A couple of quotes from an article by James Hagerty in the WSJ: Is Slashing Mortgage Principal the Answer? … Assistant Treasury Secretary Michael Barr … suggested that there would be a risk that such a [principal] program would change … Read More

Note: See earlier post for a weekly summary and a look ahead . From Eric Dash at the NY Times: Wall St. Weighs a Constitutional Challenge to a Proposed Tax In an e-mail message sent last week to the heads … Read More

I’ve excerpted below from a paper by New York Fed Researchers Andrew Haughwout, Ebiere Okah, and Joseph Tracy: Second Chances: Subprime Mortgage Modification and Re-Default Although the paper uses subprime data, the general results are applicable to all mortgages. The … Read More

From David Streitfeld in the NY Times: Rates Are Low, but Banks Balk at Refinancing (ht Dave) First some history on mortgage rates: It is highly unusual for mortgage money to be available below 5 percent. Average rates fell as … Read More

Here is the Q3 negative equity report from First American CoreLogic mentioned last night. From the report: Negative equity, often referred to as “underwater” or “upside down,” means that borrowers owe more on their mortgage than their homes are worth. … Read More

From the WSJ: 1 in 4 Borrowers Under Water The proportion of U.S. homeowners who owe more on their mortgages than the properties are worth has swelled to about 23% … Home prices have fallen so far that 5.3 million … Read More

From Kenneth Harney at the LA Times: Homeowners who ’strategically default’ on loans a growing problem National credit bureau Experian teamed with consulting company Oliver Wyman to identify the characteristics and debt management behavior of the growing numbers of homeowners … Read More

I’ve been asked many times what people should do financially during a recession. My first answer has always been “Keep your job if you can!” Earlier this week, David Leonhardt at the NY Times wrote: Wages Grow for Those With … Read More

From the WaPo: Housing Agency’s Cash Reserves Will Drop Below Requirement The Federal Housing Administration has been hit so hard by the mortgage crisis that for the first time, the agency’s cash reserves will drop below the minimum level set … Read More

From Fitch: $134B of U.S. Option ARM RMBS To Recast by 2011 Of the $189 billion securitized Option ARM loans outstanding, 88% have yet to experience a recast event … Of these loans that have not yet recast, 94% have … Read More