| Latvia's real estate star falls
With real estate prices having risen 500 percent since 2002, Latvia has long been an investment hot-spot where the sector has outstripped its counterparts in EU member states. But the Baltic state's property firms are getting gloomy as a government anti-inflation drive bites and jitters spill over from the United States' home loan crisis. "Activities in the market have slowed down considerably. People are waiting, though nobody can really predict what will happen in the future. The situation is bleak," said Aigars Smits, head of the Arco Real Estate company. Real estate prices began dipping in Latvia in May, after the government introduced a package of measures to fight rampant inflation, including stricter rules on issuing mortgages. Latvian authorities say that the number of real estate transactions has now shrunk to the level of 2001, before the boom kicked in.
High-End Housing Blues
With industry analysts not predicting relief within the next year, that could be the issue.Sagely agrees. "I think we're going to see some surplus in these higher-end homes the further we go along."Mortgage Slow DownRealtors aren't getting any help from mortgage companies when it comes to getting customers into certain homes. Bill Oberste, principle broker with Kralicek Realty, said one of his agents has had several customers who were denied home loans recently and would have normally received one in years past.Foreclosures have taken a toll on mortgage companies. Countrywide Financial, the nation's leading mortgage lender, reported a $1.2 billion third-quarter loss Oct. 26. While much of the losses are due to foreclosures on subprime and unconventional loans, that strain has also affected high-end loans.Just as subprime mortgages can't be purchased and guaranteed by Fannie Mae or Freddie Mac, the same goes for jumbo mortgages, or any home loan totaling more than $417,000.
Carper, Castle Unveil $6 Million Program for First-Time Homebuyers ...
(CSRwire) WILMINGTON, Del.--(BUSINESS WIRE)--U.S. Sen. Thomas R. Carper and U.S. Rep. Michael N. Castle today announced a more than $6 million program called First Front Door that will help lower-income first-time homebuyers across Delaware with down payment and closing costs. Appearing at the West End Neighborhood House in Wilmington with John R. Price, president and chief executive officer of the Federal Home Loan Bank of Pittsburgh (FHLBank), the institution providing the grant money, Carper and Castle encouraged first-time homebuyers to claim funds under the first-come, first-served program as soon as possible. The program is being offered in Delaware, Pennsylvania and West Virginia. In Delaware, First Front Door funding is being distributed through three banks - Artisans' Bank, WSFS Bank and Wilmington Trust Company - members of the FHLBank cooperative system that provides private funding to nearly 340 financial institution members for affordable housing and community and economic development.
Brooklyn neighborhoods top subprime foreclosures in nation
A Brooklyn community had the highest subprime foreclosure rate in the state in October, according to Federal Reserve Bank of New York data. One in four homeowners with subprime mortgages in the 11233 zip code, which spans Brooklyn's Bedford-Stuyvesant and Crown Heights neighborhoods, lost their homes, the Fed said. The community had a foreclosure rate of almost four times the national subprime figure of 6.89%, which was the highest since March 2003. Blacks and Latinos are 30% more likely to be charged a higher rate for a home loan than whites with similar credit histories, according to a 2006 study of 50,000 mortgages. Bedford-Stuyvesant and Crown Heights had 194 foreclosures out of 770 subprime borrowers, Fed data show. .
Industry dragging feet on 'piggyback' antidote
So-called "piggyback" credit-score inflation schemes for mortgage applicants haven't been reined in, despite industry pledges to do so at the end of summer. As a result, lenders continue to be misled into treating loan applicants with poor credit as prime-credit candidates - worsening already critical fraud and delinquency problems in the mortgage market. Fair Isaac Corp., developer of the FICO score widely used for home loan underwriting, confirmed that its "FICO '08" scoring model is not yet available at any of the three national credit bureaus. .
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