THE DAILY BLADE: Mortgage Loan Modification Less Than Advertised
Though lenders claim to be helping homeowners avoid foreclosure, fewer than half of loan modifications made in 4Q 2008 reduced borrowers' payments by more than 10 percent, according to a report by the federal Office of the Comptroller of the Currency and the Office of Thrift Supervision that analyzed 35 million loans worth more than $6 trillion. As a result, borrowers are redefaulting.
The Associated Press reports that President Barack Obama’s $75 billion plan to promote loan modifications notwithstanding, “[m]any borrowers and consumer groups contend that the modifications offered by the lending industry aren't very generous, despite more than a year of public prodding from regulators”:
For instance, nearly one in four loan modifications in the fourth quarter actually resulted in increased monthly payments. That situation can happen when lenders add fees or past-due interest to a loan and spread those payments out over the 30- or 40-year period.
Perhaps unsurprisingly, the report found that loans were far less likely to fall back into default if a borrower's monthly payment is reduced by a healthy amount.
The Washington Post reports that “a growing number of homeowners are falling behind on their payments and borrowers with prime mortgages, which traditionally are considered less risky, are a growing part of the problem”:
"These lenders blame the homeowner for being late in the first place, and now they are blaming them for defaulting on the modification, when in both cases the payments were unaffordable," said Bruce Marks, chief executive of the Neighborhood Assistance Corp. of America, which has been critical of industry foreclosure-prevention efforts. …
"I am like everybody else - I want to be a optimistic. But studies like this don't promote optimism," said John Taylor, president of the National Community Reinvestment Coalition. "The re-default rates of these modifications show they are not effective enough."
Maybe it’s just a coincidence, but “many of Obama's top aides earned generous salaries, investment income and fees for delivering speeches and serving on corporate boards,” reports The Washington Post:
Lawrence Summers, the chairman of President Obama's Council of Economic Advisers, collected roughly $5.2 million in compensation from hedge fund D.E. Shaw over the past year and was paid more than $2.7 million in speaking fees from several troubled Wall Street firms and other organizations. …
Summers, a leading architect of the administration's economic policies and response to the global recession, appears to have collected the most income. Financial institutions including JP Morgan, Citigroup, Goldman Sachs, Lehman Brothers and Merrill Lynch paid Summers for speaking appearances in 2008. Fees ranged from $45,000 for a Nov. 12 Merrill Lynch appearance to $135,000 for an April 16 visit to Goldman Sachs.
These are the people who are supposed to be setting and enforcing the terms under which banks and other financial institutions get bailout money, then pump it back into the economy and credit markets. Hmm, maybe there is something to the charge by some lefties that Obama’s economic team is too chummy with Wall Street.
"Little Eichmanns" Professor Prevails In Court Case
A jury ruled that the University of Colorado wrongly fired Ward Churchill, the professor who wrote an essay in which he called World Trade Center victims "little Eichmanns," and awarded him $1 in damages, reports The Associated Press:
A judge will decide whether Churchill gets his job back. [Churchill’s attorney David] Lane said a reinstatement motion would be filed within 30 days and a hearing would likely be scheduled in June. …
University spokesman Ken McConnellogue said the university will review its options before deciding whether to appeal.
"(The verdict) doesn't change the fact that more than 20 of his faculty peers found that he engaged in plagiarism and other academic misconduct," McConnellogue said.
Defective Sperm Falls Under Product Liability Laws: Judge
The commercialization of the stuff of life – not to mention of the embryo itself – continues apace with a landmark ruling by Senior U.S. District Judge Thomas N. O'Neill Jr. allowing a sperm bank to be sued under NY’s product liability laws, reports The Legal Intelligencer:
[H]is 23-page opinion in Donovan v. Idant Laboratories … cleared the way for a 13-year-old mentally retarded girl from Pennsylvania to sue a New York sperm bank under the theory that the sperm used to conceive her had a defect known as "Fragile X," a mutation known to cause a syndrome of maladies that include mental retardation and behavioral disorders.
"Under New York law, the sale of sperm is considered a product and is subject to strict liability," O'Neill wrote.
The ruling is a victory for plaintiffs attorney Daniel L. Thistle and clears the way for Brittany Donovan of Philadelphia to pursue both tort and contract claims against the New York sperm bank that sold sperm to her mother in 1995.
But O'Neill dismissed all claims brought by her mother, Donna Donovan, after finding that the statute of limitations had long expired because genetic tests showed in 1998 that the sperm donor was the source of the Fragile X genetic defect in her daughter.
Brittany Donovan's claims, however, are still viable, O'Neill found, because the Pennsylvania Minors Tolling Statute provides that the clock does not begin to run until two years after the minor reaches the age of 18.
The Stiletto Scoops Peggy Noonan (And Her Editor)
The Stiletto has been pretty tough on Michelle Obama’s figure flaws, owing to the fact that the rest of the media are kissing up to her by gushing over her bionic biceps. Now that MO herself forthrightly and self-deprecatingly acknowledged she is not the epitome of feminine pulchritude in an interview … The Stiletto was moved to drop the issue. Then she came across this paean to MO’s right to bare arms by The Associated Press.
- “Your Butt Will Look Good In These Jeans” (“The Other Shoe Drops,” fifth item), The Stiletto Blog, March 25, 2009
Michelle Obama enjoyed a well-deserved triumph, representing her country with grace and elegance. She continued to signal a secret conservatism by demonstrating support for the right to bare arms. I very much wish that were my joke and not that of the editor Jason Epstein.
- “Obama's Domestic Agenda Gains Clarity,” The Wall Street Journal, April 3, 2009
Well some mortgage loan modification plans actually work, but there's also scams and frauds out there that wreck the image of federal plans. As far as Obama's Making Home Affordable plans working, I'm not sure yet because as of I now I don't know anyone personally who has used it yet.
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