Monday, April 18, 2016

Housing Advocates Say HUD's Program Of Unloading Delinquent Mortgages A "Wall Street Giveaway" By Allowing Private Equity Rackets To Snatch Up Bad Loans At Steep Discounts

DS News reports:
  • In recent months, Agency sales of deeply delinquent mortgage loans to private investors have generated considerable objections from both lawmakers and housing advocacy groups, even to the point of a nationwide protest on February 4.

    Now a group of housing advocates and progressive groups have launched a coalition to change Agency distressed loan sales practices and require them to sell more delinquent loans to non-profits. The advocates tagged HUD’s Distressed Asset Stabilization Program (DASP) a “Wall Street Giveaway” because the majority of distressed loans sold through the program are bought by Wall Street investors whom the advocates believe are interested only in benefiting financially from the foreclosure crisis rather than in rebuilding communities and stabilizing neighborhoods.

    “HUD is supposed to help homeowners stay in their home (sic) through its ‘Distressed Asset Stabilization Program,’” the coalition said on its website. “But instead it has been a giveaway for Wall Street: In 2015, 98 percent of homes sold through HUD’s DASP program went straight to Wall Street (15,309 out of 15,624). These homes are often sold at steep discounts, averaging 45 percent off for some of the biggest banks on Wall Street.”

    The coalition’s efforts include a petition directed to HUD Secretary Julián Castro urging him to stop HUD from selling loans through DASP until the program is reformed.

See also,
  • The Wall Street Journal: Liberal Activists Launch Campaign Against HUD Secretary Julián Castro.

    A coalition of liberal activist groups launched a campaign [] against Department of Housing and Urban Development Secretary Julián Castro, questioning his fitness for higher office because they see him as favoring Wall Street firms in HUD’s sales of underwater mortgages.

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