Times Econ Reporter Goes Broke
Today in the New York Times Edmund L. Andrews today explains how, despite his training and experience as an economic reporter, he fell disastrously into debt — and also, perhaps inadvertently, how this great country of ours really works.
His reasons: he was in love (“Patty was brainy, regal, sexy, fiery and eclectic”), and wanted to give his inamorata and himself a $460,000 Silver Springs, Maryland home to consecrate the bond. Andrews was still paying child support to a previous love of his life, which put a bite in his $81K salary. But it was the mid-oughties, when everything was groovy, and his broker at American Home Mortgage (“I am here to enable dreams”) was willing to do business at a reasonable, if unfixed, rate, telling him not to worry about the large payments, because “the value of your house will be higher in five years.” (In the movie version, this will be the equivalent of a montage of jazz-age flappers driving jalopies with their feet while drinking bathtub gin.)
To make the complex plan work, Andrews had to cash out his Times stock — so, you see, there is a silver lining.
But while house-rich, the couple became cash-poor, which caused problems: Patty “refused to scrimp on top-quality produce, Starbucks coffee, bottled juices, fresh cheeses and clothing for the children and for me,” though Andrews was running out of money before paydays. He began using his overdraft protection and accumulating outrageous fees (“$5 overdrawn because of school supplies for Patty’s daughter Emily — $100 from the MasterCard”). He tried rotating his credit cards to get a better rate but, like many who have done that, wound up deeper in debt with worse rates. Edmund and Patty were tens of thousands of dollars in debt.
via New York – Runnin’ Scared – Times Econ Reporter Goes Broke, Teaches Valuable Lesson About America.
DoD issues rules for homeowner assistance
Officials have begun evaluating claims under the expanded Homeowners Assistance Program for military homeowners caught in the housing crisis, now that the Defense Department has issued its eligibility rules.
But because of limited funds, officials expect to cut off benefits Dec. 31 for homeowners affected by permanent change-of-station moves, one of the new groups covered under the expanded program. The law had authorized defense officials to run that program through Sept. 30, 2012.
Those who get PCS orders by Dec. 31 will be eligible if they meet other requirements, and they must submit the application by March 31, 2010. The program applies retroactively to those who received PCS orders on or after Feb. 1, 2006.
Mike McCord, Defense Department deputy comptroller said an estimated 10,000 homeowners will be eligible.
The first priority for the $555 million program will be wounded warriors who relocate for medical treatment or medical retirement due to disability, and surviving spouses of those killed in the line of duty. Their benefits will be retroactive to September 11, 2001, and will be permanent for those affected in the future.
According to the Pentagon rules, the government will reimburse eligible homeowners for losses incurred when selling their houses, or will buy houses of those who have been unable to sell.
Officials added one group not included in the law: Coast Guard members who make PCS moves.
via DoD issues rules for homeowner assistance – Army News, news from Iraq, – Army Times.
After every bear market on Wall Street, some investors are reluctant to buy because they believe many other investors will be anxious to sell into any rebound, swamping the market and stunting any recovery.
And yet, bull markets get going anyway.
Now the same issue is dogging the housing market.
A new Zillow.com survey of 1,266 homeowners nationwide asks, “If you saw signs of a real estate market turnaround in the next 12 months, how likely would you be to put your home up for sale?”
via Will the ‘shadow inventory’ stunt a housing recovery? | Money & Company | Los Angeles Times.
Maryland designates $2.5M to prevent foreclosures
The state unveiled Wednesday more than $2.5 million to help prevent home foreclosures.
The money comes from federal, state and local funding sources and will be used primarily to support nonprofit housing counseling groups, Maryland Gov. Martin O’Malley said. O’Malley outlined nearly $1.8 million of federal National Foreclosure Mitigation Counseling (NFMC) — NeighborWorks funds and $500,000 from the state at a roundtable discussion held in a Temple Hills church. Maryland Department of Housing and Community Development Secretary Raymond A. Skinner also highlighted $240,000 in matching funds from Montgomery County for housing counseling agencies operating in that county.
The Maryland Department of Housing and Community Development supports a statewide network of 30 nonprofit housing counseling agencies and two nonprofit legal services providers as part of its Home Ownership Preserving Equity (HOPE) initiative.
Thirty non-profit housing counseling agencies statewide and two legal service providers will share in the NFMC funds.
The funding announcement comes on the heels of DHCD’s release of its first quarter 2009 foreclosure report, which shows 9,289 property foreclosures in Maryland during the first three months of the year. That’s a reduction of 7.5 percent from the previous quarter and a decline of 18.5 percent from the same time a year ago.
Total foreclosure filings in Maryland posted the second lowest number since the first quarter of 2008.
Overall, the state has distributed more than $5.5 million in assistance since the summer of 2007. The counseling network has assisted nearly 23,000 consumers and helped more than 6,800 homeowners avoid foreclosure. Through its statewide Foreclosure Prevention Pro Bono Project, more than 700 lawyers have volunteered their time to help distressed homeowners in need of legal assistance.
“Maryland’s housing counseling community has been an important partner in this fight to combat foreclosures,” Skinner said in a statement. “Not only do they continue to fulfill their traditional role in providing financial and mortgage guidance, but they have advocating mightily for the better part of two years on behalf on thousands of families who are threatened with losing their homes. Their work is greatly appreciated.”
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