Several times per week, I get phone calls from attorneys. These calls all start out the same. "I am unable to get loan modifications done through a lender. What can I do?" The first question I ask is if the lender is Indymac/One West. Invariably, it is.
I also field the same type of calls from homeowners and from loan modification companies. Everyone is having the problem of Indymac not cooperating with regard to doing loan modifications. Furthermore, if I google the issue or check out loan modification forums, the same is true on the internet.
What is going on with Indymac/One West? Why aren't they doing loan modifications? This article will try and bring together the known facts for a better understanding of the situation, and discuss what the Indymac situation means for foreclosures in general -- and the government's response to the crisis. First, to understand the situation today, one must have an understanding of the recent history of Indymac.
History
Indymac was a national bank in the U.S. It was insured by the FDIC. On July 11, 2008, Indymac failed and was taken over by the FDIC.
Indymac offered mortgage loans to homeowners. A large number of these loans were Option ARM mortgages using stated income programs. The loans were offered by Indymac retail, and also through Mortgage Bankers would fund the loans and then Indymac would buy them and reimburse the Mortgage Banker. Mortgage Brokers were also invited to the party to sell these loans.
During the height of the Housing Boom, Indymac gave these loans out like a homeowner gives out candy at Halloween. The loans were sold to homeowners by brokers who desired the large rebates that Indymac offered for the loans. The rebates were usually about three points. What is not commonly known is that when the Option ARM was sold to Wall Street, the lender would realize from four to six points, and the three point rebate to the broker was paid from these proceeds. So the lender "pocketed" three points themselves for each loan.
When the loans were sold to Wall Street, they were securitized through a Pooling and Servicing Agreement. This Agreement covered what could happen with the loans, and detailed how all parts of the loan process occurred.
Even though Indymac sold off most loans, they still held a large number of Option ARMs and other loans in their portfolio. As the Housing Crisis developed and deepened, the number of these loans going into default or being foreclosed upon increased dramatically. This reduced cash and reserves available to Indymac for operations.
In July, 2008, the FDIC came in and took over Indymac. The FDIC looked for someone to buy Indymac and after negotiations, sold Indymac to One West Bank.
OneWest Bank and its Sweetheart Deal
OneWest Bank was created on Mar 19, 2009 from the assets of Indymac Bank. It was created solely for the purpose of absorbing Indymac Bank. The principle owners of OneWest Bank include Michael Dell and George Soros. (George was a major supporter of Barack Obama and is also notorious for knocking the UK out of the Euro Exchange Rate Mechanism in 1992 by shorting the Pound).
When OneWest took over Indymac, the FDIC and OneWest executed a "Shared-Loss Agreement" covering the sale. This Agreement covered the terms of what the FDIC would reimburse OneWest for any losses from foreclosure on a property. It is at this point that the details get very confusing, so I shall try to simplify the terms. Some of the major details are:
OneWest would purchase all first mortgages at 70% of the current balance
OneWest would purchase Line of Equity Loans at 58% of the current balance.
In the event of foreclosure, the FDIC would cover from 80%-95% of losses, using the original loan amount, and not the current balance.
How does this translate to the "Real World"? Let us take a hypothetical situation. A homeowner has just lost his home in default. OneWest sells the property. Here are the details of the transaction:
The original loan amount was $500,000. Missed payments and other foreclosure costs bring the amount up to $550,000. At 70%, OneWest bought the loan for $385,000. The home is located in Stockton, CA, so its current value is likely about $185,000 and OneWest sells the home for that amount. Total loss for OneWest is $200,000. But this is not how FDIC determines the loss.
'FDIC takes the $500,000 and subtracts the $185,000 Purchase Price. Total loss according to the FDIC is $315,000. If the FDIC is covering "ONLY" 80% of the loss, then the FDIC would reimburse OneWest to the tune of $252,000.
Add the $252,000 to the Purchase Price of $185,000, and you have One West recovering $437,000 for an "investment" of $385,000. Therefore, OneWest makes $52,000 in additional income above the actual Purchase Price loan amount after the FDIC reimbursement.
At this point, it becomes readily apparent why OneWest Bank has no intention of conducting loan modifications. Any modification means that OneWest would lose out on all this additional profit.
Black Muslim Group Celebrates "Brother & Martyr" Maurice Clemmons.
"Who is your favorite officer down?" Seattle Black Foot Soldier Alfred "Issaquah" Shafford asked a rally to celebrate (what's being called) "the blow against the white terrorist racism of the Washington State Police Regime" at the Steele Street Forza Coffee House.
The hero of the gathering was Maurice Clemens, who had shot and killed four police officers at another Forza Coffee House -- - this one on a side street in Tacoma, Washington, near the McChord Air Base.
Continued on Page 49
#4
My first thought after seeing the news of the shootings was, when will the jihad come out? These guys have such a clear MO that does not conform to ordinary types of criminal behavior. No normal criminal is likely to go looking to ambush a bunch of cops without a strong, direct motive. Faceless, innocent, and relatively helpless victims are the Moslem radical's target. They choose the people with the aim of producing the maximim amount of terror.
#5
well, one article from a very biased online publication is not enough to convince me of that. This guy was a total sociopath, he claimed to be Jesus Christ. The black guys around here arent muslim and if they are there arent many of them ( I live in Tacoma) they're just normal guys who do get profiled a fair bit, and they know this. All in all though we have a very integrated community considering the extreme diversity in Puget Sound. (I digress) But no, I'm not biting on this idea that Clemmons was part of some black brotherhood of Jihad.
#6
Thank you for explaining, 746. Agreed, the descriptions of Mr. Clemens previous behaviours do make him seem rather short of a baker's dozen. Which doesn't prevent jihadi idiots from hailing his actions whether or not he actually shared their peculiar perspective.
#7
I JUST talked with a black guy at lunch about this. He had been profiled and jailed for stabbing an intruder in his house, was charged with 1st degree manslaughter and send away. 3 years later it was proven that he was actually innocent and had killed the intruder in self defense, needless to say he was a bit miffed at the Tacoma cops for throwing him in the can for 3 years, BUT, ( I am going somewhere with this ) he had nothing but praise for the actions that had just taken place in Seattle and was amazed that the single cop was so lucky as to spot the guy creeping up on his patrol car before he got killed as well. They are as prejudice here as anywhere, but this guy realizes it, lives with it, and has moved on, he though me and my buddy were cops! very amusing for me as I'm no where near being a cop ( not to good at peaceful enforcement )
#8
I am glad he was finally proved innocent and released, 746. I didn't realize such things still went on nowadays. (Yes, I live a very sheltered life.) A very interesting perspective indeed, and a useful tale for understanding what happened.
#9
I am still holding out that he "could" be a muslim on some wacko jihad against the cops, but until it's picked up by more reputable outlets I'll wait.
Could things get any worse for CNN? Apparently, the answer is 'yes.' Things often don't change much. People just become aware of them.
The pioneering and once dominant leader in cable news has been hemorrhaging viewers for some time and earlier this year suffered the indignity of slipping to last place among cable news networks, behind even its sister network Headline News.
Now come the November Nielsen ratings showing that the surprise departure of Lou Dobbs has cost the network even more viewers.
After Dobbs announced his resignation on air on Wednesday November 11, CNN suffered a 25% decline among all viewers in Dobbs' 7pm time slot, and a 26% decline among adults 25-54.
Meanwhile - surprise, surprise - CNN's competition in the 7pm slot at FOX News, The FOX Report with Shephard Smith, scored its highest rated month of the year in November with more than 2.1 million total viewers and just over 500,000 viewers in the A25-54 demo.
CNN's fall after Dobbs' departure also allowed MSNBC's CurveballScrewball Hardball with Chris Matthews to eke its way into second place 7 pm slot in November with 672,000 total viewers and 184,000 viewers among Adults 25-54.
UPDATE: More on CNN's woes:
Anderson Cooper is fading in the ratings. The respected CNN anchor has seen his numbers slip significantly through the past year. His 10 p.m. show, "Anderson Cooper 360," has declined 62% in total viewers and 70% in adults 25-54 from November 2008, according to Nielsen figures.
Last month, in Cooper's time slot, Fox News' "On the Record" attracted an average viewership of 1.9 million while "360" averaged 672,000; repeats of MSNBC's "Countdown" and HLN's Nancy Grace show averaged 655,000 and 458,000, respectively. But in the ad-friendly 25-54 demo, those same repeats won out over Cooper with 224,000 (MSNBC) and 214,000 (HLN).
#3
Early on, it was suggested that the reason Cooper is so popular among CNN executives is because he will have sex with anyone, at any time, without even asking.
That being said, the big question is what is Lou Dobbs up to? Right now he is in the cat bird seat, but it is a situation of "use it or lose it."
#1
I'm too lazy busy to look it up right now, Hupenter - what are the requirements for nomination for a Pulitzer?
Posted by: Barbara Skolaut ||
12/03/2009 11:43 Comments ||
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#2
The Pulitzer Prizes are the most prestigious awards in journalism and are presented each year by Columbia University.
That statement says a lot about the dismal state of Journalism. Why does it seem that leftist organizations (Journalism, Hollywood, MSM) need to pat themselves on the back all the time with 'awards' anyway?
I'm afraid this is just a way to give Columbia School of Journalism (spit!) a means to legitimize leftist sites such as Democratic Underground, Daily KOS, and Huffington Post.
#2
I don't know if he originated the idea, but Enron certainly was an early and enthusiastic adopter.
Posted by: Steve White ||
12/03/2009 13:17 Comments ||
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#3
Bernie Madoff and Ken Lay were rank amateurs compared to Obama and the Democrats. Next they're going to rip us off for another $300 billion for a second porkulus package.
Obama's escalation in Afghanistan is the last in a string of disappointments. His flip-flopping acceptance of the military coup in Honduras has squandered the trust of Latin America. His Wall Street bailout leaves the poor, the unemployed, minorities and college students on their own. And now comes the Afghanistan-Pakistan decision to escalate the stalemate, which risks his domestic agenda, his Democratic base, and possibly even his presidency.... And so, iconic Leftist Tom Hayden (the former husband of Jane Fonda) breaks with the "right deviationist" Obama over a matter of principle. If Obama is going to continue the Bush-neocon war of aggression in Afghanistan, well, he'll have to do it without Tom Hayden's support. Tom will be out there working to replace the Obama regime with real progressives! To the barricades! Destroy the deviationists! Revolution Now, man!
...To be clear: I'll support Obama down the road against Sarah Palin, Lou Dobbs or any of the pitchfork carriers for the pre-Obama era. Oh. Never mind.
But no bumper sticker until the withdrawal strategy is fully carried out.... Yeah, Tom, no bumper sticker. That'll show him!
Posted by: Mike ||
12/03/2009 13:23 ||
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Link ||
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#1
Thats ok, out here in Arizona we aim our 4WD's at those Prius bumps in the highway with the "run over me Obama" stickers. Did you know the new Chevy 2500 with a six inch lift will clear that car clean!
Posted by: 49 Pan ||
12/03/2009 15:37 Comments ||
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#2
Pssst, Tom! The Sixties have been over now for like 1,402,560 fifteen minuteses.
#3
Why do I have the feeling that his back gate will fall apart when he tries to take it off? Hayden strikes me as the sort of guy whose '89 Jeep Cherokee's rusting bumper and sagging back gate is being held together by the impenetrable coating of bumperstickers covering it from wheel-well to wheel-well.
Posted by: Mitch H. ||
12/03/2009 16:18 Comments ||
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#4
Sic 'em, Tom, sic 'em. I applaud any division on the Left.
Surely there must have been serious men and women in the hard sciences who at some point worried that their colleagues in the global warming movement were putting at risk the credibility of everyone in science. The nature of that risk has been twofold: First, that the claims of the climate scientists might buckle beneath the weight of their breathtaking complexity. Second, that the crudeness of modern politics, once in motion, would trample the traditions and culture of science to achieve its own policy goals. With the scandal at the East Anglia Climate Research Unit, both have happened at once.
I don't think most scientists appreciate what has hit them. This isn't only about the credibility of global warming. For years, global warming and its advocates have been the public face of hard science. Most people could not name three other subjects they would associate with the work of serious scientists. This was it. The public was told repeatedly that something called "the scientific community" had affirmed the science beneath this inquiry. A Nobel Prize was bestowed (on a politician).
Global warming enlisted the collective reputation of science. Because "science" said so, all the world was about to undertake a vast reordering of human behavior at almost unimaginable financial cost. Not every day does the work of scientists lead to galactic events simply called Kyoto or Copenhagen. At least not since the Manhattan Project.
What is happening at East Anglia is an epochal event. As the hard sciencesphysics, biology, chemistry, electrical engineeringcame to dominate intellectual life in the last century, some academics in the humanities devised the theory of postmodernism, which liberated them from their colleagues in the sciences. Postmodernism, a self-consciously "unprovable" theory, replaced formal structures with subjectivity. With the revelations of East Anglia, this slippery and variable intellectual world has crossed into the hard sciences.
This has harsh implications for the credibility of science generally. Hard science, alongside medicine, was one of the few things left accorded automatic stature and respect by most untrained lay persons. But the average person reading accounts of the East Anglia emails will conclude that hard science has become just another faction, as politicized and "messy" as, say, gender studies. The New England Journal of Medicine has turned into a weird weekly amalgam of straight medical-research and propaganda for the Obama redesign of U.S. medicine.
The East Anglians' mistreatment of scientists who challenged global warming's claimsplotting to shut them up and shut down their ability to publishevokes the attempt to silence Galileo. The exchanges between Penn State's Michael Mann and East Anglia CRU director Phil Jones sound like Father Firenzuola, the Commissary-General of the Inquisition.
For three centuries Galileo has symbolized dissent in science. In our time, most scientists outside this circle have kept silent as their climatologist fellows, helped by the cardinals of the press, mocked and ostracized scientists who questioned this grand theory of global doom. Even a doubter as eminent as Princeton's Freeman Dyson was dismissed as an aging crank.
Beneath this dispute is a relatively new, very postmodern environmental idea known as "the precautionary principle." As defined by one official version: "When an activity raises threats of harm to the environment or human health, precautionary measures should be taken even if some cause and effect relationships are not fully established scientifically." The global-warming establishment says we know "enough" to impose new rules on the world's use of carbon fuels. The dissenters say this demotes science's traditional standards of evidence.
The Environmental Protection Agency's dramatic Endangerment Finding in April that greenhouse gas emissions qualify as an air pollutantwith implications for a vast new regulatory regimeused what the agency called a precautionary approach. The EPA admitted "varying degrees of uncertainty across many of these scientific issues." Again, this puts hard science in the new position of saying, close enough is good enough. One hopes civil engineers never build bridges under this theory.
The Obama administration's new head of policy at EPA, Lisa Heinzerling, is an advocate of turning precaution into standard policy. In a law-review article titled "Law and Economics for a Warming World," Ms. Heinzerling wrote, "Policy formation based on prediction and calculation of expected harm is no longer relevant; the only coherent response to a situation of chaotically worsening outcomes is a precautionary policy. . . ."
If the new ethos is that "close-enough" science is now sufficient to achieve political goals, serious scientists should be under no illusion that politicians will press-gang them into service for future agendas. Everyone working in science, no matter their politics, has an stake in cleaning up the mess revealed by the East Anglia emails. Science is on the credibility bubble. If it pops, centuries of what we understand to be the role of science go with it.
Rest at link if you want to bother reading it.
It's an odd formulation in some ways as "the right" is not really a single entity. But in so far as it means the dominant mode of discourse among the institutions and blogs and magazines and newspapers and journals that support the GOP, Charles Johnson is absolutely right in my view to get off that wagon for the reasons has has stated. Read his testament. It is full of emotion, but also of honesty.
#1
Toodles to both Sully and Chuckles. I left the former a long time ago and left the latter more recently. The more you look at either of them, the more, um, unbalanced each appears to be. I don't mind ideology but raving looniness (that which they both claim to abhor, and both appear to have in spades) is where I draw the line.
Posted by: Steve White ||
12/03/2009 13:11 Comments ||
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#2
It's all about the intolerance of intolerance, to put it in Rumsfeldian terms.
#3
I left Sully when he became a one trick pony ranting about GWB & Gay Marriage. I left LGF because the threads were getting way too long and repetitive. When did Chuck flip out? Does he now regret his driving of Rathergate?
#9
Sullivan was kicked out by the Right a while back - sometime during 2004, IIRC. Wasn't that about the time he started going batshit and whining about Gitmo? It was before he finished writing his disingenuous crap book about how he was the only honest conservative.
Posted by: Mitch H. ||
12/03/2009 16:20 Comments ||
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#10
Sorry Mr. Sullivan, I was at all the meetings of "the right" and never saw you there. Charles Johnson was at a few many years ago, but disappeared after being kidnapped by some Obama cultists.
...This paranoid interpretation would be laughable were it not for the fact that obstructionist politicians in the US Senate will probably use it next year as an excuse to stiffen their opposition to the country's much needed climate bill. Nothing in the e-mails undermines the scientific case that global warming is real or that human activities are almost certainly the cause. That case is supported by multiple, robust lines of evidence, including several that are completely independent of the climate reconstructions debated in the e-mails... This demonstrates NATURE's editorial policy of only publishing "scien-tainment" instead of the truth.
#1
They're just annoyed about being name-checked in the most embarrassing leaked email, the one about "Mike's Nature trick".
Posted by: Mitch H. ||
12/03/2009 16:21 Comments ||
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#2
Same old, same old. The vaguest of claims, followed by cherry picking of the evidence.
No mention of GHGs, CO2 and the fact southern Hemisphere sea ice has been at record levels for the last couple of years and now icebergs are at the furthest north (in the SH) ever recorded.
#3
No moose, NATURE does not aim to entertain. The British journal that does that is New Scientist. NATURE is part of a publishing group that includes a number of mags.
Posted by: lord garth ||
12/03/2009 23:13 Comments ||
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A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
Could things get any worse for CNN? Apparently, the answer is 'yes.'
