Margert in the News
85,000 Homes Lost in October
The Full Story
Catherine Clifford
CNN
November 13, 2008
As government and industry scrambled to stem the housing crisis, another
84,868 homes were lost to foreclosure in October, according to a report released
Thursday.
Last month 279,561 struggling borrowers received foreclosure filings, including
default notices, notices of auction sales and bank repossessions, according to
RealtyTrac, an online marketplace for foreclosures. That's a 5% increase from
September, and up 25% from October 2007.
"October marks the 34th consecutive month where U.S. foreclosure activity has
increased compared to the prior year," said James J. Saccacio, chief executive
officer of RealtyTrac, in a statement.
A total of 936,439 homes have been lost to foreclosure since the housing crisis
hit in August, 2007.
Foreclosures hit a record high in August when 304,000 homes were in default and
91,000 families lost their houses. Since then, a number of states have adopted
legislation to freeze foreclosures and give homeowners a chance to modify their
mortgages. These laws have helped slowed the rate of foreclosures.
"The really sobering reality for us is that despite these various state programs
that are artificially keeping the numbers down, we are still up 25% from a year
ago," said Rick Sharga, senior vice president of RealtyTrac.
Making matters worse is the rapidly deteriorating economy, says Global Insight
economist Pat Newport.
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HEAP Eligibility and Benefit
Changes
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PULP E-Mail News
The Public Utility Law Project
November 26, 2008
As reported in last week’s edition, the
state Office of Temporary and Disability Assistance (“OTDA”) has now confirmed
that it will be providing a $100 Regular HEAP benefit supplement to heater
households that have already received their regular HEAP grant and will increase
the amount of the regular grant for heaters by $100 for new applicants. It is
also issuing second emergency HEAP benefits to eligible households. OTDA was
able to make these changes because it received more HEAP funding from the
federal government than originally anticipated and the current State HEAP Plan
permits such adjustments. OTDA is, however, publishing for comment under SAPA
its proposed changes to the State HEAP Plan that will increase the income
eligibility for emergency benefits. If approved, the income eligibility
guidelines for Emergency HEAP benefits would be raised to 75 percent of state
median income, up from 60 percent in the current State HEAP Plan.
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Bailouts: $7 Trillion and
Rising
The Full Story
David Goldman
CNN
November 26, 2008
The U.S. government is now willing to spend more than $7 trillion to help
rescue the economy. That's about $23,000 for every American, and more than half
of U.S. annual gross domestic product.
It's a staggering and unprecedented amount of money. The last time the
government spent anything near this amount on a crisis was in the late 1980s and
1990s during the savings and loan crisis, when it spent $160 billion. That's
$237 billion in today's dollars.
But it may not be as bad as it seems: A substantial portion of that $7 trillion
is investment, the government hasn't spent close to the total allotment yet, and
the taxpayer may come out on top in the end.
"It's a lot of money, but it's not like it's out the door, never to be seen
again," said Dean Baker, co-director of the Center for Economic and Policy
Research. "A lot will be lost, but we're not going to lose anywhere close to $7
trillion."
The government has invested about $3 trillion of the total allotment, and it has
already received much of that investment back. For instance, the Fed has gotten
back about $1.2 trillion of the $1.6 trillion it has lent banks in its ongoing
Term Auction Facility.
The government collects interest on its loans and when it takes an equity stake
in a company or takes hold of an asset-backed security, those holdings could
mature in value over the duration of the government's possession of them.
"At the end of the day, it's an expensive plan, but the government had to step
in," said Silvia. "It's a difficult thing to estimate, but the government could
sell the assets at a decent price once the market's better."
Furthermore, some of the $7 trillion will likely never be spent. The government
can spend up to $1.4 trillion in purchases of short-term business debt under the
Fed's Commercial Paper Funding Facility, but so far it has spent just $270
billion on the program.
Pessimists say the government is spending too much, putting taxpayer dollars at
risk. Some say, that for all the government has spent, the results don't match
the actions.
But optimists argue that much of the bailout serves as a guardrail, preventing
the financial system from falling into a total collapse. And most economists
argue that the cost of not acting would be far greater.
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Mortgage Delinquencies, Foreclosures Rise to Record
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By Kathleen M. Howley
Dec. 5 (Bloomberg)....One in 10 American homeowners fell behind on mortgage
payments or were in foreclosure during the third quarter as the world’s largest
economy shed jobs and real estate prices tumbled.
The share of mortgages 30 days or more overdue rose to a seasonally adjusted
6.99 percent while loans already in foreclosure rose to 2.97 percent, both
all-time highs in a survey that goes back 29 years, the Mortgage Bankers
Association said in a report today. The gain in delinquencies was driven by an
increase of loans with payments 90 days or more overdue.
“Until we see a turnaround in the job situation, we’re not going to see these
numbers improve,” said Jay Brinkmann, chief economist of the Washington-based
bankers group, in an interview. “We’re seeing more loans build up in the 90-days
bucket as lenders work to modify loans and states put in place programs that
delay foreclosures.”
The U.S. economy has shed 1.91 million jobs this year, while falling home prices
have made it difficult for people who can’t pay their mortgages to sell their
property. Payrolls declined in each month of 2008 through November, the Labor
Department said today in Washington.
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