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Mass. 'Moratorium'
Gov. Deval Patrick is asking lenders to delay, for at least 60 days, any foreclosure auction if a homeowner submits a complaint to the state.
He has assigned Steven Antonakes, the commissioner of banks, to review the complaints and talk to lenders about modifying loan terms. The Division of Banks has received 43 complaints from homeowners since the governor announced the "
Though state officials acknowledge they have no authority to enforce the request, lenders apparently have been responsive.
Mr. Antonakes said in an interview Tuesday that state officials "just want to slow things down a bit and bide some time for the homeowner."
"It's a request," he said. "We're not demanding that lenders stop the foreclosure process. What we're asking for is some delay in the process so we can take that time to work with the homeowners."
His agency has spoken with several lenders about homes going into foreclosure, he said, including ACC Capital Holdings' Ameriquest Mortgage Co. and Argent Mortgage Co.; H&R Block Inc.'s Option One Mortgage Corp.; and JPMorgan Chase & Co.'s Chase Manhattan Mortgage Corp.
"So far, everyone's been pretty cooperative," he said.
Last month, six federal bank, thrift, and credit union regulatory agencies
Kevin Cuff, the executive director of the Massachusetts Mortgage Bankers Association, said he has heard two responses from his constituents to the governor's request. Some said holding off on foreclosure for 60 days would not make much difference for certain borrowers, he said, but others say workouts can cost less than foreclosure.
"Our lender members are inclined to help but want some form of litmus test to judge whether 60 days is going to matter," Mr. Cuff said. "You throw everyone into the same kettle of fish, you're going to have lenders waiting an awful lot of time for a settlement."
Though Massachusetts does not have the highest foreclosure rate in the country, it led the Northeast in the number of property auction filings in the first quarter, up 80% to 6,395, according to Warren Group, a Boston publisher and provider of real estate data. (California leads the nation in preforeclosure filings, 49,016 so far this year, and auctions, 25,023. Both numbers are up substantially from last year, 139% and 277%, respectively, according to Foreclosures.com, a Sacramento firm.)
The governor's announcement came after a protest last week at his statehouse office that was organized by Neighborhood Assistance Corp. of America, a Boston nonprofit group.
Bruce Marks, the nonprofit's chief executive, praised Gov. Patrick, calling his actions "unprecedented" and "essentially … a moratorium" but added a backhanded compliment.
As a former director of ACC Capital, "the governor is uniquely qualified to address foreclosures," Mr. Marks said.
Fizzler
An adjustable-rate mortgage that caps the rate for the first 10 years at 6.99% is to be scrapped about nine months after it was
A spokeswoman for IndyMac Bancorp Inc. said it planned to discontinue the Homeowner Protection ARM introduced in August by New York Mortgage Trust Inc. IndyMac
Steven Mumma, the REIT's chief operating and information officer, said the product "got sporadic hits" but "just didn't get a lot of traction" as most borrowers opted for 5-1 ARMs or fixed-rate loans.
"When it first came out in August, people were talking about the Fed going to move shortly," he said. "As we have now gone another nine months without the Fed doing anything, I think it just became more difficult to put them in that product."
New York Mortgage never intended the product to be a major driver of volume, however. In
Franklin Credit Management Corp.'s Tribeca Lending Corp., which bought New York Mortgage's wholesale lending operations in February, also said it does not offer the Homeowner Protection ARM.
NovaStar Melds
Novastar Financial Inc. in Kansas City, Mo., has merged two nonprime divisions, HomeView Lending Inc. in Lake Forest. Calif., and
HomeView, with 70 employees, is to add 30 sales and service employees from Acceleron, who will keep their office and serve customers in the Northeast. The unit will use the HomeView handle.
HomeView was formed in 2005 by Kal Elsayed, a former president of New Century Financial Corp.'s wholesale division.
