Borrowers

President Obama detailed plans Wednesday to help an estimated 3.5 million homeowners refinance into lower-rate mortgages through the Federal Housing Administration and to turn hundreds of thousands of houses repossessed by lenders into rentals. The president spoke at a news conference in Falls Church, Va., where, he said, property values have declined 25 percent since the housing bubble burst five years ago. Obama, who announced the initiative in his State of the Union address Jan. 24, said the program was designed for "responsible" homeowners who are current in their mortgage payments but are unable to refinance loans at fixed rates as low as 3.8 percent because they owe more than their houses are now worth.

At long last, HARP 2.0 is available to Fannie Mae and Freddie Mac borrowers who want to refinance but owe more on their mortgages than their houses now are worth. HARP 2.0 - HARP stands for Home Affordable Refinance Program - is being billed as an improvement over the three-year-old version that just about everyone acknowledges didn't help anyone. The reason for that failure: The original program had limits on loan-to-value ratio, the amount of a mortgage as a percentage of the appraised value of a property.

Borrowers with mortgages owned or serviced by the five banks: Ally Financial, JPMorgan Chase, Bank of America, Wells Fargo, and Citigroup. Collectively, the five service nearly 60 percent of the nation's mortgages. Homeowners needing loan modifications now, including first- and second-lien principal reduction. Borrowers who are current on payments but whose mortgages exceed their homes' value can refinance at current low rates. Borrowers who lost their homes to foreclosure will receive up to $2,000.

THE NEW anime version of "The Borrowers," titled "The Secret World of Arrietty" by screenwriter and "supervisor" Hayao Miyazaki, has the fascination with household "spirits," the same lovely color palette and attention to detail for which his films are famous. But Miyazaki, director of "Ponyo," "Spirited Away" and "My Neighbor Totoro," didn't direct this Studio Ghibli film. Perhaps that is why it lacks his sense of whimsy, that little sprinkling of Miyazaki magic that the Japanese director has given his best work over the decades.

Hundreds of thousands of consumers who borrowed money from Ameriquest Mortgage or its sister companies may be eligible for a share of nearly $300 million in restitution for what state officials contend were unfair, deceptive or predatory practices in loans to borrowers with shaky credit. Under a settlement announced yesterday by officials from 49 states where the companies do business - every state but Virginia - the companies agreed to compensate borrowers and to alter lending practices, but they did not acknowledge any wrongdoing.

Predatory lenders prey on the low-income, elderly and minority populations who are often our most vulnerable citizens. No one wants to see people lose their savings or their homes. The question is what should be done. The Federal Reserve System has been struggling for several years to protect unsophisticated borrowers from abusive lending without eliminating subprime lending that serves consumers who have blemishes on their credit records and are therefore considered higher-risk borrowers.

From the $2 million home he rented until recently in Southern California, Richard H. Rossmiller could see his Porsche, his Mercedes Benz, his MG and his two Jeep Wagoneers. He could sip from a wine collection worth several hundred thousand dollars. He could contemplate his new business venture, developing land just south of the border, in Mexico. He could also leaf through the two-inch-thick court filing in which he says he is bankrupt, that he has no valuable possessions and no way to repay the $100 million he borrowed from Hill Financial Savings Association in Red Hill, Montgomery County, Pa., which failed in October 1989.

Home buying in the 1990s may prove as complicated as ever, but real estate lenders are trying to simplify things for borrowers, industry officials say. Convenience and ease of use will prompt changes in everything from loan forms to appraisals to home refinancing, officials told a recent meeting of the National Association of Real Estate Editors. Mortgage disclosure forms, for example, offer little enticement for borrowers to read them. These are the pages of fine print given out at loan settlements that explain how and when payments on adjustable-rate mortgages change, or detail other terms of the mortgage.

Just when you thought it might be safe to put your house on the market comes this little bombshell from the federal government: The Federal Housing Administration has revised its guidelines for borrowers. Responding to concerns about its capital-reserve ratio, which fell below the 2 percent threshold Congress requires, the FHA is raising mortgage-insurance fees and down payments for borrowers with lower credit scores. It also is cutting the percentage of the sale amount that sellers can pay to help ease the transaction.

A Texas mortgage company accused two years ago of reneging on its agreements with borrowers and charging them higher interest rates has agreed to make restitution to 28 Pennsylvania consumers, the Pennsylvania Attorney General's Office said yesterday. Lomas Mortgage USA of Dallas has already paid the borrowers $87,384 and has agreed to contact 60 other borrowers and offer them cash settlements if they were not granted the mortgage rate quoted to them when they applied, according to Daniel R. Goodemote, attorney in charge of the Erie office of the state Bureau of Consumer Protection.

Whenever there is a financial crisis, Congress responds with legislation. This time around, it is the 849-page Dodd-Frank Wall Street Reform and Consumer Protection Act, whose mandate includes looking out for borrowers' welfare in the mortgage market. The most important lesson of this "mother of all financial crises" was how dependent the economy is on mortgage lending, said Kenneth Benton, a senior specialist in consumer regulations at the Philadelphia Federal Reserve Bank.

The Delaware River Port Authority dipped into its general fund to help pay off nearly $100 million of its debt last month. That dropped the agency's outstanding debt to $1.2 billion, but that figure will grow later this year, as the DRPA expects to borrow up to $400 million for long-term upgrades to its bridges and railroad, agency finance officials said Wednesday. The DRPA operates four toll bridges over the Delaware River and the PATCO commuter rail line. The agency's debt has been a concern for years.

During the housing boom, a borrower's ability to exhale appeared to be the chief criterion for obtaining a mortgage. Six years of record foreclosures later, with millions of borrowers owing more than their properties are worth, the housing market continues to tread water. To prevent this from happening again, the Dodd-Frank financial-reform act of 2010 required that changes be made. The chief targets: such mortgage instruments as "interest-only" and "negative-amortization" loans, both of which allowed marginal borrowers to buy more house than they could have ever possibly afforded.

Dan Mitchell has borrowed $3 million in the last year and a half to buy real estate and equipment to expand his brewery, Ithaca Beer Co. It wasn't easy. Mitchell went to at least four banks in Ithaca, N.Y., looking for a loan to buy real estate and equipment. His sales were growing 25 percent a year and the company had become profitable. His distributors wanted to buy more beer from him. But most of the loan officers just handed him applications and told him to send them in. Even a bank that had already loaned Mitchell money wasn't interested.

It was another losing week on Wall Street after worries about Europe returned. Stocks closed lower on Friday and ended their worst week of the year so far. The Dow Jones industrial average lost 1.6 percent for the week, the Standard & Poor's 500 index fell 2 percent. The Dow is still ahead 5 percent for the year after a gangbusters first quarter. On Friday the Dow lost 136.99 points to close at 12,849.59, a loss of 1.1 percent. It was down all day but the losses got worse in the last half-hour.

At long last, HARP 2.0 is available to Fannie Mae and Freddie Mac borrowers who want to refinance but owe more on their mortgages than their houses now are worth. HARP 2.0 - HARP stands for Home Affordable Refinance Program - is being billed as an improvement over the three-year-old version that just about everyone acknowledges didn't help anyone. The reason for that failure: The original program had limits on loan-to-value ratio, the amount of a mortgage as a percentage of the appraised value of a property.

Consumer borrowing in the United States rose more than forecast in January, capping the biggest three-month gain in more than a decade, as demand for autos improved and Americans sought more education. Job openings continued to increase. Credit increased by $17.8 billion, to $2.51 trillion, Federal Reserve figures showed Wednesday. The gain topped the $10.5 billion median forecast of economists surveyed by Bloomberg News. In the three months to January, borrowing climbed by the most since mid-2000.

THE NEW anime version of "The Borrowers," titled "The Secret World of Arrietty" by screenwriter and "supervisor" Hayao Miyazaki, has the fascination with household "spirits," the same lovely color palette and attention to detail for which his films are famous. But Miyazaki, director of "Ponyo," "Spirited Away" and "My Neighbor Totoro," didn't direct this Studio Ghibli film. Perhaps that is why it lacks his sense of whimsy, that little sprinkling of Miyazaki magic that the Japanese director has given his best work over the decades.

In the Region Plane order largest yet for Boeing Boeing Co. has locked in its biggest order ever with a little-known airline halfway around the world. The airplane manufacturer, which has facilities in Ridley Township, said Tuesday it had completed an order from the Indonesian carrier Lion Air for 230 planes worth a combined $22.4 billion. The deal is the largest commercial airplane order for Boeing by both dollar value and number of airplanes. Lion Air also has the rights to buy 150 more.

The American Way of Debt By Louis Hyman Vintage Books. 292 pp. $15 paperback Reviewed by Joseph DiStefano The drama leading up to the real estate crash of the mid-2000s is becoming as familiar as the Wall Street crash that sparked the Great Depression used to be. There are plenty of villains: social engineers and market ideologues in Washington; lying bond traders, conflicted credit analysts, careless bank bosses and...