Personal Finance News Jan 2009

Street looks to '09 with relief after terrible '08
AP - The last trading day of 2008 on Wall Street provided a merciful end to an abysmal year — the worst since the Great Depression, wiping out $6.9 trillion in stock market wealth. Six years of stock gains disappeared as the economy crumbled and markets crashed around the globe, shaking the confidence of professional and individual investors alike. (Thu, 01 Jan 2009 01:05:19 GMT)

Estate Planning in a Down Market
BusinessWeek Online - When times are tough, people tend to hold on to what they have that much more tightly. But for those who can get beyond that psychological response, there's a silver lining in today's combination of depressed asset values and low interest rates: Transferring assets to the next generation has rarely been less costly. (Thu, 01 Jan 2009 13:08:41 GMT)

Wells Fargo completes Wachovia purchase
Reuters - Wells Fargo & Co said it has completed its roughly $12.7 billion purchase of Wachovia Corp, a big bet that it properly assessed the risks in Wachovia's huge book of mortgage and real estate loans. (Thu, 01 Jan 2009 13:16:57 GMT)

Standout 2008 fund managers staying defensive
AP - Playing it safe paid off in 2008 for Tom Forester and David Ellison, two standout mutual fund managers in a year when winning meant losing less money than the competition. (Thu, 01 Jan 2009 18:38:25 GMT)

Fannie says IndyMac has $1 bln in mortgage obligations: report
Reuters - Fannie Mae , the largest U.S. home funding company, believes that failed mortgage lender IndyMac has obligations to repurchase around $1 billion of home mortgages that failed to meet Fannie's standards, the Wall Street Journal said, citing people familiar with the situation. (Fri, 02 Jan 2009 06:20:59 GMT)

British house prices fell at record rate in 2008
AP - House prices in Britain fell in 2008 at their fastest rate for at least 25 years, the country's biggest mortgage lender said Friday, stoking market expectations that the Bank of England will cut borrowing costs further next week. (Fri, 02 Jan 2009 11:48:55 GMT)

Estate Planning in a Down Market
BusinessWeek Online - When times are tough, people tend to hold on to what they have that much more tightly. But for those who can get beyond that psychological response, there's a silver lining in today's combination of depressed asset values and low interest rates: Transferring assets to the next generation has rarely been less costly. (Fri, 02 Jan 2009 13:08:41 GMT)

Plan B for retirees who counted on home equity
AP - The safety net is almost gone, the nest egg is cracking. (Fri, 02 Jan 2009 19:01:12 GMT)

Private equity group buying IndyMac assets
Reuters - The assets of failed U.S. mortgage lender IndyMac are being bought by a group of private equity and hedge fund firms, including Dune Capital Management and J.C. Flowers & Co, which are putting up $1.3 billion in cash. (Sat, 03 Jan 2009 00:47:51 GMT)

Estate Planning in a Down Market
BusinessWeek Online - When times are tough, people tend to hold on to what they have that much more tightly. But for those who can get beyond that psychological response, there's a silver lining in today's combination of depressed asset values and low interest rates: Transferring assets to the next generation has rarely been less costly. (Mon, 05 Jan 2009 13:08:41 GMT)

NY Fed begins purchasing mortgage securities
AP - The Federal Reserve Bank of New York said Monday it has begun purchasing mortgage-backed securities in an effort to bolster the battered housing market. (Mon, 05 Jan 2009 19:58:47 GMT)

Lawmakers set new mortgage bankruptcy bill
Reuters - Legislation designed to stem foreclosures by allowing bankruptcy judges to erase some mortgage debt will be introduced by Congressional Democrats on Tuesday, and hopes are high that it will pass after a similar plan failed last year. (Mon, 05 Jan 2009 23:53:01 GMT)

Madoff scandal, SEC role under scrutiny
AP - Two more months of mortgage payments and retiree Allan Goldstein says he'll be broke, just another victim in what may be the biggest Ponzi scheme in history. (Tue, 06 Jan 2009 13:30:14 GMT)

British house prices sink by record amount in 2008
AP - House prices in Britain fell by their biggest annual amount in at least 56 years during 2008, as credit seized up and possible buyers stayed out of the market, a leading mortgage lender said Tuesday. (Tue, 06 Jan 2009 14:38:41 GMT)

Leading Democrat offers mortgage aid bill
Reuters - The second-ranking Democrat of the U.S. Senate on Tuesday introduced legislation that would let bankruptcy judges erase some mortgage debt in an effort to stem foreclosures. (Tue, 06 Jan 2009 22:29:25 GMT)

Fed and other agencies to join U.S. fraud task force
Reuters - The U.S. government is beefing up a task force to fight mortgage crimes and safeguard federal financial bailouts, the U.S. Justice Department said on Tuesday. (Tue, 06 Jan 2009 23:02:23 GMT)

Banks may need to raise fresh capital in '09: Whitney
Reuters - U.S. banks will have to raise fresh capital in 2009, and a sharp increase in credit-rating downgrades on mortgage-related securities will lead to further stresses on the companies' capital, according to prominent banking analyst Meredith Whitney. (Wed, 07 Jan 2009 08:05:00 GMT)

AP - Paulson says allowing mortgage giants Fannie Mae and Freddie Mac to return to their old operating ways is not an option. (Wed, 07 Jan 2009 17:01:14 GMT)

Obama plans to keep Republican FDIC chair Bair: report
Reuters - Democratic President-elect Barack Obama intends to retain Federal Deposit Insurance Corp head Sheila Bair, who has pushed for fast mortgage modifications, according to a report on Wednesday. (Wed, 07 Jan 2009 19:25:24 GMT)

Investors buy $558 million in mortgages from FDIC
AP - A group of private investors including former executives of Countrywide Financial Corp. has purchased $558 million in home mortgages from the government in a deal involving assets of the failed First National Bank of Nevada, the investors announced Wednesday. (Wed, 07 Jan 2009 20:06:25 GMT)

Paulson says changes needed at Fannie, Freddie
AP - Treasury Secretary Henry Paulson on Wednesday said the best option for the future of Fannie Mae and Freddie Mac could be for the mortgage giants to be run like public utilities. (Wed, 07 Jan 2009 22:22:11 GMT)

Citigroup, U.S. senators in mortgage legislation talks: report
Reuters - Citigroup Inc is leading other lenders in advanced talks with key U.S. senators on legislation that would allow judges to set new repayment terms for millions of mortgage holders who wind up in bankruptcy court, the Wall Street Journal said, citing people involved in the talks. (Thu, 08 Jan 2009 06:58:16 GMT)

Obama's performance czar has tried to improve IRS
AP - Nancy Killefer, the management consultant chosen by President-elect Barack Obama to make federal agencies work better for the public, has a lot of experience trying to improve the agency taxpayers love to hate, the Internal Revenue Service. (Thu, 08 Jan 2009 09:37:17 GMT)

GMAC says backs ResCap, without committing to it
Reuters - Finance company GMAC LLC expressed support for its money-losing Residential Capital LLC mortgage unit on Thursday but stopped short of a commitment to keep the big home loan provider in business. (Thu, 08 Jan 2009 13:52:46 GMT)

Mortgage giants extend suspensions of foreclosures
AP - Mortgage giants Fannie Mae and Freddie Mac said Thursday they will extend the suspension of foreclosure sales and evictions from single-family homes through the end of January. (Thu, 08 Jan 2009 16:46:14 GMT)

Consumer credit posts record drop in November
Reuters - Consumer borrowing dropped by a record $7.94 billion in November, a Federal Reserve report showed on Thursday, the latest evidence that households were unwilling or unable to take on more credit. (Thu, 08 Jan 2009 20:48:34 GMT)

Stocks up on expected foreclosure deal but Dow off
Reuters - Most U.S. stocks rose on Thursday after news that Citigroup Inc agreed to support legislation aimed at stemming home loan foreclosures, offsetting Wal-Mart's disappointing sales and outlook. (Thu, 08 Jan 2009 22:13:00 GMT)

Considering dumping a mutual fund? Think twice
AP - Fiscal fitness is knocking weight loss off the top of many New Year's resolution lists, thanks to 2008's market drubbing. That often means casting off last year's worst-performing mutual funds for more promising alternatives. (Thu, 08 Jan 2009 22:46:10 GMT)

Stocks end mostly higher after mortgage deal
AP - A deal to help head off more mortgage foreclosures pulled Wall Street out of a slump Thursday, giving stocks a mostly higher close. Democratic lawmakers reached an agreement with Citigroup Inc. on a plan to let bankruptcy judges alter loans in an effort to prevent homes from going into foreclosure. Other lenders are expected to follow suit. (Thu, 08 Jan 2009 23:03:31 GMT)

Citi backs measure to help avoid foreclosures
Reuters - Financial giant Citigroup Inc will support a proposal in Congress to rewrite U.S. bankruptcy law to help troubled mortgage borrowers avoid foreclosure, Chief Executive Vikram Pandit said on Thursday. (Fri, 09 Jan 2009 01:12:44 GMT)

Citi reaches deal with lawmakers on home loans
AP - Democratic lawmakers have reached a deal with Citigroup Inc. on a plan to let bankruptcy judges alter home loans in an effort to prevent foreclosures and urged other lenders to follow suit. (Fri, 09 Jan 2009 09:52:04 GMT)

Wall Street: The Bright Side of a Bad 2008
BusinessWeek Online - Last year was that rare wrinkle in history when everything that could go wrong did go wrong. Stocks and real estate imploded. Bank failures abounded. Fannie Mae, Freddie Mac, and AIG became wards of the state, while the Federal Reserve had to double its balance sheet in the course of a few weeks. (Fri, 09 Jan 2009 13:08:41 GMT)

Obama team working on overhaul of financial rescue
Reuters - President-elect Barack Obama's economic team is working to overhaul the $700 billion financial rescue program to stem mortgage foreclosures and spur the flow of credit to the struggling U.S. economy, an Obama aide said on Friday. (Fri, 09 Jan 2009 14:54:37 GMT)

Panel criticizes Treasury use of TARP funds
Reuters - The U.S. Treasury has done nothing to ensure a $700 billion financial bailout fund is used to stabilize the weak mortgage market, which caused the U.S. economic crisis, a congressional watchdog said on Friday. (Fri, 09 Jan 2009 18:16:23 GMT)

German finance minister calls for lower base income tax rate
AFP - German Finance Minister Peer Steinbrueck is mulling a cut in the base income tax rate to 12 percent from 15 percent to help pull Europe's biggest economy out of a deep recession, a spokesman said Friday. (Fri, 09 Jan 2009 18:50:17 GMT)

Bank industry slams lawmaker-Citi mortgage deal
Reuters - A top bank industry group said on Friday that it opposes an agreement between Citigroup Inc and Democratic senators that would rewrite U.S. bankruptcy law to help troubled mortgage borrowers avoid foreclosure, saying it could make home loans more expensive. (Fri, 09 Jan 2009 22:20:01 GMT)

Lennar denies making improper loan to executive
Reuters - No. 2 U.S. homebuilder Lennar Corp said on Monday that its chief operating officer had not received a mortgage on his home from the company and denied treating its joint ventures like a "Ponzi scheme." (Mon, 12 Jan 2009 14:41:04 GMT)

Northern Rock shareholders seek redress in court
AP - Shareholders in nationalized mortgage lender Northern Rock were going to court Tuesday to try to force the British government to compensate them for their now-worthless stocks. (Tue, 13 Jan 2009 08:50:50 GMT)

Even in hard times, don't ignore the IRS
AP - You've lost your job and your mortgage company is threatening foreclosure. Then, when it seems that things can't get any worse, the tax man comes calling. What's a person to do? (Tue, 13 Jan 2009 18:50:43 GMT)

Mortgage applications up as refinancing jumps
Reuters - Mortgage applications jumped in the first full week of 2009 as record low interest rates spurred the greatest demand for home refinancing loans in over 5-1/2 years, data from an industry group showed on Wednesday. (Wed, 14 Jan 2009 12:26:29 GMT)

Germany mulling partial nationalisation of HRE bank: party spokesman
AFP - The German government is considering partially nationalising distressed mortgage lender Hypo Real Estate (HRE), a spokesman for Chancellor Angela Merkel's CDU party told AFP on Wednesday. (Wed, 14 Jan 2009 18:04:13 GMT)

IRS expands free online filing program
AP - Want a quick tax refund? File your federal tax returns electronically. (Thu, 15 Jan 2009 14:22:22 GMT)

Not all target-date funds are created equal
AP - Bracing for their year-end 401(k) statements, many investors who put money in 2010 target-date mutual funds may be facing a delayed retirement. (Thu, 15 Jan 2009 22:33:25 GMT)

Mortgage Rates Fall to Record Lows
BusinessWeek Online - Mortgage giant Freddie Mac said on Jan. 15 that rates on 30-year fixed-rate mortgages fell below 5% this week -- the lowest level since it began surveying lenders in 1971. (Fri, 16 Jan 2009 13:08:41 GMT)

What Records Can You Really Throw Away?
The Motley Fool - Stashes of old, paid bills, expired life insurance policies, receipts for broken gadgets, and canceled checks for haircuts you got in college -- sound like your filing system? (Fri, 16 Jan 2009 17:01:24 GMT)

Financial burden of homeownership spread unequally
AP - When it comes to homeownership, Hispanics in New Jersey, single parents in California and senior citizens in Rhode Island all have something in common: More than a third have an unaffordable mortgage. (Mon, 19 Jan 2009 00:54:06 GMT)

Denmark reveals bank bailout worth $18B in loans
AP - Danish lawmakers have agreed on a 100 billion kroner ($18 billion) rescue package of loans for banks and mortgage lenders to prevent the credit crunch from deepening. (Mon, 19 Jan 2009 10:22:14 GMT)

Mortgage Rates Fall to Record Lows
BusinessWeek Online - Mortgage giant Freddie Mac said on Jan. 15 that rates on 30-year fixed-rate mortgages fell below 5% this week -- the lowest level since it began surveying lenders in 1971. (Mon, 19 Jan 2009 13:08:41 GMT)

Circuit City collapse could hit real estate investors
Reuters - The collapse of electronics retailer Circuit City could drive down shopping and strip mall rents, and deal another blow to commercial mortgage-backed securities' (CMBS) investors who have already seen their bond prices slide. (Wed, 21 Jan 2009 00:10:37 GMT)

Stock futures drop after Microsoft and economic data
Reuters - Stock index futures hit session lows on Thursday after Microsoft Corp reported quarterly results earlier than scheduled in the day, hurting a market already weakened by economic data showing further deterioration in the labor and housing markets. (Thu, 22 Jan 2009 14:22:35 GMT)

Jobless claims surge, housing starts tumble
Reuters - The number of workers lining up for jobless benefits surged last week, while new housing starts and permits hit record lows in December, pointing at an acceleration in the economy's downward spiral. (Thu, 22 Jan 2009 14:35:34 GMT)

30-year mortgage rates rise after record run
AP - Rates on 30-year mortgages rose above 5 percent this week, ending a five-week run at record low levels, Freddie Mac reported Thursday. (Thu, 22 Jan 2009 17:27:29 GMT)

You don't have to clip coupons to save cash
AP - It's easy to get sloppy with your finances when times are good: adding a premium cable channel, signing up for the deluxe gym membership or reaching for the pricey Italian coffee. "But there's nothing like a good old fashioned recession to remind people you can't be sloppy all the time," said Eric Tyson, author of "Personal Finance for Dummies." (Thu, 22 Jan 2009 18:09:08 GMT)

Housing starts post larger than expected drop
AP - New-home construction plunged to an all-time low in December, capping the worst year for builders on records dating back to 1959. (Thu, 22 Jan 2009 19:11:16 GMT)

US unemployment spikes, housing crisis deepens
AFP - US unemployment claims hit a 26-year high and home building fell to half-century lows, data showed Thursday, highlighting the scale of the recession facing the new Obama administration. (Thu, 22 Jan 2009 20:29:46 GMT)

Small-cap managers see good bets in energy stocks
AP - As market observers watch for early signs that better times are around the corner, they're paying close attention to small-company stocks, which tend to recover earlier than large-company stocks coming out of a recession. (Thu, 22 Jan 2009 22:21:13 GMT)

UK may inject $13.8 billion into Northern Rock: report
Reuters - The British government is considering injecting as much as 10 billion pounds ($13.80 billion) into Northern Rock to use the nationalized bank to ramp up mortgage lending, the Daily Telegraph reported. (Thu, 22 Jan 2009 23:38:22 GMT)

Student Loans and Stanford B-School Admissions
BusinessWeek Online - Guest: Dan Thibeault, president and co-founder of Graduate Leverage (Fri, 23 Jan 2009 13:08:41 GMT)

Eight Tips for Landing a Mortgage
BusinessWeek Online - Washington is doing all it can to get money flowing again in the housing sector. At around 5%, 30-year mortgage rates are at levels that haven't been seen in, well, 30 years. (Fri, 23 Jan 2009 13:08:41 GMT)

Mortgage Crisis: Will Loan Mods Bring Relief?
BusinessWeek Online - The growing urgency to implement an effective fix for the deepening U.S. financial crisis is pushing policymakers to consider measures that were roundly rejected as too risky not very long ago. The limited success of the first $350 billion in TARP funds and the government's wavering on how best to dispose of the toxic assets that are clogging banks' balance sheets -- and preventing a rebound in the credit markets -- has added to the sense of urgency. (Fri, 23 Jan 2009 13:08:41 GMT)

How Much Life Insurance Do You Need?
The Motley Fool - To put it simply, life insurance protects those who depend on your paycheck. If you die prematurely, life insurance provides your dependents with ongoing income to replace yours, until (or unless) they can live comfortably without it. It can also provide a timely emergency fund for medical, legal, and funeral costs should family savings not be adequate to cover them. (After all, that golf-inspired Fairway to Heaven casket ain't cheap.) (Fri, 23 Jan 2009 14:49:57 GMT)

Meltdown 101: Most people safe with tax software
AP - With the Internal Revenue Service pushing electronic filing and promising faster refunds for those who use it, more than 62 percent of all federal returns are now completed using tax preparation software. (Fri, 23 Jan 2009 22:17:08 GMT)

Freddie Mac to ask for billions more in funds
AP - Mortgage finance company Freddie Mac said Friday it will need an additional $30 billion to $35 billion in government aid as it copes with losses on loans the company backed during the U.S. housing bubble. (Fri, 23 Jan 2009 23:10:19 GMT)

Freddie Mac may draw $35 billion more from Treasury
Reuters - Freddie Mac , the second-largest provider of funding for U.S. home loans, on Friday said expected fourth-quarter losses may force it to draw up to $35 billion from the U.S. Treasury to maintain a positive net worth. (Fri, 23 Jan 2009 23:32:58 GMT)

Freddie Mac to seek 30-35 billion dollar Treasury injection
AFP - US government-controlled mortgage finance giant Freddie Mac said late Friday that it would ask the Treasury for an additional 30 to 35 billion dollars to prevent its collapse. (Sat, 24 Jan 2009 00:46:21 GMT)

Obama plans fast action on financial regulation: report
Reuters - The Obama administration plans to tighten the nation's financial regulatory system, including stricter federal rules for hedge funds, credit rating agencies and mortgage brokers, the New York Times reported in Sunday editions. (Sun, 25 Jan 2009 00:45:02 GMT)

U.S. bankers avoid glitz of Davos, image a concern
Reuters - It used to be a prized invitation for Wall Street CEOs and top government officials. But for the U.S. banking elite, a ticket to this year's World Economic Forum in Davos risks becoming as toxic as the mess left over from the subprime mortgage crisis. (Mon, 26 Jan 2009 09:20:46 GMT)

ING CEO quits after 4Q loss, new state aid
AP - Bank and insurer ING Group NV said Monday it will book a large fourth quarter loss, cut 7,000 jobs and change its CEO. It also said the Dutch government will assume the risk for most of euro27.7 billion ($35.8 billion) in troubled U.S. mortgage-backed securities ING owns. (Mon, 26 Jan 2009 12:36:42 GMT)

Fannie Mae could need $16B from government
AP - Mortgage finance company Fannie Mae said Monday that it likely needs up to $16 billion from the government as conditions in the U.S. housing market continue to deteriorate. (Mon, 26 Jan 2009 22:45:18 GMT)

Fannie, Freddie may tap U.S. Treasury for $51 bln
Reuters - Fannie Mae and Freddie Mac could tap the government for up to $51 billion in coming weeks, exceeding some Wall Street estimates, so they can continue to operate as the largest providers of funding for U.S. residential mortgages. (Mon, 26 Jan 2009 23:29:32 GMT)

Fannie Mae to seek 11-16 bln dlrs from US Treasury
AFP - US government-controlled mortgage finance giant Fannie Mae said late Monday it would ask the US Treasury for 11 to 16 billion dollars to prevent its collapse. (Tue, 27 Jan 2009 00:19:32 GMT)

Geithner wins OK for Treasury, vows quick action
Reuters - Timothy Geithner won confirmation as U.S. Treasury secretary on Monday and vowed to act quickly to protect the U.S. economy from the worst financial crisis since the Great Depression. (Tue, 27 Jan 2009 07:43:58 GMT)

Geithner's assets significantly lower than Paulson
AP - Treasury Secretary Timothy Geithner is no Hank Paulson when it comes to his personal finances. (Tue, 27 Jan 2009 22:48:13 GMT)

Small businesses can run into tax prep pitfalls
AP - Income tax filing season can be a trying time for small business owners, and in a recession, even more so. (Wed, 28 Jan 2009 22:30:26 GMT)

Pa. joins mortgage-aid settlement with Countrywide
AP - Pennsylvania has joined a settlement with Countrywide Financial Corp. that makes available as much as $155 million to help keep thousands of state residents in their homes. (Wed, 28 Jan 2009 22:48:00 GMT)

U.S. life insurers denied looser capital requirements
Reuters - State insurance regulators voted against a proposal to loosen capital requirements for the battered life insurance industry. (Thu, 29 Jan 2009 21:18:34 GMT)

Investors seeking safety flock to Ginnie Mae funds
AP - Home foreclosures and market volatility are running high. So any investment even remotely connected to mortgages is the last place to look if you're trying to protect your retirement savings, right? (Thu, 29 Jan 2009 23:16:28 GMT)

Fannie strikes deal to modify mortgages: report
Reuters - Fannie Mae reached an agreement to work with one of its former critics, Neighborhood Assistance Corp of America, to prevent foreclosures by reworking home mortgages to make them easier to afford, the Wall Street Journal said. (Fri, 30 Jan 2009 05:30:32 GMT)

Freddie Mac to rent foreclosed properties
AP - Mortgage finance company Freddie Mac said it will allow some borrowers to rent out their homes after losing them to foreclosure. (Fri, 30 Jan 2009 19:47:24 GMT)

Bollywood promoter sentenced in bank fraud scam
AP - A well-known Bollywood promoter and film producer from northern Virginia was sentenced to seven years in prison Friday for one of the largest bank fraud scams in the state's history. (Fri, 30 Jan 2009 22:52:00 GMT)

Feds allege plot to destroy Fannie Mae data
AP - A fired Fannie Mae contract worker pleaded not guilty Friday to a federal charge he planted a virus designed to destroy all the data on the mortgage giant's 4,000 computer servers nationwide. (Fri, 30 Jan 2009 23:43:47 GMT)

Ex-Fannie Mae programmer says not guilty of virus
Reuters - A 35-year-old computer programer pleaded not guilty on Friday to charges that he planted a computer virus designed to destroy all the data on 4,000 Fannie Mae computer servers the day he was fired from the company. (Sat, 31 Jan 2009 00:54:19 GMT)

Obama pledges mortgage help with new financial plan
Reuters - President Barack Obama promised on Saturday to help lower Americans' mortgage costs with a new plan, coming soon, that would revive the financial system and "get credit flowing again." (Sat, 31 Jan 2009 11:07:01 GMT)