Mortgages and Housing: Affordability, USDA Danger, Radar Logic, DeMarco Pro and Con, Who Pays for Writedowns, Live Free, Helping Out Seconds, Don’t Buy a House, Genworth Reverse Grows, Where To Buy & Rent, Property Tax Revolution, Economy and Politics

BillCoppedge_26Nov2011original content selection by MortgageNewsClips.com

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2 articles worth your time:

(outstanding, gives example) How Housing Affordability Can Falter Even as House Prices Decline – Charles Hugh Smith – The assumption that lower home prices improves the affordability of houses ignores two critical inputs: interest rates and income. … In other words, there are three inputs to housing affordability, and price is only one of them. Interest rates and disposable income are equally important. … – Of Two Minds Blog

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(USDA home loans the next big problem?) Taxpayers On Hook As Government Insured Lending Spins Out Of Control – by Donna S. Robinson – … Even after the uproar over subprime lending … the sub-prime market continues. … since the new lending guidelines for a “government insured” USDA Rural Development mortgage loan have NO minimum credit score, assuming other qualifying criteria are met. And a borrower can borrow 100% of the value of the home. …  But this time, instead of private capital being at risk, it’s the taxpayers who will be responsible for these “government insured” mortgages. In fact, according to an article written by George Brooks, published this week on insidemortgagefinance.com, the USDA is refusing to make public its default rate … – Realty Biz News
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Other news:

(reasons why) Radar Logic: 2011 Home Bargains May Continue This Year – BY: KRISTA FRANKS BROCK – Radar Logic predicts prices will remain flat this year and next before increasing “at an accelerating pace” in 2014 and 2015. – DS News

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A Bailout by Another Name – By GRETCHEN MORGENSON – ED DeMARCO is a marked man.NY Times
vs.
Gretchen Morgenson’s bizarre defense of Ed DeMarco – By Felix Salmon – Reuters

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Mortgage melee spreads - By CATHERINE CURAN – The battle over who pays for $10 billion in loan writedowns in the new $25 billion national mortgage settlement … the Association of Mortgage Investors, plans to file court papers in the coming weeks opposing the settlement, sources said. … At issue is the fact that banks get $1 of credit for writing down loans they own, but can also get 45 cents of credit for every dollar written down on loans owned by investors, including pension funds, according to settlement documents. … said Chris Katopis, executive director of AMI. “At the end of the day, it is taking money from investors, seniors and unions to pay for banks’ misconduct.” It will be tough to mount a successful legal challenge. … – NY Post 

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(live free vs pay rent – who will win?) Bank of America hopes underwater homeowners become renters to avoid foreclosure - By Kenneth R. Harney – If you’re seriously underwater and headed to foreclosure, what would you say if the lender suddenly offered you the chance to remain in your home as a tenant for an extended period plus have your mortgage debt wiped away? Would you say yes? Or would you instead conclude: Hey, why pay rent? It’s going to take the bank more than a year to complete the foreclosure and evict us, so why not just stay put and save some money?Washington Post

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Principal Reductions By GSEs Would Enrich Banks if Second Liens Remained Intact – By: David Dayen – Fire Dog Lake
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(list) Why Entrepreneurs Should NOT Buy Homes - JAMES ALTUCHER – Editor’s note: James Altucher is an investor, programmer, author, and entrepreneur. He is Managing Director of Formula Capital and has written 6 books on investing. – TechCrunch

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Genworth Targets Retail Reverse Mortgage Growth, Hires Six New Managers – by Elizabeth Ecker – Reverse Mortgage Daily

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(graph and charts) Where to Buy and Where to Rent Now - JED KOLKOMAR – (Trulia) – The Atlantic Cities

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Property Tax Revolution in North Dakota, Minnesota, Michigan; It’s Our Home Not Theirs! – Michael Shedlock - The granddaddy of property tax revolts is now underway in North Dakota.MISH’S Global Economic Trend Analysis

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Economy and Politics

Pimco’s Gross Says Fed May ‘Hint’ at QE3 in April – By Wes Goodman – Bloomberg Businesswek

vs.
This time, a rate rise may be for real – By Dan Jamieson – Investment News

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(rates) Masters of the Universe Start to Challenge Ben Bernanke – By Caroline Baum – Bloomberg

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34% chance of ObamaCare to be ruled unconstitutional this year, 50% by end of next yearSober Look Blog

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(Oil and food stamps) Food Stamp Use in L.A. Pauses At the Million Mark, Awaiting Oil’s Next Move - Gregfo Macdonald – For the first time in several years, the rate of growth in Los Angeles County food stamp use has slowed. That’s little consolation however given that total participation zoomed from just above 600,000 to over 1,000,000 people since the onset of the financial crisis. As longtime readers know, I’ve tracked the series as a backdoor view on rising energy costs–and in the case of LA County–gasoline costs in particular.Gregor.us

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