March 1, 2014
ocwen under investigationRecall about a week ago when I mentioned that the relationship of certain loan servicers with massive rental companies should raise alarm bells?
Alarm bells officially rung:
Regulators and investors, which actually own most of the loans [Ocwen Financial] services, are also questioning the unusual arrangements between Ocwen -- "new co" backward -- and four other publicly traded companies where [Ocwen founder Bill] Erbey is chairman. The companies do things from buying up delinquent loans to renting out foreclosed houses.
The specific regulator is New York State's Superintendent of Financial Services, Benjamin M. Lawsky, who notified Ocwen and its sister companies that they were under investigation. The investors in question are the ones who were selling their stock in Ocwen yesterday once the news of the investigation broke.
Also important to note that this is not the first time that Ocwen has danced with regulators, as last December Ocwen agreed to a $2.1 billion dollar settlement with the CFPB and 49 states over allegations of mishandling mortgages.
To sum up the sins of Ocwen, the largest non-bank loan servicer in the country, they have systematically bungled home mortgages that they were being paid to service (much like the stories you've been hearing since real estate bubble popped), and now they are being investigated for the possibility that they may be pushing homes into unjust/sloppy foreclosure so that companies under common ownership can acquire the foreclosed home and turn it into a rental property.
That last one sounds insane, right? Right.
"If a mortgage goes into foreclosure and you lose those servicing fees, so what," said Christopher Wyatt, a housing consultant and former vice president at Goldman Sachs Group Inc.'s Litton Loan Servicing. "You can funnel it to one of your other businesses and still make money from it."
I know this is all terribly terribly boring. But remember if a guy takes your wallet at gunpoint and gets caught, he does hard time, probably. What if a multibillion dollar company takes your house? What happens to them?
Posted by mrbrent at 8:38 AM
February 28, 2014
public space private moneyThis is why I voted for Bill de Blasio.
So you may or may not know that I have some ties to the Brooklyn neighborhood of Williamsburg. Granted, not like the ties those have that were born and raised there, but my affinity group moved there in the Eighties, and I joined them in the Nineties for an eleven year hitch. And yeah, it's changed a lot now, to the point of near-unrecognizability, but the "development" projects spurred by zoning changes implemented by the Bloomberg Administration have not yet all been implemented.
Take for example the Domino Sugar factory on the waterfront, not far from the Williamsburg Bridge, with the iconic sign visible from Manhattan. When I lived there, it was still factory, with a couple hundred union jobs. Unfortunately, and in no small part because of a labor dispute, the factory closed in 2004. And it has been the target of (heinous) development plans ever since. And some of these plans even began to leverage community support, through design changes and increase in affordable rental units.
(Between you and me, even the so-called popular plans are still horrifying. Sorry, the neighborhood and its infrastructure is just not designed to support dozens of luxury condo skyscrapers, and frankly the families that lived there for decades deserve better. Actually, not sorry.)
The mayor's administration is insisting that the developer add even more space for affordable housing and, as a result, fewer market-rate apartments, in exchange for the zoning changes that [most recent developer Jed] Walentas needs to build his towers with spectacular views of Midtown Manhattan.
Lookit. The previous mayor had this Randian belief that enticing the super-rich and dangling huge incentives for luxury development would have a sort of trickle-down effect on the rest of the city. ("Hey, you may be priced out of the five boroughs, but imagine the really cool doorman job you can have!") This did not work. In the least.
Developers like Walentas are not only getting zoning rules unilaterally amended, but they're also getting a generous array of tax abatements, rebates, credits, etc. It does not behoove a smart mayor to basically pay some already rich guy to destroy neighborhoods.
OMG I'm anti-business! Well, show me one, one, real estate developer that had to find a new neighborhood further away from Manhattan because someone built a skyscraper next to them.
There are eight and a third million residents in New York City. It's time (and I congratulate de Blasio for doing so) to think of them as constituents and not as collateral damage to the wheels of "progress."
Posted by mrbrent at 10:23 AM
February 27, 2014
where did that go?God, that was the sort of publishing interruption that usually accompanies big old life tragedies or holiday seasons or vacations or that sort of thing. None of which are the case.
I made the ill-advised decision to take some (non-writing) side projects on top of the day job and everything else, and then managed to give myself a sinus infection in the process.
Oh, not that there aren't tiny little tragedies here and there, but no one likes a whiner, right?
We'll see if my left maxillary sinus decides to behave today, and then I'll start the process of figuring out which of the many very interesting developments are worth a couple hundred of words on my part.
Thanks for your continued support.
Posted by mrbrent at 11:02 AM