Wednesday Links Bigger than we Thought

For Obama, Tax Deal Is a Back-Door Stimulus – NYT14119 71351 300x200 Wednesday Links Bigger than we Thought

Mr. Obama effectively traded tax cuts for the affluent, which Republicans were demanding, for a second stimulus bill that seemed improbable a few weeks ago. Mr. Obama yielded to Republicans on extending the high-end Bush tax cuts and on cutting the estate tax below its scheduled level. In exchange, Republicans agreed to extend unemployment benefits, cut payroll taxes and business taxes, and extend a grab bag of tax credits for college tuition and other items.

The Economic Incompetence Of The Political Class – Forbes

California’s budget deficit has soared to $25 billion, or more than 25% of total spending. And, according to a recent study, the City of Chicago’s unfunded pension liabilities total $45 billion, or more than $40,000 per household.

Politicians may not be solely responsible for this fiscal mess. But they are responsible for using borrowed money to pay for current expenses until they had borrowed more than they now seem able to pay back.

Industry Completes over 1.5M Loan Mods in First 10 Months of 2010 – DS News

It’s a notable accomplishment, but the report makes it clear that there’s far more work to be done. HOPE NOW says there are currently 3.4 million homeowners 60 or more days behind on their mortgage payments.

Foreclosure mess: Much bigger than you thought –

Goodman’s breakdown goes roughly like this. Twenty of every 100 loans are “impaired.” Of these, nine are seriously behind on their payments. Another six are now “Dirty Current” – in various government modification programs whose graduates have been defaulting at a rate of 50 percent a year. The final five are underwater on their mortgages by more than 20 percent – a group that has been defaulting at a rate of 20 percent a year.

It is a crisis that is more staggering that most of us realize – and is likely to have a much more dramatic impact on both federal policy and the banking industry than many are bargaining for right now.

Servicer Distrust as an Obstacle to Mortgage Mods – Yves Smith

Borrowers don’t trust servicers, and with good reason. It’s virtually impossible to get consistent answers from servicers. If you have an error, even with the intervention of an attorney, it seldom gets corrected. And the horror stories from HAMP both showed the borrower worst fears to be fully warranted and further damaged their already bad reputations. Accounts of banks requiring borrowers to submit the same paperwork multiple times because they “lost” it were legion. Even worse, homeowners were instructed to become delinquent to qualify, then told they were going to get the mod (or even receiving a written mod offer) while they continued to receive foreclosure notices. The servicer would tell them to ignore the foreclosure notices, only to find it was the legal notices, not the servicer reassurances that mattered, and they’d lose the home.

Give States a Way to Go Bankrupt – The Weekly Standard

California—recently dubbed the “Lindsay Lohan of states” in the Wall Street Journal—has a deficit that could reach $25.4 billion next year, and Illinois’s deficit for the 2011 fiscal year may be in the neighborhood of $15 billion. There is little evidence that either state has a recipe for bringing down its runaway expenses, a large portion of which are wages and benefits owed to public employees. This means we can expect a major push for federal funds to prop up insolvent state governments in 2011, unless some miraculous alternative emerges to save the day.

Fannie, Freddie Pressed on Mortgages – WSJ

The Obama administration is pressuring Fannie Mae and Freddie Mac, through their primary regulator, the Federal Housing Finance Agency. The administration wants the firms to join a program run by the Federal Housing Administration that allows banks and other creditors, which agree to write down mortgages, to essentially hand off the reduced loans to the FHA.

Federal officials estimate that 500,000 to 1.5 million homeowners could benefit from the program—a fraction of the estimated 11 million borrowers who were underwater as of June 30, according to CoreLogic Inc. That figure represents about 23% of all U.S. households with a mortgage.

No – People Are Not Collecting 13 More Months of Unemployment Benefits – Kid Dynamite

…the truth of the matter is that the “compromise” allows people receiving UI benefits who have not yet received their full 99 weeks to continue receiving benefits up to 99 weeks, while otherwise they would have been ineligible to move to the next tier of extended benefits.  Obviously, that’s very different from another 13 months of benefits

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I am a longtime real estate agent who has pretty much seen it all during the housing boom as bust. With experience in selling high-end property and low-end foreclosures, raw land, short sales, development work, apartment buildings, and working with investors, I bring a well-rounded perspective to my work.I also have started to do some paid real estate consulting. If you have questions or just need some good real estate advice, book an appointment at addition to selling real estate, my insights have been featured in The New York Times, The Big Picture, and regularly on I have also done consulting work with ForeclosureRadar.Starting my career, in 2003, I have sold homes throughout Alameda and Contra Costa counties, specializing in Danville, Alamo, Blackhawk, San Ramon, Dublin, Pleasanton, Walnut Creek, Lafayette, and Orinda. I live in Danville with my three kids.

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