Mortgage Delinquencies

Not getting better anytime soon:

The number of U.S. homeowners who are behind on their mortgages rose to a record level in the first quarter, according to industry data released Wednesday that also included tentative signs the nation’s foreclosure crisis may be starting to ease.

The increase in mortgage delinquency was a surprising and unwelcome sign for economists expecting the recent improvements in the economy to translate into fewer homeowners falling into trouble.

On a seasonally adjusted basis about 10 percent of borrowers were delinquent on their mortgages during the first three months of this year — a new record, according to the survey by the Mortgage Bankers Association. That is up from about 9.1 percent during the same period last year and 9.5 percent during the fourth quarter of 2009.

However, excluding those seasonal adjustments, borrowers were falling behind at a slower rate, said Jay Brinkmann, the group’s chief economist. Borrowers who had missed one mortgage payment, for example, fell to 3.1 percent during the first quarter on a nonseasonally adjusted basis, compared with about 3.3 percent during the same period last year.

“We are in extraordinary times. How much of the change is being driven by seasonal factors or the fundamental changes in the trend is unclear,” said Brinkmann. “If mortgage delinquencies are not yet clearly improving, it also appears they are not getting worse. However, a bad situation that is not getting worse is still bad.”

But that does little to offset the growing backlog of borrowers who are seriously delinquent on their mortgages and who have little hope of catching up on their payments. About 68 percent of delinquent borrowers have missed three or more payments or are in the foreclosure process.

About 4.6 percent of outstanding mortgages were in foreclosure proceedings — meaning the bank had started to foreclosure on but not yet taken back the home, according to the survey. That is the highest level in the history of the survey, and compares with nearly 3.9 percent during the same period last year and 4.6 percent during the previous quarter.

The foreclosure problem worsened in the Washington region, according to the survey. The number of borrowers who were delinquent or in foreclosure in the District rose to 10.4 percent during the first quarter, compared with 9 percent during the same period in 2009. In Virginia, 9.4 percent of borrowers were in trouble with their mortgages, compared with 8.3 percent the year before. Maryland had the region’s highest proportion of borrowers in delinquency or foreclosure, at 13.8 percent in the first quarter, up from 11.3 percent a year earlier.

Register Now

America’s Future Now! — the biggest progressive conference of the year — convenes June 7-9 in Washington, DC. Register at www.ourfuture.org/now.

Join Speaker Nancy Pelosi, Rep. Alan Grayson, Arianna Huffington, Markos Moulitsas, Van Jones, Gov. Howard Dean, Rep. Donna Edwards,
Rep. Jan Schakowsky, Richard Trumka, Andy Stern, Bob Herbert, Juan Cole, Digby, Deepak Bhargava, James Rucker, Drew Westen, Katrina vanden Heuvel, Robert Kuttner, Lizz Winstead and thousands more.

Be part of the great debate “Progressives In The Obama Era,” at which
everyone in attendance will get to participate.

Progressives must lead to make sure 2010 is not the year of the Tea Party. Jobs, clean energy, fair workplaces, immigration, health care and human rights are at all stake. Let’s show Washington how to fight!

Register today, and learn more about the conference at
www.ourfuture.org/now.

Self-Regulating Business

See how well that worked out?

In its 2009 exploration plan for the Deepwater Horizon well, BP PLC states that the company could handle a spill involving as much as 12.6 million gallons of oil per day, a number 60 times higher than its current estimate of the ongoing Gulf disaster.

In associated documents filed with the U.S. Minerals Management Service, the company says that it would be able to skim 17.6 million gallons of oil a day from the Gulf in the event of a spill.

[…] Mueller also said via e-mail Tuesday that “the spill has stayed about the same size or even shrunk on the water as a result of our response efforts.”

Skytruth.org, a website that monitors environmental problems using satellite imagery, reported Monday that the spill had grown to 10,170 square miles, based on NASA images. John Amos, head of Skytruth, told the Press-Register then that the spill had approximately doubled in size since Friday.

Wall Street Criminal Conspiracy

Via Political Carnival. Yeah, this is where the kickbacks – so-called “pinstripe patronage” – have always been hidden. And this was why I was so wary of Mike Nutter, the guy who became Philadelphia’s mayor — he’s a former municipal bond dealer. It’s an industry so rife with corruption, you can’t imagine:

A telephone call between a financial adviser in Beverly Hills and a trader in New York was all it took to fleece taxpayers on a water-and-sewer financing deal in West Virginia. The secret conversation was part of a conspiracy stretching across the U.S. by Wall Street banks in the $2.8 trillion municipal bond market.

The call came less than two hours before bids were due for contracts to manage $90 million raised with the sale of West Virginia bonds. On one end of the line was Steven Goldberg, a trader with Financial Security Assurance Holdings Ltd. On the other was Zevi Wolmark, of advisory firm CDR Financial Products Inc. Goldberg arranged to pay a kickback to CDR to land the deal, according to government records filed in connection with a U.S. Justice Department indictment of CDR and Wolmark.

West Virginia was just one stop in a nationwide conspiracy in which financial advisers to municipalities colluded with Bank of America Corp., Citigroup Inc., JPMorgan Chase & Co., Lehman Brothers Holdings Inc., Wachovia Corp. and 11 other banks.

They rigged bids on auctions for so-called guaranteed investment contracts, known as GICs, according to a Justice Department list that was filed in U.S. District Court in Manhattan on March 24 and then put under seal. Those contracts hold tens of billions of taxpayer money.

The workings of the conspiracy — which stretched from California to Pennsylvania and included more than 200 deals involving about 160 state agencies, local governments and nonprofits — can be pieced together from the Justice Department’s indictment of CDR, civil lawsuits by governments around the country, e-mails obtained by Bloomberg News and interviews with current and former bankers and public officials.

“The whole investment process was rigged across the board,” said Charlie Anderson, who retired in 2007 as head of field operations for the Internal Revenue Service’s tax-exempt bond division. “It was so commonplace that people talked about it on the phones of their employers and ignored the fact that they were being recorded.”

Anderson said he referred scores of cases to the Justice Department when he was with the IRS. He estimates that bid rigging cost taxpayers billions of dollars. Anderson said prosecutors are lining up conspirators to plead guilty and name names.

“This will go on for a long time and a lot of people will be indicted,” he said in a telephone interview.

Steven D has more.

Change of Heart

Many, many earnest progressive spokespeople explained to me how Arlen Specter can’t be trusted for switching parties.

Yet many earnest, progressive spokespeople, people who consider themselves the voices of the progressive movement, are… people who switched parties.

Markos Moulitsas
Ed Schultz
John Aravosis
Cenk Uygur
Arianna Huffington

And, while he’s a Senator, not a spokesperson, I seem to remember progressives going wild about Sen. Jim Webb. (h/t DCBlogger)

I’m sure there’s more, but that’s all I can remember right now. Funny, huh?

Sestak Wins

I have to vote for him if he’s running against Toomey, but I’ll have to hold my nose. Oh well, I don’t like politics anymore, anyway.

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