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Zillow report: Median Rent Prices on the Rise as Home Values Drop

While homes prices continue to be on the decline, rent prices are actually on the rise and showed a 3 percent increase from January 2011 to January 2012, as opposed to home values, which dropped 4.6 percent during that same period, according to the January Zillow Real Estate Market Reports. Zillow data also showed year-over-year gains for 69.2 percent of metropolitan areas covered by the index while only 7.3 percent of metros saw increases in home values. Based on the Zillow Rent Index, the states with the greatest increases in median rent over a year were New Jersey (+16.5), New York (+13.7), Kansas (+10.2), Indiana (+10), and Michigan (+10.0).

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Ally Will Write Some Borrowers’ Principal Down to 85% LTV

According to documents filed in federal court Monday, Ally Financial formerly GMAC will offer principal reductions beyond what is required of the majority of the five banks in $25 billion the national mortgage settlement. While the general rule for principal reductions required through the settlement is to lower principal to no more than 120 percent of a home's value, Ally will offer reductions of as low as 85 percent in some cases where borrowers are considered likely to default. Other homeowners with high-risk loans may receive reductions bringing their loan to 105 percent or 100 percent of their homes' current values.

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Report: Investors Buying Foreclosures on West Coast

For West coast states, the foreclosure wave is reported to be dying down as third parties, who are typically investors, snatch up foreclosed homes, according to the February 2012 Foreclosure RadarReport. While third party sales were down month-over-month, as a percentage of all sales, third parties purchased 37.6 percent of foreclosures. Compared to the year before, foreclosure sales to third parties increased 84.62 percent in Oregon, 61.33 percent in Nevada, 39.72 percent in California, 23.31 percent in Arizona, and 7.35 percent for Washington.

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AMI Warns $25B Settlement Will Cost Innocent Investors

The Association of Mortgage Investors (AMI) says the $25 billion settlement signed by the five largest servicers is expected to draw billions of dollars from uninvolved investors, which include seniors and unions. While HUD acknowledges the settlement could affect some investor-owned loans, the agency stated that when considering the projected losses from foreclosures on investors, applying loan modifications, including principal reductions, will actually cost less. AMI, on the other hand, fears the cost of improperly applied modifications will lead to re-defaults.

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BofA to Offer Principal Reductions of More than $100K

Some Bank of America borrowers may be in for principal reductions in amounts exceeding $100,000, according to the latest developments in the settlement the bank and four other large servicers made with state and federal regulators. While the other four servicers in the national settlement are being required to diminish principal so underwater borrowers have loan-to-value ratios of 120 percent or less, BofA will be reducing principal for about 200,000 homeowners to fall in line with current market values.

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After More Than a Month, $25B Settlement Filed in Court

The $25 billion mortgage servicing settlement agreement was filed in federal court Monday, according to an announcement from the Justice Department, HUD, and 49 state attorneys general. The court documents provide details of the servicers' financial obligations under the agreement, which include payments to foreclosed borrowers, more than $20 billion in consumer relief, and new servicing standards that will change foreclosure practices and policies for foreclosure prevention.

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FHFA Reveals Plans to Cut Pay for Top GSE Executives

Fannie Mae and Freddie Mac executives won't be receiving bonuses anymore, and new CEO pay will be capped at $500,000 as part of an FHFA executive compensation program, according to FHFA 2012 Conservatorship Scorecard released by Acting Director Edward J. DeMarco on Friday. The new $500,000 CEO cap does not apply to chief financial officers, and current CEOs won't have their salaries cut back to $500,000. Total direct compensation for executives will be reduced by 10 percent, with a few exceptions for executives already positioned at a low percentile or for recent hires, according to the report.

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Freddie Mac Reports Net Income Gain for Q4

Freddie Mac reported a gain in the fourth quarter and less losses overall for the year 2011 compared to the previous year, according to the GSE's fourth quarter and year 2011 report released today. Freddie Mac reported a net income of $619 million for the 2011 fourth quarter. During the third quarter ending September 30, 2011, a net loss of $4.4 billion was reported. Freddie Mac will request $146 million from the U.S. Treasury for the company's fourth quarter net worth deficit.

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Payrolls Up 227,000 in February; Unemployment Rate Steady

The nation added 227,000 jobs in February - the seventh straight month of 100,000-plus payroll gains, the longest such string since 2005 - as the unemployment rate held steady at 8.3 percent, the Bureau of Labor Statistics reported Friday. Economists had anticipated about 210,000 new jobs and a slight uptick in the unemployment rate. The strong report continued a positive trend with just a smattering of weak spots: retail employment dropped slightly and construction jobs declined, hinting that gains in construction in recent months were related to mild weather.

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California Law Firm Owners, Attorney Arrested for Modification Fraud

Owners and the managing attorney of a California-based law firm were arrested Thursday for loan modification fraud, California Attorney General Kamala D. Harris announced in a release. Flahive Law Corporation charged thousands of dollars in up-front modification fees for services that were never performed for homeowners, many of whom ended up losing their homes. The defendants claimed that through a mortgage violation audit, they could find bank violations in loan documents and use that as leverage to get a loan modified.

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