Archive for December, 2010

Third-quarter demand for foreclosed homes plummets: survey

Thursday, December 2nd, 2010 | Finance News


WASHINGTON (Reuters) – Buyers looking to purchase a foreclosed home saw the largest price discounts in almost five years as demand for foreclosed homes plummeted in the third quarter, a closely watched industry survey said on Thursday.

Real estate data company RealtyTrac said foreclosed homes, which made up about 1 in 4 of all residential home sales in the third quarter, sold for about 32 percent lower than homes not in the foreclosure process, the highest average discount since the last three months of 2005.

There were about 189,000 homes in some stage of the foreclosure process sold to third parties in the three months through September, a decline of about 25 percent from the second quarter and a 31 percent drop from the same period in 2009.

"The foreclosure-processing controversy, which was brought to light at the very end of the third quarter, could chill demand even further - particularly for foreclosure properties," said James J. Saccacio, chief executive officer of RealtyTrac.

Saccacio said the overall drop in demand for homes in the third quarter was led by the expiration of a popular tax credit in the prior three months.

Regulators and state investigators are probing big mortgage servicers, including Bank of America Corp (BAC.N), JPMorgan Chase & Co (JPM.N), Citigroup Inc (C.N) and Ally Financial, amid allegations banks used "robo-signers" to sign hundreds of foreclosure documents a day without proper legal review.

(Reporting by Corbett B. Daly; Editing by Andrew Hay)


SEC and several banks discuss to end mortgage deal probe: report

Thursday, December 2nd, 2010 | Finance News

BANGALORE (Reuters) – U.S. securities regulators are in preliminary talks with several banks to resolve probes involving sales of complex mortgage bond deals that led to the financial crisis, the Wall Street Journal said, citing people familiar with the matter.

The investigation by the U.S. Securities and Exchange Commission (SEC) involves mortgages and other loans known as collateralized debt obligations, or CDOs, that were sold to different investors, the paper said.

Complex mortgage derivative products like CDOs packaged and sold by Wall Street banks were widely blamed for causing the financial crisis more than two years ago.

Settling the allegations with the SEC would resolve one of the biggest legal threats clouding the big banks, according to the Journal.

The SEC, after issuing subpoenas for documents and interviewing officials from leading banks that offered the toxic CDOs, has now begun negotiating with the companies, the sources told the paper.

The talks are at an early stage and settlement terms are still being hammered out by the parties, the sources told the Journal.

A SEC spokesman did not comment to the Journal. The regulator could not immediately be reached for comment by Reuters outside regular U.S. business hours.

(Reporting by Sakthi Prasad in Bangalore; Editing by Dhara Ranasinghe)


Qantas may take legal action against Rolls-Royce

Thursday, December 2nd, 2010 | Finance News

SYDNEY (Reuters) – Qantas Airway (QAN.AX) has filed a statement of claim in an Australian court to ensure it can pursue legal action against engine maker Rolls-Royce (RR.L) in case a commercial settlement is not possible, the airline said on Thursday.

A Qantas Airbus (EAD.PA) A380 with 466 people on board made an emergency landing in Singapore on November 4, after one of its Rolls-Royce engines partly disintegrated mid-flight following an oil fire.

Qantas said it had started discussions with Rolls-Royce on a range of issues, including the financial and operational impacts of the Nov 4 incident.

(Reporting by Balazs Koranyi; Editing by Ed Davies)