Stories related to: mortgage crisis

AngryRenter.com might look “underdoggy and grass-rootsy, with a heavy dose of aw-shucks innocence,” the Wall Street Journal reports, but the anti-mortgage bailout website is actually the work of publisher Steve Forbes, former House majority leader Dick Armey and other Republican bigwigs. It’s a paragon of “AstroTurfing”—big-sponsor advocacy posing as spontaneous movement. More »

It can happen to the rich and famous, too: Jose Canseco's mansion is in foreclosure, and he's had to move into more modest digs, Inside Edition reports. Canseco owed more than $2.5 million on the California property his neighbors called the "hotel." He made $30 million in baseball and wrote two best-sellers, but it wasn't enough to save him from becoming a high-profile statistic of the housing collapse. More »

A plan to federally subsidize the refinancing of troubled mortgages has in fact helped relatively few of the most at-risk borrowers, the New York Times reports. Though Bush administration officials said FHA Secure has benefited 150,000, federal statistics show that only 1,729 of those mortgages were delinquent. “They came to us before they got into trouble,” one official said. More »

President Bush conceded that “it’s a very slow economy” one day ahead of possibly ugly GDP numbers, the New York Times reports, and said Congress is dragging its feet on gas prices, the mortgage crisis, farm subsidies and student loans. The Democratic-controlled legislature should be “sending me sensible and effective bills,” he said, not ones "that simply look like political statements.” More »

More than $6 billion in subprime writedowns sent Bank of America profits skidding for the third straight quarter today, as the nation's second-largest bank posted a 77% decline in net income for the first quarter. Earnings were $1.21 billion, down from $5.26 billion a year ago, reports Bloomberg. The losses exceeded analysts’ expectations by some 44% and sent market futures into a slide this morning. BofA—in the process of acquiring troubled home lender Countrywide Financial—said revenue slipped 6%. More »

Merrill Lynch today posted nearly $2 billion in losses in the first quarter, after taking another $9 billion in writeoffs, the Wall Street Journal reports. In its third straight quarterly loss, Merrill was in the red $1.96 billion, or $2.19 a share, compared to earning $2.16 billion, or $2.26 a share a year ago. The company said it will cut about 3,000 jobs. More »

Merrill Lynch is likely to report another $6 billion to $8 billion in writedowns related to the subprime collapse tomorrow, leading to a third consecutive quarterly loss, the Wall Street Journal reports. Merrill’s chronic mortgage losses—$30 billion and counting—show just how deep the world's largest brokerage is mired in the mess, and have it slashing costs and jobs. More »

Wachovia reported a surprise first-quarter loss today 2 years after taking over a subprime-dealing savings and loan. The CEO of the fourth-largest US bank was “deeply disappointed” that the bank lost $393 million, or 20 cents a share; analysts had anticipated earnings of 40 cents a share, Bloomberg reports. Wachovia cut its dividend; it plans to raise $7 billion to replenish capital reserves by selling shares and axing 500 jobs. More »

John McCain reversed his laissez-faire policy on the mortgage crisis today, saying government should indeed help subprime mortgage holders get guaranteed 30-year mortgages. “There is nothing more important than keeping alive the American dream to own your home,” the Republican said. McCain was criticized for his earlier stance that neither banks nor borrowers should be rewarded for acting irresponsibly. More »

With foreclosures skyrocketing, overwhelmed mortgage lenders are turning a blind eye to homeowners who haven’t paid up, letting them live in their houses despite delinquency, Bloomberg reports. The 3.6% of borrowers at least 90 days behind is almost twice the percentage foreclosed upon. Lenders’ delays are skewing foreclosure records and means even more homes could soon clog a flooded market. More »

State lawmakers aren’t sitting around waiting for Washington to solve the mortgage crisis, the Wall Street Journal reports. Instead, many are taking aggressive steps to ease borrower pain, sometimes running afoul of lenders in the process. Illinois, Maryland, and Minnesota all have bills in the works to impose a moratorium on foreclosures—in one state as long as 12 months— for families attempting to restructure mortgages. More »

The Senate’s first major step toward trying to make sense of the US mortgage mess is a needed salve to businesses caught in the chaos, but it doesn’t go far enough to help homeowners, critics say. Lawmakers contend the plan is a start toward addressing a multitude of problems resulting from a devastating housing slump, reports the Los Angeles Times. More »

The Senate voted 94-1 to move a housing legislation package into formal consideration today, reports the New York Times . Banking committee chair Chris Dodd and ranking Republican Richard Shelby now have until noon tomorrow to work out a compromise acceptable to both parties. “Inaction is not an option," said Dodd. "Failure is not an option." More »

Although he doesn't foresee long-term catastrophe, Allan Sloan of Fortune sounds an alarm in today's Washington Post, saying he's "more nervous about the world financial system now than I've ever been in my 40 years of covering business and markets." He dissects "the collapse of a Tinker Bell financial market, one that depended heavily on borrowed money that has now vanished like pixie dust." More »

Looking for cheap real estate? Hop on a foreclosure bus tour, a trend sweeping the nation in the wake of the mortgage crisis, the AP reports. The excursions typically include experts who educate buyers while showing empty homes: some bargain beauties, some fixer-uppers. "We're kind of a seminar on a bus," says one California real-estate agent. More »

Barack Obama called today for stricter financial regulations and laid out a $30 billion stimulus plan, the Wall Street Journal reports, including measures aimed at the foreclosure crisis. The Democratic candidate said President Bush had “a generally scornful attitude toward oversight and enforcement,” and proposed expanding Fed powers and upping banks’ capital requirements. More »

The government should step into the mortgage mess on a broader scale, Hillary Clinton told the Wall Street Journal yesterday, suggesting monetary policy alone can’t ignite a recovery and warning that procrastination could lead to stagnation similar to Japan’s weary economy. Clinton said the Federal Housing Administration should buy troubled mortgages in combination with a program to auction defaulted loans. More »

Economists, and rivals, are scoffing at John McCain’s ideas for countering the nation’s foreclosure crisis, taking aim at the suggestion that top lenders follow the post-9/11 example of General Motors—which offered 0% financing on new cars. But experts note that GM had its own interests in mind—not the country’s—in selling off excess inventory, the New York Sun reports. More »

John McCain said today he opposes government action to bail out homeowners having trouble with their mortgages, the New York Times reports. McCain—who will receive Nancy Reagan's endorsement today—differentiated himself from both Democratic candidates, who have called for federal intervention, saying: “It is not the duty of government to bail out and reward those who act irresponsibly." More »

Ex-Fed chief Alan Greenspan and other high-profile economic bigwigs should take the lead in deciding whether the government should buy homes affected by the housing crisis, Hillary Clinton says. "As it has in the past, this kind of temporary measure by the government could give our economy the boost it needs and families the help they need," the candidate said today in Philadelphia. More »