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California Atty. Gen. Kamala D. Harris is suing Fannie Mae and Freddie Mac to force the mortgage giants to answer questions about their role in California's housing meltdown. In two suits filed Tuesday in San Francisco County Superior Court, Harris seeks to compel the companies to respond to subpoenas from her office that have been ignored so far. Harris is seeking information about the practices by Fannie and Freddie in California as part of her ongoing investigation into the mortgage industry. The suits ask a judge to order the two companies to answer a set of 51 questions served in...

The Securities and Exchange Commission has brought civil fraud charges against six former top executives at Fannie Mae and Freddie Mac, saying they misled the government and taxpayers about risky subprime mortgages the mortgage giants held during the housing bust. Those charged include the agencies' two former CEOs, Fannie's Daniel Mudd and Freddie's Richard Syron. They are the highest-profile individuals to be charged in connection with the 2008 financial crisis. Mudd, 53, and Syron, 68, led the mortgage giants when the housing bubble burst in late 2006 and 2007. The four other top executives also worked for the companies during...

BEGIN TRANSCRIPT RUSH: Laurie, who can't say where she is. Is that right? She's worried about lawsuits, so she can't say where she is. Laurie, welcome to the EIB Network. You're worried about the lawsuits from what you're going to say here? CALLER: Well, it's possible, Rush, and, by the way, it's an honor to speak to you. RUSH: Thank you. CALLER: I worked as both a packager and an advertising executive for a mortgage brokerage firm. I saw the rise and fall of the housing market and what infuriates me about when Obama speaks or Barney Frank or anyone...

Rep. Barney Frank won't seek re-election Posted by CNN Wire Staff (CNN) - Massachusetts Congressman Barney Frank, a 16-term Democrat, will announce Monday he does not intend to seek re-election in 2012........

The FBI warned in September 2004 that there was an “epidemic” of mortgage fraud and predicted that it would cause a financial “crisis” if it were not contained. The mortgage banking industry’s own anti-fraud experts reported in writing to nearly every mortgage lender in 2006 that: “Stated income and reduced documentation loans speed up the approval process, but they are open invitations to fraudsters.” ....stated income loans deserve the nickname used by many in the industry, the ‘liar’s loan’”. We know that accounting control fraud is itself criminogenic – fraud begets fraud. The fraudulent CEOs deliberately create the perverse incentives...

Explosive Audio Unearthed: After the Sub Prime Crisis already started in 2007 Obama says Sub Prime Mortgages that gave houses to people WHO COULDN'T AFFORD THEM was a GOOD IDEA!!

New York Gov. Andrew Cuomo on Monday supported President Barack Obama's proposal to tax millionaires and corporations at a higher rate to pay for a jobs program. Cuomo initially declined to comment during a Monday press conference on Obama's proposal until he received "specifics." Hours later, Cuomo urged Congress to support the Democratic president's proposal. Cuomo killed a state proposal by his fellow Democrats in the Assembly earlier this year that would have increased the income tax on wealthier New Yorkers. He said it would hurt the economy and chase wealthier New Yorkers and employers to neighboring states.

  Too Big To Fail, or Too Big Not To? David C. Stolinsky Sept. 19, 2011 The Bank of America was founded in San Francisco in 1904 by A. P. Giannini, the son of Italian immigrants. He never attended a university, but he took courses at a private business school. He made money in the produce business. His friends complained that they could not obtain the loans they needed to enlarge their businesses, so he opened a bank. It was located in a building that had been a saloon. Originally the bank was called Bank of Italy. At the...

Regulators are nearing a settlement with Fannie Mae and Freddie Mac over whether the mortgage finance giants adequately disclosed their exposure to risky subprime loans, bringing to a close a three-year investigation. The proposed agreement with the Securities and Exchange Commission, under the terms being discussed, would include no monetary penalty or admission of fraud, according to several people briefed on the case. But a settlement would represent the most significant acknowledgement

If someone you knew claimed to have bought a new house for $16, you'd probably expect it to be a rundown hovel. But for Kenneth Robinson, that princely sum could see him as the new owner of a $300,000 home in an well-manicured part of Flower Mound, Texas. On June 17, Mr Robinson took advantage of a little known Texas law to move into the abandoned home. The house had been in foreclosure for more than a year and its owner walked away. Then, the mortgage company went bust. After months of research, Mr Robinson used the obscure law 'adverse...

In what could be a repeat of the easy-lending cycle that led to the housing crisis, the Justice Department has asked several banks to relax their mortgage underwriting standards and approve loans for minorities with poor credit as part of a new crackdown on alleged discrimination, according to court documents reviewed by IBD. [snip] Another Reno protege, Perez has compared bankers to Klansmen. Only difference is, he said, bankers discriminate "with a smile" and "fine print." He said this kind of racism, though more subtle, is "every bit as destructive as the cross burned in a neighborhood." Perez has put...

A long-delayed federal program aimed at helping hundreds of unemployed Massachusetts homeowners pay their mortgages is finally being launched today, with $61 million earmarked for the state. The US Department of Housing and Urban Development and the nonprofit NeighborWorks America said the program will provide hundreds of local borrowers with interest-free loans of up to $50,000 over a two-year period. In some cases, the money will not have to be paid back. The $1 billion national program is expected to benefit 30,000 unemployed homeowners in 27 states and Puerto Rico with financial assistance. Homeowners must file loan applications by July...

I believe that the sine qua non of the financial crisis was U.S. government housing policy, which led to the creation of 27 million subprime and other risky loans -- half of all mortgages in the United States -- which were ready to default as soon as the massive 1997-2007 housing bubble began to deflate. If the U.S. government had not chosen this policy path -- fostering the growth of a bubble of unprecedented size and an equally unprecedented number of weak and high-risk residential mortgages -- the great financial crisis of 2008 would never have occurred...

Subprime Scandal: The left is unhappy that no high-profile bankers have gone to jail in the financial crisis. But the real culprits were - and still are - in Washington. They've gotten off scot-free. A growing chorus is complaining that federal prosecutors have dragged their feet in the aftermath of the mortgage mess. Despite a raft of referrals against financial giants alleging securities fraud and "predatory lending," no senior bank executives have been charged or imprisoned. The media elite demand to know why it is that almost three years after the meltdown, Goldman Sachs CEO Lloyd Blankfein, ex-AIG CEO Hank...

RUSH: Now, I have a story here that's simply unreal, and it's from last week. I purposely sat on this story to see if I would see it anywhere else. I've had it in the stack since May the 5th, almost a week. It's from Business Week magazine, a story by Clea Benson, headline: "A Renewed Crackdown on Redlining -- In the wake of the subprime implosion, the Obama Administration has stepped up its scrutiny of disadvantaged neighborhoods' credit access. Community activists in St. Louis became concerned a couple of years ago that local banks weren't offering credit to the...

Abstract. We estimate a mortgage default model with national data on conventional mortgages that were current from 1986 to 1992. Our analysis confirms the results of previous analyses of Federal Housing Authority mortgages: Black households have higher marginal default rates, controlling for differences in borrower and property characteristics. Further, we do not find that Black borrowers have significantly more home equity. These results do not provide evidence of racial discrimination in mortgage lending and suggest that differences in default costs or transaction costs may explain differences in default rates. Introduction This article presents evidence that Black borrowers have higher default...

Community activists in St. Louis became concerned a couple of years ago that local banks weren't offering credit to the city's poor and African American residents. So they formed a group called the St. Louis Equal Housing and Community Reinvestment Alliance and began writing complaint letters to federal regulators. Apparently, someone in Washington took notice. The Federal Reserve has cited one of the group's targets, Midwest BankCentre, a small bank that has been operating in St. Louis's predominantly white, middle-class suburbs for over a century, for failing to issue home mortgages or open branches in disadvantaged areas. Although executives at...

wo lawsuits accusing Wells Fargo of discriminatory lending practices have been allowed to move forward, a victory for plaintiffs that have accused the bank of steering African-Americans toward predatory loans. In one lawsuit, brought by the city of Memphis and Shelby County, Tenn., Judge S. Thomas Anderson of Federal District Court for the Western District of Tennessee on Wednesday denied a motion from Wells Fargo to dismiss, partly on the grounds that the suit was too broadly drawn. Both jurisdictions accused the lender of improperly steering African-Americans toward loan products that ultimately led to foreclosures, vacancies and increased government costs....

WASHINGTON (AFP) – The Senate will soon issue findings of a probe of the US mortgage meltdown that fueled the global financial crisis, with Goldman Sachs likely to face fresh embarrassment over its role, the Wall Street Journal reported Sunday. The Senate Permanent Subcommittee on Investigations, whose high-profile inquiry commission subpoenaed Goldman's and other executives last year, is due to release its report on the subprime implosion of 2007 and 2008. The paper, citing people familiar with the matter, said the report was expected to release emails from securities firms that developed or sold subprime mortgages and financial vehicles including...

Litigation and regulatory actions tied to Goldman Sach's selling of mortgage-backed securities could cost the investment bank an additional $3.4 billion in legal expenses, Goldman's said in a Securities and Exchange Commission filing this week. The $3.4 billion is a "worst-case scenario" projection and does not reflect the true risk Goldman faces, but rather what could happen if the firm lands on the losing end of all litigation, a spokesman for the firm said. The company's projection of greater-than-budgeted for legal expenses puts it in company with Bank of America, Wells Fargo & Co. and JPMorgan & Co., all of...

'Not a single financial executive has gone to jail, and that's wrong," bellowed Charles Ferguson at Sunday night's Academy Awards. Is it really? Consider the source: "Inside Job," Ferguson's Oscar-winning documentary on the financial collapse of 2008, proudly features Eliot Spitzer -- who, as New York's attorney general, went on a tear against the big brokerages and their executives over various alleged crimes. In the film, Spitzer discusses how he uncovered various misdeeds, and claims the feds could have used their investigative powers to bring the bad guys to justice before it all blew up. But why didn't Spitzer do...

The Securites Exchange Commission (SEC) formally charged former Countrywide Financial CEO Angelo Mozilo and two other company executives with civil fraud. The SEC also charged Mozilo with illegal insider trading, an agency spokesman said Thursday. Civil fraud charges also were filed against Countrywide's former Chief Operating Officer David Sambol and ex-Chief Financial Officer Eric Sieracki. Countrywide Financial, the California-based mortgage lender, was a key component to the subprime mortgage crisis in 2007, which was the beginning of the financial decline and current recession in the U.S. Mozilo is the most high-profile individual to face formal charges from the federal government...

Insiders at Freddie Mac are downplaying the memo revealed by Bloomberg yesterday. The memo revealed that a survey of mortgages Freddie bought from Citigroup [C 4.765 -0.035 (-0.73%) ] in late 2009 and early 2010 uncovered shockingly high rates of defects. In late 2009, for example, more than 30 percent of the mortgages in the review had flaws. These weren't old, housing-bubble-era mortgages. They were loans made in 2009. Among the defects Freddie Mac detected were a missing appraisal, missing documentation, loans exceeding the maximum amount permitted, and a construction loan described as a refinancing. In short, a mess of...

It is not difficult to deprive the vast majority of independent thought.[i] Does anyone remember what happened on Christmas Eve last year? In one of the most expensive Christmas presents ever, the government removed the $400 billion limit on their Fannie and Freddie guaranty. This act increased taxpayer liabilities by six trillion dollars; however, the news was lost in the holiday cheer. This is one instance in a broader campaign to manipulate the public perception, gradually depriving us of independent thought. Consider another example: what news story broke on April 16, 2010? Most of us would say the SEC's lawsuit...

NEW YORK -- Home prices took a shockingly steep plunge on a monthly basis, an indication that the housing market could be on the verge of -- if it's not already in -- a double-dip slump, according to an industry report released Tuesday. Prices in 20 key cities fell 1.3% in October from a month earlier, an annualized decline of 15%, according to the S&P/Case-Shiller index. Prices were down 0.8% from 12 months earlier. Month-over-month prices dropped in all 20 metro areas covered by the index. Six markets -- Atlanta; Charlotte, N.C.; Miami; Portland, Ore.; Seattle and Tampa, Fla. --...

As detailed in this previous clip, co-authors Bethany McLean and Joe Nocera say there's plenty of blame to go around, from Alan Greenspan .....

Was the great financial crisis caused by greedy and reckless bankers and Wall Street players or by a broad range of individuals, financial institutions and governments who became less risk-averse and prudent or by government housing policies that brought on the housing bubble and mismanaged the risks? The lame-duck Congress now in session is about to make some major decisions on spending and taxes - when all too many members still are operating on the idea that greedy bankers and Wall Street players, rather than government housing policies, are the problem. Without waiting for the evidence, many in the political...

Benjamin Franklin is credited with defining insanity as the action of constantly doing the same thing over and over again yet expecting different results.  Well with that understanding, it is my opinion that both California and New York voters are suffering from an extreme case of insanity.  In California, Democrat Jerry Brown is holding a slight edge over Republican Meg Whitman 48% to 42%.  Now I do believe that both Whitman and Paladino can win, if Republicans vote with the same enthusiasm they had during the primaries.  However, if these numbers hold then it looks as if Jerry Brown...

Would it be queer to vote for the man who created the housing bubble and hence buggered the U.S. economy? ... Before it all erupted, Fannie and Freddie held or backed half of all American mortgages and a full 20% of their portfolio was subprime. ... Congress allowed them to leverage their assets more highly than any bank (Freddie was in hock for $70 for every $1 in cash it held – banks run at about 30:1 – and some think Mae and Mac’s numbers are low due to the mortgage-back securities for which they were on the hook). ......

The foreclosure crisis has hit blacks harder than any other group in America and it will be tough for them to regain their footing in the housing market. Blacks' homeownership rate has plummeted nearly 6 percent to 46.2 percent since its peak in 2004. That's more than twice that of any other racial or ethnic group, as well as the nation's rate as a whole, which fell only 2.3 percent, according to U.S. Census data. Also, among recent borrowers, nearly 8 percent of blacks have lost their homes to foreclosure, compared to 4.5 percent of whites, according to the Center...

SAN FRANCISCO (MarketWatch) — The Federal Reserve Bank of New York is part of a group of investors pressuring Bank of America Corp. to repurchase billions of dollars in home loans. The investor group owns more than 25% of the voting rights in over $47 billion of residential mortgage-backed securities issued by Countrywide Financial, the home loan giant that Bank of America /quotes/comstock/13*!bac/quotes/nls/bac (BAC 11.75, -0.60, -4.82%)  acquired in 2008. On Monday, the group wrote to Countrywide Home Loan Servicing and Bank of New York Mellon Corp. /quotes/comstock/13*!bk/quotes/nls/bk (BK 26.11, -0.51, -1.92%)  , the trustee of the mortgage securities, saying...

You should probably be a buyer of Bank of America right now. I never thought I’d find myself typing those words. I’ve been a huge critic of Bank of America for years. I'm bearish on the financial supermarket model. I don't think the acquisition of Merrill Lynch is working out. I still don't understand the logic of buying Countrywide. But Bank of America's recent decline—down almost 10% this week—is driven by fears that the bank could be hit with huge liabilities for faulty mortgage pools. And I’m pretty sure that is not going to happen. Why not? Because the politicians...

SASEBO NAVAL BASE, Japan – The financially troubled USA Federal Credit Union will merge with Navy Federal Credit Union -- a larger competitor that also serves U.S. military bases in the Pacific -- both credit unions said Tuesday. San Diego-based USA Federal, which operates 11 branches in Japan and South Korea and eight in southern California, said recently that it was considering mergers after being rocked by bad mortgages and the global economic recession. Its branches will become part of the Navy Federal network Oct. 1, pending approval by the National Credit Union Administration, according to a joint news release....

A new wave of distressed home sales is rippling, more quietly this time, through American cities and suburbs. Its unsettling effects are playing out here in Manassas, along Brewer Creek Place, a modest, horseshoe-shaped street lined with 98 brick townhouses. Several years after the U.S. foreclosure crisis erupted, the U-Hauls are back. The last time, banks seized nearly every fourth house on the street through foreclosure. This time, homeowners are going another route: a short sale. Completed short sales have more than tripled since 2008, and 400,000 of these deals are projected to close this year, according to mortgage research...

Take it from me because I see the Nielsen television ratings every day: NFL football is riding a huge wave of popularity in America. In the first week of play, the ratings are up by double digits, and the games have even taken some viewers away from my news program, which is a complete and utter outrage. Why are more people watching football? The first reason is economic: It's free. Because of the recession, fewer people are going out for entertainment. Instead, they grab popcorn and a beverage and watch huge men run into each other. Simple and inexpensive. The...

“We are sitting on a time bomb,” the mortgage analyst said — a huge increase in unconventional home loans like balloon mortgages taken out by consumers who cannot qualify for regular mortgages. The high payments, he continued, “are just beginning to come due and a lot of people who were betting interest rates would come down by now risk losing their homes because they can’t pay the debt.” He would have given great testimony at the current Senate hearings on subprime mortgage lending. The only problem is, he said it in 1981 — when soon after several of the alternative...

In what's being called a "first of its kind," the report, analyzed more than half a million statewide cases of foreclosures and found that the vast majority-48%-has been on Latinos. Whites totaled 35%, African Americans 8% and Asians 6%. An in-depth 2009 report on Latino home ownership by the Wall Street Journal found another reason why so many Latinos sought home ownership in the first place. The Journal's investigation found "a push by low-income housing groups, Hispanic lawmakers, a congressional Hispanic housing initiative, mortgage lenders and brokers, who all were pushing to increase homeownership among Latinos." It looks like this...

Higher monthly fees are coming for consumers who take out home loans guaranteed by the Federal Housing Administration, the primary source of mortgages for first-time homebuyers. Earlier this year, the FHA raised the upfront fee to 2.25 percent of the total mortgage amount from 1.75 percent. Agency officials want to lower that to 1 percent. The combined impact of lowering the upfront fee and raising the monthly fee would mean a borrower taking out a mortgage of $170,000 at an interest rate of 5 percent would pay an extra $38 a month.

EXCERPT Page 110: Ramping up the pressure was the 1992 study by the Federal Reserve Bank of Boston that had concluded there was widespread racism and income discrimination in the mortgage- lending process; in other words, people were being denied mortgages based purely on their race and income level, even if they had the means to repay tortgages. The study purported to prove statistically that many minorities might have had bad credit scores, but they also held jobs and were being denied mortgages even though they had the ability to repay them. The Study argues that the traditional ways of...

Democrats claim their sweeping financial-sector reforms will guard against the kind of problems that triggered the recent economic meltdown. But if they really wanted to do that, they would've focused on how so many US officials were simply . . . bought. Fat chance. Nonetheless, Rep. Darrell Issa (R-Calif.), ranking member of the House Committee on Oversight and Governmental Reform, is demanding just such a review -- and, for the sake of the nation, he should get one. Last week, Issa wrote to Alfred Pollard, general counsel to the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac,...

DETROIT – General Motors Co. will buy AmeriCredit Corp. for $3.5 billion, a deal that allows the automaker to expand loans to customers with poor credit and offer more leases, key areas where GM must grow to accelerate its car sales. But the acquisition of the independent auto financing company also means that GM, which is 61 percent owned by the U.S. government, is getting back into the business of making risky loans. GM said it advised the U.S. Treasury Department of the acquisition, although government approval was not required.

Housing: America still has far too many underwater debtors labeled as "homeowners," but Washington can't bear to let them liquidate. Instead, it saddles taxpayers with ever-costlier bailouts. The federal government has tried just about every trick in the book to revive the nation's housing market and forestall a feared tsunami of foreclosures. How well have they worked? The answer depends on how you judge success. If the object is to keep "owners" - really, maxed-out debtors - in their homes, the results have been so-so. But there's another way of framing the issue. What if it would have been better...

For almost a quarter century, Cynthia Johnson, a Boston homeowner, has paid the mortgage on her three-bedroom single-family house on time. But in July, for the first time, she'll miss a payment. "I'm on [the bank's] doorstep at this point, saying, 'The savings are gone. I can't pay you as promised,' " she said. Unless something changes, Ms. Johnson (not her real name) is set to join the nearly 2.4 million Americans with prime loans seriously delinquent on their mortgages. They are the new face of the housing crisis. Unlike subprime borrowers, most of these homeowners did everything right. They...

Sometime in the early summer of 2007, the name Barack Obama began to register in my consciousness. I began to hear and see his name more often, and within the next year, a plethora of terms that I had heard of but not paid much attention to before began to show up in things I read, saw and heard on a daily basis: "Economic Justice" "Positive Rights" "Living document" "Black Liberation Theology" "Saul Alinsky" "Rules for Radicals" And so on. In the summer of 2008, I decided to read "Rules for Radicals" by Saul Alinsky, because I knew both of...

Students fresh out of college, six-figures deep in debt, face decades of debt slavery. Both parents and students are wondering what went wrong. Please consider Placing the Blame as Students Are Buried in Debt. Like many middle-class families, Cortney Munna and her mother began the college selection process with a grim determination. They would do whatever they could to get Cortney into the best possible college, and they maintained a blind faith that the investment would be worth it. Today, however, Ms. Munna, a 26-year-old graduate of New York University, has nearly $100,000 in student loan debt from her four...

"Sub-prime mortgages are just the start the worst still to come" 60 Minutes special. Get out of Dollars and the US Stock Market. There is going to be a run on the dollar soon as China becomes a net seller of treasuries instead of a net buyer like they are currently. They just announced a 600b bailout of their own, how do you think they will pay for it? Dump their 1Trillion plus in US treasuries. The game is up. In 2010 a hundred US dollars wont even buy you a case of beer.

The similarities between the subprime mortgage crisis and that of the coming collapse of the U.S. bond market are uncanny. In fact, Mark Twain may have had the U.S. debt market and the previous debt-fueled real estate crisis in mind when he said that "History does not repeat itself--but it does rhyme." The housing and credit crisis first became evident to most in 2007 with the distress in the subprime mortgage market. The foundation for the housing bubble was low interest rates, which were provided by the Fed, and passed along to consumers via commercial banks and the shadow banking...

WASHINGTON, Sept. 29— In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders. The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring. . .

No one wants to go through another financial crisis like we had in 2008, so our government is busy writing new regulations to fix things. But how do we know what to fix if we don't know what broke, exactly? To some, it is enough to simply start regulating something, since we know that too little regulation was the problem. Late-night economist David Letterman summarized the situation: "Republicans in power previously for eight years deregulated banks, and that was a contributory factor." Key words: Republican, deregulated. That might be a plausible explanation...if Republicans had deregulated anything. Perhaps Mr. Letterman mixed...

The panel investigating the nation's financial crisis hears sharply divergent explanations for the failure of mortgage giants Fannie Mae and Freddie Mac. They were well-intentioned victims of a historic, unanticipated meltdown in the housing market -- or they were reckless, arrogant financial firms that plunged headfirst into the riskiest mortgages in a blind pursuit of profits. The panel investigating the nation's long financial crisis heard those two sharply divergent rationales for the failures of mortgage financing giants Fannie Mae and Freddie Mac, which were seized by government officials in 2008 at a cost to taxpayers of $126 billion, to date....