Fannie Mae and Freddie Mac begin to make write-downs on troubled mortgages as they post a 2012 profit of $17.2 billion and begin to repay the Treasury Department for their bailouts.
Meanwhile, a Dallas council member reacts to an increase in the city’s homeless population and says all programs should be cut to keep the city from becoming the “Homeless Capital of the World.”
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U.S. to ease mortgage modifications on Fannie, Freddie backed loans
By Mary Ellen Podmolik Chicago Tribune March 27, 2013
The overseer of Fannie Mae and Freddie Mac is directing mortgage loan servicers this summer to begin offering a simplified mortgage modification to some struggling borrowers whose loans are backed by the two enterprises.
Beginning July 1, the Federal Housing Finance Agency said loan servicers will be required to reach out to eligible seriously delinquent borrowers and offer them a three-month trial loan modification without the borrower providing any financial documents or hardship letters. The payments could decrease more if the homeowner documents their income and financial difficulty.
While different than the Obama administration’s Home Affordable Modification Program, the program announced Wednesday is similar to a short-lived effort under HAMP that offered no-doc trial modifications. That effort, designed to get more struggling homeowners into the program quicker, also led to mortgage redefaults and for a time, marred HAMP program results.
Fannie Mae posts record annual profit at $17.2 billion
Reuters April 2, 2013
Fannie Mae said in its filing that it did not book a tax-related gain that could have been as much as $59 billion that would have fueled earnings and allowed the company to make an enormous one-time payment to the U.S. Treasury to reduce remaining bailout funds.
The company had missed its March 18 filing deadline for its fourth-quarter financial results and said it needed more time to analyze those so-called deferred tax assets, which are unused credits that can be used to cover future tax bills.
Wrangling Over Housing Tax Credits
Travis County Commissioners to revisit a housing finance scheme
By Elizabeth Pagano Austin Chronicle March 29, 2013
Few people would claim that getting subsidized housing built in Texas was ever easy. But in the wake of a failed $78.3 million affordable housing bond proposal, the fight to build new affordable housing in Austin has become downright scrappy.
Throw in new rules from the state that have local governments delving into the complicated realm of federal tax credits for the first time, and you pretty much have a complex mess.
This was certainly the case last week at the Travis County Commissioners Court, when the county decided to take a second look at its decision to endorse two projects that were seeking 9% tax credits. Though the credits are federal, they are distributed by the state in a competitive process that is broken down by region. Each project is assigned points based on various criteria, and the projects that get the most points are awarded the tax credits, which then end up financing the majority of the project. The local endorsements, which now must be submitted by local governments, account for just over 10% of the scoring.
Last month, the city of Austin set aside a hefty chunk of the budget surplus for six projects in the city, with the understanding that only two would be financed. Because the tax credit competition is so fierce, only two from our area – Region 7 – are expected to receive this kind of financing.
But then, just two weeks before the applications were due at the state, the County Commissioners were presented with a deal that seemed too good to pass up. Not only would they be able to help build more affordable housing in the county, but it would be at no financial risk for them.
Dwaine Caraway Says Dallas is the “Homeless Capital of the World” and Should Bus Them Out of Town
By Eric Nicholson Dallas Observer March 30, 2013
It’s been a decade since the city of Dallas announced the development of a 10-year plan to end chronic homelessness, a quest that, as a short stroll downtown will tell you, has fallen short of its goal. There are still plenty of people without homes.
That’s not to say the program, which has focused attention and money on substance abuse counseling, permanent supportive housing, prisoner reentry programs, and the like, has been a failure. According to statistics presented to City Council’s Housing Committee today, chronic homelessness has decreased by 66 percent in that time frame.
That’s good news, but it’s not the whole story. As the city’s homeless services manager, Suanne Durham, told the council, the same period has seen a sharp increase in the number of homeless families (36 percent) and children (22 percent), which is something neither the city nor nonprofits that serve the homeless are well-equipped to deal with.