BUBBLETALK: Fresh thread to talk about the Late Great Housing Ponzi Scheme

February 23, 2007

BUBBLETALK: Fresh thread to talk about the Late Great Housing Ponzi Scheme

Post "Great Unwinding" article highlights and tinyurls, talk about random stuff, have a good chat, keep it clean...

440 comments:

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Anonymous said...: Data, data, data. Keynes once said that orgainzing financial affairs based on the completion of the earths orbit around the sun (1 yr) made no sense at all. Same is true on timing and estimating bubbles. I love it when people look at the sham of yoy data. So this means miami had only a 6% decline in one year, not a crisis they say and we HPers are morons. Well look at the data for example for the peak of the miami bubble for median price of houses in the 75 percentile. August 2005--median house in the 75% went for 719k. February 2007--median house in 75% percentile went for 559k--a 22% drop. Nothing to sneeze at my denier friends. To capture the median at the peek a 22% decline would require a 28% increase--no way! So my dear HP ers, lets agree on a bubble measuring methodlogy. lets agree on date of peak for bubble and track decline accordingly!!!!; February 23, 2007 5:31 AM
Anonymous said...: H&R Block sees 3rd-quarter loss because of mortgage lending arm woe.

H&R Block the largest U.S. income tax preparer, reported a quarterly net loss on Thursday Feb 22, 2007, weighed down by the subprime mortgage unit Option One Mortgage.

Option One makes home loans to borrowers with subprime -- poor -- credit, a business under pressure as the U.S. housing market cools and loans made in recent years go sour.

This downturn again took a hit out of Block earnings. The company increased its loan loss reserves for the business by $111 million, reflecting expectations that more loans may go bad.

http://abcnews.go.com/
Business/wireStory?
id=2897396; February 23, 2007 5:36 AM
Anonymous said...: Federal Deposit Insurance Corp noted one failure of a federally insured bank or thrift this year. Metropolitan Savings Bank of Pittsburgh closed earlier this month.

Slumping home prices and rising interest rates pushed banks' write-offs of home mortgage loans to a three-year high in the fourth quarter, data released Thursday show.

"A weakening mortgage market (has) made the operating environment more challenging" FDIC Chairman Sheila Bair said ``bankers and regulators should ensure that risk-management practices are also equal to the challenges.''

Home-mortgage delinquencies and foreclosures are surging, especially for people who took out subprime mortgages higher-interest loans for those with blemished credit records or low incomes who are considered higher risks during the sizzling housing boom that waned in the latter half of 2005.

Writeoffs of home mortgage loans by banks and thrifts totaled $888 million in the October-December period, a three-year high, according to figures in the FDIC's quarterly banking profile. Home loans that were 90 days or more past due rose by $3.1 billion, or 15.6 percent, from the year-earlier quarter following an increase of $974 million, or 5.2 percent, in the third quarter.

http://wcbs880.com/topic/
ap_news.php?story=AP/APTV
/National/f/f/Earns-
Banks_f_f_9----; February 23, 2007 5:49 AM
Anonymous said...: A Painful Hiss from the Subprime Balloon

Michael Simonsen, president and CEO of Altos Research, which studies California and 15 other major U.S. real estate markets, says subprime lenders' recent performance is "one of the scariest signs" for the larger housing market.

The Ripple Effect

"The majority of the subprime business is with first-time buyers. So it may take several years to shake out," Simonsen says. "But when it comes time to sell and trade up we may find that the low end has been squeezed out."

In other words, a meltdown in the subprime market could affect the supply of future buyers for years to come.

Tightening credit standards may also ripple through the broader market.

Lenders across the spectrum are rewriting their loan guidelines, checking applicants' incomes and credit histories far more diligently, and generally becoming more rigorous in the face of consumer and regulatory scrutiny.

That will lead to fewer loans and less access to credit.

http://www.businessweek.com
/bwdaily/dnflash/content/
feb2007/db20070221_
387085.htm; February 23, 2007 5:56 AM
Anonymous said...: Late payments for residential mortgages shot up by 15.6 percent in the fourth quarter, as an inverted yield curve and weakening mortgage market made the operating environment more challenging.

The Federal Deposit Insurance Corporation, which insures deposits at more than 8,600 banks and savings institutions, said the increase in late mortgage payments followed a 5.2 percent increase in the third quarter.

Noncurrent mortgage loans - payments that are more than 90 days late - grew by $3.1 billion in the last three months of 2006 after rising by $974 million in the third quarter, the FDIC said.

Richard Brown, FDIC's chief economist, said regulators are seeing emerging signs of distress among subprime loans, especially with hybrid mortgages that subject borrowers to higher monthly payments after introductory interest rates.

Bank regulators are considering new rules on popular loans for subprime borrowers with less-than-stellar credit that carry low introductory rates but can rise over the life of the loans.

Consumer advocates have warned that loose underwriting standards will soon have homeowners buried under mortgage debt.

Brown said that total subprime mortgages outstanding amount to about $1.3 trillion, of which $700 billion are held by private asset-backed securities issuers.

That means banks, thrifts and other mortgage lenders are holding about $500 million in subprime mortgages, Brown said.

http://money.cnn.com/2007/
02/22/real_estate/
mortgage.reut/index.htm?
section=money_latest; February 23, 2007 6:05 AM
Anonymous said...: Moody’s: Five Subprime Servicers Face Ratings Downgrade

Moody’s Investors Service said late Wednesday that it had placed five of the nation’s largest subprime servicers — Ameriquest, Specialized Loan Servicing, New Century, Accredited, and NovaStar — on review for a possible servicer ratings downgrade.

According to a review of past ratings actions at Moody’s, the move likely represents the first time the agency has simultaneously placed several large lenders on a ratings review. Moody’s cited increasing risks to liquidity at each company as the driving factor behind its decision to review the ratings of each servicer.

In addition to citing ongoing troubles in the subprime credit sector, the rating agency also acknowledged increasing volatility in the Alt-A mortgage market as well.

http://www.housingwire.com/
2007/02/22/moodys-five-
subprime-servicers-face-
ratings-downgrade/; February 23, 2007 6:11 AM
Anonymous said...: The “spill-over effect” of Subprime market to ALT-A market.

Central Pacific Mortgage is selling six wholesale branch offices, according to an announcement Wednesday. More than half of the operation's $180 million monthly volume has reportedly been Alt-A.

New York Mortgage Trust Inc. said it has agreed to sell substantially all the assets of New York Mortgage Co.'s wholesale lending arm in a transaction expected to close by the end of the month.

The wholesale operation was originally launched in July 2005 to generate ARMs and Alt-A loans, the company announced at the time.

http://www.tickertech.com/
cgi/?a=news&ticker=a&w=
&story=200702200702200700PR
_NEWS_USPR_____DATU024; February 23, 2007 6:16 AM
Anonymous said...: BUY SILVER - (SLV)
BUY MINERS - (GDX)(HL)
BUY YEN & EUROS
SHORT THE MARKET

DO IT NOW!; February 23, 2007 2:49 PM
Anonymous said...: This comment has been removed by a blog administrator.; February 23, 2007 8:13 PM
Anonymous said...: Let the small MBS Investors beware of the tricks in the industry:

Hedging Against Decline

Issuers of CMBS sometimes sell Treasuries or other fixed- rate products as protection against a market decline that would have increased the interest rate on the bonds. Once the mortgage- backed securities are sold, the hedge would be dismantled by buying back the fixed-rate products.

Hedge Funds are temporary pulling their money out of Mortgage Back Securities to temporary park their money in US Treasury so that they can drive the yields on MBS back up.

What happens when hedge funds find a buying opportunity and start to pull their money out of US Treasury? Treasury yields goes up.

Anyone wonder why Vice President Dick Cheney has dumped another (estimated) $10 to $25 million in a European bond fund

Is Cheney counting on a steadily weakening dollar as subprime market callapse?

http://www.infoshop.org/
inews/article.php?
story=20070218082106650

An index of credit-default swaps on 20 subprime mortgage bonds with the lowest investment-grade ratings sold in the second half of last year dropped to a record low for a sixth straight day, as companies lending to the riskiest borrowers report losses.

Delinquencies and Defaults

The index fell 7.7 percent today and is down 30 percent since Jan. 18. The level of delinquencies and defaults on subprime mortgages made last year is the highest ever for such loans at a similar age, according to New York-based Bear Stearns Cos. At least 20 subprime lenders have shut down, scaled back or sold themselves to larger companies since the start of 2006, according to data compiled by Bloomberg.

``You see a market like that starting to break down" said James Caron, head of U.S. interest-rate strategy in New York at primary dealer Morgan Stanley.

http://www.bloomberg.com/
apps/news?pid=20602007&
sid=aGFy8tYbITyg&refer=
rates; February 23, 2007 8:44 PM
Anonymous said...: Subprime Mortgage Risk Rises for a Fifth Week, Derivatives Show.

The perceived risk of owning low- rated subprime mortgage bonds surged, heading for the fifth straight weekly increase, as companies that lend to the riskiest borrowers continued to report losses.

An index of credit-default swaps on 20 securities rated BBB- , the lowest investment grade, and sold in the second half of 2006 tumbled 7.7 percent to 68.5 today, according to Deutsche Bank AG. It's down 30 percent since trading started Jan. 18, meaning an investor would pay more than $1.25 million a year to protect $10 million of bonds against default, up from $389,000.

``Despite some sporadic buying, sentiment remains mostly negative and many believe the index will go lower,'' said Peter DiMartino, an asset-backed securities strategist at RBS Greenwich Capital in Greenwich, Connecticut.

The index has dropped to record lows for six straight days as some investors used it to bet on the declining fortunes of the housing market and of companies that make loans to the riskiest borrowers rather the performance of the underlying bonds.

The level of delinquencies and defaults on subprime mortgages made last year is the highest ever

http://quote.bloomberg.
com/apps/news?pid=
20601087&sid=aDRm_g4rEh8c

In other words, small MBS investors could make more money taking the risk on currency exchange and buy Eurobond like what Vice Prsident Dick Cheney is doing.; February 23, 2007 9:03 PM
Anonymous said...: This comment has been removed by a blog administrator.; February 23, 2007 9:24 PM
Anonymous said...: A stronger Euro is a weaker Dollar

The U.K. economy grew at the fastest pace in 2 1/2 years in the fourth quarter as household spending and investment surged.

Gross domestic product increased 0.8 percent from the previous three months, the most since the second quarter of 2004, the Office for National Statistics said today in London, confirming an estimate from Jan 24. The annual growth rate was 3 percent, up from 2.9 percent in the third quarter.

Economic growth picked up on a boom in financial services and rising house prices, and the Bank of England predicts the expansion will accelerate in 2007 to the fastest pace in three years. Some policy makers are pushing for a fourth interest-rate increase since August on concern growth will fan inflation.

http://www.bloomberg.com/
apps/news?pid=
email_en&refer=uk&sid=a.
wm7Iy7rIhg; February 23, 2007 9:44 PM
Anonymous said...: This comment has been removed by a blog administrator.; February 23, 2007 10:50 PM
Anonymous said...: Wow, one day I'll have to visit New Zealand, Australia, and Iceland to thank them for helping me to make so much money. Those currencies are really flying along, aren't they?; February 23, 2007 11:09 PM
Anonymous said...: "this is all better than a "B" movie this is only beginning"

Hey Keith, we need HP's video taping these crazy open houses to post on this blog. That would be entertaining.; February 23, 2007 11:14 PM
Anonymous said...: "‘I am shell shocked after the conference that took place yesterday, and quite annoyed that I participated in the collective hallucination that led so many into such a disaster.'’"

I just threw up inside my mouth.; February 23, 2007 11:23 PM
Anonymous said...: Who said the problems in the subprime market can not spread to main street mortgage business?

Bank of America says it saw short sales of homes increase 25% last year, albeit from relatively low levels. In San Diego, the number of entries in the local multiple-listing service that include the words "short sale" has climbed to 129 from 50 a little more than a year ago, according to Sandicor, the local multiple-listing service.

www.realestatejournal.com/
buysell/mortgages/
20070221-simon.html?
mod=RSS_Real_Estate_Journal
&rejrss=frontpage; February 23, 2007 11:47 PM
Anonymous said...: Gold is nearing 700 mark today.

Is the Fed finally losing its credibility?

With Wednesday’s data release that showed that the increase in “core” CPI in January was higher than expected, the price of gold soared by over $20 per ounce.

My guess is that the market is calling the Fed’s bluff. Gold investors may have finally concluded that when it comes to fighting inflation, the Fed is all bark and no bite. Despite the tough talk, many are now convinced that Bernanke will not risk pushing the U.S. economy into recession in an effort to contain inflation.

With the sub-prime mortgage market unraveling, the last thing the Fed wants is to add kerosene to the fire in the form of higher interest rates.

If gold investors now believe that the Fed will tolerate higher inflation, then any signs of heightened inflation can now be seen as purely bullish for gold.

This is an extremely significant development with profound implications for U.S. financial markets, particularly long-term bonds, the housing market, and the entire U.S. economy.

If investors are finally wising up to the Fed’s bluster, a run on the dollar can not be too far off. To maintain international confidence in our currency, the Fed must be credible in its resolve to fight inflation.

If our foreign creditors decide that “Helicopter” Ben is more concerned about keeping housing prices up than he is about keeping consumer prices down, they will rush for the exits.

http://news.goldseek.com/
EuroCapital/1172250090.php; February 24, 2007 12:14 AM
Anonymous said...: Keith,

HouseBubble.com is now in chinese. Maybe the link on your blog is no longer necessary.; February 24, 2007 12:53 AM
Anonymous said...: “ResMae Mortgage Corp. may be on the cutting edge of a trend in the U.S. subprime-loan industry. It’s bankrupt and selling assets for pennies on the dollar.”

“ResMae, which made home loans to people with bad credit, will be auctioned off next week. The opening bid, by Credit Suisse Group, is $19.1 million, less than half the size of an offer received by ResMae before it went bankrupt Feb. 13.”

“More than 100 other lenders will go out of business this year, said Doug Duncan, chief economist of the Mortgage Bankers Association in Washington. Many will be subprime lenders, victims of loans to borderline borrowers last year.”

“‘Loans in 2006 will be the worst we have ever seen in the business,’ said Matthew Howlett, an analyst who covers the subprime market for an investment bank. ‘The underwriting quality was disastrous.’”; February 24, 2007 7:39 AM
Anonymous said...: This comment has been removed by a blog administrator.; February 24, 2007 6:35 PM
Dr. Brightside said...: I believe the economic strength will outweigh the fears in many of the U.S. housing markets. Just look at the article posted in the NY Times on monday, the strong local enonomy and job growth has quickly turned a second half of '06 slowdown to a Jan/Feb 2007 rally due to pent up demand. Many which they would have gotten in earlier, hindsight is 20/20. If you're on the fence may be a good time to buy. You'll make a lot more money as a contrarian than a sheep.

http://drbrightside.blogspot.com/2007/02/hit-links-on-saturday.html#links; February 24, 2007 10:28 PM
Anonymous said...: This has to be happening all across the nation.

Thursday, February 22, 2007
"Massive Backlog" In Denver

The Rocky Mountain News reports from Colorado. "Hundreds of foreclosures in Denver are on hold because of a massive backlog in the Clerk and Recorder's Office, putting lenders in a 'precarious position' and forcing the city to hire more help. On Wednesday, 661 foreclosure packets, which are supposed to be recorded within 10 days, were more than two weeks past due, according to an internal report obtained by the Rocky Mountain News."

"The problem is so bad that employees are working weekends to catch up and fielding urgent pleas from law firms handling foreclosures. 'I'm desperate!' starts off one e-mail to the clerk and recorder. 'I have a (Department of Housing and Urban Development) title package that has to be sent out tomorrow.'"

"Interim Clerk and Recorder Stephanie O'Malley said she inherited the problem when she was appointed to the post Jan. 9 by Mayor John Hickenlooper. 'The only thing I could do was say, 'I need to get more people in here to help move this process along,' and that is what I've done,' she said."

"O'Malley, who is running for the seat in May, said there are two factors contributing to the backlog. First, foreclosures in Denver have tripled since 2002."

"The other factor delaying Denver foreclosures points to former Clerk and Recorder Wayne Vaden, who resigned in the wake of the disastrous Nov. 7 election. While in office, Vaden approved the purchase of a $143,500 software program that requires employees to manually transfer data from about 2,500 older but active foreclosures into the new system."

"'My staff has been held captive in having to migrate data physically from that old system to the new system and be attentive to new packets,' O'Malley said. 'It is a lot of work.'"

"Rhonda Stewart, a deputy public trustee, said it used to take 10 minutes to process a foreclosure. With the new software, it now takes about 30 minutes, she said."

"Metro-area law firms that handle foreclosures and do business with the city either declined to comment or did not return calls. But in e-mails obtained by the Rocky, it is clear the backlog has put them under pressure. 'I know HUD could refuse title if we don't get it to them,' states another e-mail."

"HUD requires that all documentation, including the original or certified copy of a deed, be submitted within 45 days of the request for deed recording."

"O'Malley said the backlog 'doesn't bode well for the community.' 'When you just have these properties sitting there dormant, from a community standpoint, that's not a good thing,' she said."

"The delay also hurts business. 'If you have a piece of property out there that's (on hold), the lender is put in precarious position because now they're sitting on a piece of property of which they're not getting any revenues,' O'Malley said. 'There's no payment on the mortgage,' she said. And so their goal, of course, is to move the property so that they can get a return on their investment."; February 24, 2007 10:53 PM
Anonymous said...: I went to an open house up in Hollywood (CA) where I get my smokes.

It was being sold by Keller Williams Realty.

Is is not listed on the Keller Williams website nor is it listed in the MLS listings.

The house is a true POS with a flipper remodel IMO. Bamboo Floors...Granite Tile Counters. 1400sf approx. Dirt for a back yard. @5000sf Lot.

The flyer provided by the realtor listed the asking price at $800,000 - $1,300,000.

Quite a spread eh?; February 24, 2007 11:14 PM
Anonymous said...: This comment has been removed by a blog administrator.; February 25, 2007 3:27 AM
Anonymous said...: While in office, Vaden approved the purchase of a $143,500 software program that requires employees to manually transfer data from about 2,500 older but active foreclosures into the new system."

"'My staff has been held captive in having to migrate data physically from that old system to the new system and be attentive to new packets,' O'Malley said. 'It is a lot of work.'"
+++++++++
This is so freaking typical of bureaucracies. Stupid managers buy new software but they won't hire the employees necessary to implement the new program. Somehow, they think the current employees will "magically" be able to do twice or three times the amount of work in the same period of time. Idiots!; February 25, 2007 4:12 AM
Anonymous said...: Mexicans into the (California housing market) breach!

http://www.californiaprogressreport.com/2007/02/california_need_1.html; February 25, 2007 5:05 AM
Anonymous said...: Anyone think that Ten-year swap spreads can widened another 0.75 basis point on Monday?

U.S. interest rate swap
spreads widened on Friday amid worries of a potential spillover
of problems from the U.S. subprime mortgage sector.

Traders said volatility in the swaps market was related to the pricing of commercial mortgage-backed securities (CMBS)
deals and associated hedging.

The subprime industry, which provides loans to borrowers with weak credit, has been hit by defaults as home prices
slump.

Nearly 20 mortgage companies operating in the sector have faltered.

"There is some concern about potential spillover from the subprime market and that has caused spread widening," said
Fidelio Tata, interest-rate derivatives strategist at RBS Greenwich Capital in Greenwich, Connecticut.

"There is also some volatility associated with CMBS pricing and associated hedging," he said.

Swap spreads were 0.75 to 1.75 basis points wider compared to Thursday's late levels. Ten-year swap spreads widened 0.75
basis point to 52 basis points.

http://www.reuters.com/
article/bondsNews/
idUSN2326634820070223; February 25, 2007 5:32 AM
Anonymous said...: Subprime Credit Quality Submerging

GIVEN THE DETERIORATION EXPERIENCED of late in the subprime-mortgage sector, we thought it timely to update our work.

We first looked at our companies' subprime exposure in August 2006. The 2006 vintage is now performing substantially worse than in prior years, spreads on subordinated subprime securities have widened by 700-plus basis points, and 23 companies have failed and another half dozen have been acquired.

The pressure on the subprime segment is now coming from almost every direction, starting, of course, with the deterioration in credit quality.

http://online.barrons.com/
google_login.html?url=http%
3A%2F%2Fonline.barrons.com%
2Farticle%
2FSB117219030404416705.html
%3Fmod%3Dgooglenews_barrons; February 25, 2007 5:36 AM
Anonymous said...: US CREDIT-GMAC spread widen

The cost of insuring bonds issued by GMAC, the former finance arm of General Motors Corp., jumped this week on concerns about the subprime mortgage sector, where Residential Capital Corp., GMAC's mortgage finance holding company, operates.

On Thursday, GMAC was downgraded to "underweight" by Merrill Lynch & Co. analysts, who cited problems in the subprime mortgage sector. Such mortgages make up nearly a third of finance receivables and loans at GMAC, Merrill said.

Merrill's analyst also said that GMAC is now unlikely to achieve an investment-grade rating this year, and recommended investors hold 30 percent fewer GMAC bonds in their portfolios than benchmark indexes.

Credit default swaps for GMAC and ResCap have widened since the analyst downgrade

The cost to insure GMAC's debt rose about 16 basis points on Friday to 123.5 basis points, meaning it costs $123,500 annually to protect $10 million on a five-year basis. GMAC's default swaps rose 6 basis points during Thursday's session.

Credit protection on ResCap was quoted at about 11 basis points higher on Friday at 137.5 basis points, after jumping 20 basis points on Thursday.

A second factor likely weighing on GMAC's spreads is "the fact that GMAC is supposed to release their numbers" soon, a corporate bond trader said.

GMAC said earlier this month it would restate its financial results back to 2001 because of problems with its accounting for interest-rate hedges.

http://www.reuters.com/
article/bondsNews/
idUSN2359494620070223?
pageNumber=2; February 25, 2007 5:42 AM
Anonymous said...: BOJ rate rise could be good news.

The decision by the Bank of Japan (BoJ) to raise interest rates to 0.5% earlier in the week may serve to stimulate the Japanese economy rather than act as a break in the way that monetary tightening often affects other major economies.

Notably, the Japanese are assiduous savers and are not burdened by debt like their Western counterparts. Consumers’ being paid additional interest on their savings is bullish for domestic demand.

http://www.easier.com/view/
Finance/Investments/Funds/
article-102120.html; February 25, 2007 6:13 AM
Anonymous said...: FDIC Data Tells Me to Avoid Financials

The FDIC headline read, "Insured Banks and Thrifts Report Record Earnings in 2006" - Net operating income was up 4.0% in 2006, but was down 11.6% in the second half of the year - To me that's a major turnaround!

Under the Hood, FDIC Data Puts Wrinkles on Goldilocks! Banks are increasing their lending to developers to build new homes and condos, while demand continues to slump. This is happening because communities planned and started two to four years ago are not yet completed. Incomplete homes can not be sold to a homebuyer, and thus banks want projects to be completed. If this stress continues the economy could suffer, and weakness could spread beyond the housing market.

Number: The number of FDIC-Insured Institutions is declining as mergers exceed new charters.

Assets: Decelerating Asset Growth. At the end of 2006 the banking system had $11.860 trillion in assets with slowing sequential growth

Loans Secured By Mortgages: A sign of a slowing economy. Slowing sequential growth

1-4 Family Residential Mortgages: A sign of a slowing economy. Slowing sequential growth

Commercial Loans: Loans for office buildings was rising sequentially, but stalled in Q4.

Residential Construction and Development Loans: Slowing sequential growth but up 25.6% YOY, while demand for new Homes is down at least 30%.

Reserves for Losses: Turned negative sequentially in Q4.

Other Real Estate: This is a small absolute level, but the FDIC is likely worried about the 8.8% sequential increase and the 48.4% year-over-year rise. This is where loan collateral such as land gets hidden.

30-89 Day Past Due: Up 14.3% sequentially and 22.6% year-over-year.

Non-current: Up 8.0% sequentially and 13.6% YOY.

Net Operating Income: Peaked in Q2 at 37.6 billion. Declined 9.4% sequentially in the Q4

Summary of Data for the 1,256 Publicly- Traded FDIC-Insured Financial Institutions

* 450 (35.6%) have exposure to residential construction and development loans above the FDIC-monitored guideline of 100% of risk capital. 175 have exposures above 200%.

* 612 (48.7%) have exposure to CRE loans (residential plus commercial) above the FDIC-monitored guideline of 300% of risk capital.

www.rightsideadvisors.com/
feed/commentary.aspx?
Path=/rsa/commentary/blog/2
0070223_082440_msg.html; February 25, 2007 6:23 AM
Anonymous said...: SunTrust Mortgage is now ranked 14th in total mortgage originations and ninth in purchase mortgage originations, according to the president and CEO.

The one dark spot in his outlook for 2007 involves the deteriorating credit quality of alt-A loans, which includes IO and option ARMs, stated-income and piggyback loans.

“Our delinquencies are up,” said Mr. Edmunds, “but not as high” as the industry averages.

However, it appears that alt-A performance is “as bad as subprime loans or close to it,” he said. “Some of the alt-A and subprime companies have shut down because the buybacks are so heavy.”

http://www.suntrustmortgage
careers.com/retail/news0123
2007.asp; February 25, 2007 7:05 AM
Anonymous said...: S&P Puts Countrywide 'Alt-A' Bonds Under Review

As the mounting number of delinquencies begins to bleed from the subprime market into the “Alt-A” category, Standard & Poor announced that it had put a number of bonds backed by Countrywide Financial Corp. on review.

www.mortgageledger.com/
modules.php?
name=News&new_topic=14; February 25, 2007 7:37 AM
Anonymous said...: Tri-State Foreclosure Considered "Epidemic"

If you own a house, you need to know that a lot of homeowners are finding it harder to hold on to that home.

The foreclosure rate is so staggering in the Buckeye State, it's being called an "epidemic," and it's effecting even those of you who can afford your home.

9News found that Ohio has the highest foreclosure rate in the country. What it comes down to is that people don't realize they are buying more than

A sheriff's auction is not how any homeowner wants their house to be sold, but if you can't pay your bills your house will eventually end up for sale at an auction like those in Butler County.

The 9News investigation showed about 200 houses were foreclosed in Butler County in 1995.

In 2006, the number jumped 550% to 1,300.

The situation is similar in Hamilton County, where in 1995 there were 1,300 foreclosures. In 2006, there were 5,700.

http://wcpo.com/news/2007/
local/02/23/
foreclosure.html; February 25, 2007 7:51 AM
Anonymous said...: California Tops List of Subprime Mortgage Foreclosure Risk

Four of the five metro areas expected to experience the highest foreclosure rates for subprime mortgages originated in 2006 are California cities. The top five metro areas, along with their corresponding projected foreclosure rates are:

Merced, CA (25%)

Bakersfield, CA (24.2%)

Vallejo-Fairfield, CA (23.8%)

Las Vegas, NV (23.7%)

and

Fresno, CA (23.5%)

Of the top 15 metro areas projected to see the largest increase in foreclosure rates for subprime mortages (comparing the projected foreclosure rates for loans orginated between 1998-2001 and those originated in 2006), 14 are in California.

The areas with the largest projected increase in foreclosure rates are:

Santa Ana
Anaheim
Irvine
Santa Barbara
Santa Maria
San Diego
Carlsbad
San Marcos

http://www.muninetguide.com
/articles/California-Tops-
List-of-Subprime-203.php; February 25, 2007 7:55 AM
Anonymous said...: Bill targeting cash-back mortgage deals moves forward

Legislation to make mortgage fraud a felony is one step closer to becoming law.

A bill that would make the "white-collar crime" a felony punishable by up to 10 years in prison passed in the Arizona state Senate last week. The legislation, introduced by Sen. Jay Tibshraeny, R-Chandler, now must clear the House.

The mortgage-fraud legislation was prompted by the recent wave of mortgage fraud in the Valley centered on cash-back deals.

Those schemes involve getting a mortgage for more than a home is worth and pocketing the extra cash. The deals inflate home values and potentially values across entire neighborhoods. Homeowners stuck with overpriced mortgages may never recover the difference and may not be able to hold onto their homes.

Lenders end up with the bad loans. Mortgage fraud could hurt not only Arizona's real estate market but also the state's overall economy.

The mortgage-fraud legislation, Senate Bill 1221, makes it a Class 4 felony to commit residential mortgage fraud and a Class 2 felony to engage or participate in a pattern of that type of fraud. This Class 4 felony would be punishable by 1 1/2 to three years in prison; Class 2, four to 10 years.

http://www.azcentral.com/
arizonarepublic/business/
articles/0225biz-
catherine0225.html; February 25, 2007 7:58 AM
Anonymous said...: Moody's eyes downgrade for Home Lenders

Subprime mortgage lender Accredited Home Lenders Holding Co. expressed disappointment Thurday after Moody's Investors Service said it is considering downgrading the company's service quality rating.

http://www.businessweek.com
/ap/financialnews/
D8NETT000.htm; February 25, 2007 8:03 AM
Anonymous said...: This was a much better thread than most of the others; February 25, 2007 6:40 PM

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HousingPANIC - The Housing Bubble Blog with an Attitude Problem, 2005 - 2008

February 23, 2007

BUBBLETALK: Fresh thread to talk about the Late Great Housing Ponzi Scheme

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