News

On Thursday banks received the much awaited proposal that many speculated would detail the potential ramifications for their part in the foreclosure and robo-signing mess. According to various reports, the proposal could force banks to reduce principal loan balances for borrowers who are delinquent or underwater, or pay a multi-billion dollar fine. Reports have surfaced that banks are pushing back against proposed mandatory write-downs, claiming that such a practice could invite fraud.

According to the Warren Group, a Boston-based provider of real estate data and research, Massachusetts foreclosure activity posted double digit decreases in both starts and completed foreclosures in January. Foreclosure petitions and deeds dropped in every county in the state. The agency says, though, that it's likely the reduction is caused by lenders slowing their processes rather than improved financial stability among homeowners.

With the national unemployment rate still staggering, there's good news for job seekers in Depew, New York. AMS Servicing, LLC, a national specialty servicer for residential and small balance commercial mortgages headquartered in Buffalo, announced this week it has immediate openings for full- and part-time positions to provide support to internal and external customers regarding the short sale of residential properties.

The national unemployment rate fell to 8.9 percent in February, as employers added 192,000 jobs to their payrolls, the Department of Labor reported Friday. The rate is down from 9.0 percent in January and 9.4 percent as recently as December. The Labor Department described the latest numbers as ""little changed,"" noting that 44 percent of the 13.7 million unemployed have been jobless for 27 weeks or more. However, the 192,000 jobs that were added in February represented the largest monthly net gain since mid-2010.

The Federal Reserve released a new rendition of its popular Beige Book this week. Reports from all 12 Fed districts indicated that overall economic activity continues to expand, but all said housing activity remains a key risk - a point reiterated by Fed Chairman Bernanke in his semiannual report to Congress this week when he explained to lawmakers that the housing market remains weak, with the overhang of foreclosed houses still weighing heavily on prices and potential homebuyers concerned about further declines in home values.

As the House prepares to debate on the future of the Federal Housing Administration's Short Refinance option, FHA Commissioner David Stevens implored House subcommittee members to give the program a chance. The program is a voluntary option for lenders to agree to offer principal write downs and restructure loans for underwater borrowers. Stevens said as of February 11, 23 FHA-approved lenders are participating in the program and 245 FHA case numbers have been requested, of which 44 loans have been endorsed.

The House Financial Services Committee voted Thursday to scrap two foreclosure relief programs - one that gives underwater homeowners a federal refinancing option through FHA's Short Refi Program, and a second that provides temporary assistance to unemployed homeowners through the Emergency Mortgage Relief Fund. The two bills now move to the full House for debate. The committee was also planning to consider two separate bills to end the Home Affordable Modification Program (HAMP) and HUD's Neighborhood Stabilization Program, but votes on these have been pushed to next week.

RealtyTrac, an online marketplace for foreclosure properties, launched a new foreclosure search widget in February for real estate agents and brokers. The widget allows users to INSERT IGNORE a fully functional nationwide foreclosure property search on their Web sites, which delivers real-time foreclosure data from RealtyTrac.

While the housing crisis is what triggered the economic downturn and pushed so many lenders under early on in the receession, it seems the biggest threat has now shifted from residential mortgages to souring commercial real estate (CRE) loans. Commercial real estate proved to be the downfall of the 12 banks that failed last month, according to a report by Trepp, LLC. The company says CRE loans made up 72 percent of the failed banks' nonperforming assets, while residential loans were a distant second, comprising just 20 percent.

Interest rates on home loans continued their downward trend this week, marking the third straight week that they've headed lower. According to Freddie Mac's national survey, the average rate on a 30-year fixed mortgage came in at 4.87 percent for the week ending March 3. That's down from 4.95 percent the week prior. Freddie's chief economist says the drop means homebuyers could now expect to pay $263 less per year on a $200,000 loan.