Financial Beast

Major banks are stepping up their efforts to curtail losses from souring mortgages, with Citigroup Inc. becoming the latest institution to adopt initiatives aimed at helping at-risk borrowers remain in their homes.

Is this great news or what? The economical situation forces banks to provide help to people that have problems paying their mortgage!

With defaults mounting, lenders including JPMorgan Chase & Co. and Bank of America Corp. have become more aggressive about modifications to mortgage agreements. The government is also working on an ambitious plan to help around 3 million borrowers avoid foreclosure, but details have yet to be released.

More than 4 million American homeowners with a mortgage were at least one payment behind on their loans at the end of June, and 500,000 had started the foreclosure process, according to the most recent data from the Mortgage Bankers Association.

Citigroup announced late Monday that it won’t initiate a foreclosure or complete a foreclosure sale on any eligible borrower who seeks to stay in a home if it is the borrower’s principal residence, the homeowner is working in good faith with Citi and has sufficient income to make affordable mortgage payments.

Citi said it is also working to expand the program to include mortgages the bank services but does not own.

Additionally, over the next six months, Citi plans to reach out to 500,000 homeowners who are not currently behind on their mortgage payments, but who are deemed as potentially needing assistance to keep current with their payments. This represents about one-third of all the mortgages that Citigroup owns, the bank said.

Citi plans to devote a team of 600 salespeople to assist the targeted borrowers by adjusting their rates, reducing principal, or increasing the term of the loan, steps known in the mortgage industry as a workout.

Of the four biggest U.S. banks — Citigroup, JPMorgan Chase, Bank of America and Wells Fargo & Co. — Citi has been on the shakiest footing as a result of the mortgage crisis, reporting losses in the past four consecutive quarters while its rivals have managed to post profits. The steps announced Monday are designed to stem those losses.

Sanjiv Das, chief executive of CitiMortgage, said, “It is in our interest that borrowers stay in their homes and actually make the payments.”

Citi is targeting homeowners in geographic areas with higher-than-average unemployment and foreclosure rates, primarily in Arizona, California, Florida, Michigan, Ohio and Indiana, Das said. The program is expected to affect about $20 billion in mortgages.

“As the unemployment rate is starting to creep up on us, there is going to be increasing distress in the marketplace,” Das said in an interview with The Associated Press. “It’s not going to distinguish between what type of mortgage they have.”

Since early last year, Citigroup has helped about 370,000 families avoid foreclosure, representing more than $35 billion in loans, the bank said.

By taking a proactive approach, Citigroup isn’t waiting until it’s too late to deal with delinquent borrowers, said Steve Curnutte, president of InsBank Mortgage in Nashville, Tenn. However, the problem is growing faster than most banks can handle, he said.

“It’s nearly an insurmountable undertaking,” said Curnutte. “The number of bad loans that they can modify using their resources is being quickly outstripped by the number of new loans that need to be modified.”

Late last month, JPMorgan expanded its mortgage modification program to an estimated $70 billion in loans, which could aid as many as 400,000 customers. The New York-based bank has already modified about $40 billion in mortgages, helping 250,000 customers since early 2007.

JPMorgan also said it will not put any loans into foreclosure as it implements the expanded program over the next 90 days.

Bank of America, meanwhile, has said that starting Dec. 1, it will modify an estimated 400,000 loans held by newly acquired Countrywide Financial Corp. as part of an $8.4 billion legal settlement reached with state officials in early October.

Fox News pushing hard on the ‘Black Panthers’ story

Fox News and other conservatives on the Web are pushing hard on the story that two black panthers may be intimidating voters at a polling place in north Philadelphia.

But an Obama campaign volunteer who’s been on the scene since 6:30 AM this morning tells me in a phone interview that there’s been absolutely no intimidation of voters at all today. And a Pennsylvania spokesperson for Obama said the two men aren’t in any way affiliated with the campaign.

Fox News’ story is right here

It says one of two black panthers on the scene was “allegedly blocking the door,” says another was “holding a nightstick.” and adds that “the concern was that they were intimidating people who were trying to go inside to vote.”

But Jacqueline Dischell, the Obama volunteer, tells me by phone that that’s false.

Dischell confirms that there were in fact two black panthers guarding the polling place, a nursing home on Fairmont Avenue in north Philadelphia, earlier this morning.

But she says one was an officially designated poll watcher (it was not immediately clear which municipal office had designated him in that role), and the second was his friend. The second panther, who left two or three hours ago, was the one with the nightstick, she says.

Dischell says that earlier this morning a few men who identified themselves as being from the McCain campaign came and started taking pictures of the two panthers on their cell phones. She suggested that they seemed to be baiting the panthers, and that the designated watcher may have given one of them the finger in response to the picture taking.

The police came roughly an hour and a half later

She says she talked to the cops and told them there had been no incident. The police drove away without getting out of the car, she adds.

Some time later, a second, larger group of men whose affiliation couldn’t be determined came with real cameras and started taking more pictures. Maybe 15 minutes later the cops returned. This time, they spoke to people on both sides, and told the panther not designated to watch the polls to leave, which he did without an argument.

“There was no fight, nothing,” she says.

Fox News arrived on the scene at around that time and started interviewing people near the entrance. The building manager asked the Fox reporter to leave, she says, and he moved further from the entrance.

That’s where things now stand. “There has been no fighting, no voter intimidation at all,” she said.

source; TPM Election Central