Bad loans still make money - Jul 30, 2009 12:06 PM — Scott Jagow
A group of former Countrywide people launched an IPO today with their new company, PennyMac. Take one guess at what they’re doing. And while we’re at it, let’s talk about why the government’s loan modification program isn’t working.
PennyMac is based in Calabasas, California (sound familiar?), and it plans to make money by buying up failing home mortgages from failed banks and then restructuring the loans. From Forbes/Reuters:
PennyMac’s chief executive is Stanford Kurland, a former president and chief operating officer of Countrywide. At least 10 other top PennyMac officials are alumni of Countrywide, which was also based in Calabasas.
Countrywide was once the largest U.S. mortgage lender, but its aggressive lending practices are widely considered to be a major cause of the nation’s housing crisis.
PennyMac’s business has drawn the attention of critics who have accused Kurland and other Countrywide alumni of trying to profit from a housing crisis they helped create.
Do investors have faith in the crew the second time around? Well, in May, PennyMac predicted its IPO would raise $750 million. It netted $320 million. But the company has raised hundreds of millions from private investors as well, so some people believe PennyMac will find a way to profit.
And why not? What’s left of the mortgage business seems to be doing just fine. The New York Times reports that one reason the government’s loan mod program isn’t going very well is that mortgage companies collect tons of fees on delinquent mortgages:
“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”
More from the article:
“If they do a loan modification, they get a few shekels from the government,” said David Dickey, who led a mortgage sales team at Countrywide and Bank of America, leaving in March to start his own mortgage advisory firm, National Home Loan Advocates. By contrast, he said, the road to foreclosure is lined with fees, especially if it is prolonged. “There’s all sorts of things behind the scenes,” he said…
“For many subprime servicers, late fees alone constitute a significant fraction of their total income and profit,” said Diane E. Thompson, a lawyer for the National Consumer Law Center, in testimony to the Senate Banking Committee this month. “Servicers thus have an incentive to push homeowners into late payments and keep them there: if the loan pays late, the servicer is more likely to profit.”
One more note on a semi-related subject. The Wall Street Journal reports that the Senate has subpoenaed Goldman Sachs, Deutsche and other banks to inquire about possible fraud in the mortgage market:
The congressional investigation appears to focus on whether internal communications, such as email, show bankers had private doubts about whether mortgage-related securities they were putting together were as financially sound as their public pronouncements suggested. Collapsing values for many of those securities played a big role in precipitating last year’s financial crisis.
If they can’t prove fraud, how about absolute and utter negligence?
Thursday, August 6, 2009
Must Read - Bad loans still make money - Jul 30, 2009 12:06 PM — Scott Jagow
Bad loans still make money - Jul 30, 2009 12:06 PM — Scott Jagow
A group of former Countrywide people launched an IPO today with their new company, PennyMac. Take one guess at what they’re doing. And while we’re at it, let’s talk about why the government’s loan modification program isn’t working.
PennyMac is based in Calabasas, California (sound familiar?), and it plans to make money by buying up failing home mortgages from failed banks and then restructuring the loans. From Forbes/Reuters:
PennyMac’s chief executive is Stanford Kurland, a former president and chief operating officer of Countrywide. At least 10 other top PennyMac officials are alumni of Countrywide, which was also based in Calabasas.
Countrywide was once the largest U.S. mortgage lender, but its aggressive lending practices are widely considered to be a major cause of the nation’s housing crisis.
PennyMac’s business has drawn the attention of critics who have accused Kurland and other Countrywide alumni of trying to profit from a housing crisis they helped create.
Do investors have faith in the crew the second time around? Well, in May, PennyMac predicted its IPO would raise $750 million. It netted $320 million. But the company has raised hundreds of millions from private investors as well, so some people believe PennyMac will find a way to profit.
And why not? What’s left of the mortgage business seems to be doing just fine. The New York Times reports that one reason the government’s loan mod program isn’t going very well is that mortgage companies collect tons of fees on delinquent mortgages:
“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”
More from the article:
“If they do a loan modification, they get a few shekels from the government,” said David Dickey, who led a mortgage sales team at Countrywide and Bank of America, leaving in March to start his own mortgage advisory firm, National Home Loan Advocates. By contrast, he said, the road to foreclosure is lined with fees, especially if it is prolonged. “There’s all sorts of things behind the scenes,” he said…
“For many subprime servicers, late fees alone constitute a significant fraction of their total income and profit,” said Diane E. Thompson, a lawyer for the National Consumer Law Center, in testimony to the Senate Banking Committee this month. “Servicers thus have an incentive to push homeowners into late payments and keep them there: if the loan pays late, the servicer is more likely to profit.”
One more note on a semi-related subject. The Wall Street Journal reports that the Senate has subpoenaed Goldman Sachs, Deutsche and other banks to inquire about possible fraud in the mortgage market:
The congressional investigation appears to focus on whether internal communications, such as email, show bankers had private doubts about whether mortgage-related securities they were putting together were as financially sound as their public pronouncements suggested. Collapsing values for many of those securities played a big role in precipitating last year’s financial crisis.
If they can’t prove fraud, how about absolute and utter negligence?
A group of former Countrywide people launched an IPO today with their new company, PennyMac. Take one guess at what they’re doing. And while we’re at it, let’s talk about why the government’s loan modification program isn’t working.
PennyMac is based in Calabasas, California (sound familiar?), and it plans to make money by buying up failing home mortgages from failed banks and then restructuring the loans. From Forbes/Reuters:
PennyMac’s chief executive is Stanford Kurland, a former president and chief operating officer of Countrywide. At least 10 other top PennyMac officials are alumni of Countrywide, which was also based in Calabasas.
Countrywide was once the largest U.S. mortgage lender, but its aggressive lending practices are widely considered to be a major cause of the nation’s housing crisis.
PennyMac’s business has drawn the attention of critics who have accused Kurland and other Countrywide alumni of trying to profit from a housing crisis they helped create.
Do investors have faith in the crew the second time around? Well, in May, PennyMac predicted its IPO would raise $750 million. It netted $320 million. But the company has raised hundreds of millions from private investors as well, so some people believe PennyMac will find a way to profit.
And why not? What’s left of the mortgage business seems to be doing just fine. The New York Times reports that one reason the government’s loan mod program isn’t going very well is that mortgage companies collect tons of fees on delinquent mortgages:
“It frustrates me when I see the government looking to the servicer for the solution, because it will never ever happen,” said Margery Golant, a Florida lawyer who defends homeowners against foreclosure and who worked in the law department of a major mortgage company, Ocwen Financial. “I don’t think they’re motivated to do modifications at all. They keep hitting the loan all the way through for junk fees. It’s a license to do whatever they want.”
More from the article:
“If they do a loan modification, they get a few shekels from the government,” said David Dickey, who led a mortgage sales team at Countrywide and Bank of America, leaving in March to start his own mortgage advisory firm, National Home Loan Advocates. By contrast, he said, the road to foreclosure is lined with fees, especially if it is prolonged. “There’s all sorts of things behind the scenes,” he said…
“For many subprime servicers, late fees alone constitute a significant fraction of their total income and profit,” said Diane E. Thompson, a lawyer for the National Consumer Law Center, in testimony to the Senate Banking Committee this month. “Servicers thus have an incentive to push homeowners into late payments and keep them there: if the loan pays late, the servicer is more likely to profit.”
One more note on a semi-related subject. The Wall Street Journal reports that the Senate has subpoenaed Goldman Sachs, Deutsche and other banks to inquire about possible fraud in the mortgage market:
The congressional investigation appears to focus on whether internal communications, such as email, show bankers had private doubts about whether mortgage-related securities they were putting together were as financially sound as their public pronouncements suggested. Collapsing values for many of those securities played a big role in precipitating last year’s financial crisis.
If they can’t prove fraud, how about absolute and utter negligence?
Friday, July 31, 2009
$877 PAYMENT FOR SOME NEVADANS
$877 PAYMENT FOR SOME NEVADANS
About 3,500 Countrywide Financial borrowers who lost Nevada homes in foreclosure can expect to receive checks for about $877 each early next year, the attorney general's office said Friday.
The payments are part of a settlement announced in October with Countrywide over deceptive practices in making subprime, first home loans to borrowers around the country.
Subprime loans are those made to consumers with low credit ratings.
Former Countrywide subprime borrowers who lost their homes to foreclosure are expected to receive notices in a few days, Attorney General Catherine Cortez Masto said in a statement.
To qualify, the first payment on the loan must have been due between Jan. 1, 2004, and Dec. 31, 2007. The borrowers must have lost their homes through foreclosure, a short sale or a deed in lieu of foreclosure. A short sale occurs when the lender allows the homeowner to sell the home for less than the amount owed.
Bank of America acquired Countrywide in July 2008 after the end of the period specified in the lawsuit.
The bank agreed to pay $150 million to borrowers in 39 states who went through foreclosure. Nevada was allocated $3 million for 3,467 former homeowners. In addition, the bank offered mortgage loan modifications to Countrywide borrowers and relocation assistance to some customers.
Consumers may phone Rust Consulting at 866-411-6987 or vis countrywidesettlementinfo.com to get more information about the foreclosure settlement.
JOHN G. EDWARDS LAS VEGAS REVIEW-JOURNAL
Monday, July 20, 2009
Mira Villa Back on Track in Summerlin
The beautiful condo development called Mira Villa, the luxury golf-front community in heart of Summerlin is back online after a long process of bankruptcy. The new developer is offering seller financing by Colonial Bank, Tier One Bank, and Nevada State Bank. These banks have approved an outstanding and accessible in-house financing program for buyers at Mira Villa.
If you have an interested in a condo development with a ton of amenities, quality construction in the heart of Summerlin give us a call at 702-372-2671 we would be love to assist with you finding the right property at the right price.
If you have an interested in a condo development with a ton of amenities, quality construction in the heart of Summerlin give us a call at 702-372-2671 we would be love to assist with you finding the right property at the right price.
Friday, July 17, 2009
Tuesday, July 14, 2009
Buyers Backed Out at the 11th Hour Leaving Seller Twisting in the Wind
Buyers Backed Out at the 11th Hour Leaving Seller Twisting in the Wind
7036 Delta Falls , Las Vegas NV 89149 Google Map
SHORT SALE WITH PREVIOUS APPROVAL CALL FOR DETAILS Former Model Home*NEVER LIVED IN* Spacious Eat-in Kitchen, Breakfast Bar, pendant lights, Corian, Oak Cabinets w/ pantry, 2 story ceilings in LR w/ 2 fans & FP, Driveway Pavers, Backyard fully landscaped w/ syngrass, Mt & Strip Views, Ceiling fans T/O, custom paint, updated 7/14/09 View Tour Here - Listed at $186,000 - Approval Letter Just Expired
7044 Delta Falls, Las Vegas NV 89149 Google Map
Model Home in*Spacious Kit,Island,Breakfast Bar, DR/Family rm, 20x20 tile, Separa LR, Granite, Upgraded Cabinets, WI pantry, stone backsplash, built-in desk,custom paint, Balcony/Covered patio,french doors, Driveway Pavers, Fully Landscaped, MT/Strip Views, surround sound, full house audio package, patio in front
View tour Here - Listed at $199,900 - Approval Letter Expires on 7/14/09
Call for Showing - 3rd Tier Bank Representative Involved in Closing these Deals.
Call Lising Broker at 702-372-2671
Olivia McClellan, REALTOR®, ABR, CRS, GRI, RRG
Broker, Property Manager
Triple8 Associates Inc.
5940 S. Rainbow Blvd. Ste 1007
Las Vegas, NV 89118
Direct 702-372-2671
Fax: 702-948-5790
Olivia@Triple8Associates.com
Visit me online at www.Triple8Associates.com
7036 Delta Falls , Las Vegas NV 89149 Google Map
SHORT SALE WITH PREVIOUS APPROVAL CALL FOR DETAILS Former Model Home*NEVER LIVED IN* Spacious Eat-in Kitchen, Breakfast Bar, pendant lights, Corian, Oak Cabinets w/ pantry, 2 story ceilings in LR w/ 2 fans & FP, Driveway Pavers, Backyard fully landscaped w/ syngrass, Mt & Strip Views, Ceiling fans T/O, custom paint, updated 7/14/09 View Tour Here - Listed at $186,000 - Approval Letter Just Expired
7044 Delta Falls, Las Vegas NV 89149 Google Map
Model Home in*Spacious Kit,Island,Breakfast Bar, DR/Family rm, 20x20 tile, Separa LR, Granite, Upgraded Cabinets, WI pantry, stone backsplash, built-in desk,custom paint, Balcony/Covered patio,french doors, Driveway Pavers, Fully Landscaped, MT/Strip Views, surround sound, full house audio package, patio in front
View tour Here - Listed at $199,900 - Approval Letter Expires on 7/14/09
Call for Showing - 3rd Tier Bank Representative Involved in Closing these Deals.
Call Lising Broker at 702-372-2671
Olivia McClellan, REALTOR®, ABR, CRS, GRI, RRG
Broker, Property Manager
Triple8 Associates Inc.
5940 S. Rainbow Blvd. Ste 1007
Las Vegas, NV 89118
Direct 702-372-2671
Fax: 702-948-5790
Olivia@Triple8Associates.com
Visit me online at www.Triple8Associates.com
Back on the Market - two model homes at providence in the northwest
Buyers Backed Out at the 11th Hour Leaving Seller Twisting in the Wind
7036 Delta Falls , Las Vegas NV 89149 Google Map
SHORT SALE WITH PREVIOUS APPROVAL CALL FOR DETAILS Former Model Home*NEVER LIVED IN* Spacious Eat-in Kitchen, Breakfast Bar, pendant lights, Corian, Oak Cabinets w/ pantry, 2 story ceilings in LR w/ 2 fans & FP, Driveway Pavers, Backyard fully landscaped w/ syngrass, Mt & Strip Views, Ceiling fans T/O, custom paint, updated 7/14/09 View Tour Here - Listed at $186,000 - Approval Letter Just Expired
7044 Delta Falls, Las Vegas NV 89149 Google Map
Model Home in*Spacious Kit,Island,Breakfast Bar, DR/Family rm, 20x20 tile, Separa LR, Granite, Upgraded Cabinets, WI pantry, stone backsplash, built-in desk,custom paint, Balcony/Covered patio,french doors, Driveway Pavers, Fully Landscaped, MT/Strip Views, surround sound, full house audio package, patio in front
View tour Here - Listed at $199,900 - Approval Letter Expires on 7/14/09
Call for Showing - 3rd Tier Bank Representative Involved in Closing these Deals.
Call Lising Broker at 702-372-2671
Olivia McClellan, REALTOR®, ABR, CRS, GRI, RRG
Broker, Property Manager
Triple8 Associates Inc.
5940 S. Rainbow Blvd. Ste 1007
Las Vegas, NV 89118
Direct 702-372-2671
Fax: 702-948-5790
Olivia@Triple8Associates.com
Visit me online at www.Triple8Associates.com
7036 Delta Falls , Las Vegas NV 89149 Google Map
SHORT SALE WITH PREVIOUS APPROVAL CALL FOR DETAILS Former Model Home*NEVER LIVED IN* Spacious Eat-in Kitchen, Breakfast Bar, pendant lights, Corian, Oak Cabinets w/ pantry, 2 story ceilings in LR w/ 2 fans & FP, Driveway Pavers, Backyard fully landscaped w/ syngrass, Mt & Strip Views, Ceiling fans T/O, custom paint, updated 7/14/09 View Tour Here - Listed at $186,000 - Approval Letter Just Expired
7044 Delta Falls, Las Vegas NV 89149 Google Map
Model Home in*Spacious Kit,Island,Breakfast Bar, DR/Family rm, 20x20 tile, Separa LR, Granite, Upgraded Cabinets, WI pantry, stone backsplash, built-in desk,custom paint, Balcony/Covered patio,french doors, Driveway Pavers, Fully Landscaped, MT/Strip Views, surround sound, full house audio package, patio in front
View tour Here - Listed at $199,900 - Approval Letter Expires on 7/14/09
Call for Showing - 3rd Tier Bank Representative Involved in Closing these Deals.
Call Lising Broker at 702-372-2671
Olivia McClellan, REALTOR®, ABR, CRS, GRI, RRG
Broker, Property Manager
Triple8 Associates Inc.
5940 S. Rainbow Blvd. Ste 1007
Las Vegas, NV 89118
Direct 702-372-2671
Fax: 702-948-5790
Olivia@Triple8Associates.com
Visit me online at www.Triple8Associates.com
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