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California Officials Take Down National Foreclosure Rescue Fraud Ring

California's attorney general and the state's Department of Justice have taken down a fraud ring of legal firms and attorneys that officials say swindled thousands of homeowners out of millions of dollars by convincing them to take part in mass lawsuits against their lenders. Attorney General Kamala Harris has sued three law firms, four lawyers, and 14 other defendants. Officials with the state and HUD have seized the defendants' assets and bank accounts.

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Justice Department Joins Investigation of S&P

Investigators are looking to determine whether Standard and Poor's (S&P) over-rated dozens of mortgage-backed securities prior to the financial crisis. The Securities and Exchange Commission has been investigating the matter for several months, and the Justice Department recently joined the investigation, according to media reports. The federal probe began before S&P downgraded the U.S. credit rating from triple-A status to double-A status. The SEC has reportedly also been investigating Moody's in regards to two mortgage-bond deals.

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Obama Says Housing Market Needs More Than Federal Support

At a town hall meeting this week in Atkinson, Illinois, President Obama said it will take more than federal action to address the still-suffering housing market. The president said his administration has made helping families stay in their homes a priority over the past two-and-a-half years. Obama conceded that the market appeared to be bottoming out until the recent conflict over the debt ceiling. He predicts it will take the next two years for the market to start slowly appreciating.

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New Jersey Judge OKs Five Major Servicers to Resume Foreclosures

A New Jersey judge has given the green light for five of six major mortgage servicers to resume uncontested foreclosures in the state after a formal review of their procedures demonstrated the ""reliability of their processes."" Bank of America, Citibank, JPMorgan Chase, Wells Fargo, and OneWest Bank have been granted permission to restart foreclosures. Ally's GMAC Mortgage is awaiting the court's decision. Since the beginning of 2011, just over 6,000 foreclosures have surfaced in the state courts, compared to 35,000 filings at this time last year.

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New York Congressman to Propose Down Payment Subsidy

Rep. Gary Ackerman of New York plans to propose a bill he says will reduce the housing glut, create jobs, and stimulate the economy. Deriving inspiration from the success of the Homestead Act of 1862 -- which offered 160 acres to Americans in order to promote Western settlement -- Ackerman's Homestead: Act 2 aims to get 3 million properties off an already depressed market by providing a subsidy of up to $20,000 for down payments on foreclosed homes and a tax break for investors who purchase foreclosures for rental properties.

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HUD Offers Discounted REOs to Storm Victims

HUD has announced it will sell almost 90 REO properties to public housing authorities in central Alabama and Joplin, Missouri -- areas suffering the impact of this spring's tornadoes. In a pilot program, HUD will sell move-in ready properties to public housing authorities at a discount, and the housing authorities will lease or sell the homes to families impacted by the storms. The houses will be ready for sale or lease within two months of the purchase from HUD.

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U.S. Bank Partners with City of Milwaukee to Revitalize Neighborhoods

U.S. Bank has announced several new initiatives to support the city of Milwaukee in its efforts to stabilize hard-hit communities through the Neighborhood Stabilization Program (NSP). The bank is setting up a $1 million restoration fund for developers to acquire and rehabilitate foreclosed properties in the city's designated NSP zones. It has also agreed to provide $15 million in mortgages to qualified borrowers in NSP zones over the next four years, and has committed to give more than $240,000 in grants to housing agencies working within the city.

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Obama Administration Continues to Review Housing Policy Proposals

While the Obama administration continues to consider options for the future of housing finance, two mainstream media outlets reported Tuesday that officials are looking into a plan that would retain major government involvement in the housing market, namely by preserving federal loan subsidies through the GSEs. The administration has issued a statement negating these reports, stressing that any government support for housing finance will be ""targeted and limited.""

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New Jersey Firm Calls on Obama to Convene Housing Think Tank

According to Realogy Corp., it's time to put real estate professionals who are on the front line every day fighting the housing crisis at the head of the table when it comes to crafting a solution to stimulate the sector's recovery. The firm's CEO Richard A. Smith has sent a formal request to President Obama and his administration calling for a White House summit on housing that brings together industry stakeholders to provide ""unfiltered, real-time market feedback"" for devising policy strategies.

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Fed Reports Slight Decline in Mortgage and Other Debt

The Federal Reserve found a small increase in consumers' willingness to borrow and banks' willingness to lend, but a decline in loan balances, according to the second-quarter household debt report issued Monday by the central bank's New York arm. Mortgage debt and home equity lines of credit each decreased by about $20 billion during the second quarter of 2011. This represents a 0.2 percent drop for mortgage balances and a 3 percent drop for home equity loans.

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