A story released by NPR and ProPublica shares information on Freddie Mac betting billions of dollars on homeowners not being able to refinance their mortgages at a lower rate. By Freddie Mac doing this, it is causing a stir of shock amongst industry insiders and homeowners alike. This is understandable as just in December, Freddie Mac's chief executive, Charles Halderman, said the company is "helping financially strapped families reduce their mortgage costs through refinancing their mortgages."
The investigation by NPR and Problica show a different story with public documents of Freddie Mac bringing in funds for the company by using mortgage securities during a time when homeowners in high interest rate loans were unable to refinance their mortgages. Speculations are that Freddie Mac, holding the power of the qualifying guidelines for refinancing, was keeping the restrictions tight so many homeowners could not gain the permission to refinancing, therefor allowing Freddie Mac to continue their financial gains.
Freddie Mac and the FHA continue to decline commenting; however, Freddie Mac has stated that their employees in charge of investments are "walled off" from those who deal with the guidelines of homeowners.
Tuesday, January 31, 2012
Thursday, January 26, 2012
Bank of America Gives Help if Borrowers Stop Complaining
As reported by the Huffington Post, Bank of America's loan modification program is coming back into the eyes of the justice system. Bank of America is said to have offered mortgage assistance to customers only if they agreed to not make any derogatory statements and also remove any statements that were already posted through any form of online publication including Facebook and Twitter.
Arizona attorney general, Thomas Horne, investigated the accusations and found a dozen of cases where Bank of America waived borrower's debt and paid their fees upon the agreement that they stop complaining. It appears that in attempts to help their image, Bank of America is now suffering from more allegations that are adding to their already dwindled reputation.
Lawyers of Bank of America have said that borrowers are still able to obtain loan modifications without the above stipulations.
Arizona attorney general, Thomas Horne, investigated the accusations and found a dozen of cases where Bank of America waived borrower's debt and paid their fees upon the agreement that they stop complaining. It appears that in attempts to help their image, Bank of America is now suffering from more allegations that are adding to their already dwindled reputation.
Lawyers of Bank of America have said that borrowers are still able to obtain loan modifications without the above stipulations.
Tuesday, January 24, 2012
Charlotte-Six Charged in Mortgage Fraud Scheme
Charlotte area mortgage fraud "kickback" scheme hits the newstands this week. According to The Charlotte Observer, six different defendants were accused of working with the home building company Tara Properties to offer kickbacks to straw buyers which were never disclosed to the lenders involved.
During the height of activity that lead to the mortgage meltdown, between January of 2055 and February of 2008, this scheme resulted in more than $42 million in lending dollars and $5 million in kickbacks. Tara Properties offered kickbacks to the straw buyers at 15 percent of the homes sales price. Due to falsified documentation and unqualified straw borrowers, most of the purchased properties ended in foreclosure.
The defendants are being charged with mortgage fraud conspiracy and money laundring conspiracy. Some of the defendants include a licensed loan officer, a licensed real estate agent and a certified public accountant.
During the height of activity that lead to the mortgage meltdown, between January of 2055 and February of 2008, this scheme resulted in more than $42 million in lending dollars and $5 million in kickbacks. Tara Properties offered kickbacks to the straw buyers at 15 percent of the homes sales price. Due to falsified documentation and unqualified straw borrowers, most of the purchased properties ended in foreclosure.
The defendants are being charged with mortgage fraud conspiracy and money laundring conspiracy. Some of the defendants include a licensed loan officer, a licensed real estate agent and a certified public accountant.
Friday, January 20, 2012
Former RE Broker Charged with 39 Counts of Fraudulent Activity Goes to Court Next Month
As reported by the Santa Cruz Sentinel, former real estate broker, Louisa Katrina Dubinsky, is scheduled to be sentenced next month regarding an initial charge of 39 counts of embezzlement, financial elder abuse and writing bad checks. It was during her time working as President of Vision Lending and Investment in 2007 when she was accused of stealing more than $500,000 from her clients. Her license was then revoked when it was found that her business was working with three trust funds which were short $187,000.
The initial hearing was held in September of 2011 when a former client's allegations were confirmed that Dubinsky was taking $3,000 a month for seven years to supposedly pay different lenders for the client's home loan but was actually keeping months worth of the payments. By the time is was brought to the client's attention they were unable to track down Dubinsky.
Dubinsky pleaded no contest last month and will now be coming back to court on February 8th, facing a maximum of eight years in prison. Part of her plea agreement also includes paying restitution to some former clients and victims.
Fraudulent activity happens all to easy in the mortgage industry but has luckily been put mostly to a halt since new guidelines and laws have been placed after the mortgage crisis; however, it is always good to know how to stay on top of your mortgage payments and understand how to track every payment which is made. If you have any questions regarding which practices are correct, please contact us today at 704-892-5211.
The initial hearing was held in September of 2011 when a former client's allegations were confirmed that Dubinsky was taking $3,000 a month for seven years to supposedly pay different lenders for the client's home loan but was actually keeping months worth of the payments. By the time is was brought to the client's attention they were unable to track down Dubinsky.
Dubinsky pleaded no contest last month and will now be coming back to court on February 8th, facing a maximum of eight years in prison. Part of her plea agreement also includes paying restitution to some former clients and victims.
Fraudulent activity happens all to easy in the mortgage industry but has luckily been put mostly to a halt since new guidelines and laws have been placed after the mortgage crisis; however, it is always good to know how to stay on top of your mortgage payments and understand how to track every payment which is made. If you have any questions regarding which practices are correct, please contact us today at 704-892-5211.
Wednesday, January 18, 2012
PNC and US Bancorp Lead the New Mortgage Abuse Army
Today, PNC and US Bancorp shared with Reuters that they have set aside funds for mortgage related matters in exchange for immunity from lawsuits for improper foreclosures and bad mortgage origination practices. This newly proposed settlement, which has mostly targeted the big 5 lenders, orders banks to provide $20 to $25 billion in funding for troubled home loan borrowers and is predicted to help around one million people.
It has been said by US Bancorp CEO, Richard Davis, that this information regarding their mortgage abuse funds does not mean they have reached a final decision on the settlement. PNC and Bancorp were part of the group of 14 lenders which have been put under scrutiny regarding their lending practices but by them sharing they are looking ahead and setting aside funds for borrowers, this proves as hope for the industry, beyond the big five lenders.
It has been said by US Bancorp CEO, Richard Davis, that this information regarding their mortgage abuse funds does not mean they have reached a final decision on the settlement. PNC and Bancorp were part of the group of 14 lenders which have been put under scrutiny regarding their lending practices but by them sharing they are looking ahead and setting aside funds for borrowers, this proves as hope for the industry, beyond the big five lenders.
Friday, January 6, 2012
RE Agents Get New Facebook Group
With the way the market has been the past few years, it has left many real estate agents holding onto the work they have and carefully allocating their money to bring in new work. Co-founder of The MLS App, Jimmy Mackin, knows this all to well so he decided to post on a Facebook group the question "What should I spend my money on?" He just posted this question yesterday and as of today, over 1,200 real estate agents and industry insiders have joined in with their ideas and suggestions. Check out the page HERE
Thursday, January 5, 2012
Potential Game Changing Refi Program
Word has been spreading of a potential $1 trillion mortgage refinancing program geared to help boost the economy to be enacted by President Obama. Speculation of this program going underway has gained much notice by the stock market with bank stock losses turning around this afternoon. Jim Pethokoukis, a columnist at the American Enterprise Institute, released an article stating that this program is modeled from two economists from Columbia University, Glenn Hubbard and Christopher Mayer. The details of the program are said to be that all Fannie and Freddie mortgages that are current on their payments can be refinanced at 4.2 percent or less with no appraisal or income verification. This information is still speculation and not confirmed to be occurring.
Wednesday, January 4, 2012
The Mortgage Finance Act of 2011
Former real estate broker and current Senator of Georgia, Johnny Isakson, has shared a new finance act to transform the secondary market to the Dodd-Frank legislation. The Mortgage Finance Act of 2011 has some changes for the secondary market including:
- Eliminating Fannie Mae and Freddie Mac
- Creates a catastrophic fund in case of any future issues
- Full privatization within 10 years
Tuesday, January 3, 2012
Potential Bad News Ahead for MGIC
MGIC is the largest U.S. mortgage insurer, meaning they pay lenders when homeowners default on loans and when foreclosures do not gain the intended financial outcome. MGIC had put $200 million into a subsidiary in hopes of continuing their underwriting business proceeding their 90 percent drop at the end of 2006.
Since their capital expenditure, MGIC has dropped 6.2 percent and is anticipating a heavy decline in the future, therefore; MGIC is in discussion with Fannie Mae and the State of Wisconsin regarding their waiver expiration.
Since their capital expenditure, MGIC has dropped 6.2 percent and is anticipating a heavy decline in the future, therefore; MGIC is in discussion with Fannie Mae and the State of Wisconsin regarding their waiver expiration.
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