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Foreclosures Had Errors, Bank Finds
http://www.officebcs.com 商务中心资讯网
Even as Bank of America begins to restart foreclosure proceedings in 23 states on Monday, the bank confirmed that it had discovered errors, including incorrect data and misspelled names, in the paperwork it has reviewed.
 
For weeks, Bank of America has insisted its review had not turned up any serious errors, and emphasized that it had not found a single case where a homeowner was facing foreclosure in error.
 
But on Sunday, the bank revised its fairly combative public stance. Bank of America had found errors, but only in a tiny number of cases, Dan Frahm, a spokesman for the bank, said late Sunday.
 
“These are examples of exceptions that were caught early in the process through control steps,” Mr. Frahm said. “They do not reflect exceptions in final documents that are being resubmitted to the courts.”
 
Bank of America and several other institutions, including JPMorgan Chase and GMAC Mortgage, halted foreclosures in late September and early October amid a growing controversy over problematic documents, including so-called robo-signers — bank employees who say they signed foreclosure affidavits without reviewing the documents. Other foreclosure cases were initiated with missing documents or incorrect information.
As a result of its review, Bank of America has combined signing and notarization into one step, unlike in the past, when they were separate tasks. “We felt there was greater risk for error before,” Mr. Frahm said.
On Sunday, Bank of America maintained that no homes were foreclosed in error.
“The basis for our foreclosure decisions has been accurate,” he said, and he added that the bank would work to correct any problems.
 
Initially, Bank of America imposed the freeze in 23 states where judicial approval is required before a foreclosure can go ahead, and the bank extended it nationwide on Oct. 8. But on Oct. 18, the bank confirmed foreclosures would resume in the initial 23 states and declared it was confident in the procedures it had in place.
“We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate,” Barbara J. Desoer, president of Bank of America Home Loans, said at the time. “We paused while we were doing that, and now we’re moving forward.”
 
Since the controversy began, Bank of America shares have been pummeled and the company has repeatedly sought to reassure investors that it does not a deeper financial threat from the controversy.
What’s more, it is facing pressure from large institutional owners of troubled mortgages, including the Federal Reserve Bank of New York, Pimco and BlackRock, to buy tens of billions in bad loans back from them.
That has forced analysts to rethink earnings expectations, with some warning that the mortgage mess represents a long-term drain on an industry that only recently has gotten back on its feet.
As the nation’s largest bank and the servicer of roughly one in five American mortgages, Bank of America is closely watched by the rest of the industry, and its decision to resume foreclosures was seen as an attempt by the big banks to put the growing furor behind them.
Still, it is far from certain that banks will be able to calm the public controversy easily or quickly. Aside from the robo-signers, lawyers for homeowners have found evidence that documents were lost or even thrown out. Armed with this information, lawyers are gearing up for protracted court battles.
Bank of America’s troubled mortgage portfolio is a legacy of its July 2008 acquisition of Countrywide, a subprime mortgage specialist that was among the financial institutions with the most troubled loans, as well as its January 2009 merger with Merrill Lynch, which was a major player in the business of taking mortgages and transforming them into securities to be sold to investors.
In addition, as the beneficiary of two capital infusions by Washington under the federal bailout, Bank of America was among the banks most dependent on Washington to help survive the financial crisis, receiving $45 billion from taxpayers. Of that, $20 billion came in emergency aid after Merrill’s losses were revealed.
That money has been paid back, but the bank remains eager to maintain good relations with the government, and has emphasized that restoring its public image was a crucial factor throughout the foreclosure controversy.
Last Wednesday, Bank of America reported that operating earnings in the third quarter hit $3.1 billion, in contrast to a loss a year ago.
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How a Tunnel Would Help New Jersey Home Values
WHAT is the real estate value of a one-seat train ride to Manhattan from a station close to one’s home in New Jersey? Leave it to statisticians to come up with a figure.
 
If a third rail tunnel was built under the Hudson, homes close to a rail station offering direct service to Manhattan, like this one at Watchung Avenue in Montclair, would be likely to rise in value.
 
“It has to be a lot,” said Perri K. Feldman of Keller Williams Realty, who has built a client base in towns along a section of the New Jersey Transit Midtown Direct line running from Morristown to South Orange. “It’s the first question so many people ask about a house: ‘How close is it to the train? Can I walk to the station?’ ”
Now, the extra value that comes with proximity to a station with direct service to Manhattan — no transfer required — has been quantified: $19,000, on average, for homes within two miles of a station; $29,000 for houses within half a mile.
Home values would increase by those amounts in neighborhoods surrounding 10 New Jersey Transit lines and 2 Metro-North Railroad lines if a third rail tunnel under the Hudson River was ever built, according to a study by the independent Regional Plan Association.
Statisticians worked backwards, analyzing the impact on real estate value when previous rail-improvement projects were done, to project the impact that a new tunnel would have on home values.
The cumulative increase in property value would be $18 billion, according to the study, which was published two months before Gov. Christopher J. Christie of New Jersey decided to suspend work on the tunnel as of Oct. 7. Senator Frank R. Lautenberg, a tunnel supporter, has worked to publicize the findings.
Mr. Christie says the state should not proceed with the $8.7 billion project, because it cannot afford to pay for any cost overruns. He cited a recent study by his transit officials, which predicted that the project could end up $2 billion to $5 billion over budget.
The original cost of the tunnel was to be financed this way: $3 billion from the federal government, $3 billion from the Port Authority of New York and New Jersey, and $2.7 billion from the State of New Jersey (mostly in the form of Turnpike receipts).
In the study of the tunnel’s potential effects, researchers estimated that the $18 billion in increased property value would generate $375 million in increased tax revenues per year.
Some local and county politicians — in addition to Mr. Lautenberg — have argued that municipalities cannot stand to “lose” those potential tax revenues, which would presumably start flowing in 2017, after the project was completed. Others have called the tax receipt estimates “fictional,” and contended that they were too far in the future to matter now, in the midst of a statewide budget crisis.
The calculations on the proposed trans-Hudson tunnel known as ARC (Access to the Region’s Core) were based on what happened to real estate after these developments:
¶The 1996 addition of Midtown Direct service to the Morris and Essex Line;
¶The 2002 addition of the service along the Montclair-Boonton Line;
¶The 2003 opening of the Secaucus Junction, allowing transfers there instead of at Hoboken.
After those projects were completed, the value of homes within two miles of train stations increased by an average of $23,000, according to the planning group’s study. The Regional Plan Association is a nonprofit that studies policy matters affecting Connecticut, Long Island and New Jersey.
Data from 45,000 area home sales that took place from 1993 through 2008 were analyzed. According to Juliette Michaelson, who performed that section of the research, the analytic process assumes that the price of a house is determined by the value of characteristics like number of bedrooms, quality of the school district and access to train service. By looking at thousands of sales involving houses with differing combinations of those characteristics, it becomes possible to estimate the amount that each individual characteristic adds to the price of the house, Ms. Michaelson explained in the notes accompanying the study.
She tallied the estimated time in minutes that train riders saved on travel, waiting and making transfers after the Midtown Direct and Secaucus Junction improvements. Each minute saved, she determined, adds an average of $1,959 to the value of the house.
For homes within walking distance (half a mile) of a station, each minute was worth $2,902.
If the ARC tunnel was built, the average New Jerseyan’s train ride would be shortened by 10 minutes each way, the study indicated.
Riders on the Raritan Valley line, which runs to Raritan Station out of Pennsylvania Station in Newark, would see the biggest drop in round-trip travel time in the state, since the new tunnel would directly serve that area. Trip time would decrease by an average of 32.6 minutes, with variations along the route.
Cranford residents’ commute would be 23.6 minutes shorter, for instance; Roselle Park riders would get the biggest drop in travel time in the state, 37.6 minutes.
Using the rate-per-minute formula, the value of a home close to the rail line in Roselle Park could be expected to increase by more than $100,000.
But a third tunnel would also have statewide impact, as it would nearly double the current tunnel capacity, cutting down on trip time across the board and allowing for more frequent trains. (The estimates in the planning group’s study are all based on schedules as they stood last spring.)