HUD CHARGES MASSACHUSETTS APARTMENT BUILDING OWNER WITH DISCRIMINATING AGAINST FAMILIES WITH CHILDREN

WASHINGTON – The U.S. Department of Housing and Urban Development (HUD) announced today that it is charging the owner of a 24-unit apartment building in Holyoke, Massachusetts, with housing discrimination for denying units to families that have children. HUD’s charge alleges that Nilma Fichera, who owns and manages New York-based N.A.G. Realty, LLC, violated the Fair Housing Act when she refused to show or rent apartments to families with children because she could not certify that the building was free of lead-based paint.

HUD, MAYOR BING ANNOUNCE "TRANSITION PLAN" TO RETURN DETROIT HOUSING COMMISSION TO LOCAL CONTROL

DETROIT -U.S. Housing and Urban Development Assistant Secretary Sandra B. Henriquez today joined Detroit Mayor Dave Bing to announce a transition plan to return the Detroit Housing Commission to local control. HUD assumed control of the agency in 2005.

Trump: Banks to Blame for Hotel Malaise

Associated Press
Donald Trump, shown here in New York in December.

LOS ANGELES — The U.S. hotel industry would be faring even better and perhaps expanding with new construction if it weren’t for banks’ reluctance to lend to the hotel industry. So says Donald Trump, long-time hotelier and television personality who flirted with a presidential run.

“Unless banks start loaning money to developers who have good projects but will never get them off the ground, you won’t see much happening,” Mr. Trump said Tuesday during a press conference at the Americas Lodging Investment Summit conference in Los Angeles. “There’s very little development because, for the most part, the banks aren’t loaning for development or acquisitions.”

Lending on commercial real estate projects indeed has fallen off, particularly from the frothy days of the real-estate boom. European banks, previously active lenders to U.S. hotels, mostly have stopped originating new hotel loans or sold their U.S. loan portfolios in government-mandated steps. Many U.S. banks remain mostly subdued in their lending to hotels, leaving relatively healthy Wells Fargo & Co. as the most active lender to the sector. Meanwhile, the market for commercial mortgage-backed securities continues to struggle to get on its feet again.

In response to questions, Mr. Trump said that many banks can’t lend due to restrictions such as capital requirements placed on them by regulators. “I know some bankers who are very good bankers and they’d like to do certain deals but they can’t because the regulators are telling them not to,” Mr. Trump said.

Mr. Trump delivered a keynote speech at the ALIS conference in which he remarked on his well-known distaste for the policies of President Barack Obama and discussed his hotel-management venture, the Trump Hotel Collection. The company manages seven Trump-branded hotels, including those in Chicago, Las Vegas and near Manhattan’s Central Park. He said the company is considering 10 deals across the globe.

Other pending hotel deals involving Mr. Trump includes his $150 million stalking-horse offer to buy the 692-room Doral Golf Resort & Spa near Miami from hedge fund Paulson & Co. and Winthrop Realty Trust, which put the resort and four others under bankruptcy protection in early 2011. Trump had lowered its offer to $150 million from an earlier $170 million, explaining that the Doral needs roughly $200 million in upkeep and renovations.

Mr. Trump declined in an interview to comment on his effort to buy the Doral. However, a person familiar with the deal said Trump must be paid $10 million as the initial bidder if a rival bidder eventually tops his price for the property.

Consumer Advocacy Group Weighs in on AG Settlement

Rumors have been circulating for some
time that the Obama Administration is pressuring the 50 state attorneys general,
the Justice Department and the Department of Housing and Urban Development to
settle with major banks over issues relating to errors in servicing and
foreclosure abuses including the robo-signing uproar.  The settlement has been controversial and several
attorneys general including those in California, Delaware, and New York have opted
out of the settlement and/or launched independent lawsuits of their own,
claiming the settlement is not sufficient to the offense.  The rumors have intensified over the last few
days based on a theory that the President hopes to announce the settlement
during his State of the Union Address tonight.

Today the Center for Responsible Lending
which has been an early and outspoken critic of mortgage lending came out in
favor of the settlement saying, while it isn’t perfect, it would represent an important
step forward in addressing foreclosure abuses

“The settlement would include key reforms to clean up unfair mortgage
servicing practices,” the statement from the Center said.  “It would also provide an important template
for ways banks can use principal reduction to reduce unnecessary foreclosures
and put the country back on a path to economic recovery.”

While the Center admits that not all
details of the settlement are available as yet, but based on current
information, the key reforms include:

  • The
    elimination of robo-signing as banks would agree to individually review
    foreclosure documents according to the law.
  • Adoption
    of practices that would improve communication with services and end servicer
    abuses including fairer treatment for homeowners who are late on mortgage
    payments.
  • More
    sustainable loan modifications including a requirement that banks “get serious”
    about reducing principal balances.
  • While
    the state AGs would be prohibited by the settlement from pursuing further
    actions against the banks, the Center said that nothing in the settlement would
    prevent homeowners from suing on an individual basis nor would the settlement
    shield the banks from prosecution for criminal activities or from claims based
    on mortgage securities violations, fair lending suits or claims against the
    Mortgage Electronic Registration System.
  • The
    settlement would be enforceable in court by an independent monitor.

The Center said that its research
indicates that the country is only about half-way through the mortgage crisis,
but the proposed settlement would wrap up a year-long investigation into
robo-signing and other abuses and is “crucial to containing the damaging
effects of foreclosures on our economy.” 
It stresses, however, that additional policy actions on multiple fronts
is a necessary addition to the settlement.

…(read more)

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Mr. President, it’s Time for a National Housing Policy

Please Mr. President, enough with the one-off responses, it’s time for a National Housing Policy.

The only thing more predictable than the fact that the President will deliver to Congress a State of the Union Address each year is the speculation that precedes it regarding what “Big” announcements the President’s speech will contain.

This year is no different, and a great deal of current speculation surrounds the topic of housing and whether the President’s speech will include some grand proposal intended to relieve those American homeowners who continue to suffer under the weight of a housing economy that remains stuck in neutral.

One plan getting a great deal of attention would involve the government granting debt forgiveness to borrowers whose mortgages are underwater, meaning that the amount currently owed by them on their mortgage exceeds the current value of their home.

To date, the Federal Finance Housing Finance Agency (FHFA) – the primary regulator of Fannie Mae and Freddie Mac – has resisted calls from Congress to approve principal forgiveness. In a report circulating today, we now understand why. According to that report, the cost of such a plan to Fannie and Freddie could well exceed $100 Billion! That $100 Billion would be in addition to the $151 Billion already owed by the two enterprises to the US Treasury. And to be clear, that means owed to US taxpayers.

Hopefully, current speculation is wrong and the President’s address includes no such proposal. Its not that we don’t sympathize with underwater homeowners, we most certainly do. We too look forward to the day when the American housing economy is once again growing and functioning well – and by extension, when the challenges facing homeowners are far less. When that day arrives, that will be a sure sign that the American economy generally has returned to a healthy condition.

Our objection is broader and goes to the fact that since 2009 the policy response to the housing crisis by the Administration has involved one tactical reaction after another – or as we have said before … “a series of one-off reactions …” and, unfortunately, little more.

And while certain tactical reactions were appropriate and even required in 2009 and even into 2010, the time is long passed for the development and introduction of a comprehensive National Housing Policy. Such a policy would lay out in clear terms the goals to be achieved through the Nation’s support of housing; the economic costs and benefits of such a policy; as well as the anticipated intangible benefits of such a policy. Finally, such a plan would identify the likely costs and risks of the failure to implement such a plan.

With such a plan in place (or at least proposed), the uncertainty that today plagues this industry would begin to lift and Congressional policy makers, regulators and business leaders alike would be better equipped to address the important considerations that must still be resolved if we hope to develop an enduring solution to the Nation’s housing crisis.

And for those who would ask, “Why should a housing policy be a priority?”, consider the following written in 2003 – perhaps the last time we had a legitimate National Housing Policy in this great Nation – by the Millennial Housing Commission:

“… housing matters. It represents the single largest expenditure for most American families and the single largest source of wealth for most homeowners. The development of housing has a major impact on the national economy and the economic growth and health of regions and communities. Housing is inextricably linked to access to jobs and healthy communities and the social behavior of the families who occupy it. The failure to achieve adequate housing leads to significant societal costs.”

Until these sort of deliberations and debate occur and a National Housing Policy is in place, it is impossible to know what we as taxpayers get (and give up) for another $100 Billion spent in this manner in support of the housing crisis.

It seems to us, that the time to answer the important question: “What do we get?” … before we give more … is long overdue.

…(read more)

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