Loans » Mortgage

Ally mortgage unit files bankruptcy

davidguide — Tue, 15 May 2012 05:42:00 +0000

Diane Alter – Fourth Estate Cooperative Reporter

Midvale, Utah, United States (4E) – Ally Financial ResCap mortgage on Monday filed for prepackaged bankruptcy protection.

The bank, owned by taxpayers, said the filing will allow the bank to take another step to repay the U.S. treasury.

Ally’s ResCap unit operates under the GMAC Mortgage brand. At one time, it was the nation’s leading subprime lender. Problems with those home loans for risker borrowers, and the steep drop in the company’s core auto finance business, forced the Treasury to shell out some $15.8 billion in bailout funds in 2009 in an effort to rescue the ailing auto industry and bubble-bursting housing market.

ResCap began as the finance unit of automaker General Motors under the GMAC name. It changed its name to Ally after the bailout. In addition to its auto finance business, Ally also operates as an online commercial bank.

The struggling bank said it is seeking strategic alternatives for its international businesses, a euphemism that the overseas arm is up for sale.

Ally said it expects GMAC to continue to make and service mortgage loans during the bankruptcy process. Its portfolio of home loans, currently valued at less than half its original value, will be auctioned off as part of the bankruptcy process.

GMAC said it will make a so-called “stalking horse” bid of $1.6 billion for those loans, adding that it anticipates them to attract higher bids from investors.

In a statement, Ally CEO Michael A. Carpenter said, “The action by ResCap will enable Ally to achieve a permanent solution to its legacy mortgage risks and put these issues behind us. This action, along with pursuing alternatives for the international businesses, will allow Ally to focus 100 percent of its energies on further strengthening its already leading U.S. auto finance and direct bank franchises.”

At present, the U.S. Treasury owns about 74 percent of Ally’s outstanding stock. To date, Ally has repaid, through dividends and loan repayments, about $5.5 billion of the bailout funds it received.

The company also said Monday that upon successful completion of the bankruptcy auction and disposal of its international business, it should be able to pay back roughly two-thirds of the government bailout.

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Mortgage rates for 30-year loans rise to 3.95 percent

davidguide — Fri, 24 Feb 2012 05:42:43 +0000

Diane Alter – AHN News Reporter

New York, NY, United States (AHN) – Rates for 30-year fixed mortgages rose for the first time in four weeks as sales of previously owned homes climbed to the highest level since May 2010.

The average rate for a 30-year fixed loan increased to 3.95 percent in the week ending Feb. 23 from 3.87 percent, the lowest on records dating back to 1971, mortgage giant Freddie Mac reported Thursday.

The average 15-year rate rose to 3.19 percent from 3.16 percent.

Low mortgage rates are helping reduce the cost of housing, supporting demand. The National Association of Realtors said on Wednesday that sales of existing homes increased 4.3 percent to a 4.57 million annual rate in January.

However, weighing on the housing market were distressed deals. Foreclosures and short sales, in which the price is less that the amount owed, made up the largest share of all purchases since April 2011.

Home loan applications fell in the week ending Feb. 17, according to the Mortgage Bankers Association. Purchase loans fell 2.9 percent, while the group’s refinancing index dropped 4.8 percent.

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Los Angeles Mortgage Customers Welcome The Fall Season with Mixed Results

davidguide — Sun, 25 Sep 2011 21:48:20 +0000

Los Angeles area mortgage customers said good-bye to a long summer and hello to the Fall season. The change in seasons offers more good news for the few borrowers who can qualify for a mortgage loan. Refinance…

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Mortgage applications fall

davidguide — Wed, 24 Aug 2011 16:36:52 +0000

Applications for mortgages to buy a house or to refinance an existing loan fell last week, even though mortgage rates are at all-time lows. The D.C.-based Mortgage Bankers Association said overall applications fell 2.4 percent last week, and purchase applications decreased 5.7 percent, the lowest level since December 1996. “Another week of volatile markets and rampant uncertainty regarding the economy kept prospective homebuyers on the sidelines,” said Mike Fratantoni, the association’s vice president of research and economics…

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Mortgage company urges plan for principal cuts (Reuters)

davidguide — Fri, 20 May 2011 15:28:39 +0000

Reuters – American Home Mortgage Servicing, one of the largest servicers of subprime mortgages, is urging the U.S. Treasury to organize a plan to boost principal reductions for up to one million homeowners by unlocking loans from securities.

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Mortgage rates: Average on 30-year fixed loans rises to 4.86%

davidguide — Thu, 31 Mar 2011 15:28:35 +0000

NEW YORK — Fixed mortgage rates rose slightly this week, but the average rate on the 30-year loan remained below 5 percent.

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Mortgage rates hold steady, Freddie Mac survey finds

davidguide — Fri, 11 Mar 2011 00:29:26 +0000

The interest rate on a 30-year fixed loan this week edges up to 4.88% from 4.87% last week, while the 15-year fixed loan is unchanged from 4.15%. Rates on adjustable loans are nearly unchanged. Mortgage rates held steady this week, with lenders offering 30-year fixed-rate loans at 4.88% on average and 15-year fixed loans at 4.15%, Freddie Mac reported in its latest weekly survey.

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Uncertain Path Ahead For U.S. Mortgage Giants

davidguide — Mon, 31 Jan 2011 06:30:38 +0000

The fight over mortgage giants Fannie Mae and Freddie Mac is part of a larger debate about the appropriate role for government in supporting the U.S. housing market. That market is still fragile and heavily dependent on the government-run giants for new home loans.

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Some banks help keep mortgage holders out of default, studies find

davidguide — Mon, 03 Jan 2011 18:28:16 +0000

While the nation’s foreclosure crisis has focused blame on bad loan practices by some lenders, new research shows how some banks may have actually reduced the default risk of their homebuyers. Researchers found that low-income homeowners who received a mortgage from a local lender were less likely to default on their loans than are those who borrowed from a more distant bank or mortgage company.

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3 FHA Mortgagees Pay HUD $1.7 Million

davidguide — Mon, 27 Dec 2010 21:28:21 +0000

The U.S. Department of Housing and Urban Development disclosed that WR Starkey Mortgage LLP was hit with a $223,000 civil money penalty. Countrywide Home Loans Inc. entered a settlement with HUD that included a $141,500 civil money penalty and buy downs of $93,263. HUD accepted an $815,913 settlement offer from Birmingham Bancorp Mortgage Corp.

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