Richard Hiner, 31, of Catlett, allegedly advertised rental homes on Craigslist, bringing potential renters on tours of the properties and then having them sign a rental contract with a down payment.
His victims would later learn the properties were bank-owned and in foreclosure.
Police were notified of the scheme by four victims between July 13 and July 18.
Detectives posing as potential renters responded to an online advertisement and arrested Hiner when he arrived for the meeting.
Monday, July 28, 2008
Tuesday, July 15, 2008
Baltimore condo sales plummeting in tough residential real estate market
Homeowners worried about the sliding value of their home have at least one thing to be grateful for — the condominium market might be even worse.
“The condo market is hurting from same factors hurting the general home market,” said Jody Landers, executive vice president of the Greater Baltimore Board of Realtors. “Financing isn’t easy, and people are deciding this isn’t the time to buy.”
Both new condo sales and condo resales in the Baltimore metro area are well behind last year’s pace, according to midyear data released last week by Delta Associates, a Washington, D.C.-based real estate research firm. Since last spring, condo values have also dropped slightly more than local home values, according to the data.
Just 59 new condos were sold in Baltimore City and Anne Arundel, Baltimore, Harford and Howard counties during the second quarter, down from 303 in the same quarter last year.
In the first quarter, a net of just 13 condos were sold in the metro area, and Baltimore City reported new condo sales of -119, which Delta attributed to cancellations of contracts already signed.
For the year ending June 30, 109 new condos were sold, down 90 percent from 1,101 in the 12 months ending June 30, 2007, according to Delta’s figures.
Condo resales are on pace for a 50 percent decline this year, according to the data. Through May 31, 919 condo resales were reported in the metro region, an average of 184 per month. But last year, 3,237 resales were reported, an average of 270 per month.
Median resale prices in the Baltimore area fell 4.7 percent in May to $225,214 from $236,223 during the same month a year ago.
“They’re not immune to the rest of the market,” said David Martz, a Realtor with Long and Foster Fells Point specializing in condos. “To me, except for the [condo] fee, there’s no difference between a condo resale and a regular town home resale.”
By comparison, metro-area home prices fell 1.14 percent in May and sales volume was down 30.4 percent from the same month a year before, according to data gathered by Realtor-owned Metropolitan Regional Information Systems. MRIS data include condo sales as well as single-family sales.
But Delta’s numbers, especially the number of contracts broken, are reported by the condo developers themselves and so could be suspect, said Ross Mackesey, sales manager with Coldwell Bank Federal Hill who has represented about 50 condo projects.
He said the numbers could also be unintentionally skewed by new, large developments such as those in Harbor East throwing many units on the market at once.
“The Baltimore condo market is finite enough that we can actually look at Delta’s numbers and pin down events that skewed them,” Mackesey said. “But that doesn’t mean year-over-year [numbers] ... don’t have some validity.” (by Aaron Cahall, The Examiner)
“The condo market is hurting from same factors hurting the general home market,” said Jody Landers, executive vice president of the Greater Baltimore Board of Realtors. “Financing isn’t easy, and people are deciding this isn’t the time to buy.”
Both new condo sales and condo resales in the Baltimore metro area are well behind last year’s pace, according to midyear data released last week by Delta Associates, a Washington, D.C.-based real estate research firm. Since last spring, condo values have also dropped slightly more than local home values, according to the data.
Just 59 new condos were sold in Baltimore City and Anne Arundel, Baltimore, Harford and Howard counties during the second quarter, down from 303 in the same quarter last year.
In the first quarter, a net of just 13 condos were sold in the metro area, and Baltimore City reported new condo sales of -119, which Delta attributed to cancellations of contracts already signed.
For the year ending June 30, 109 new condos were sold, down 90 percent from 1,101 in the 12 months ending June 30, 2007, according to Delta’s figures.
Condo resales are on pace for a 50 percent decline this year, according to the data. Through May 31, 919 condo resales were reported in the metro region, an average of 184 per month. But last year, 3,237 resales were reported, an average of 270 per month.
Median resale prices in the Baltimore area fell 4.7 percent in May to $225,214 from $236,223 during the same month a year ago.
“They’re not immune to the rest of the market,” said David Martz, a Realtor with Long and Foster Fells Point specializing in condos. “To me, except for the [condo] fee, there’s no difference between a condo resale and a regular town home resale.”
By comparison, metro-area home prices fell 1.14 percent in May and sales volume was down 30.4 percent from the same month a year before, according to data gathered by Realtor-owned Metropolitan Regional Information Systems. MRIS data include condo sales as well as single-family sales.
But Delta’s numbers, especially the number of contracts broken, are reported by the condo developers themselves and so could be suspect, said Ross Mackesey, sales manager with Coldwell Bank Federal Hill who has represented about 50 condo projects.
He said the numbers could also be unintentionally skewed by new, large developments such as those in Harbor East throwing many units on the market at once.
“The Baltimore condo market is finite enough that we can actually look at Delta’s numbers and pin down events that skewed them,” Mackesey said. “But that doesn’t mean year-over-year [numbers] ... don’t have some validity.” (by Aaron Cahall, The Examiner)
Monday, June 30, 2008
Subprime Mortgages and Race: A Bit of Good News May Be Illusory
Subprime mortgages have been linked to a meltdown in housing and questionable Wall Street practices, and they may have been the original domino that set off America's current economic crisis.
But the loans -- typically made to people with poor credit -- have long been hailed for one reason: They were thought to be a powerful way to increase homeownership rates among minorities, and to provide a mechanism to undo the "redlining" policies of past decades, in which some banks refused to extend loans in predominantly minority neighborhoods, even to applicants with good credit.
Intersecting lines of new sociological evidence, however, suggest that this silver lining may have actually been a part of the cloud: There is growing evidence that the subprime mortgage industry may have both benefited from and contributed to racial segregation in the United States.
The financial industry has strenuously argued that subprime loans were given to people with low incomes and poor credit -- regardless of race.
George Washington University sociologist Gregory D. Squires, however, has been looking at rates of subprime loans issued in about 350 U.S. metropolitan areas. Squires's preliminary findings show that subprime loans were indeed more likely to be issued to people with poor credit and those with limited incomes -- no surprise there. But when Squires holds income and credit factors constant in his analysis, he finds that subprime loans were more likely to be concentrated in areas with higher levels of racial segregation.
"We see these loans heavily concentrated in poor neighborhoods and targeted to minority neighborhoods," he said. "There is some evidence that these neighborhoods were actually targeted -- that lenders have gone after people whom they think are less sophisticated borrowers, including single women and the elderly."
"Credit rating and income would and does explain some of the patterns," Squires added. "But when you control for those, segregation is also a factor. . . . In those metro areas where segregation is highest, the share of loans that are subprime goes up."
The city of Baltimore recently decided to sue a bank over subprime lending practices and race issues. In a lawsuit filed in U.S. District Court, the city argued that it was facing an "unprecedented crisis of residential mortgage foreclosures" and argued that Wells Fargo, a prominent mortgage lender, ought to bear some responsibility for the growing numbers of defaults.
"In contrast to 'redlining,' which involves denying prime credit to specific geographic areas because of the racial or ethnic composition of the area, reverse redlining involves the targeting of an area for the marketing of deceptive, predatory or otherwise unfair lending practices because of the race or ethnicity of the area's residents" the city charged in its complaint.
In 2005 and 2006, according to the complaint and Brad Blower, a lawyer at the firm Relman & Dane that is representing the city, two-thirds of Wells Fargo's foreclosures in Baltimore were in areas that were more than 60 percent African American, whereas only 15.6 percent of the foreclosures were in areas that were less than 20 percent African American.
Wells Fargo rejects the charges and has said racial factors played no role in its lending. If larger numbers of subprime loans were issued in some neighborhoods, in other words, it was only because those neighborhoods tended to have poorer people with weak credit. Individual issues -- not racial patterns -- explains why some people defaulted while others did not, the company argued.
Disparities in lending by race, however, have been striking in many parts of the country: In New York City, for example, an analysis by the Furman Center for Real Estate and Urban Policy found that around 40 percent of subprime loans issued between 2004 and 2006 were made to blacks, and an additional third of such loans were given to Hispanics. Whites, by contrast, received around 10 percent of such loans, as did Asians.
In a rigorous national analysis based on data collected in the 1990s, researchers Carolyn Bond and Richard Williams found the same phenomenon nationwide. But in addition to demonstrating large racial disparities in who got such loans, Bond and Williams also found the loans -- far from reversing racial segregation -- may have actually contributed to increased levels of segregation in the United States.
"By 1999 the proportion of black borrowers receiving loans from subprime lenders was six times what it was in 1992," the researchers wrote in a paper they published in the journal Social Forces.
While the cheap loans did increase black homeownership rates, especially in predominantly minority neighborhoods, they simultaneously increased the risk that homeowners would default on their loans, send houses into foreclosure and drive down the value of entire neighborhoods, making them less attractive for people from other social classes and racial groups who might have once considered moving in.
"Many subprime borrowers are losing their homes, and the deteriorating and destabilized neighborhoods that result are unlikely to foster integration," Bond and Williams concluded. "In the absence of effective action, the findings suggest that persistent or even increasing levels of segregation may be one of the most important long-term consequences of the current home lending crisis." (By Shankar Vedantam, Washington Post)
But the loans -- typically made to people with poor credit -- have long been hailed for one reason: They were thought to be a powerful way to increase homeownership rates among minorities, and to provide a mechanism to undo the "redlining" policies of past decades, in which some banks refused to extend loans in predominantly minority neighborhoods, even to applicants with good credit.
Intersecting lines of new sociological evidence, however, suggest that this silver lining may have actually been a part of the cloud: There is growing evidence that the subprime mortgage industry may have both benefited from and contributed to racial segregation in the United States.
The financial industry has strenuously argued that subprime loans were given to people with low incomes and poor credit -- regardless of race.
George Washington University sociologist Gregory D. Squires, however, has been looking at rates of subprime loans issued in about 350 U.S. metropolitan areas. Squires's preliminary findings show that subprime loans were indeed more likely to be issued to people with poor credit and those with limited incomes -- no surprise there. But when Squires holds income and credit factors constant in his analysis, he finds that subprime loans were more likely to be concentrated in areas with higher levels of racial segregation.
"We see these loans heavily concentrated in poor neighborhoods and targeted to minority neighborhoods," he said. "There is some evidence that these neighborhoods were actually targeted -- that lenders have gone after people whom they think are less sophisticated borrowers, including single women and the elderly."
"Credit rating and income would and does explain some of the patterns," Squires added. "But when you control for those, segregation is also a factor. . . . In those metro areas where segregation is highest, the share of loans that are subprime goes up."
The city of Baltimore recently decided to sue a bank over subprime lending practices and race issues. In a lawsuit filed in U.S. District Court, the city argued that it was facing an "unprecedented crisis of residential mortgage foreclosures" and argued that Wells Fargo, a prominent mortgage lender, ought to bear some responsibility for the growing numbers of defaults.
"In contrast to 'redlining,' which involves denying prime credit to specific geographic areas because of the racial or ethnic composition of the area, reverse redlining involves the targeting of an area for the marketing of deceptive, predatory or otherwise unfair lending practices because of the race or ethnicity of the area's residents" the city charged in its complaint.
In 2005 and 2006, according to the complaint and Brad Blower, a lawyer at the firm Relman & Dane that is representing the city, two-thirds of Wells Fargo's foreclosures in Baltimore were in areas that were more than 60 percent African American, whereas only 15.6 percent of the foreclosures were in areas that were less than 20 percent African American.
Wells Fargo rejects the charges and has said racial factors played no role in its lending. If larger numbers of subprime loans were issued in some neighborhoods, in other words, it was only because those neighborhoods tended to have poorer people with weak credit. Individual issues -- not racial patterns -- explains why some people defaulted while others did not, the company argued.
Disparities in lending by race, however, have been striking in many parts of the country: In New York City, for example, an analysis by the Furman Center for Real Estate and Urban Policy found that around 40 percent of subprime loans issued between 2004 and 2006 were made to blacks, and an additional third of such loans were given to Hispanics. Whites, by contrast, received around 10 percent of such loans, as did Asians.
In a rigorous national analysis based on data collected in the 1990s, researchers Carolyn Bond and Richard Williams found the same phenomenon nationwide. But in addition to demonstrating large racial disparities in who got such loans, Bond and Williams also found the loans -- far from reversing racial segregation -- may have actually contributed to increased levels of segregation in the United States.
"By 1999 the proportion of black borrowers receiving loans from subprime lenders was six times what it was in 1992," the researchers wrote in a paper they published in the journal Social Forces.
While the cheap loans did increase black homeownership rates, especially in predominantly minority neighborhoods, they simultaneously increased the risk that homeowners would default on their loans, send houses into foreclosure and drive down the value of entire neighborhoods, making them less attractive for people from other social classes and racial groups who might have once considered moving in.
"Many subprime borrowers are losing their homes, and the deteriorating and destabilized neighborhoods that result are unlikely to foster integration," Bond and Williams concluded. "In the absence of effective action, the findings suggest that persistent or even increasing levels of segregation may be one of the most important long-term consequences of the current home lending crisis." (By Shankar Vedantam, Washington Post)
Tuesday, June 24, 2008
How-to Monday: Finding foreclosures
The more you hear about foreclosures piling up, the more you may be tempted to buy one. There's a lot to consider if you do -- but first things first: how to find them.
A foreclosure becomes a foreclosure when the home goes to auction. Frequently, the buyer is the lender -- that's what happens when there's no one else willing to bid at least as much as the lender wants. If you think there's a deal to be had, you can be that bidder.
You'll find ads for impending auctions in the newspapers. Or you can see listings online. Alex Cooper Auctioneers, for instance, keeps a tally of scheduled foreclosure auctions -- typically on courthouse steps. Express Real Estate Auction Services has foreclosure auctions listed as well, as does Tidewater Auctions. Harvey West Auctioneers doesn't separate its foreclosure listings from its regular auctions, but you can see the full list HERE.
Then there are companies you can pay for pre-foreclosure and foreclosure information, such as ForeclosureS.com and RealtyTrac. (Paul R. Cooper, a vice president with Alex Cooper, pooh-poohs the idea of paying. If you're willing to do your own homework, "all the information's free," he said.)
Remember: You have to come prepared to make an immediate deposit if you're going to bid at an auction. Alex Cooper expects cash, a cashier's check or a certified check.
If auctions worry you, there's another option: Buy from the bank afterward.
Some lenders keep a list of their post-auction properties -- known as "Real Estate Owned," or REO -- on their websites. Countrywide, last I checked, had more than 250 in Maryland. Others with lists include Chase Mortgage, Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development (which oversees FHA-insured loans).
Or ask a real estate agent. Realtors often market foreclosed properties for lenders, so they'll be listed for sale. (Agents can, if they choose, note on Metropolitan Regional Information Systems' multiple listing service whether a property is a foreclosure.) You can look for agents who take a lot of foreclosure listings or those who work with a lot of buyers interested in foreclosures.
A note of caution before you rush off to buy: While a foreclosed home could be a great value, seasoned real estate investors say there's no guarantee. The asking price or starting bid could be more than the house is really worth, particularly if the previous owner started with a small down payment. Or the house might need more repair work than you can afford.
That's where research and due diligence come in. You might, for instance, start by looking up the property's assessment record -- click on "property sales" to see recent sales prices elsewhere on the same street -- and by checking out the loan history. ( by Jamie Smith Hopkins, Baltimore Sun)
A foreclosure becomes a foreclosure when the home goes to auction. Frequently, the buyer is the lender -- that's what happens when there's no one else willing to bid at least as much as the lender wants. If you think there's a deal to be had, you can be that bidder.
You'll find ads for impending auctions in the newspapers. Or you can see listings online. Alex Cooper Auctioneers, for instance, keeps a tally of scheduled foreclosure auctions -- typically on courthouse steps. Express Real Estate Auction Services has foreclosure auctions listed as well, as does Tidewater Auctions. Harvey West Auctioneers doesn't separate its foreclosure listings from its regular auctions, but you can see the full list HERE.
Then there are companies you can pay for pre-foreclosure and foreclosure information, such as ForeclosureS.com and RealtyTrac. (Paul R. Cooper, a vice president with Alex Cooper, pooh-poohs the idea of paying. If you're willing to do your own homework, "all the information's free," he said.)
Remember: You have to come prepared to make an immediate deposit if you're going to bid at an auction. Alex Cooper expects cash, a cashier's check or a certified check.
If auctions worry you, there's another option: Buy from the bank afterward.
Some lenders keep a list of their post-auction properties -- known as "Real Estate Owned," or REO -- on their websites. Countrywide, last I checked, had more than 250 in Maryland. Others with lists include Chase Mortgage, Fannie Mae, Freddie Mac and the U.S. Department of Housing and Urban Development (which oversees FHA-insured loans).
Or ask a real estate agent. Realtors often market foreclosed properties for lenders, so they'll be listed for sale. (Agents can, if they choose, note on Metropolitan Regional Information Systems' multiple listing service whether a property is a foreclosure.) You can look for agents who take a lot of foreclosure listings or those who work with a lot of buyers interested in foreclosures.
A note of caution before you rush off to buy: While a foreclosed home could be a great value, seasoned real estate investors say there's no guarantee. The asking price or starting bid could be more than the house is really worth, particularly if the previous owner started with a small down payment. Or the house might need more repair work than you can afford.
That's where research and due diligence come in. You might, for instance, start by looking up the property's assessment record -- click on "property sales" to see recent sales prices elsewhere on the same street -- and by checking out the loan history. ( by Jamie Smith Hopkins, Baltimore Sun)
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