Some struggling homeowners find way to dodge foreclosure
By Stephanie Armour, USA TODAY
At night, Margaret Jones would lie in bed, unable to sleep, her heart galloping.
Each time she came home, she feared the worst: a padlock on her door and a sign declaring her home in foreclosure. She was months behind on her adjustable-rate mortgage, which she'd become unable to pay as the rate climbed from 7% in 2004 to 12% this year. Her three-bedroom house, she was told, would be auctioned on July 1.
"My blood pressure was through the roof," says Jones, 45, a nurse in North Lauderdale, Fla. "I can see why some people commit suicide. You just want it to go away."
But the worst never happened. Rescued by a hardship loan and a mortgage-modification plan, Jones managed to stave off foreclosure and save her house.
Though the number of homeowners facing or going through foreclosure has surged — filings rose 55% from July 2007 to July this year — thousands of other homeowners on the verge of losing their homes are finding last-minute ways to ward off foreclosure. These tales have become the little-known success stories of the worst housing slump in decades. For a smattering of today's distressed homeowners, last-ditch remedies intended to stem the damage have saved the day.
Jones took out a $26,000 hardship loan from her 401(k) to pay off much of what she owed. She also managed to get her mortgage modified by calling a hotline for a credit-counseling organization, Money Management International. (The agency is part of the Homeownership Preservation Foundation, which oversees counselors and runs a hotline with Hope Now, an industry-sponsored alliance to help troubled homeowners.)
Jones' monthly mortgage bill dropped from $3,000 to about $1,800, and her interest rate is down to a fixed rate of 7.4%. She'll pay her first lower monthly payment in October.
"Now, I have peace of mind," says Jones, a mother of five whose husband, Deryck, is unemployed. "I can eat. I'm no longer afraid of the knock on the door or the sign on the front lawn. It's changed me. Now, I will send my payments in ahead of time. I may lose my water, my light, but I won't lose the roof over my head."
Those who have managed to save their homes remain a small fraction of people at risk of losing their properties. One in every 464 U.S. households received a foreclosure filing in July, according to RealtyTrac. More than 2.2 million foreclosure filings were reported during 2007, up 75% from 2006. The number of homes in some stage of foreclosure was up 79%, indicating that some properties may have just entered the initial stage in 2007 and could be completing the foreclosure process in 2008.
Hope for some
Still, the number who have benefited from assistance programs is believed to reach into the hundreds of thousands. Hope Now says it completed more than 181,000 mortgage workouts in June alone for loans that would otherwise have gone into foreclosure.
In the second quarter of 2008, mortgage servicers finished more than 522,000 workouts. That doesn't include homeowners who have worked out loan modifications on their own with lenders or those who received counseling or financial aid from charitable groups that aren't part of the alliance.
Some of the options that have helped distressed homeowners include:
•Lenders agreeing to repayment plans for homeowners behind on their mortgage. The lenders might, for example, agree to tack delinquent payments onto the end of a home loan.
•Lenders changing from an adjustable rate to a lower fixed rate. Many borrowers have taken on subprime loans, which go to those with shaky credit. Those loans often carry rates that increase after an initial fixed rate, and borrowers have frequently fallen behind when the payments rise. About 14% of subprime loans are in default, according to the Center for Responsible Lending.
•Lenders have also allowed some borrowers to temporarily pay less than the full amount of their monthly payment. This is a rarer option. It's usually done in cases of an unexpected financial emergency, such as a health crisis.
In other cases, homeowners on the financial brink are taking second jobs or finding newer, more lucrative jobs. Some are renting out rooms to tenants.
But research shows that a majority of homeowners on the financial precipice don't know all the options available to them to stave off foreclosure. Fifty-seven percent of borrowers who are late on their mortgage payments are unaware of foreclosure alternatives offered by their lenders, according to a survey by Freddie Mac and marketing research firm Roper Public Affairs & Media. That represents a slight improvement from 2005, when the survey found that 61% of delinquent borrowers didn't know their mortgage lender offered workout options.
Some lenders say that rescuing a homeowner from foreclosure isn't always a possibility, though there are cases where it can work. Russell Izzo, chief operating officer at the American Modification Agency in Uniondale, N.Y., says, "Options are limited but greater than many understand."
His company represents borrowers in renegotiating the terms of mortgage loans. "Some lenders are friendly, and some are more adversarial," Izzo notes.
While some critics might consider assistance for distressed homeowners an unjustified bailout, Izzo says many of those facing foreclosure have simply met bad luck or made one-time financial mistakes.
"They're honest, tax-paying people," he says. "These are not the overreaching speculator. Some may have gotten sick or lost a job."
At Mortgage Network, a Danvers, Mass.-based independent mortgage company, some customers are so overjoyed at loan modifications that they've sent bottles of wine or thank-you cards. "We look at each deal individually," says Brian Koss, managing director of Mortgage Network. Lenders are willing to work out modifications, he says, because, "You can't carry too many bad loans.
"If people can sit down, and we can look at them as people and find some middle ground, it can be worked out," Koss says.
That's what happened for Benjamin MacArthur, 46, of Burke, Vt., who suffered severe injuries in a car accident in February 2006. MacArthur, who owned a property management company, was barely able to work after the accident, and his wife was unemployed. They soon fell behind on their mortgage payments.
In 2008, he and his wife divorced and decided to sell their home. They listed their 56-acre farm house at $315,000, below its appraised value of $360,000, but couldn't sell it in the depressed housing climate. They feared they would soon face foreclosure, which, among other things, would mar their credit records.
But Mortgage Network agreed to work with them to avoid a foreclosure. In the spring of this year, Mortgage Network agreed to take "a deed in lieu of foreclosure." In doing so, the MacArthurs signed the house over to the bank and were able to walk away. The lender forgave all unpaid debt.
"I was shocked — we don't have a foreclosure on our credit," says MacArthur, who now lives with his girlfriend and golden retriever, Bo. "It was a great relief. They came and sat with us personally at our dining room table to work things out. We didn't want to have to go through foreclosure, and we didn't have to."
Even so, for the majority of homeowners facing foreclosure, efforts to save properties from bank takeovers are typically met with frustration, with many lenders remaining reluctant to renegotiate mortgages. Some lenders are simply overwhelmed with requests. Sometimes, loans have been resold, and borrowers struggle to find the right contact to initiate any negotiations.
In other cases, home buyers have gotten so far over their heads that there's no realistic way to bail them out. Some economists and advocacy groups argue that current assistance programs aren't nearly enough to help the legions of homeowners in trouble.
"Hope Now has been helpful, but it's getting completely overwhelmed by the magnitude of the problem," says Mark Zandi, chief economist of Moody's Economy.com.
Getting a lift
Jess Alfaro didn't know where to go. Like tens of thousands of homeowners hit by the devastating housing slump, Alfaro had fallen behind on his mortgage payments and was facing possible foreclosure.
His situation seemed bleak. In September of last year, Alfaro, 45, of Pueblo, Colo., was earning barely $500 a month doing odd jobs such as landscaping and stucco repair, and his wife, Della, was on disability. The couple scrimped to make their $660 monthly mortgage, living on Ramen noodles, rice and beans.
They had lived in their three-bedroom house for 19 years, raised three children, and enjoyed their fenced yard with abundant room for their two pit bulls. They didn't want to leave.
He called his local Catholic Charities for help. (Catholic Charities USA is a private network of more than 1,700 Catholic social service agencies and institutions nationwide.) Counselors at Catholic Charities of Pueblo spoke with his mortgage company, which agreed to add the unpaid mortgage payments to the end of his mortgage. Alfaro also found a higher-paying job as a school custodian.
A year ago, the family was on the brink of foreclosure. Today, they're up to date on their mortgage and other bills.
"We were in danger of losing our house, and we were stressed out," Alfaro says. "My wife was crying a lot and not sleeping, but I never gave up. Now, there's a big calm in our house. We're getting along better, we're a lot less stressed about money, and we even bought some odds and ends for the house. I am living my life so peaceful and happy now."
http://www.usatoday.com/money/economy/housing/2008-09-02-foreclosure-keep-home_N.htm
A very good source of vitamins and easy to store and eat, for emergencies
Plumpy'nut is a high protein and high energy peanut-based paste in a foil wrapper. It tastes slightly sweeter than peanut butter. It is categorized by the WHO as a Ready-to-Use Therapeutic Food (RUTF).
Plumpy’nut requires no preparation or special supervision, making it easy to deploy in difficult conditions. Plumpy'nut is very difficult to over eat and keeps even after opening. It has a 2 year shelf life when unopened. The product was inspired by the popular Nutella spread. It is manufactured by Nutriset, a French company, that specializes in making food supplements for relief work in their factory near Rouen in northern France. The ingredients are: peanut paste, vegetable oil, milk powder, powdered sugar, vitamins and minerals, combined in a foil pouch. Each pack provides 500 Kcal or 2.1 MJ. [1].
Plumpy'Nut contains vitamins A, B-complex, C, D, E and K, and minerals calcium, phosphorus, potassium, magnesium, zinc, copper, iron, iodine, sodium, and selenium.
http://en.wikipedia.org/wiki/Plumpy'nut
Another we never learn from history moments
Talks resume on US-India nuclear technology deal
Originally published 07:02 a.m., September 4, 2008,
VIENNA, AUSTRIA (AP) - A senior U.S. official says he sees "steady progress" in talks under way in Vienna on a deal that would let the United States sell peaceful nuclear technology to India.
U.S. undersecretary of state for political affairs William Burns has told reporters that Washington believes giving New Delhi access to nuclear fuel and technology would actually strengthen _ and not undermine _ nonproliferation efforts.
Burns says a second round of contentious talks that resumed Thursday are "making steady progress," and he says the U.S. remains optimistic that a deal can be reached.
The talks were convened by the Nuclear Suppliers Group, the global body that governs the legal trade in nuclear materials.
Several small nations are trying to block the deal.
http://www.washingtontimes.com/news/2008/sep/04/talks-resume-on-us-india-nuclear-technology-dea-1/
World's strongest hurricanes could be getting stronger
By Doyle Rice, USA TODAY
The strongest hurricanes in the Atlantic Ocean have become more intense due to global warming over the past 25 years, according to a new study in Wednesday's edition of the British journal Nature. The findings add fuel to the simmering argument in the meteorological community about the Earth's changing climate, and its relationship to the power of tropical systems worldwide.
Scientists from Florida State University and the University of Wisconsin-Madison analyzed satellite data from nearly 2,000 tropical cyclones around the world from 1981 to 2006, and found that the strongest storms are getting stronger, especially over the Atlantic and Indian Oceans.
Tropical cyclones are the umbrella term for hurricanes (in the Atlantic and east Pacific), typhoons (in the West Pacific) and cyclones (in the Indian).
"As seas warm, the ocean has more energy that can be converted to tropical cyclone wind," FSU professor of geography and study lead author James B. Elsner explained.
Elsner's team found that wind speeds for the strongest hurricanes increased from an average of 140 mph in 1981 to 156 mph in 2006, while the average global sea-surface temperature — as measured in all regions where tropical cyclones form — increased from 82.8 degrees to 83.3 degrees during those 25 years. The authors calculated that this increase in ocean temperature results in a 31% increase in the global frequency of strong cyclones from 13 to 17 per year.
All of the world's tropical basins showed this pattern, with the exception of the South Pacific Ocean. Also, there was no noticeable uptick in the intensity of weaker hurricanes, however.
"By creating a better, more consistent historical data set, we've been able to weed out quality issues that introduce a lot of uncertainty," said research scientist James Kossin of the U. of Wisconsin. "Then, by looking only at the strongest tropical cyclones, where the relationship between storms and climate is most pronounced, we are able to observe the increasing trends in storm intensity that both the theory and models say should be there."
National Hurricane Center scientist Christopher Landsea, who has questioned the link between a warming world and a rise in the number and intensity of hurricanes, said that while the paper's statistical methodology is excellent, he doubted its conclusion because he thinks the data is flawed. He questions the data for Indian Ocean storms before 1997, when there weren't as many satellites watching the storms, and in the way the scientists used the data for the most extreme winds.
Additionally, Landsea said the Atlantic is in a multi-decade period of heightened hurricane activity due to natural climatic cycles. The current active era began in the mid-90s. "This current paper cannot address this cyclic variability for the Atlantic, as it starts with data in 1981," he said.
"The paper has some elegantly calculated statistics, but these are generated on data that are not, in my opinion, reliable for examining how the strongest tropical cyclones have changed around the world," wrote Landsea in an e-mail.
Elsner does acknowledge that "we still do not have a complete understanding of why some cyclones intensify, sometimes quite rapidly, and others don't."
http://www.usatoday.com/weather/research/2008-09-03-hurricanes-warming-oceans_N.htm
More European tension
Cheney slams Russia for war against Georgia
TBILISI, Georgia (AP) — Demonstrating Washington's commitment to beleaguered Georgia, Vice President Cheney flew in Thursday and condemned Russia for what he called an "illegitimate, unilateral attempt" to redraw Georgia's borders by force.
Speaking during a closely watched trip to this U.S.-allied South Caucasus nation, Cheney also assured Georgian President Mikhail Saakashvili that the United States was "fully committed" to his country's efforts to join NATO.
"Georgia will be in our alliance," Cheney said.
One of the U.S. administration's most hawkish figures and a longtime critic of Russia, Cheney was visiting three ex-Soviet republics that are nervous about Moscow's intentions — Georgia, Azerbaijan and Ukraine.
His trip signaled to Moscow that the United States will continue to cultivate close ties with Georgia and its neighbors even after Russia showed it was not afraid to use its military against countries along its border.
http://www.usatoday.com/news/world/2008-09-04-cheney-georgia_N.htm
More on tools, you need to think low tech when you lose your electric. Here is an interesting aticle, hope you enjoy it.
Low-tech aid for poor Inventions that make life easier Vijaysree Venkatraman CHRISTIAN SCIENCE MONITORWednesday, September 3, 2008
For three weeks this summer, masons and mechanics, farmers and welders, scientists and a pastor threw themselves into creating low-tech solutions to big problems that persist across the globe. Converging at the Massachusetts Institute of Technology, these 61 inventors from 20 countries divided into multilingual teams, each drafting and tinkering a device of the team's own making that may make life for the world's poor a little easier.
There was no grand prize to be won at this second annual International Development Design Summit (IDDS), but members sometimes skipped meals and stayed up late - sawing, hammering and welding - to perfect and build their designs.
Soon, their prototypes will be rebuilt and refined in the developing world by artisans using locally available materials, and ultimately they will be tested by consumers who live on less than $1 a day.
The 10 teams constructed a wide variety of devices - from an inexpensive incubator for low-birth-weight babies to a rope system that could help craftswomen in the Himalayas get their products to market. Here are three of the inventions that emerged from this year's IDDS:
Each summer, Americans fire up their charcoal grills for outdoor barbecues. In many developing countries, charcoal is an everyday fuel used with indoor kitchen stoves, but the smoke-flavored food carries a health risk. Charcoal is not clean-burning, and one IDDS team says the resultant indoor pollution has been linked to deaths on the same scale globally as those caused by malaria and tuberculosis.
One way to make charcoal produce fewer emissions is to pulverize charred agricultural waste - such as corncobs or crushed sugar cane - and pack it into denser briquettes. A $2 metal press already is available for forming charcoal, says Jessica Vechakul, an engineer from MIT. What is missing in the market is a device to crush the burned cobs into powder - so her IDDS team decided to build one.
Their prototype looks like an oversized mouse trap with a hand crank. The user spins the crank and feeds the blackened cobs through a hopper. The grinder drops the powder into a container, where it's mixed with other ingredients into a cookie-dough consistency for briquettes. The simple contraption can crush 6 pounds of cobs in 10 minutes.
Now people who make charcoal from corncobs stomp on bags of burned cobs or beat the sacks with heavy sticks. When they empty the bags, the worker is engulfed momentarily in a black cloud, inhaling the dust, Ms. Vechakul says. Also, after a few stomping sessions, the bags must be replaced - a recurring expense.
"It is one messy job," Ms. Vechakul says.
Bernard Kiwia, a bike mechanic from Tanzania, will take his team's design to his home country. There, his job will be to persuade rural communities to use the hand-cranked device instead of cutting down trees for fuel.
This alternative fuel from agricultural waste might be cheap overall, but, as some rural poor see it, wood costs nothing but time and effort, Mr. Kiwia says. Unless they understand the huge environmental cost of regularly chopping down trees, those in the countryside have little incentive to switch to a cleaner fuel, he says. Getting the target audience to invest in the IDDS device appears to be the toughest part of the design game.
Video-game cartridges from the 1980s may strike some as quaint relics from an eight-bit era, but one IDDS team sought to convert the outmoded systems into an inexpensive learning tool for children in developing countries.
Computers are prohibitively expensive for many in developing nations, but televisions are common and could work as a platform for educational games, says Derek Lomas, the design team leader.
Earlier this year in Bangalore, India, Mr. Lomas strolled through a bazaar and noticed an educational video-game system based on the Japanese Nintendo Famicom, for which patents have run out. On a lark, he bought the set for $12.50. The generic system came with two game cartridges, a keyboard and a couple of controllers.
The cheap TV-based computer got his IDDS team brainstorming.
Facilities in Ghanaian public high schools are significantly lacking compared with those in private schools, says teammate and Ghanaian pastor George Fuachie. Some cleverly designed educational software with reasonable price tags could give disadvantaged youngsters much-needed help and computer training.
Off the shelf, this rudimentary computer can run a graphic user interface with a mouse and has some built-in programming capability. The team's job is to design software appropriate for the classroom.
"It can run eight-bit games like Oregon Trail, Lemonade Stand ... and Number Munchers, which I enjoyed playing as a kid," Mr. Lomas says.
Eventually, students could create their own locally relevant games on this system. Imagine children in Africa playing ethnic board games such as Mancala - or a regional variation - on a television screen, he says.
The team researched hardware modifications to the TV-computer that will enable users to connect to text-only Internet sites - and they declare it doable. Within a month, they also assembled a software development kit that makes it easier for open-source developers to produce new games and educational content for the system.
Going from the design concept to a commercial product is the task that lies ahead. When that happens, Mr. Lomas can consider his $12.50 investment a decent bargain.
Globally, 1.6 billion people have no access to electricity and use fuel lamps or stay in darkness every night. Going about their daytime chores - pumping water, grinding dough or getting around on bicycles - these off-the-grid people physically exert themselves to run machines.
One IDDS team worked on a bit of modern alchemy - converting mechanical energy from everyday labor into stored electrical energy. Few consumers will labor away to generate electrical power.
"But if the effort is incidental as they go about some regular task, people don't seem to mind putting in that extra 10 percent," says Jay Pagnis, a mechanical engineering student from India.
His team focused on treadle pumps - foot-operated devices used to irrigate farmland in Asia and Africa. Many country farmers step on and off these StairMaster-like contraptions to pump water for an average of four hours a day.
The team's generator attachment fits in a wooden frame and hooks the pump's treadle to a turning wheel, which charges a couple of store-bought batteries. After the day's work, a farmer can unhook the rechargeable batteries and use the power to light a 5-watt compact fluorescent lamp - the equivalent of a regular 25-watt incandescent lamp - for four hours, Mr. Pagnis says.
CHRISTIAN SCIENCE MONITOR A team at this summer's International Development Design Summit at the Massachusetts Institute of Technology works on learning games that can be used with television sets, common in Third World countries, instead of computers. The team members (from the left) are Miguel Chaves from Brazil, Derek Lomas from the United States, William McIver from Canada, the Rev. George Fuachie from Ghana, Jesse Austin Brenemen from the United States and Anuj Nanavati from India.
It may not seem like much, but this lighting is more efficient compared with the kerosene lamps currently in use in such places, says teammate Suprio Das, an Indian electrical engineer. What's more, this setup can pay for itself in six months, they say. If it breaks down, the mechanism is simple enough to be repaired by a local bike mechanic.
http://www.washingtontimes.com/news/2008/sep/03/low-tech-aid-for-poor/
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