Thursday, May 20, 2010

MarcyWatch 2010 - Winograd for Congress June 8 - Foreclosures Break Records!

Marcy Winograd for Congress Countdown - Vote on Tuesday, June 8!

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One huge reason to kick Jane Harman to the curb is that she signed the vile, loathsome Bankruptcy Bill of 2005, the disgusting bill that closed off a last attempt to protect ourselves from the rapaciousness of the credit card companies - an industry-written bill that the credit card industry had been attempting to purchase from Congress for the previous 20 years. One of the components of the bill rescinded the ability of bankruptcy judges to order banks to modify home loans. And, as we have found, if asked instead of ordered, banks will refuse to do so.

Here's Marcy's take on the foreclosure crisis:

In light of record foreclosures, more than 7,000 in our district last year, Marcy supports a "First Right to Rent" rule for homeowners losing their homes. "If banks were required to rent to those facing foreclosure, we would have far fewer foreclosures," says Marcy, "because banks find it harder to sell a home with tenants in the house."

Foreclosures not only impact those losing their homes, but also neighborhoods that suffer vandalism and lower property values, as well as counties that lose their tax base, thus forcing cuts in social services that hurt the newly homeless. Marcy's opponent, Jane Harman, voted for the 2005 bankruptcy bill which makes it easier for banks to foreclose by prohibiting bankruptcy judges from ordering banks to modify home loans.

For more on the foreclosure crisis, read the Associated Press report below:

Mortgage Delinquencies, Foreclosures Break Records
by Alan Zibel

WASHINGTON - The number of homeowners who missed at least one mortgage payment surged to a record in the first quarter of the year, a sign that the foreclosure crisis is far from over.

More than 10 percent of homeowners had missed at least one mortgage payment in the January-March period, the Mortgage Bankers Association said Wednesday. That number was up from 9.5 percent in the fourth quarter of last year and 9.1 percent a year earlier.

Those figures are adjusted for seasonal factors. For example, heating bills and holiday expenses tend to push up mortgage delinquencies near the end of the year. Many of those borrowers become current on their loans again by spring.

Without adjusting for seasonal factors, the delinquency numbers dropped, as they normally do from the winter to spring.

More than 4.6 percent of homeowners were in foreclosure, also a record. But that number, which is not adjusted for seasonal factors, was up only slightly from the end of last year.

Stocks slid Wednesday as investors looked past a rising euro and focused on the U.S. economy, including the rising number of foreclosures. The Dow Jones industrial average fell more than 100 points in early trading.

Jay Brinkmann, the trade group's chief economist, said the foreclosure crisis appears to have stabilized. Seasonal adjustments may be exaggerating the change from the previous quarter, he added.

"I don't see signs now that it's getting worse, but it's going to take a while," he said. "A bad situation that's not getting worse is still bad."

Economic woes, such as unemployment or reduced income, are the main catalysts for foreclosures this year. Initially, lax lending standards were the culprit. But homeowners with good credit who took out conventional, fixed-rate loans are now the fastest growing group of foreclosures.

Those borrowers made up nearly 37 percent of new foreclosures in the first quarter of the year, up from 29 percent a year earlier.

The risky subprime adjustable-rate loans that kicked off the foreclosure crisis are making up a smaller share of new foreclosures. They made up 14 percent of new foreclosures in the January-March period, down from 27 percent a year earlier.

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