40 million to $60 million in the Pacific Heights section known as the Gold Coast never sold, said Patrick Barber, head of the San Francisco office of Pacific Union International, the property’s listing brokerage. The 1922 mansion sold for 24 percent less than the original listing price of $39 million and below the most recent asking price of $33.9 million.”
“‘Homes now are priced realistically, and they’re selling,’ Barber said.”
