These are legacy loans from Country-wide and I think this just for good Public Relations. In a past article only .22% of of the total bad in deficiencies have been collected.
Justice Department Sues BofA for Over $1B, Alleging Mortgage Fraud
10/24/2012 By: Esther Cho
The U.S. Department of Justice sued Bank of America for over $1 billion for alleged mortgage fraud related to the sale of loans to Fannie Mae and Freddie Mac, Manhattan U.S. Attorney Preet Bharara announced in a release Wednesday.
According to the release, the civil fraud suit is a first for the Justice Department for mortgage loans sold to the GSEs.
The lawsuit stems from origination practices from Countrywide, which BofA acquired in 2008.
According to the complaint, from 2007 to 2009, Countrywide implemented a loan process called the “Hustle,” which pushed loans through the origination process by eliminating quality checkpoints and by compensating employees based on the volume of loans originated.
For example, the complaint stated Countrywide eliminated the use of an underwriter for many high risk loans and instead used loan processors who previously weren’t even qualified to answer borrower questions.
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Proprietary OC Housing News home purchase analysis
2433 West CALIFORNIA St Santa Ana, CA 92704
$329,000 …….. Asking Price
$223,000 ………. Purchase Price
2/29/2012 ………. Purchase Date
$106,000 ………. Gross Gain (Loss)
($17,840) ………… Commissions and Costs at 8%
============================================
$88,160 ………. Net Gain (Loss)
============================================
47.5% ………. Gross Percent Change
39.5% ………. Net Percent Change
59.8% ………… Annual Appreciation
Cost of Home Ownership
——————————————————————————
$329,000 …….. Asking Price
$11,515 ………… 3.5% Down FHA Financing
3.50% …………. Mortgage Interest Rate
30 ……………… Number of Years
$317,485 …….. Mortgage
$82,210 ………. Income Requirement
$1,426 ………… Monthly Mortgage Payment
$285 ………… Property Tax at 1.04%
$0 ………… Mello Roos & Special Taxes
$82 ………… Homeowners Insurance at 0.3%
$331 ………… Private Mortgage Insurance
$0 ………… Homeowners Association Fees
============================================
$2,124 ………. Monthly Cash Outlays
($212) ………. Tax Savings
($500) ………. Equity Hidden in Payment
$13 ………….. Lost Income to Down Payment
$102 ………….. Maintenance and Replacement Reserves
============================================
$1,527 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$4,790 ………… Furnishing and Move In at 1% + $1,500
$4,790 ………… Closing Costs at 1% + $1,500
$3,175 ………… Interest Points
$11,515 ………… Down Payment
============================================
$24,270 ………. Total Cash Costs
$23,400 ………. Emergency Cash Reserves
============================================
$47,670 ………. Total Savings Needed
The property above is available for sale on the MLS.
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Lenders are providing rationalizations and justifications for their policy of delaying foreclosures. Populist bullshit.
Foreclosures Cost Nearly $2 Trillion in Home Equity: Report
Foreclosures have drained nearly $2 trillion in home equity from neighborhoods across the United States, according to a report from the Center for Responsible Lending (CRL).
In a report titled “Collateral Damage: The Spillover Costs of Foreclosures,” researchers Debbie Bocian, Wei Li, and Peter Smith conclude that, based on the 10.9 million loans that entered foreclosure between 2007 and 2011, approximately $1.95 trillion in property value has been lost or will be lost by residents who live close to foreclosed properties. This estimate includes losses stemming from completed foreclosures and future losses projected on foreclosure starts.
The researchers noted that the estimated cost does not include the total loss in home equity resulting from the foreclosure crisis (estimated at $7 trillion) and also does not take into account the equity lost by families who are actually foreclosed on.
In addition, the report doesn’t cover “the billions of dollars drained from communities as a result of lost tax revenue, vacant properties, increased crime, and lower school performance by children.”
Communities of color are seeing the greatest share of the $2 trillion loss, with more than half of the home equity drain impacting minority neighborhoods. The average spillover cost per family is or will be $21,000 in household wealth, or 7 percent of median home value, according to the report. However, in minority neighborhoods, the average loss is or will be $37,000, or 13 percent of home value.
Wade Henderson, president and CEO of the Leadership Conference on Civil and Human Rights, called the report “troubling evidence of how much the economic costs of foreclosures are spilling over into communities all over America.” He also said the increased cost to minorities comes at the hands of abusive lending and servicing behavior.
“Communities of color—which have been targeted for years by predatory lenders, and abused for years by mortgage servicers-have been practically drowning. Until policymakers get serious about reducing foreclosures and restoring meaningful home ownership in all communities, a full economic recovery will likely remain out of reach,” Henderson said.
Janet Murguia, president and CEO of the National Council of La Raza, echoed the sentiment.
“The wealth drain triggered by foreclosures is continuing unabated, hurting Latino families and other vulnerable communities the hardest,” Murguia said. “We’re calling on policymakers to show strong leadership in stopping the foreclosure crisis and making fair and sustainable housing a national priority.”