The Resolution Law Group: Home mortgage rates drop again

30 year mortgage

The average interest rate for the most popular kind of home loan, the 30-year fixed rate, fell to 4.22%, down from 4.32% a week earlier.

Rates, as measured by a weekly Freddie Mac survey, have dropped from 4.57% since the Federal Reserve unexpectedly announced three weeks ago that it would not alter its stimulus program of buying Treasury bonds and mortgage-backed securities.

Most industry experts had thought the Fed would start to taper off those purchases, which bring liquidity to the mortgage markets and help keep rates low.

Related: Top 10 markets to buy an investor property

The rate decline can also be traced to economic uncertainty, which has heightened due to the government shutdown, according to Frank Nothaft, Freddie’s chief economist.

“With the onset of the federal government shutdown and declining consumer confidence, fixed mortgage rates fell for the third consecutive week,” he said.

For borrowers applying for $200,000 loans, the rate decline over the past three weeks could save them about $42 a month, $500 a year — if they can get a mortgage.

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“While this is great news for mortgage shoppers, what’s not great is that it comes as the government has ground to a halt, making it hard for mortgage lenders to get verification of tax returns or even Social Security numbers,” said Keith Gumbinger, vice president of HSH.com, a mortgage information firm. “This is likely to slow the loan approval process.”

If you feel you are the victim of Mortgage Fraud, please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

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The Resolution Law Group: AIG Shuts Down Customers’ Bank Accounts in the Wake of Dodd-Frank Limits

American International Group (AIG) will give its banking unit back their money and close out their accounts. The move is because the Dodd-Frank Wall Street Reform and Consumer Protection Act has imposed limits on insurers that have units that take deposits.

In a letter to clients, the insurance giant said that retail deposit accounts would stop being serviced as of September 30 and AIG Bank will become a “trust-only organization.” Interest will be included in the fund returns.

AIG is streamlining its focus before rules limiting proprietary trading and investments by insurance companies in banking units in hedge funds or private equity go into effect. Already, Allstate Corp., Hartford Financial Services Group Inc., MetLife Inc. (MET) have stepped back from banking or sold deposits because of greater regulator oversight.

Because of AIG’s involvement in banking, the Office of Thrift Supervision was its main federal regulator before the economic crisis. In 2009, the OTS said that it “fell short” of that oversight and failed to identify the risk involved in the insurer’s credit-default swap portfolio. The US later spent $182.3 billion to bail out the insurer, which the latter repaid last year. AIG is now overseen by the Fed, and state watchdogs can regulate its insurance units.

In July, AIG received the designation of “systematically important,” which could subject it to stricter cap rules and additional oversight by the Fed. To receive this designation indicates that regulators believe the company could threaten the financial system if the insurer were to fail.

Our securities fraud law firm represents investors that sustained losses because financial representatives, investment advisers, broker-dealers and/or firm executives were negligent, careless, or committed financial fraud.  If you feel you are the victim of Securities Fraud, please do not hesitate to email or call the The Resolution Law Group (203) 542-7275 for a confidential, no obligation consultation.

The Resolution Law Group Update: Standard & Poors Wants DOJ’s Mortgage Debt Lawsuit Against It Tossed

Standard Poors is asking a judge to dismiss the US Justice Department’s securities lawsuit against it. The government claims that the largest ratings agency defrauded investors when it put out excellent ratings for some poor quality complex mortgage packages, including collateralized debt obligations, residential mortgage-backed securities, and subprime mortgage-backed securities, between 2004 and 2007. The ratings agency, however, claims that the DOJ has no case.

Per the government’s securities complaint, financial institutions lost over $5 billion on 33 CDOs because they trusted S & P’s ratings and invested in the complex debt instruments. The DOJ believes that the credit rater issued its inaccurate ratings on purpose, raising investor demand and prices until the latter crashed, triggering the global economic crisis. It argues that certain ratings were inflated based on conflicts of interest that involved making the banks that packaged the mortgage securities happy as opposed to issuing independent, objective ratings that investors could rely on.

Now, S & P is claiming that the government’s lawsuit overreaches in targeting it and fails to show that the credit rater knew what the more accurate ratings should have been, which it contends would be necessary for there to be grounds for this CDO lawsuit. In a brief submitted to the United States District Court for the Central District of California, in Los Angeles, S & P’s lawyers argue that there is no way that their client, the Treasury, the Federal Reserve, or other market participants could have predicted how severe the financial meltdown would be.

S & P is also fighting over a dozen other CDO lawsuits filed by state attorneys general that make similar securities fraud allegations. The states are generally invoking their consumer-protection statutes, which carry a lower burden of proof, and the credit rating agency is seeking to have their securities lawsuits moved to federal court.

If you, your family, friends, neighbors or associates have been subjected to Mortgage Fraud, please contact The Resolution Law Group at (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud

Federal Reserve Board Establishes Key Rule That Will Let Regulator Identify Systemically Important Nonbank Financial Institutions

The Federal Reserve Board has moved closer toward being able to designate certain firms as Systemically Important Nonbank Financial Institutions. Earlier this month it set up a key rule that lets the Financial Stability Oversight Council name these SIFIs. The Federal Reserve would be their consolidated supervisor.

The rule defines when a firm is “predominantly” involved in financial activities. An SIFI would need to have at least $50 billion in overall consolidated assets or have risk exposures that could harm the US financial system should it fail. Among the companies that will likely get the SIFI designation are Prudential Financial Inc., GE Financial, MetLife Inc., and American International Group Inc.

A company will be considered as primarily involved in activities that the Bank Holding Company Act deems “financial in nature,” if at least 85% of its assets or revenues are related to such activities. However, the Fed has decided that involvement in physically settled derivatives transactions would generally not be considered a financial activity. This is to protect companies, such as manufacturers and farmers, that work with derivatives to hedge against supply price modifications.

The list of activities (encompassing 12 pages) that are considered financial in nature include: investing for others, lending, insuring against harm or loss, offering investment or financial advisory services, underwriting, selling interests in asset pools, servicing loans, and underwriting. SIFIs will have to turn in reports to the Federal Reserve, the Federal Deposit Insurance Corp., and FSOC about their credit exposure to other key nonbank financial institutions and key bank holding companies. They also will need to report on credit exposure to entities that are significant to them.

The new rule provides definitions for the terms “significant bank holding company” and “significant nonbank financial company.” These terms are key because when FSOC is deciding whether a company is an SIFI that the Fed must supervise, it has to look at the nature and extent of that firm’s transactions and its relationships with other key SIFIs and key holding companies.

Establishing which nonbank companies can qualify as SIFIs takes a way a key stumbling block that was preventing FSOC from being able to identify them. The Fed has the power to make SIFIs get rid of operations that it considers too high risk, raise capital levels so that they factor in the risk levels involved, and outline living wills to help close down an institution should it fail.

The new rule to designate SIFIs doesn’t go into effect until May 6. However, it is unlikely that FSOC will name any nonbank firms as SIFIs for a while. Some firms are expected to oppose such a designation because of the burdens it comes with it.

Institutional Investor Fraud
Our securities lawyers represents institutions that have been the victim of investment fraud.  If you, your family, friends, neighbors or associates have been subjected to Investment Fraud, please contact The Resolution Law Group at (203) 542-7275 for a confidential, no obligation consultation.

Lender Litigation, Unlawful Foreclosure, Tarp Money, Mortgage Backed Securities, Derivitives Lawsuits, Insider Trading Lawsuit, SEC Settlements, Ponzi Scheme Lawsuits, Intentional Misrepresentation, Securitized Mortgage, Class Action Securities Lawsuit, Robo-Signing Lawsuit, Lost Equity Litigation, Mortgage Lender Fraud, FINRA Fraud Lawsuit, Suing Banks, Fraudulent Misrepresentation, Short Sale Fraud, Fraudulent Business Practices, Mortgage Litigation, Complex Tort Litigation, Injunctive Relief, MERS Fraud

THE RESOLUTION LAW GROUP, P.C: The government was a major contributor to the current housing crisis by helping the banks and servicers carry out their practices that were designed to maximize bank profits and were destined to create the largest housing and financial crisis of all time.

The Office of the Comptroller of the Currency (OCC) and the Federal Reserve announced another “huge” settlement with some of the larger banks. Geoffrey Broderick, the senior partner of the Resolution Law Group, says “This is another headline designed to make homeowners believe that the Government is taking steps to hold banks and servicers accountable for the mess that has been created.” What had previously been rumored as a $10 billion for 14 servicers, turned out to be $8.5 billion for 10 servicers.  $3.3 billion has been earmarked for direct payments to “eligible borrowers” who were wrongfully foreclosed – assuming a process can be created to identify these former homeowners who were wrongfully displaced from their homes.  The balance of the money, $5.2 billion will be “soft dollars” applied to loan modifications and short sale relief.
Mr. Broderick adds that “The government was a major contributor to the current housing crisis by helping the banks and servicers carry out their practices that were designed to maximize bank profits and were destined to create the largest housing and financial crisis of all time.”
This so-called “huge” settlement will not provide meaningful relief for homeowners and will not fix the problems most borrowers continue to face.  Mr. Broderick maintains that the Government, by announcing  a series of settlements and programs, is simply confirming its partnership with banks and financial institutions, and the headlines and press releases fail to inform homeowners that the new arrangement eliminates the Independent Foreclosure Review, a program that was supposed to give homeowners an opportunity to have an unbiased third-party review their foreclosure and determine whether they might qualify for a cash payment f up to $125,000.
The Resolution Law Group continues to prosecute ground breaking litigation in Federal Court on behalf of homeowners suing lenders and servicers for, among other things, the illegal use of MERS, robo-signing, and intentionally ignoring underwriting standards and encouraging inflated appraisals.
Prospective clients are invited to call the law firm or visit its website at www.TheResolutionLawGroup.com