Did Bankruptcy Reform Create More Mortgage Defaults?
May 17, 2010 — Wall Street Journal

As we reported recently, people whose mortgage payments are reduced through loan modifications often are still drowning in other types of debt. The loan-mod treatment can be akin to using a small Band-Aid to try to cover up a mortar-sized wound.

Foreclosures threaten Metro Detroit housing recovery
May 17, 2010 — The Detroit News

A budding recovery in Metro Detroit home prices could soon be wiped out by a new wave of foreclosures and a growing stockpile of bank-owned homes and condos.

Housing market diagnosis: Bipolar
May 17, 2010 — CNN Money

NEW YORK — Bipolar is what comes to mind when diagnosing the post-homebuyer tax credit market. There are two separate forces pulling it in opposite directions, and experts aren't yet sure which path the market will take.

Foreclosure fix stalls in legislature
May 17, 2010 — NewsandSentinel

MARIETTA - An Ohio bill focusing on preventing home foreclosures seems to have stalled in the state Senate, while area foreclosure filings continue at a high, and often climbing, rate.

Lenders offer 'cash for keys' to speed foreclosures
May 17, 2010 — Minnesota Public Radio

Columbia Heights, Minn. — With the foreclosure crisis continuing, banks are struggling to clear foreclosures from their books. To help speed the process, many mortgage lenders are offering people cold hard cash to vacate their homes more quickly.

April Foreclosures Ebb, Suggesting High Plateau
May 11, 2010, Reuters

Foreclosure activity fell in April as lenders repossessed homes at a record pace but started far fewer new actions against struggling homeowners, signaling a plateau in loan failures, RealtyTrac said on Thursday. View this Associated Press video clip. Read more at: USA TODAY.  Bloomberg. Washington Post. Associated Press.


Optimists Are "Not Paying Attention" to the Facts, Says Dean Baker
May 11, 2010, Yahoo Finance

Among the crowded ranks of economists and market watchers, Dean Baker stands out. Baker presciently called the housing bubble when he published“The Run-up in Home Prices: Is It Real or Is It Another Bubble?” in 2002. So does our guest Baker see the so-called housing recovery now? "No. I mean I think people that are saying that just aren't paying attention to what's in front of their eyes," says Baker, an American economist and co-director of the Center for Economic and Policy Research.


Fannie Offers Mixed Signals on the State of Housing
May 11, 2010, Wall Street Journal

By now, everyone is used to big quarterly losses at Fannie Mae and Freddie Mac. On Monday Fannie posted an eye-popping $11.5 billion loss for the January-to-March period, days after Freddie said it had lost $6.7 billion during the same period. As Tuesday’s story notes, the losses are so big—and they keep coming, quarter after quarter—because Fannie and Freddie are so heavily, singularly exposed to the housing market. They sit on $5.5 trillion in mortgages and loan guarantees, and as more Americans lose their jobs and are weighed down in homes that are worth less than the amount they owe, defaults are climbing. Around 5.5% of Fannie’s loans are 90 days or more past due, and the same is true for around 4.1% of Freddie’s loan book.


FHA Puts 90-day Freeze on Foreclosures in Flooded Areas
May 10, 2010, Nashville City Paper

In Nashville on Monday, U.S. Secretary of Housing and Urban Development Shaun Donovan said he’s ordered all Federal Housing Administration lenders to place a 90-day moratorium on all home foreclosures in Tennessee’s flood disaster areas. “It is simply wrong for a family that has been struck by a natural disaster like you’ve seen here in Nashville, across Tennessee, to be victimized again by foreclosures because they cannot make their payment,” Donovan said. “So we have declared all FHA lenders are putting in place a 90-day moratorium.”

Mortgage Defaults Show Signs of Slowing
May 10, 2010, Los Angeles Times

Is the tide of home-loan defaults finally beginning to recede?  There were signs of that on Monday in two reports examining trends in serious delinquencies — home loans on which borrowers are at least 60 days behind on payments.  A report from the credit data firm TransUnion said such delinquencies fell slightly across the nation in the first quarter of 2010 — the first such decline in three years. The rate was 6.77 percent of all home loans, down from 6.89 percent in the fourth quarter of last year.


CoreLogic Data Shows Decline in Negative Equity
May 11, 2010, DSNews.com

The number of mortgaged residential properties sinking under the weight of negative equity declined slightly during the first three months of this year, CoreLogic reported Monday. ccording to the company’s market data, just over 11.2 million, or 24 percent, of all homes in the United States with a mortgage were worth less than the outstanding loan balance at the end of the first quarter of 2010. That figure is down from 11.3 million at the end of last year.


Republican Senators Pressing to End Federal Control of Fannie, Freddie
May 11, 2010, Washington Post

As the Senate resumed debate Monday on legislation to overhaul financial regulation, leading Republican lawmakers are pushing an amendment that would wind down the government-controlled mortgage finance giants Fannie Mae and Freddie Mac. Congressional aides say the amendment is unlikely to pass. But as Congress argues over what to do with Fannie and Freddie, the hole burns deeper at the companies. Fannie reported Monday that it lost $11.5 billion in the first three months of the year and needed $8.4 billion from taxpayers to stay afloat.


Minnesota Sees More Foreclosures Coming
May 11, 2010, StarTribune.com

In a sign that the housing recovery is still on shaky legs, foreclosures in Minnesota in the first quarter rose for the fourth straight quarter, reaching the third-highest level during the current housing crisis.

U.S. Added 290,000 Jobs in April
May 7, 2010, Wall Street Journal

The U.S. economy in April added jobs at the fastest pace in four years, but the unemployment rate unexpectedly rose. The Labor Department said nonfarm payrolls rose by a higher than expected 290,000 jobs last month — the largest gain since March 2006. That followed an upwardly revised 230,000 increase in March. However, as a reminder of the labor market's continued weakness, the unemployment rate increased to 9.9 percent last month. Economists were expecting it to remain at March's 9.7 percent level.

Fed Officials Develop Plan to Shrink Central Bank's Mortgage Portfolio
May 7, 2010, Wall Street Journal

Federal Reserve officials have agreed to sell some of the central bank's $1.1 trillion of mortgage-backed securities at some point, but have been unable to reach a firm consensus on how soon or how aggressively to do that, according to several people familiar with the matter. Many Fed officials want to wait until after the central bank has started to raise short-term interest rates and tighten financial conditions, which could be many months away, but a minority is eager to move sooner.

High-End Homeowners Falling Into Foreclosure Trap
May 7, 2010, CNBC News

Heated pools, ocean views and media rooms are not what most people would expect to find in a foreclosed property, but more high-end homes—priced over a million dollars—have been falling into the hands of banks this year. Foreclosures of homes worth over $1 million began increasing at the end of 2009, according to exclusive data provided by foreclosure tracking website RealtyTrac.

Where Americans Are Losing Home Equity Most
May 6, 2010, Forbes

Though the nation's unemployment picture appears to be improving, and some economists are cautiously talking of the recession's end, homeowners in several metro areas continue to feel its sting. Nevada and Florida were some of the hardest-hit states when the real estate market unraveled in 2007, and the pain there persists. Last week the S&P/Case-Shiller 20-city home price index revealed that February prices in Las Vegas, Miami and Tampa dropped an average of 8.3% over the same time a year earlier.

Bailed Out Homebuilders Collect Fat Paychecks
May 7, 2010, Reuters

No one rode the U.S. housing bubble higher than the company that calls itself "America's Builder," D.R. Horton Inc. During the boom years, Horton and its peers sprawled across the map, opening new divisions and buying up smaller fry in an industry-wide frenzy of expansion and acquisition. In 2006, the year home prices peaked, D.R. Horton's sales did as well, with 53,099 home sales closed. Its founder predicted the company would break the 100,000-unit barrier by 2010. That will not happen -- not this year, not anytime soon.

Bomb Suspect Faced Foreclosure
May 4, 2010, Wall Street Journal

Faisal Shahzad was losing his Connecticut home to foreclosure, disliked President George W. Bush, and was an almost invisible presence at the American university where he earned two degrees. Those are some of the details in the still-emerging portrait of the man who authorities say has implicated himself in the botched Times Square bomb plot.


Pending Home Sales Rise 5.3 Percent in March
May 4, 2010, Washington Post via AP

The number of buyers who signed contracts to purchase homes surged more than expected in March, another sign that government incentives are propelling the housing market this spring. The National Association of Realtors said Tuesday its seasonally adjusted index of sales agreements for previously occupied homes rose 5.3 percent from a month earlier to a reading of 102.9.


Is Strategic Default a Menace?
April 27, 2010, City Journal

In his recent article in City Journal, economist Luigi Zingales suggests that strategic defaults are immoral and socially irresponsible. He also criticizes me, along with Roger Lowenstein of the New York Times, for supposedly contributing to the social menace of strategic default. Before I respond, let me emphasize that the decision to default strategically on a mortgage involves many complex, localized, and individualized factors.


Commercial Real Estate Carnage Continues
May 5, 2010, Fox Business

The troubled commercial real estate market continued to ravage the community banking sector last month as federal banking regulators closed 23 banks, the highest monthly toll in nearly a year. In total, the April bank closings cost the Federal Deposit Insurance Corporation nearly $9 billion as banks loaded with commercial real estate and construction loans continued to falter at a record pace.