American nightmare

first_imgLending institutions filed 46,760 notices of default during the January-to-March period, a 148 percent jump from the first quarter of 2006. Most of the loans that went into default last quarter originated between April 2005 and May 2006, DataQuick said. Predators and prey Most mortgage bankers admit that predatory lending has contributed to higher default and foreclosure rates. But they don’t think lenders are solely responsible. “I get upset at finger-pointing at our industry,” said Marc Brinitzer, a loan officer in Roseville and author of a mortgage blog called Lendingclarity.com. “Consumers have some responsibility. One thing that characterized the last few years is an abnormal level of greed on the part of the consumer. I saw people buying three or four homes at the same time with no intent of living in (them). A lot of those people make up the early payment defaults.” Brinitzer said he knows that there are many homeowners who were taken advantage of and are hurting, but that a lot of borrowers knew their loans were unrealistic for them, but they borrowed anyway. Noemi Estrada became a homeowner in 2004 after securing an adjustable-rate mortgage to finance a $175,000, one-bedroom town home in Pacoima. The trouble started when Estrada, then a 24-year-old single mother, received her first statement and noticed that the $600 payment she was being asked to make would cause her principal to keep on growing. On top of that, her payments began climbing immediately, by $10 to $20 each month. Estrada had unknowingly signed on for a “neg am” loan, one of the cornucopia of products pushed in recent years to individuals whose credit or income wasn’t good enough to qualify for a traditional loan. Today, her payments are $800, and she already has one notice of default on her record. “If I knew all this would happen, I would go back and live in my mom’s house,” said Estrada, who works in a Beverly Hills plastic surgeon’s office and also has a part-time job with a catering company. “Right now, I’m about to lose my house. But if I let the bank take it, it would ruin my life.” Estrada claims that the mortgage broker who sold her the loan lied to her about the terms. Now, she is working with the Neighborhood Assistance Corporation of America, a nonprofit group that has secured $1 billion from banks, including Bank of America and Citibank, to help convert questionable mortgages into long-term fixed loans. Don’t blame victims Bruce Marks, CEO of the assistance corporation, said placing any blame on homeowners who took out bad loans is wrong. “I will not accept the theory of blaming the victim,” he said. “Lenders have a legal responsibility to make affordable loans to people. If you look behind the scenes, then you understand this was an organized scheme … to steal billions from people.” Marks said investment banks and regulators looked the other way even though they knew that the lending was out of control. He said homeowners can’t be held responsible for that. Still, his agency’s programs to refinance or modify loans require that participants be the owner-occupant of the house, and they can’t own other investment properties. Currently, the group is working with about 5,000 people nationwide. Other assistance plans in the works carry similar restrictions on who can participate. Assemblyman Ted Lieu, D-Torrance, has introduced a bill that would create funds to help Californians facing foreclosure by tapping into the housing bond that voters approved in November. It would also ask banks that have large numbers of subprime customers to pitch in, Lieu said in an interview. Participants would have to live in the home in question and not own other houses. They would also have to attend a financial literacy and counseling course. Freddie, Fannie aid Government-sponsored mortgage investors Freddie Mac and Fannie Mae each announced plans last month to buy subprime mortgages so that holders of them can refinance loans with better terms. Some of the plan details are still being worked out, but the idea is to convert some of the subprime loans into traditional loans with terms of 40 or 50 years. Marc Brinitzer, the loan officer in Roseville, said a friend on the Freddie Mac board told him to look for a 50-year, interest-only loan by the end of the second quarter. As assistance trickles down to homeowners, more people should be able to stay in their homes with better terms on their loans. But challenges remain. One problem that has lenders concerned is that it will be difficult to modify some of the loans that have already been sold off to Wall Street and beyond. For now, the industry is still predicting that the subprime problem and foreclosures will continue to rise before they retreat. “We’re starting to see the tip of the iceberg,” said Tingting Zhang, president of The TerraCotta Group, a Redondo Beach real-estate-investment company funded by private investors. “It will be bitter; it doesn’t matter what the government does. People are still going to be going through pain.”160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! Now that some of the dire fears about adjustable-rate mortgages and sub- prime loans are proving true, lenders and nonprofit groups are rushing to come up with ways to slow down the defaults and foreclosures. Institutions behind these assistance programs say that a lot of home buyers were duped or deceived into signing bad loans. The main goal, they say, should be to keep people in their homes. But there’s also a growing call from mortgage brokers and other market watchers for struggling buyers to take some personal responsibility for their decisions. After all, they say, nobody forced them to sign these loans. Tough love “We’re going to give somebody a crutch all because they couldn’t spend a day in a seminar to find out about the loan products, and now they’re saying, `Nobody told me there was education,”‘ said Richard Pittman, director of housing and counseling at ByDesign Financial Solutions, a credit counseling nonprofit based in Commerce. “Come on, get your paycheck out and look at it next to your loan statement. You didn’t realize the $4,000-a-month payment was going to take 92 percent of your paycheck? … There’s a point to tough love, when you say this is a learning experience.” Pittman said he has plenty of sympathy for true victims of predatory lending, but that a lot of people he sees about mortgage problems should have known better. “We’re talking about college-educated people.” Real-estate-tracking company DataQuick Information Systems found that the number of default notices sent to California homeowners during the first quarter of this year rose to the highest level in almost 10 years. The reasons are varied: flat appreciation, a sales slowdown and the resetting of interest rates on loans that started with low “teaser” rates. last_img

Crowd funding for a bit of Christmas cheer

first_imgThrough crowd funding Angel Projects is now able collect many smaller donations from people all over the country and build towards being able to provide each child with a food hamper that will help balance their diets. (Image: Angel Projects)With the festive season nearly upon us, Angel Projects is making use of the crowd funding services offered by Start Some Good to ensure that the festive spirit reaches about 1 500 children throughout South Africa.The organisation would be joining the crowd funding trend to help raise the funds it needed to meet its goals, Angel Projects founder and chief executive Brenda Scheepers announced recently. She also called on South Africans to help it reach its target.Scheepers highlighted the need for a special project to make sure that underprivileged children were well-nourished over the festive periods. She felt programmes like Angel Projects’ holiday food package initiative would go a long way to meeting this need.“Township crèches across South Africa are responsible not only for looking after children during the day while their parents are at work, but they are also responsible for providing them with possibly the only balanced meal they will have per day,” she said.“Each December these crèches close and with that ends their support of these developing children’s most basic nutritional needs.”Through crowd funding Angel Projects is now able collect many smaller donations from people all over the country and build towards being able to provide each child with a food hamper that will help balance their diets.To make use of the Start Some Good crowd funding services, projects must be aimed at making a positive social impact. Start Some Good co-founder Alex Budak said the group’s ultimate goal was “to create a world where anyone could bring about a new future for their community”.“We look forward to connecting (with) more change-makers such as Brenda from Angel Projects around the world with the resources they need to make a difference.”Scheepers said her initiative was very excited to provide South Africans with a heart for change a real opportunity to do something meaningful this Christmas. “We know this campaign will be a great success.”If you want to help Angel Projects raise funds for this project visit the Start Some Good holiday food package page to make a donation or get in touch with Angel Projects either via email at info@angelprojects.co.za or telephonically; phone Laura on 074 704 8126 or Jean-Michel on 074 613 6170.last_img read more

California voters approve Prop 12

first_imgShare Facebook Twitter Google + LinkedIn Pinterest On Election Day California voters approved Proposition 12, an initiative that, starting in 2020, bans the sale of pork and veal from animals raised anywhere in the country in housing the state banned through a 2008 ballot initiative. (In 2010, the California Legislature banned the sale of eggs from hens housed in so-called battery cages regardless of where they are raised.)Prop. 12 also requires egg-laying hens in the state to be cage free. National Pork Producers Council, which strongly opposed it, maintains that the initiative violates the U.S. Constitution’s Commerce Clause and that it will be costly for farmers and consumers. The organization is supporting federal legislation that would prohibit states from regulating agricultural production practices outside their borders and is backing lawsuits — now pending before the U.S. Supreme Court — filed by attorneys general from nearly two dozen states against California’s egg sales ban and a 2016 Massachusetts ballot measure that banned the sale of eggs, pork and veal from animals raised in housing prohibited by the same measure.last_img read more

New roadblock for Manipur varsity

first_imgTribal students’ bodies have given a highway blockade twist to the Manipur University crisis.Three organisations have threatened to impose a five-day economic blockade on all national highways connecting State capital Imphal if the authorities concerned cannot let normal classes and other academic activities in Manipur University resume by October 8.Separate university These organisations have also demanded a separate Hill Central University to ensure that the tribal students have an alternative to the disruption-prone university in the non-tribal dominated Imphal Valley.The All Tribal Students’ Union, Manipur, the Kuki Students’ Organisation-General Headquarters and the All Naga Students’ Association, Manipur, had on October 2 served a seven-day ultimatum to the University authorities to resume classes. The decision to go for a highway blockade was taken at their meeting on Thursday.Manipur depends on two arterial highways – one via Nagaland capital Kohima and the other via Jiribam on the Assam-Manipur border – for supply of essential commodities. A third highway through Mizoram is relatively less used.These highways pass through areas dominated by the Nagas and the Kuki-Zomi tribes, and blocking them has been a popular mode of protest against the allegedly partisan Manipur government.At their meeting on Thursday, the ATSUM, KSO-GHQ and ANSAM said they were “anguished by the premeditated holding of the career of students to ransom because of the agenda of a few individuals with vested interests in Manipur University”.‘Facing hardships’The three organisations said that tribal students face hardship every year. “We want a Hill Central University so that all the colleges in the hill districts can be affiliated to it and be assured of ideal academic atmosphere,” a joint statement said.The tribal students have stayed away from the agitation by organisations of Manipur University’s students, teachers and staff since July against alleged financial and administrative irregularities by Vice-Chancellor Adya Prasad Pandey. The Ministry of Human Resources Development had made him go on leave till a two-member probe committee submits a report on the allegations against him, but the university continues to burn. On September 20 midnight, police and paramilitary forces raided the campus and rounded up 89 students and six teachers for allegedly manhandling Pro-Vice-Chancellor K. Yugindro. Based on his FIR that the students and teachers had tried to kill him, the police arrested nine students and six teachers.last_img read more