NEWS NEW YORK (CNNMoney.com) -- Lenders continued to rewrite troubled mortgages at a fast clip during March, but the weakening economy still sent foreclosure starts soaring to a record high.
lenders, servicers, investors and community groups put together to fight the foreclosure plague - were a decidedly mixed bag. 0:00 /0:46Tax break for homebuyers Approximately 134,000 mortgages were rewritten by Hope Now members, which is nearly 20,000 more than the average since September. Another 115,000 at-risk borrowers were granted repayment plans, for a total of nearly a quarter of million troubled mortgages addressed for the month. Repayment plans merely postpone payments for delinquent borrowers without making them any more affordable. Mortgage modifications are changes in the terms of loans that reduce or freeze interest rates, extend the life of the loan, reduce loan balances or any combination of those three, to, ideally, lower the amount borrowers pay monthly. Modifications are considered more effective that repayment plans. "The lending industry is steadily working out solutions for homeowners and keeping as many as possible in their homes," said Faith Schwartz, director of Hope Now. "I expect that these numbers will continue to increase as servicers work with the Obama Administration to implement its Homeowner Affordability and Stability Plan." Steep spike in starts Despite the efforts, however, more homeowners fell into default in March. Servicers initiated foreclosure proceedings against 290,000 mortgage borrowers, a jump of nearly 20% from February's 243,000, and the highest monthly total since the coalition began tracking data in mid-2007. Starts have risen by more than a third since January. On the other hand, completed foreclosure sales, transactions in which lenders have actually taken back homes from defaulting borrowers, dropped by 39% in March. Banks repossessed only 53,000 homes compared with 87,000 taken over during February. Since the mortgage meltdown hit in July 2007, 1,447,866 homes have been lost to foreclosure. Michael Bright, a chief statistician with Hope Now, attributed the sharp reduction in completed foreclosures to servicers suspending foreclosures as they geared up to implement the administration's refinance and mortgage-modification program. "It's too early to say this is a trend," he said in a press release. "But anecdotal reports from servicers do indicate that they are taking this extra step to help homeowners who qualify stay in their homes." Once the program is fully in place, servicers will have more tools to be able to make successful modifications to unaffordable mortgages. In the meantime, they're allowing a kind of grace period for homeowners until the government program can be applied to individual cases. "Our counselors have been getting hardly any answers for weeks," said Mark Seifert, director of the East Side Organizing Project in Cleveland, which advocates mortgage workouts for hundreds of delinquent homeowners a month. "The servicers have been sitting on their hands." But the impact of the Homeowner Affordability and Stability Plan should begin to be felt soon, according to Schwartz, who thinks it going to change - and improve - the mortgage landscape. "It's one of the most comprehensive programs I've seen," she said. ""Eleven major servicers have formally signed on, and we should start to see data from it over the next few months." WASHINGTON (Reuters) -- The House of Representatives overwhelmingly approved credit card legislation on Thursday aimed at protecting consumers from hidden fees and sudden interest rate hikes. The chamber voted in support of the Credit Cardholders' Bill of Rights. Banks opposed to legislation have warned it could reduce the amount of credit available and make it more costly to use a credit card. President Barack Obama, who backs congressional efforts to overhaul the industry, is expected to sign a bill into law by late May once the Senate considers its own version next week. You're considered a "first-time home buyer" if you had no ownership interest in a principal residence in the U.S. During the three years before the purchase. The credit is refundable, so you could get money back if the amount you're eligible to claim is more than the tax you owe. The credit is reduced when modified adjusted gross income exceeds $75,000 if you're single and $150,000 if you're married filing jointly. A house you construct qualifies, but one you purchase from relatives generally does not. There's a recapture provision, meaning you'll have to pay the credit back in most cases. The payback period is spread over 15 years, beginning two years after you buy your home. Additional standard deduction. For 2008 you can deduct real property taxes even if you don't itemize. The break takes the form of an increased standard deduction. The amount of this one-time benefit is the lesser of property taxes you actually pay during the year or $500 ($1,000 for married filing jointly). Reduced home sale exclusion. Generally, up to $500,000 ($250,000 for singles) of gain on the sale of your principal residence is tax-free, as long as you meet time and use requirements. The new rules, effective for sales after December 31, 2008, reduce the gain exclusion for "non qualified use," such as use as a rental or as a vacation home. The amount of the reduction is based on periods of time after January 1, 2009, when the home is not the principal residence of you, your spouse, or former spouse. Some exceptions apply. Other tax provisions include changes to the low income housing credit, expansion and extension of Gulf Opportunity Zone incentives, and an election to accelerate alternative minimum tax credits and research credits in place of bonus depreciation. |
COLONIAL ACCOUNTING, INC ACCOUNTING SERVICES We will work closely work you to manage every aspect of your financial needs. |
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NEW YORK (CNNMoney. com) -- Unemployment rates in 109 metropolitan areas reached 10% or higher in March, almost eight times more than a year earlier, according to a government report released Wednesday.
jobless rates of at least 10% last year, the Labor Department said. The March 2009 report said unemployment rates in all of the nation's 372 metropolitan areas rose in March compared with the same month in the prior year. Jobless rates of at least 15% were reported in March in 18 areas, compared with only one - El Centro, Calif. - the previous year. The number of metropolitan regions that had unemployment rates under 7% dropped significantly to 95 from 329 in March 2008. A total of 33 metro areas registered unemployment rates that were at least 6 percentage points higher than a year ago, and another 42 areas' increases were 5 to 5.9 percentage points. 0:00 /1:452 million job losses The Labor Department does not adjust the rates in its metropolitan unemployment report for seasonal changes in employment. El Centro continued to have the highest metropolitan unemployment rate at 25.1%. The town is near the Mexican border and relies on agricultural employment, according to economists. The area's unemployment rate tends to rise and fall depending on the farming season. Houma-Bayou Cane- Thibodaux, La., and Iowa City, Iowa, reported the lowest rates in the country at 3.6%. Elkhart-Goshen, Ind., reported the largest unemployment rate increase year-over-year, at 13 percentage points. |
| Colonial Accounting, Inc. | 3279 Westover Ridge | Williamsburg, VA 23188 | tel: 757.645.2799 | fax: 757.645.2828 | cai@colonialaccounting.com |
NEW YORK (CNNMoney.com) --
Next week the government is
expected to reveal the results of
its all-important bank
stress-tests. Investors and
customers alike will be
scrutinizing these numbers to
make sure their bank has the
wherewithal to survive in this
tough economic environment.
But how you can be sure that the
bank where you keep your
money is safe?
The Federal Reserve's stress
tests will value bank assets and
analyze their capital cushion.
And while investors will be
scouring the reports next week
looking for telltale weaknesses,
here's the rub: for the average
consumers, this information is
less than useful.
What you need to know is
whether your bank is lending to
people like you, whether fees
are out of sight, and if the bank's
credit card department is cutting
credit limits.
The Fed is less concerned
about all of this, and the stress
test is only being applied to 19
of America's 8,500 banks: yours
might not even be tested.
Consumers are better off
consulting sites like
bankrate.com. The Web site
offers a Safe & Sound rating
system that can help you get a
picture of how your bank is
doing.
You can also check out
HSH.com for mortgage and
consumer loan information
divided by region.
And remember, if you think your
bank might be in trouble, don't
panic. As long as your bank is a
member of the FDIC, your
money is protected up to certain
limits. Through the end of this
year, individual accounts are
fully protected up to $250,000,
and the same goes for all
retirement accounts, including
IRAs.
If you're over the limit, spread
out your money at different
institutions, or consider joining
a credit union. Credit unions are
just as safe as banks. Instead
of the FDIC guarantee, you have
the National Credit Union
Association to back up your
accounts.
One of the worst moves you
could make is pulling your
money out of a regulated
institution and holding the cash
yourself.
Next week the government is
expected to reveal the results of
its all-important bank
stress-tests. Investors and
customers alike will be
scrutinizing these numbers to
make sure their bank has the
wherewithal to survive in this
tough economic environment.
But how you can be sure that the
bank where you keep your
money is safe?
The Federal Reserve's stress
tests will value bank assets and
analyze their capital cushion.
And while investors will be
scouring the reports next week
looking for telltale weaknesses,
here's the rub: for the average
consumers, this information is
less than useful.
What you need to know is
whether your bank is lending to
people like you, whether fees
are out of sight, and if the bank's
credit card department is cutting
credit limits.
The Fed is less concerned
about all of this, and the stress
test is only being applied to 19
of America's 8,500 banks: yours
might not even be tested.
Consumers are better off
consulting sites like
bankrate.com. The Web site
offers a Safe & Sound rating
system that can help you get a
picture of how your bank is
doing.
You can also check out
HSH.com for mortgage and
consumer loan information
divided by region.
And remember, if you think your
bank might be in trouble, don't
panic. As long as your bank is a
member of the FDIC, your
money is protected up to certain
limits. Through the end of this
year, individual accounts are
fully protected up to $250,000,
and the same goes for all
retirement accounts, including
IRAs.
If you're over the limit, spread
out your money at different
institutions, or consider joining
a credit union. Credit unions are
just as safe as banks. Instead
of the FDIC guarantee, you have
the National Credit Union
Association to back up your
accounts.
One of the worst moves you
could make is pulling your
money out of a regulated
institution and holding the cash
yourself.