Too Little, Too Late, and Too Timid: The Federal Response to the Foreclosure Crisis at the Five-Year Mark

Housing Policy Debate

Volumn 23, Issue 1, 2013, Pages 199-232

  Immergluck, Dan ^a  

^a GEORGIA INSTITUTE OF TECHNOLOGY   (United States)

Author keywords

foreclosure; mortgage crisis; subprime crisis

Indexed keywords

EID: 84873897861     PISSN: 10511482     EISSN: 2152050X     Source Type: Journal    
DOI: 10.1080/10511482.2012.749933     Document Type: Review

References (81)

1. Agarwal, S., Amromin, G., Ben-David, I., Chomsisengphet, S. and Evanoff, D. 2010. Market-based loss mitigation practices for troubled mortgages following the financial crisis, working Paper WP 2011-3 Chicago, IL: Federal Reserve Bank of Chicago.
2. Alexander, F. 2011. Land banks and landbanking, Flint, MI: Center for Community Progress. Retrieved from http://www.communityprogress.net/filebin/pdf/new_resrcs/LB_Book_2011_F.pdf
3. American Securitization Forum (2007). Streamlined foreclosure and loss avoidance framework for securitized subprime adjustable rate mortgage loans. December 6. Retrieved fromhttp://americansecuritization.com/uploadedFiles/FinalASFStatementonStreamlinedServicingProcedures.pdf
4. Bocian, D., Li, W., & Ernst, K. (2010). Foreclosures by race and ethnicity: The demographics of a crisis. Retrieved fromhttp://www.responsiblelending.org/mortgage-lending/research-analysis/foreclosures-by-race-and-ethnicity.pdf
5. Braucher, J. 2010. Humpty Dumpty and the foreclosure crisis: Lessons from the lackluster first year of the Home Affordable Modification Program, Tuscon, AZ: University of Arizona. Arizona Legal Studies Discussion Paper No 09-37
6. Buhl, T. (2009, March 6). Tranche warfare: MBS investor sues American home over REO sales. Housing Wire, Retrieved fromhttp://www.housingwire.com/news/tranche-warfare-mbs-investor-sues-american-home-over-reo-sales
7. Calculated Risk (2011). REO inventory: Fannie, Freddie, FHA, PLS and FDIC through Q2 2011. Retrieved from http://cr4re.com/charts/charts.html?Delinquency#category = Delinquency&chart = REOInventoryQ22011.jpg
8. Chaddock, G. R. (2011, March 11). House looks to cut $62 billion for distressed homeowners, properties. Christian Science Monitor. Retrieved fromhttp://www.csmonitor.com/USA/Politics/2011/0311/House-looks-to-cut-62-billion-for-distressed-homeowners-properties
9. Collins, M. (2012, March 21). FHA "short refi" program gets an extension. National Mortgage News, Retrieved from http://www.nationalmortgagenews.com/dailybriefing/2010_563/fha-short-refi-program-1029524-1.html?zkPrintable = true
10. Coulton, C., Schramm, M., & Hirsch, A. (2008). Beyond REO: Property transfers at extremely distressed prices in Cuyahoga County, 2005-2008. Center on Urban Poverty and Community Development. Case Western University. December. Retrieved fromhttp://blog.case.edu/msass/2008/12/09/20081209_beyond_reo_final.pdf
11. Dudley, W. (2012). Housing and the economic recovery [Remarks at the New Jersey Bankers Association Economic Forum]. January 6. Newark, NJ. Retrieved fromhttp://m.newyorkfed.org/newsevents/speeches/2012/dud120106.html
12. Duke, E. (2011). The housing market going forward: Lessons learned from the recent crisis [Speech at the Federal Reserve Board Policy Forum]. Washington, DC. Retrieved fromhttp://www.federalreserve.gov/newsevents/speech/duke20110901a.htm
13. Fannie Mae (2011). Fannie Mae second quarter credit supplement. August 5. Retrieved fromhttp://www.fanniemae.com/ir/pdf/sec/2011/q2credit_summary.pdf
14. Federal Deposit Insurance Corporation (2008). FDIC loss sharing proposal to promote affordable loan modifications. November 20. Retrieved fromhttp://www.fdic.gov/consumers/loans/loanmod/
15. Federal Housing Finance Agency (2012a). Foreclosure prevention and refinance report. Fourth Quarter 2011
16. Federal Housing Finance Agency (2012b). Refinance report. June 2012
17. Financial Crisis Inquiry Commission (2011). Financial crisis inquiry report. January. Retrieved fromhttp://www.gpo.gov/fdsys/pkg/GPO-FCIC/pdf/GPO-FCIC.pdf
18. Fitch Ratings. 2009. U.S. RMBS servicers' loss mitigation and modification efforts, May 26 New York: Author.
19. Fitch Ratings (2012). Fitch on AG settlement: More clarity, not much change yet for U.S. RMBS. July 9
20. Gagnon, J., Raskin, M., Remache, J. and Sack, B. 2011. The financial market effects of the Federal Reserve's large scale asset purchases. The International Journal of Central Banking, 7: 3-44.
21. Hagerty, J. (2010, January 19). Loan modifications help the housing market. Wall Street Journal, Retrieved fromhttp://online.wsj.com/article/SB10001424052748703626604575010711922339400.html
22. Hancock, D. and Passmore, W. 2010. Did the Federal Reserve's MBS purchase program lower mortgage rates?, Washington, DC: Federal Reserve Board of Governors. Retrieved from http://www.federalreserve.gov/pubs/feds/2011/201101/201101pap.pdf
23. Hiltzik, M. (2011, June 28). Homeowners deserve more than halfhearted mortgage relief. Los Angeles Times, Retrieved fromhttp://articles.latimes.com/2011/jun/28/business/la-fi-hiltzik-20110628
24. Hope Now Alliance (2007). Hope Now Alliance created to help distressed homeowners (Press release). Retrieved fromhttp://www.fsround.org/media/pdfs/AllianceRelease.pdf
25. Immergluck, D. 2009. Foreclosed: High-risk lending, deregulation and the undermining of America's mortgage market, Ithaca, NY: Cornell University Press.
26. Immergluck, D. (2010). State foreclosure mitigation strategies: A comparison of round 1 and 2 Hardest Hit Fund Plans in states with nonjudicial foreclosure processes. October 20. Retrieved from http://ssrn.com/abstract = 1695217
27. Immergluck, D. 2012. Distressed and dumped: Market dynamics of low-value, foreclosed properties during the advent of the federal Neighborhood Stabilization Program. Journal of Planning Education and Research, 32: 48-61.
28. Jacobides, M. 2005. Industry change through vertical disintegration: How and why markets emerged in mortgage banking. Academy of Management Journal, 48: 465-498.
29. Joint Economic Committee (2007). Momentum builds for Schumer's call for additional federal funds to avert subprime foreclosure crisis [Press release]. Washington, DC: Joint Economic Committee of the U.S. Congress June 5. Retrieved from http://jec.senate.gov/public/index.cfm?p=PressReleases&ContentRecord_id=b2d3916-7e9c-9af9-742d-195da80f550e&ContentType_id=66d767ed-750b-43e8-b8cf-89524ad8a29e&Group_id=1a3081df-5769-4cc9-99e8-a0387a830c5f
30. Kashkari, N. (2012, April 27). Why few homeowners have been rescued. Washington Post, Retrieved Fromhttp://www.washingtonpost.com/opinions/why-homeowner-bailout-plans-dont-work/2012/04/27/gIQAhplImT_story.html
31. Kiel, P., & Pierce, O. (2010). Homeowner questionnaire shows banks violating government program rules. Propublica, Retrieved fromhttp://www.propublica.org/article/homeowner-questionnaire-shows-banks-violating-govt-program-rules
32. Korte, G. (2010, July 28). Clock ticking for foreclosure aid: Local governments must use $1B in federal funds. USA Today, p. 1A
33. Levitin, A., & Goodman, J. (2008). The effect of bankruptcy strip-down on mortgage markets. Research Paper No. 1087816. February 6. Georgetown University Law Center
34. Levitin, A. and Twomey, T. 2010. Mortgage servicing. Yale Journal on Regulation, 28(1): 1-90.
35. Lillis, M. (2009, July 16). Obama administration abandons cramdown. Washington Independent, Retrievedfromhttp://washingtonindependent.com/51486/obama-administration-abandons-cramdown
36. Mallach, A. 2009. Saving America's struggling communities: Defining the federal role in addressing the secondary impacts of the foreclosure crisis, Washington, DC: Brookings Institution. Retrieved from http://www.brookings.edu/topics/financial-markets.aspx
37. Mayer, C., Morrison, E., Piskorski, T., & Gupta, A. (2011). Mortgage modification and strategic behavior: Evidence from a legal settlement with Countrywide. Columbia Law and Economics Working Paper No. 404. Retrieved from http://ssrn.com/abstract = 1836451
38. Mayer, N., Tatian, P., Temkin, K. and Calhoun, C. 2010. National Foreclosure Mitigation Counseling program evaluation: Preliminary analysis of program effects (September 2010 update), Washington, DC: Urban Institute.
39. Mortgage Bankers Association (2011). National delinquency survey: Facts. Retrieved fromhttp://www.mbaa.org/files/Research/Flyers/NDSFAQ.pdf
40. National Consumer Law Center (2009). Homeowners need mandatory loan modifications and expanded access to mediation; Current programs fall short. September 11. Retrievedfromhttp://www.nclc.org/images/pdf/foreclosure_mortgage/mortgage_servicing/loanmodificationonepage091109.pdf
41. Newberger, H. 2010. Acquiring privately held REO properties with public funds: The case of the Neighborhood Stabilization Program, Washington, DC: Federal Reserve Board of Governors. Retrieved from http://www.bos.frb.org/commdev/REO-and-vacant-properties/101-Newburger.pdf
42. Nocera, J. (2008, October 2). As crisis spread, alarm led to action. New York Times. Retrieved fromhttp://www.nytimes.com/2008/10/02/business/02crisis.htm
43. Panchuk, K. (2011). House Republicans push back at plan to settle with mortgage servicers. Retrieved fromhttp://www.housingwire.com/2011/03/09/house-republicans-push-back-at-plan-tosettle-with-mortgage-servicers
44. Paul, E. (2008). Brownfields redevelopment toolbox for disadvantaged communities. Northeast-Midwest Institute. Retrieved fromhttp://www.epa.gov/brownfields/pdf/bftoolbox_disadvantage_communities.pdf
45. Percelay, B. (2007, September 20). Predatory borrowers. Boston Globe. Retrieved fromhttp://www.boston.com/news/globe/editorial_opinion/oped/articles/2007/09/20/predatory_borrowers/
46. Powell, M., & Martin, A. (2011, March 30). Foreclosure aid fell short, and is fading. New York Times, p. A-1
47. Prior, J. (2011). Freddie Mac authorizes HUD unemployment program. July 14. Retrieved fromhttp://www.housingwire.com/2011/07/14/freddie-mac-authorizes-hud-unemployment-program
48. Randall, M. (2011, July 7). Questions on Warren's role in mortgage talks dominate hearing. Dow Jones Newswires. Retrieved fromhttp://www.foxbusiness.com/industries/2011/07/07/questions-on-warrens-role-in-mortgage-talks-dominate-hearing/
49. Said, C., & Zito, K. (2007, December 7). Bush's plan for an interest rate freeze gets and icy response. San Francisco Chronicle. Retrieved from http://www.sfgate.com/cgi-bin/article.cgi?f = /c/a/2007/12/07/MNQCTPRVP.DTL
50. SIGTARP (Special Investigator General for the Troubled Asset Relief Program) (2011). Quarterly report to Congress. July 28. Retrieved fromhttp://www.sigtarp.gov/reports/congress/2011/July2011_Quarterly_Report_to_Congress.pdf
51. SIGTARP (Special Investigator General for the Troubled Asset Relief Program) (2012). Factors affecting implementation of the Hardest Hit Fund program. April 12. Retrieved fromhttp://www.sigtarp.gov/Audit%20Reports/SIGTARP_HHF_Audit.pdf
52. Stolberg, C. (2009, February 20). Critique of housing plan draws quick White House offensive. New York Times. Retrieved fromhttp://www.nytimes.com/2009/02/21/us/politics/21obama.html
53. Summers, L. (2009). Letter of Larry Summers, Director-designate National Economic Council to Senate and House Leadership. January 15. Retrieved fromhttp://financialservices.house.gov/summers011509.pdf
54. Swarns, R. (2008, April 30). Federal mortgage plan falls short. New York Times. Retrieved fromhttp://www.nytimes.com/2008/04/30/business/30fha.html
55. Tamny, J. (2008, October 30). The sanctification of irresponsible borrowers. Real Clear Markets, Retrieved fromhttp://www.realclearmarkets.com/articles/2008/10/the_sanctification_of_irrespon.html
56. Thompson, D. 2009. Why servicers foreclose when they should modify and other puzzles of servicer behavior, Washington, DC: National Consumer Law Center.
57. Timiraos, N. (2011, August 31). An accidental housing chief embraces the power of "no". Wall Street Journal. Retrieved fromhttp://online.wsj.com/article/SB10001424053111904199404576538803284685440.html
58. U.S. Department of Housing and Urban Development (2008). Methodology for allocation of $3.92 billion of emergency assistance for the redevelopment of abandoned and foreclosed homes. Retrieved fromhttp://www.hud.gov/offices/cpd/communitydevelopment/programs/neighborhoodspg/nspfa_methodology.pdf
59. U.S. Department of Housing and Urban Development (2010a). Guidance for tracking and reporting the use of NSP funds: Obligations for specific activities. Retrieved fromhttp://hudnsphelp.info/media/resources/NSPPolicyAlert_Obligations_4-23-10.pdf
60. U.S. Department of Housing and Urban Development (2010b). HUD Secretary announces national First Look program to help communities stabilize neighborhoods hard-hit by foreclosure. Retrieved from http://portal.hud.gov/hudportal/HUD?src = /press/press_releases_media_advisories/2010/HUDNo.10-187
61. U.S. Department of Housing and Urban Development (2010c). Guidance on the impact of new definitions for NSP-eligible properties. April 2, 2011. Retrieved fromhttp://hudnsphelp.info/media/resources/ImpactOfNewDefinitions.pdf
62. U.S. Department of Housing and Urban Development (2011a). FHA single-family operations. Retrieved fromhttp://www.hud.gov/offices/hsg/rmra/oe/rpts/ooe/ol2011.pdf
63. U.S. Department of Housing and Urban Development (2011b). The facts about the Neighborhood Stabilization Program. Retrieved fromhttp://blog.hud.gov/2011/03/15/facts-neighborhood-stabilization-program/
64. U.S. Department of the Treasury (2009). Making Home Affordable: Updated detailed program description. March 4. Retrieved fromhttp://www.treasury.gov/press-center/press-releases/Documents/housing_fact_sheet.pdf
65. U.S. Department of the Treasury (2010). Making Home Affordable. September 16. Unpublished presentation
66. U.S. Department of the Treasury (2011a). Making Home Affordable program performance report through June 2011. August 5. Retrieved fromhttp://www.treasury.gov/initiatives/financial-stability/results/MHA-Reports/Documents/June%202011%20MHA%20Report%20FINAL.PDF
67. U.S. Department of the Treasury (2011b). Obama Administration releases May housing scorecard featuring new Making Home Affordable servicer assessments, regional spotlight on Phoenix housing data. June 9. Retrieved fromhttp://www.treasury.gov/press-center/press-releases/Pages/tg1205.aspx
68. U.S. Department of the Treasury (2012). Making Home Affordable program performance report through March 2012. April. Retrieved fromhttp://www.treasury.gov/initiatives/financial-stability/results/MHA-Reports/Documents/Mar%202012%20MHA%20Report%20Final.pdf
69. U.S. Government Accountability Office (2010). Neighborhood Stabilization Program: HUD and grantees are taking actions to ensure program compliance but data on program outputs could be improved. GAO-11-48. December
70. U.S. Government Accountability Office (2011). Survey of housing counselors about HAMP. GAO-11-376-R. May
71. U.S. Government Accountability Office (2012). Foreclosure mitigation: Agencies could improve effectiveness of federal efforts with additional data collection and analysis. GAO-12-296. June
72. U.S. House of Representatives (2008). H.R. 3221 Housing and Economic Recovery Act. July 30. Retrieved from http://www.govtrack.us/congress/bill.xpd?bill = h110-3221
73. U.S. House of Representatives (2009). H.R.1. American Recovery and Reinvestment Act of 2009, Title XII, Community Development Fund. Retrieved fromhttp://thomas.loc.gov/cgi-bin/query/z?c111:H.R.1.enr
74. U.S. House of Representatives (2010). H.R. 4173. Dodd-Frank Wall Street Reform and Consumer Protection Act. Retrieved fromhttp://docs.house.gov/rules/finserv/111_hr4173_finsrvcr.pdf
75. U.S. House of Representatives (2012). The Obama Administration's response to the housing crisis. Hearing before the Subcommittee on Insurance, Housing and Community Opportunity of the Committee on Financial Services, U.S. House of Representatives. October 6, 2011. Serial no. 112-169
76. U.S. Senate (2007). Senate Bill 2136: Helping families save their homes in bankruptcy act of 2007. October 3. United States Senate. Retrieved fromhttp://www.opencongress.org/bill/110-s2136/text
77. Weise, K. (2010, December 17). Fannie and Freddie's regulator opposes reducing mortgages for struggling homeowners. Propublica. Retrieved fromhttp://www.propublica.org/article/fannie-and-freddies-govt-regulator-opposes-reducing-mortgages-for-strugglin
78. Weiss, N., Getter, D., Jickling, M., Keightley, M., & Murphy, E. (2008). Housing and Economic Recovery Act of 2008. Congressional Research Service. Order Code RL34623. August 19. Retrieved fromhttp://assets.opencrs.com/rpts/RL34623_20080819.pdf
79. White, A. 2009. Deleveraging the American homeowner: The failure of 2008 voluntary mortgage contract modifications. Connecticut Law Review, 41: 1107 Retrieved from http://ssrn.com/abstract = 1325534
80. White, A. (2011). Foreclosures and modifications - securitized mortgage data through May 25, 2011. Retrieved fromhttp://www.valpo.edu/law/faculty/awhite/data/index.php
81. Zandi, M. (2012, May 12). The politics of forgiving mortgage debt. Washington Post, p. E-1