School district could cut 30 jobs starting July 1 as state aid lags / Some positions could be restored if November tax measure passes
Glenn Wohltmann, Pleasanton Weekly, February 6, 2012, link
School district could cut 30 jobs starting July 1 as state aid lags / Some positions could be restored if November tax measure passes
Glenn Wohltmann, Pleasanton Weekly, February 6, 2012, link
Les Christie, CNNMoney, February 9, 2012, link
NEW YORK (CNNMoney) — The nation’s five largest banks have finally struck a deal with 49 states to settle charges of abusive and negligent foreclosure practices dating back to 2008.
Under a deal announced Thursday, the banks will commit $26 billion to help underwater homeowners and compensate those who lost their homes due to improper foreclosure practices.
A group of state attorneys general claimed that banks lost important paperwork, cut corners and enlisted robo-signers to attest to facts they had no knowledge of on hundreds of documents a day.
The settlement has been in the works for more than a year.
What did the mortgage lenders and loan servicers agree to do? The banks and servicers have committed at least $17 billion to reduce principal for borrowers who 1) owe far more than their homes are worth 2) are behind on payments.
The amount of principal reduction will average about $20,000 per borrower.
Another $3 billion will go toward refinancing mortgages for borrowers who are current on their payments. This will enable them to take advantage of the historic low interest rates currently available.
The banks will pay $5 billion to the states and the federal government, the only hard money involved in the deal. Out of that fund will come payments of $1,500 to $2,000 to homeowners who lost their homes to foreclosure. Other funds will be paid to legal aid and homeowner advocacy organizations to help individuals facing foreclosure or experiencing servicer abuses.
Another $1 billion will be paid directly by Bank of America to the Federal Housing Administration to settle charges that its subsidiary, Countrywide Financial, defrauded the housing agency.
In addition, the banks agreed to eliminate robo-signing altogether and to use proper and legal procedures when putting homeowners through the foreclosure process. They also agreed to end servicer abuses, like harassing delinquent borrowers for payments, and to include principal reductions more often in their mortgage modifications programs. (Mortgage deal could bring billions in relief)
Is my mortgage lender taking part in this settlement? Bank of America (BAC, Fortune 500), Wells Fargo (WFC, Fortune 500), JPMorgan Chase (JPM, Fortune 500), Citigroup (C, Fortune 500) and Ally Financial (GJM)
are taking part in the settlement.
In addition, nine other unnamed loan servicers may join the settlement later, and that would bring its value to $30 billion.
Loans owned or backed by Fannie Mae and Freddie Mac, however, are not part of the deal. (Obama proposes new home loan refinancing program)
The Federal Housing Finance Agency, which oversees the two government-sponsored mortgage giants, will not allow any balance reductions for loans insured by the companies under the settlement.
I lost my home to foreclosure; how do I know if I qualify for payment? If you were foreclosed on in the calendar years 2008 through 2011, you may be be eligible for a payment of up to $2,000. People who think they may qualify should notify their bank.
The exact amount of the payments will depend on how many people participate in this part of the settlement. They will share equally in a pool of $1.5 billion. The U.S. Department of Housing and Urban Development expects about 750,000 former homeowners to take part.
What should I do if I think I may qualify for a principal reduction or refinanced mortgage? Contact your lender/servicer and ask them to review your case.
If I take the money, what rights do I give up? Individual borrowers do not give up any right to sue.
As part of this deal, state attorneys general gave up the right to sue the mortgage servicers for foreclosure abuses arising out of the robo-signing scandal. However, they reserve the right to sue if they uncover improper acts when the loans were originated or when they were securitized.
When will the new rules and bank policies be put into place? Most of them have already become part of bank policies.
When will homeowners get paid? HUD said the settlement will be put before a court for approval within two weeks. It is unknown how long it will then take for a court to rule.
The relief for homeowners has to be completed within three years, but the state attorneys general and HUD want it to be front-loaded and completed within 12 months.
Would I have to pay taxes on the principal reductions or the pay-outs? If the principal is reduced in 2012, it will not be subject to income tax.
That’s because the Mortgage Debt Relief Act of 2007 allows taxpayers to exclude income from the discharge of debt on their principal residence. The act is scheduled to expire at the end of this year, however.
So if the act is not extended and the principal reduction occurs in 2013, borrowers may be on the hook to pay taxes on the settlement amount.
It’s not clear whether you would have to pay taxes on the $1,500 to $2,000 payout. The IRS declined to comment on the question.
Which state didn’t participate and what does it mean if you live in that state? Oklahoma was the only holdout of the 50 states. Instead, it announced its own settlement with the five banks Thursday.
Under its settlement, the banks agreed to pay $18.6 million in damages, part of which would compensate homeowners who were victims of unlawful and unfair mortgage practices, according to the Oklahoma attorney general’s office.
Homeowners who believe they may have been wrongly foreclosed upon should visit the Oklahoma attorney general’s website and fill out the paperwork for processing a claim.
Will the settlement make it harder to get a mortgage? The new rules and regulations the banks have agreed to under the settlement should have little impact on future mortgage borrowing since most of practices are already in place, said Keith Gumbinger of HSH Associates, a mortgage information provider.
The actual cost to the banks of the settlement should not discourage lending either. (Housing: The one bailout America really needs)
Only $5 billion of the $26 billion settlement will be a direct cost to the banks. The remainder will be the cost of modifying mortgages. Many of those modifications may be in the best interests of the banks to make, however, since the alternative may be foreclosure, which can cost banks more than modifications.
Mortgage deal could bring billions in relief
Chris Isidore and Jennifer Liberto, CNNMoney, February 9, 2012, link
WASHINGTON (CNNMoney) — In the largest deal to date aimed at addressing the housing meltdown, federal and state officials on Thursday announced a $26 billion foreclosure settlement with five of the largest home lenders.
The deal settles potential state charges about allegations of improper foreclosures based on robosigning, seizures made without proper paperwork.
The settlement includes the Justice Department and the U.S. Department of Housing and Urban Development, as well as 49 state attorneys general — all but Oklahoma.
“We are using this opportunity to fix a broken system,” said U.S. Attorney General Eric Holder at the news conference announcing the settlement.
The settlement sets up a federal monitor to oversee the process and try to prevent roadblocks and red tape that tripped many homeowners seeking help in earlier programs designed to address the housing crisis.
President Obama said the settlement will “begin to turn the page on an era of wrecklessness that has left so much damage in its wake.”
“No action, no matter how meaningful, is going to by itself entirely heal the housing market,” he said in separate remarks. “But this settlement is a start.”
Most of the relief will go to those who owe far more than their homes are worth, known as being underwater on the loans. That relief will come over the course of the next three years, with the banks having incentives to provide most of the relief in the next 12 months.
“This settlement is about homeowners, homeowners in distress,” said Iowa Attorney General Tom Miller at the news conference with state and federal officials.
Principal reduction: At least $17 billion will go to reducing the principal owed by homeowners who are both underwater and behind on their mortgages.
The agreement calls for principal reduction for as many as 1 million people. But it’s unlikely the money will go that far, because many people need more than the $17,000 average reduction that would result if the money is split among 1 million homeowners.
At the same time, total principal reduction could go higher — to as much as $34 billion — since the agreement requires deeper principal reductions for the most troubled loans.
Refinancing: Officials say up to 750,000 other underwater homeowners who are current on their mortgages will be able to refinance their current loans at lower rates. They will not receive a reduction in principal, but with mortgage rates now near record lows, they could receive substantial savings on their monthly payments.
The settlement sets aside $3 billion to account for the reduced interest payments the banks will receive after the refinancing.
Robosigning payments: About $1.5 billion of the settlement will go to homeowners who had their homes foreclosed upon between Jan. 1, 2008 and Dec. 31, 2011, and who meet other criteria. They will receive up to $2,000 each.
Accepting that payment does not preclude homeowners who lost their home in an improper foreclosure from suing the bank to recover damages, Donovan said.
Participating banks: The five mortgage servicers that are parties to the settlement — Bank of America (BAC, Fortune 500), JPMorgan Chase (JPM, Fortune 500), Citigroup (C, Fortune 500), Wells Fargo (WFC, Fortune 500) and Ally Financial — will pay a total of $5 billion to the states and federal government. Some of that money will go to foreclosed homeowners and the rest to the states.
Federal officials say negotiations are underway to expand the settlement to nine other major servicers, which would raise the overall value of the settlement to $30 billion.
Related settlements: The deal spurred pacts between the authorities and banks in similar cases.
Oklahoma Attorney General Scott Pruitt announced a separate $18.6 million settlement that addressed homeowners whose homes were foreclosed through improper means, but did not provide help to those whose mortgages were underwater. He said he believes the broader agreement “overreached” the authority of both federal and state governments.
“We had concerns that what started as an effort to correct specific practices harmful to consumers, morphed into an attempt by President Obama to … fundamentally restructure the mortgage industry in the United States,” Pruitt said.
The Federal Reserve said it had reached an agreement with the five banks to pay $766.5 million in sanctions related to their servicing practices.
And Loretta Lynch, the U.S. Attorney in Brooklyn, N.Y., announced a $1 billion settlement with Bank of America to resolve claims of underwriting and mortgage origination fraud by BofA and mortgage lender Countrywide Financial, which BofA bought in 2008.
The bigger foreclosure problem: The $26 billion deal announced Thursday is the second biggest settlement ever involving states. It trails only the $206 billion pact in 1998 with the tobacco industry.
And it dwarfs any settlements that major Wall Street firms have reached to resolve other allegations of misdeeds related to the financial markets meltdown and the Great Recession.
Still it only will help a faction of those homeowners who are struggling with mortgages. The relief would not be available to those homeowners whose mortgages have been sold to the government-sponsored mortgage guarantors Fannie Mae and Freddie Mac.
There are 1.5 million homeowners who are 90 days or more delinquent on their mortgages but not yet in foreclosure, according to the most recent estimate from the Mortgage Bankers Association. An additional 1.9 million are in the foreclosure process. And CoreLogic estimates that 11 million homeowners are underwater on their mortgages.
The settlement does not preclude criminal prosecutions from being pursued. It also doesn’t stop investigations into other allegations of misdoings, such as the process of bundling loans into mortgage-backed securities and selling them to investors.
“It wasn’t the servicing practices that created the bubble nor caused the collapse,” said Donovan. “It was the origination and the securitization of these horrendous products. We will be aggressive about going after those claims.”
The deal is supposed to protect consumers when it comes to robosigning, and ensure that mortgage servicers agree to communicate better, avoid delays and give homeowners who are late on mortgage payments a fairer shake.
New York’s participation had been shaky this week, because some of the banks involved in the multi-state deal had also been sued by Attorney General Eric Schneiderman last week. Those banks — Bank of America, Wells Fargo and JPMorgan Chase — had also asked for a legal pass from Schneiderman’s lawsuit, which accuses them of deceptive foreclosure practices for relying on the Mortgage Electronic Registration System.
On Tuesday, Schneiderman’s office organized a media briefing to talk about the deal and then canceled it minutes before it was supposed to begin.
The big question throughout the negotiations was how much money would be available to help homeowners, which depended on how many states agreed to the deal. California’s participation raises the total settlement value by several billion dollars.
At least one consumer advocacy group, the Center for Responsible Lending, has said the deal — while “no silver bullet” — leaves room to hold banks accountable in other mortgage probes, said Kathleen Day, a spokeswoman for the nonprofit.
But other left-leaning groups, including Move On and the New Bottom Line, are continuing to urge states to hold out for a big criminal investigation and a $300 billion settlement award.
MSNBC.com, February 9, 2012, link
President Obama outlines a financial package that he says will force some of the nation’s biggest banks to put billions of dollars toward the relief of many struggling homeowners.
American homeowners can breathe (a small) sigh of relief. The U.S. announced a $25 billion deal Thursday with the nation’s largest banks – after more than a year of bickering and about-faces – that would provide some help for people struggling to pay their mortgages.The settlement comes after evidence emerged late in 2010 that banks robo-signed thousands of foreclosure documents without properly reviewing paperwork. The Obama administration hopes the pact will open a new avenue for housing relief because it will force the banks to write down mortgages at a time when roughly one in four borrowers owe more on their mortgage than their home is worth.
The settlement helps “turn the page” on “recklessness” and abusive practices by banks that led to the housing crisis, President Barack Obama told reporters in remarks at the White House after the deal was announced. The settlement has been billed as complementing other government programs designed to boost the housing market that has been a drag on the economic recovery, a key issue for Obama as he fights for re-election in November.
“We have reached a landmark settlement with the nation’s largest banks that will speed relief to the hardest hit homeowners,” Obama said. He also urged Congress to take action on some other proposals aimed at aiding homeowners, including one to help underwater borrowers who are current on their payments refinance their mortgages.
The Obama administration has estimated that up to 1 million homeowners could benefit from the deal through mortgage writedowns and other forms of relief. The New York Times said another 750,000 people who lost their homes through foreclosures between January 2008 through the end of last year will get a $2,000 check. The aid will be doled out over three years, the Times said.
The core group of banks involved in settlement talks are Bank of America Corp, Wells Fargo & Co, JPMorgan Chase & Co, Citigroup Inc and Ally Financial Inc.
Forty-nine states joined the settlement in advance of a Feb. 6 deadline, but several states continued negotiations to address concerns specific to their state. The deal was clinched after California and New York joined at the last minute. Oklahoma was the lone holdout and will get no funds.
Although the deal with 49 states is the largest joint federal-state settlement ever obtained, the amount is minuscule compared to the declines in home values and the banks still face a host of other mortgage-related lawsuits.
“The bottom line about this settlement, is it’s okay, it’s a step forward, it’s a step in the right direction. But let’s not kid ourselves, there’s a hell of a lot more that needs to be done,” said Ira Rheingold, executive director of the National Association of Consumer Advocates.
The deal does little to ease bank investor fears, industry analysts said.
“We believe any initial euphoria over the deal will quickly fade as investors realize the flood of additional mortgage-related litigation that the major banks face,” said Guggenheim Partners analyst Jaret Seiberg in a note on Thursday.
The deal, so far, only applies to the five banks who signed it. It does not apply to government-owned mortgage giants Fannie Mae and Freddie Mac, which hold more than half of all the mortgages in the U.S.
The proposed settlement distributed last month to state officials included rough estimates on the benefits each state’s homeowners might receive, but did not include guaranteed numbers.
California received a guarantee its struggling homeowners would receive around $8 billion in relief, two people familiar with the negotiations said. The state itself would receive around $430 million for foreclosure prevention and other housing efforts.
Under the terms of the agreement, the servicers are required to collectively dedicate $20 billion toward various forms of financial relief to borrowers. At least $10 billion will go toward reducing the principal on loans for borrowers who, as of the date of the settlement, are either delinquent or at imminent risk of default and owe more on their mortgages than their homes are worth.
At least $3 billion will go toward refinancing loans for borrowers who are current on their mortgages but who owe more on their mortgage than their homes are worth. Borrowers who meet basic criteria will be eligible for the refinancing, which will reduce interest rates for borrowers who are currently paying much higher rates or whose adjustable rate mortgages are due to soon rise to much higher rates.
Up to $7 billion will go towards other forms of relief, including forbearance of principal for unemployed borrowers, anti-blight programs, short sales and transitional assistance, benefits for service members who are forced to sell their home at a loss as a result of a Permanent Change in Station order, and other programs.
Because servicers will receive only partial credit for every dollar spent on some of the required activities, the settlement will provide direct benefits to borrowers in excess of $20 billion.
The Office of the Comptroller of the Currency also said on Thursday that Bank of America, Citigroup, JPMorgan and Wells Fargo have agreed to pay a penalty of $394 million as part of a settlement they reached in April 2011 with regulators over foreclosure abuses.
The banks can meet the terms of the penalty through payments they make as part of the larger settlement with state attorneys general and the Justice Department, the OCC said.
Barbara Mahany, Tribune Newspapers, January 23, 2012, link
|“Slow Gardening” by Felder Rushing (Bill Hogan/ Chicago Tribune photo / January 11, 2012)|
“Slow Gardening: A No-Stress Philosophy for All Senses and Seasons”
What it is: “Slow Gardening: A No-Stress Philosophy for All Senses and Seasons” is iconoclast gardener-author Felder Rushing’s slow-paced, all-purpose guide to living the slow life in the garden. In Rushing’s world view, to garden slowly is to garden richly, mining for depth of meaning and whatever brings you — not your neighbor across the picket fence — the purest, most exhilarating joy. While he’s plenty philosophical, Rushing generously throws in plenty of how-to’s: from how to slow down to how to get the most oomph out of your backyard waterfall.
What makes it armchair-worthy: This is not a book that leaps out and shakes you by the lapels. It works its thought-provoking ways without drumroll and cymbal crash. But as you read along, you begin to survey your own gardening style with an eye toward savoring the labors, the delights, the time it takes to watch a sapling grow into a tree that shades your afternoon lemonade. He invites contemplation, for mulling over such revolutionary ideas as ditching noisy garden tools, or sitting in your garden even when it’s raining or dark outside. “Get personal with your weather,” Rushing implores. And, above all else, he encourages you to share your garden with a child — your own or someone else’s.
One fine line: “Slow Gardening has deep roots, because gardening has always been a process, a collaboration between humans and nature, and not something you can go out and buy. The passage of time is central: Planting a little tree is just a beginning.”
Tim Johnson, Chicago Tribune, January 20, 2012, link
Q: We have 2 1/2 acres with a beautiful lawn and wonderful oak trees. The problem: Moss seems to be taking over. Everywhere I look there is more moss. Is there something I can do to control it?
— B. Wiley, West Chicago
A: Moss invading lawns is not unusual, especially when site conditions are shady. Moss can out-compete lawns when the conditions are better for moss than for grass. Your moss is a signal that your grass is weak and has thinned for some reason.
Moss prefers sites that have poor drainage and are shady and damp with acidic soil. Turf grass does not perform as well in those conditions. The shade in your lawn will have increased as the trees have grown, which may explain why the moss has increased over time. Grass evolved to grow in full sun.
Managing your site conditions will be the best strategy to improve your lawn. Start by reviewing your lawn care practices. Mow your lawn so it always is at least 2 1/2 to 3 inches tall, so the grass can develop a better root system that will help it resist stress and will help choke out competitors. Core-aerating your lawn will help reduce compaction and encourage a stronger root system.
Established lawns in shade require less fertilizer that those in full sun, so apply only 1 to 2 pounds of nitrogen per 1,000 square feet of shady lawn per season. If you are irrigating your lawn, switch to watering less frequently and more deeply. Soils in shade take longer to dry out, so watering the lawn three or more times a week will help the moss and discourage the grass. Most likely, you would be fine with one supplemental watering per week. Water only if there has not been adequate rain.
Have a soil test done to see if you need to apply lime to make the lawn less acidic. (Many soils in northern Illinois are alkaline, so adding lime probably is not necessary.)
You could consider some pruning of your oak trees to increase the amount of light for the lawn, but use pruning practices that favor the health of the oaks over the health of the lawn. Lawns are easier to replace than trees. It is best not to make major changes to the grade of the soil where the oak trees are growing.
You also should consider overseeding the lawn with a good-quality shade mixture of grass seed. Broadcast the seed right after the core-aerating or use a slit seeder, which is a machine that will cut a slit in the ground and drop in the grass seed into it. Using the slit seeder will likely be most effective.
In deep shade areas, consider replacing the grass with a shade-tolerant groundcover, which will be better adapted to handle life beneath trees.
Chicago Tribune Newspaper, January 20, 2012, link
We’re always looking for ways to make gardening more fun, more successful, more exciting. Katie Walker of Organic Gardening magazine offers these favorite iPhone apps; she also lists some cool tech toys for gardeners too. Go to Organic Gardening’s website (organicgardening.com) and type “best apps” in the search field.
GardenPilot: Informational videos, plant information for 15,000 plants, and a database of local retailers make this a gardener’s best friend; 99 cents.
Eden Garden Designer: Create a virtual garden by taking pictures of your space and adding digital plants, for fun or planning; 99 cents.
Chirp! Bird Songs USA: More than 200 bird songs and useful information will delight even the most dedicated bird-watcher; $2.99.
Bugs and Insects: The database of more than 900 species ranges from pests to butterflies; 99 cents.
Herbs+: A wide range of information on herbs, including culinary and medicinal uses; $2.99.