patrick.net

Those Black Friday shoppers stormed the mall like the beaches of Normandy, braving all sorts of inconvinience.

Well Brand,
So we've gone from the Greatest Generation to the Greatest Fool Generation.

God help us all.

Brand Says:
skibum, if you had just busted out a credit card yesterday, you would be a respectable American, too.

I busted out the debit-card... but only to buy petrol at Costco. Damn near $70 right there.

That is about all the 'shopping' you will get out of me... I can't imagine WTF people are still buying and why they think they need it.

good_guy Says:
I have about 40K positive equity…

How do you know? Did you sell it yet? Counting equity before selling is SO 2005.

skibum - good post!

I for one didn't spend a red cent.

I mended the hem (dental floss, yay!) on this fleece "Endwave" sweater I'm wearing, sure it was only about $4 at the Goodwill, and could be found out here for a buck or so, but it's hard to find one that's just right, well worth the mending. Then took a pice of heavy duty cloth I got for a quarter last week at a local Christian thrift, and made yes MADE, a laundry bag. With drawstring. Using dental floss. Punkers and the homeless know how to sew with dental floss, but I actually learned it from the archery folks - they'll repair all kinds of stuff with it. Now I can put my laundry in it and go to the laundromat and get some washing done when the truck's in use.

I not only deprived the "consumermaschine" of money, I created value for myself.

Oh yeah Juicy Local RE Dirt: A family here who've been holding a fairly constant yard sale, turn out to be moving to Florida. They say it's because they have "family support" there. Sounds like RE payment trouble. Family will take them in or at least it's better to be homeless in FL. than here.

Brand Says:
skibum, if you had just busted out a credit card yesterday, you would be a respectable American, too.

Yep, send that borrowed dollar to China. Maybe if enough heros do that, the dollar will get real cheap and spawn a new surge of American exports. After all, the loonie parity has caused a great anount of sales on the US side of the Canadian border. I understand that the stores up there have a hard time keeping enough stock on hand.

Not Serious

ex-sunnyvale-renter Says:

I for one didn’t spend a red cent.

That is no surprise to regular readers of this blog. If I read your posts right, you are a debt refugee who left a trail of stiffed creditors as you hopped a boxcar out of California. Your new austere lifestyle is evidenced by the variety of Hobo survival tips (such as making a laundry bag) that you now post. We would be surprised if you had a cent.

I jest, because you actually sound like a survivor who is keeping good humor about a temporarily down situation.

Headset says: Yep, send that borrowed dollar to China. Maybe if enough heros do that, the dollar will get real cheap and spawn a new surge of American exports.

Actually, I've been saying that for a while. A falling dollar isn't necessarily that bad. A lot of folks on this blog are in high tech. As that 3:1 ratio of Chinese/Indian engineers falls off, this whole intercontinental outsourcing thing will start to look like a push. I bet companies will still do engineering outsourcing, except that they might go to U.S. firms instead.

And God knows we need to bring some manufacturing back here, or the hollow shell of our economy will eventually implode.

Brand,

You are quite right. I just do not like debt to be the engine for a cheaper dollar. A potential issue with your cheap dollar theory is that a low dollar may cause oil to be priced in Euros, and the resulting higher dollar energy costs may force a decline in US living standards rather than a rebirth of domestic manufacturing.

Frankly, I hope we get roasted with rising oil prices. The only way the U.S. will become more energy independent is if the pain far exceeds our threshold for a long time.

Oil will never be priced in Euros alone. Perhaps a separate, smaller exchange could be built around the Euro, but huge industrial economies like the U.S., China and Japan all spend the U.S. dollar for oil. Were OPEC and company ready to make such a change, it could take years, and at that point the U.S. dollar might be strong again, rendering the move pointless.

Besides, a weak dollar is a great deal for OPEC countries. They're getting more dollars per barrel, which they can use to buy more U.S. goods. That's an advantage for them.

Besides, a weak dollar is a great deal for OPEC countries. They’re getting more dollars per barrel, which they can use to buy more U.S. goods.

Are you sure? If OPEC were paid in Euros they would just trade those strong Euros for many weak dollars if they wanted US goods. A wash. Also, a weak dollar may mean less demand for OPEC oil from OPECs biggest consumer.

Hey SP :
Fair enough. Equity should not be counted before you sell. But I think my home value is holding up okay...for better or worse...the 49 square miles of San Francisco is holding up better than the Bay Area overall. Plus, I'm here for the long haul...and don't plan (at least for now), to move for a good 10-15 years....and I'll be happy sitting on my 6.5% fixed rate, 30 year mortgage....I think when the market does come back (post-2009), the banks will hopefully be smarter, make mortgages even harder to get....and truly qualify people for the right financial products....but everyone trying to time the bottom of the SF market...will be in trouble...because when everyone is convinced the bottom is here...they'll all rush in, drive the prices nonsensically higher (again, I'm not defending buyers irrantionality), and prices will shoot back up again....for another cycle of nonsense....

Ooops, I misread your post. Pease disregard Euros comment.

Headset - you describe the situation well. I drove my car out and used it another month or so before turning it into the repo people, and yeah, sadly, my creditors will be um, well, stiffed. Since as recently discovered, all the major banks are engaging in debt collection fraud (selling debts that have been discharged and no longer exist) I'm feeling decreasingly bad about this these days.

But I actually do have more than one red cent right now, in fact I have about 4000 cents lol.

"American Dream"? What BS! So, if I default on my student loan, can I just call it a "dream" and not have to pay it back? If I take a loan for a Yacht that I simply cannot afford/could-not-ever-in-wildest-dreams afford/did not budget for, can I call that beautiful machine a "dream" and have the Governor make all my problems go away? Where is the line drawn in this proverbial sand?

WTF is The Terminator smoking? And, can I have some?

Good_Guy -- Thank you for hanging on to your "investment" and not asking us diligent savers to save your ass too.

So nice that Awnold is so caring for the FB's. Where is he when we are paying nearly $4 a gallon for gasoline? Can we get some of that "dream-exemption" for that too?

Christ on a stick, when can we expect some personal responsibility in CA?

Personal responsibility? The FBs are now a protected class. That's why I got pissed off when I read the thread. It's not that I care about a bank in its own interest renegotiating or working with people on a case by case basis. The governor's involvement legitimizes the FBs by recognizing them as victims and condones the behavior that we had been warning about for years.

Exactly Malcolm. If some bank (in fantasy land) wants to renegotiate terms for a FB, great. Chalk one up on the Karma balance sheet for them. But to legitimize, legalize, such behavior on a State scale is unconscionable and IMHO, WRONG! It means a safe passage for any idiot who can sign their name on the dotted line, no questions asked, all mistakes forgiven, all losses turned into gains. If that isn't Socialism, I don't know what is. All the return, with none of the risk.

Welcome all to the Socialist Republic of Kalifornia, courtesy of an ex-pat from Austria, no less. I am sooo pissed by this move.

I tried to respond Malcom. But I used the S-word, and now is in moderation. S-word meaning Social ist. Maybe that can that get through the moderator's filter?

Sorry, mispelled your name Malcolm. I was 'dreaming' so please forgive me.

hmmm, lets review:

BofA loans 2 billion to countryslide at 8%
Countryslide decides to modify loans at their teaser rates... (less than 8%)
So borrow at 8 loan at 6, and you get to shake the governors hand?
I don't have an MBA, so maybe I miss how this is good for a company...

Oh, but BofA gets to convert that 2billion to stock in countryslide at $15 per share... (well when they inked the deal CFW was north of $20, currently about $10)

Well, poor B of A might not have understood banking or the loan business, its not like they should have any experience in those industries right? Its not like they are a bank or know about loans right?

Even today, it takes a special type of good business sense to lose almost a billion dollars on one transaction, in such a short period of time...

the 3 players who are supposed to bailout housing, countryslide, fanniemae and freddidmac, all took a hammering last week... Boards of directors might suddenly not feel like doing their impression of the fantastic 4 and trying to save the world now...

good_guy Says:
I think when the market does come back (post-2009)

You mistyped 2019. Other than that, good luck.

good_guy Says:

...bought a house last fall, took a boring 30-year fixed rate mortgage at 6.5% (a historically low rate),

6.5% is historically low only when you talk to RW's, they have been saying that in the past 3-4 years. Instead of counting the 40k equity you should evaluate your ability to pay your mortgage in a job market downturn. If you are good at what you do, then you have a lot less to worry about.

LowlySmart no apologies, it is a very common thing.

Azrob, of course you are correct, I think the reason they would participate in what is essentially a PR stunt is because now they are giving the illusion of being cooperative which opens Pandora's box to even more involvement and bailouts. It is like when a criminal turns state's witness and all of a sudden gets the new job and becomes legitimate.

One random note to add here...the banking, automobile and insurance industries have put us on a debt treadmill by making us believe we need to own cars....To all you folks who own you own hom in a major city....and also work in the city (and can take public transportation to work)...SELL YOUR CAR...and rent out your parking space. My partner and I rent out our parking space for $250 month...and we use Zipcar for cars when we need them. Start collecting rent....and stop fueling the finance, auto and insurance industries with your hard earned money....GIVE UP YOUR CARS whenever possible....oh, and it helps the environment too...

Yes ride bikes if at all possible, and dive into the "car free" and bicycling/bike messengering literature, you'll find it's quite possible.

Tell yourself if you ever need to you can always take a cab, you'll be surprised how little it costs next to having your own car.

If for some reason you live out in the boonies, look at getting an older car with a good repairability index and learn to repair it.

around here, I have 2 mountain bikes in various states of disrepair, one's rideable right now but I plan to get the 2nd one going too (it was a Dumpster special) plus my Honda Rebel plus we have an assortment of gas-guzzlers, trucks, that we actually put very few miles on. There's also a decrepit VW Rabbit that I'm afraid I'll break so I don't drive it. It and the Honda Rebel are about the same discomfort level lol.

Giving up cars whenever and wherever possible is a GOOD idea - I was bike/bus for a long time, then got into cheap motorcycles and scooters, more expensive but still much cheaper than a car.

Gas will be $4 a gallon soon, like after the presidential election. The high price of gas/oil will be one of the major factors in this Depression. Last Depression gas was comparatively cheap. This time it won't be. There *will* be work for the mechanically handy, to make/repair bikes, bike trailers, and such things.

LOL. There's not going to be a depression. We're going to get our ass handed to us on oil, gasoline and natural gas. Much deserved, I might add. But the world might want to purchase American goods again, and that's excellent for all of us.

Recession is a natural part of the economic cycle, especially after two booms in a row. The U.S. needs to buckle down, rediscover its work ethic and then surge out of the recession and into another prosperous era.

good guy and ex renter:

You both are so right. So many people got it so wrong when they're not looking at their transportation cost as part of their housing cost. And also they don't consider the fixed cost of their transportation versus the variable cost of their transportation.

A goal of mine has been to have practical steps to decouple housing from transportation. It means, not living in outyling areas, and living close to functional public transit (in other words, in SC county, that means one of the very few high frequency bus lines). (Counts out the fortress, except for along the El Camino or Stevens Creek).

Another goal is to keep the fixed cost low. I think you know what that means. Because, if the fixed cost is low, then I'm mostly only paying as I use it (fuel, maint.), and not for collision insurance, depreciation. So I think you know what that means working in SV with all the beautiful people: lotsa derisive looks and remarks about the old highly depreciated vehicle in my parking lot.

Some of them smugly remark that their transportation costs are even lower than mine because they drive a Prius. Hah! Call up Toyota and get a quote to replace that battery, which has a finite lifetime spec'd for about 10 years: I think it's something like $8500.

I think the issue of transportation costs will accelerate the downturn in the outlying areas. Places like Tracy, Antioch, Morgan Hill, Gilroy, where people moved to afford homes at the expense of Herculean commutes are already feeling serious pain in their housing markets. Transportation costs will only make things worse when households there are already stretching to make mortgage payments, are facing ARM resets, can't refi, and now are looking at $4/gallon gas or more. Plus, you can't bike to work.

It's sad that so many otherwise educated people don't know anything about working on their cars. It's not rocket science. I've done most of the work on my own cars now for 30 years and have saved enormous amounts of money, plus the aggrevation of being beholden to the schedules of mechanics.

A cheap $100 OBD-II scanner can pull and reset your codes. Rotate your own tires and check the pad thickness when you are down there. Change all your fluids yourself. You would be amazed how much these simple steps can save your funds.

but in the long run it is better even for jealous renters if the banks do ok. The recession with 50% price drops and mass unemployment etc etc is going to bite EVERYBODY.

Speak for yourself.

@ptiemann

You might not care for what skibum or anyone else here says, but you might be interested in what someone who posted 1,000% gains this year betting against real estate says. I find it interesting he is already rotating out of his subprime residential real estate trade, and moving towards commercial real estate. The overall real estate market might be moving towards the really interesting phase now, as a general recession gains traction and actual income drops and credit deterioration registers into the market with sizable force by Q4 2008, Q1 2009 at the earliest.

HSBC Bails Out 2 Troubled Funds
Monday November 26, 10:43 am ET
By Robert Barr, Associated Press Writer

HSBC Assumes $45B in Assets and Funding in Bailout of 2 Troubled Investment Funds

LONDON (AP) -- HSBC Holdings PLC, Europe's largest bank, said Monday it will bail out two troubled funds it manages by transferring about $45 billion of their assets onto its balance sheet.
HSBC said it will also inject $35 billion into the two funds, Cullinan Finance Ltd. and Asscher Finance Ltd., in a move that will clarify responsibility for the funds and prevent liquidation of their assets.

The funds are "structured investment vehicles" or bank-sponsored businesses that sell short-term debt but have been operated off the bank's balance sheet.

The moves are another symptom of a global credit crisis which has forced up the cost of short-term lending.

HSBC shares fell 2.2 percent to 809.5 pence ($16.56) in midday trading Monday in London.

Structured investment vehicles, or SIVs, are bank-sponsored businesses that sell short-term debt -- such as unsecured commercial paper -- to investors such as hedge funds. The banks use the proceeds to buy longer-term assets, like mortgage-backed securities.

SIVs normally generate money through fees and the difference between short-term and long-term rates. But in August, demand for short-term assets dried up, creating liquidity problems for SIVs.

The viability of an SIV relies on its ability to continue borrowing money.

Amid this year's flight from risk, lenders in the commercial paper market have frequently balked at letting borrowers "roll over," or extend, their debt. This is what is happening to most of the world's roughly 30 SIVs, which collectively manage about $320 billion.

An SIV that cannot continue borrowing money would need to find cash elsewhere or sell its investments. Since mortgage debt has lost so much value -- some types of mortgage debt are selling at less than 20 cents on the dollar -- this would likely lead to losses for investors in SIVs.

Earlier this month, bankers from Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp. announced an agreement on a multibillion-dollar fund to buy distressed debt securities.

HSBC, whose SIVs are among the largest in the market, said it would not be participating in that fund.

"As existing investors will continue to bear all economic risk from actual losses up to the full amount of their investment, HSBC expects no material impact to its earnings," the company said in an announcement to the London Stock Exchange.

HSBC said it will offer investors in Cullinan and Asscher the option to exchange their existing income and mezzanine notes for notes issued by one or more new vehicles.

Current senior debt holders of Cullinan and Asscher will be repaid as the debt falls due and will have the opportunity to reinvest in the commercial paper issued by the new vehicles, HSBC said.

No issues whatsoever with unrestrained shopping binges! (Both sick as a dog) Works great. Other than gas, take-out and a few dvd rentals we weren't feeling well enough to join in on the fun.

It's hard to spend when you're in a coma. Feeling... much better now thank you.

"Next year I will start to appeal some property tax bills"

Might be a teence early for that but you're welcome to give it a shot. Pack a lunch (it may take a while). I'm sorry if this seems... testy but on one hand you're saying you don't care if your property values go down but OTOH you're at the ready to appeal? It just sounds a little defensive a position for someone that doesn't care to take?

DennisN,

I did all that stuff for years. In many cases b/c we had 4 or 5 cars and it CAN... add up quickly. Then when the complete lack of gratitude finally struck me (and the fact that they just found other ways to spend what "I" was saving I retired as "Fleet Maint. Coordinator".

Now my job description consists mainly of scheduling maint. appts. for "the fleet" and I'm complaining about THAT. They call and ask you to call one of "your buddies" to get them a deal on having their transmission serviced and then don't like the day/time you were able to set up. So I've turned in my "notice" there too.

Yep, maintenance on one's ride may get more popular.

One good tool to use is the internet. I had a blower that only worked in "off" and "high", so I googled the problem and came up with several sites explaining the problem and how to fix it. All I had to do was replace the blower resister, a $26 part that took 2 minutes and a screwdriver to replace. Had I taken the car in for repair, I'm sure the shop would diagnosed a need for a whole new blower motor assembly along with lots of labor charges.

Headset,

Excellent point. Some of the Car Club threads will give you just what need.

"My 2003 ____ won't ____ when it's____"

Those are the "fixes" I love. When you have thousands of people that ALL own your year, make and model contributing to a single source you're bound to find answers even factory trained tech's hadn't encountered. Oh and all the aggravation they went through getting to the bottom of things!

It's just not worth it to me though to have hot tranny fluid running into my armpit to save __ $'s. I'd rather have someone else contend w/ that.

From Bloomberg , via Ben's blog:

The ``SuperSIV'' fund, backed by U.S. Treasury Secretary Henry Paulson, would buy assets from so-called structured investment vehicles, whose $300 billion of holdings include corporate and mortgage debt in danger of default. Analysts including Richard Bove of Punk Ziegel & Co. have criticized the proposal because it may saddle new participants with losses created by their bigger rivals.

``Why should we put something on our balance sheet that is going to result in further writedowns?'' is how most contributors will respond, Bove said in an interview. ``The job of the Treasury isn't to go out and defraud investors.''

I LOVE IT! Not to pick on Mr. Bove, but I agree that it is not the job of the Federal Reserve (or the Treasury) to defraud investors. That particular job belongs to someone else, like Citibank or Countrywide Mortgage.

Another zinger:

``It's so nice to get a personal invitation to go to Washington and have a one-hour visit with Ben Bernanke,'' said Fuss, who decided participating wasn't worth the risk to his firm. ``Oh, boy, did I feel important for about 27 seconds, and then you smell a rat.''

Sweet. Absolutely deliscious.

From

http://www.pimco.com/LeftNav/Featured+Market+Commentary/FF/2007/GCBF+Dec+2007.htm

Indeed, I’ve taken to calling the 2004-2006 vintages of limited or no document, no down payment, negative amortization (pay-option) subprime ARM loans as not loans at all, but rather free, at-the-money call and put options on property prices. Not exactly free, to be sure, as the putative borrower was obligated to pay something in cash interest, even if not the full amount, with the unpaid amount being added to the principal.

But as a practical matter, the options were essentially free. If home prices went up, the putative “borrower” would stay current, as the call went into the money, refinancing before the ARM reset, essentially re-striking the option exercise price higher. Simply stated, the borrower wouldn’t default, as logical people do not walk away from in-the-money call options.

And they didn’t, until about a year ago. As a consequence, default rates on pools of such subprime loans came in amazingly low, soothing rating agencies’ nerves and re-enforcing the shadow banking system’s appetite for securitized pools of them.

But if house prices didn’t rise, the call option would fall out of the money, and the put option – the right to default on the full principal value of the loan – would go into the money. Indeed, house prices didn’t have to fall, but simply not rise for this outcome to unfold, given negative amortization. In which case, the putative borrower would no longer have any incentive to stay current: Why throw good money after bad for an at-the-money call option that you got for free, which has gone out of the money?

And so it came to pass about a year ago, when early-payment defaults became a new phrase in our collective lexicon. The home price bubble popped, the at-the-money call options went out of the money, the at-the-money put options went into the money, and the holders of them remembered the wisdom of Paul Simon’s 1975 treatise on 50 ways to leave a bad situation:

You just slip out the back, Jack
Make a new plan, Stan
You don’t need to be coy, Roy
Just get yourself free
Hop on the bus, Gus
You don’t need to discuss much
Just drop off the key, Lee
And get yourself free

And with Jack, Stan, Roy, Gus and Lee setting themselves free, the shadow banking system was revealed to be caught between the longing for love and the struggle for the legal tender, living life as Jackson Browne’s Pretender, ships bearing their dreams sailing out of sight, with the junkman pounding their fenders. To wit, a run on the asset backed commercial paper market!

My 2004 forecast of a cyclical peak for Fed funds of 2 ½% was spectacularly wrong. I own that. I also own the very rational reason why: the Fed chose not to use its regulatory powers to police the mortgage loan originator sharks feeding the levered yield appetites of the shadow banking system. I thought they both should and would, and I was wrong.

Refinancing programs omit many borrowers
Mass., other states limit their focus
By Binyamin Appelbaum, Globe Staff | November 21, 2007

Eight states including Massachusetts have pledged almost $900 million this year to help borrowers replace unaffordable mortgages, but the states collectively have refinanced fewer than 100 people, a Globe survey found.

In Massachusetts, where the Patrick administration introduced a $250 million program in July as a "big piece" of its efforts to limit foreclosures, not a single loan has been refinanced.

In Maryland, the first state to create a refinancing program, officials have found it so ineffective that they are considering shutting it down. The program has made just nine loans in about a year.

A leading advocacy group said the programs simply aren't able to help most borrowers. "They're very well intentioned," said David Berenbaum of the National Community Reinvestment Coalition, "but these new products aren't fitting the needs of the consumers we see."

The vast majority of the applicants aren't eligible for refinancing. They have either fallen too far behind on their payments, have badly damaged credit, or simply owe more on their loans than the value of their homes, making refinancing effectively impossible.

In Massachusetts, more than 3,500 people have called seeking help, but only about 30 passed two stages of screening and were referred to lenders to begin the actual refinancing process. None have received a loan as yet. Ohio initially expected to serve one of every three applicants; officials say they have so far helped one in 15.

The state programs, which work in similar fashion, do not lend money directly to homeowners and are not funded with tax dollars. Instead, qualified applicants are referred to traditional lenders, who can resell the mortgages they make to state housing finance agencies. Because the agencies are assuming the lenders' risk, borrowers are able to qualify for lower rates and payments than they otherwise would receive.

But the programs primarily were designed to help only a portion of the population with problem mortgages: those who can make their payments now, but are facing unaffordable rate increases.

"It was a great program for somebody who was thinking ahead," said Tonna Phelps, director of Single Family Housing at the Maryland Department of Housing and Community Development. "The problem is that people aren't thinking ahead, so now we have to go back to the drawing board."

While the programs struggle, new states keep jumping in. Connecticut, New Jersey, and Pennsylvania all announced refinancing programs within the last month, totalling almost $300 million.

The stalled state efforts highlight the general difficulty of helping homeowners avoid foreclosure: Officials have only a short time frame to act before borrowers fall too far behind to be helped. Yet the circumstances of each loan are unique and complex - "Like snowflakes," said one official - making it is impossible to process cases routinely. Moreover, lenders often must be persuaded to accept a financial loss to make the refinancing possible.

Berenbaum said his group has helped several thousand borrowers across the country by getting lenders to modify existing loans by lowering monthly payments. That allows the group to help people without subjecting them to the increasingly difficult process of qualifying for a new loan.

More than 6,200 properties were foreclosed in Massachusetts during the first 10 months of this year, according to data released yesterday by Warren Group. That is more than three times the number of foreclosures during the same period last year.

The $250 million Massachusetts program is the largest by any state. Governor Deval Patrick introduced it with great fanfare in July, as part of a series of measures to limit foreclosures.

Officials at the Massachusetts Housing Finance Agency, the quasi-public entity administering the program, said it is too early to judge the results. They said they spent months building infrastructure to help large numbers of applicants, and that the first people who applied for help, in August, are only now approaching the end of the refinancing process.

The Patrick administration said it was committed to making sure the program succeeds.

"If we see as the months go on that this MassHousing product needs a second look, we will work with MassHousing to give it a second look," said Kofi Jones, a spokeswoman for the Massachusetts Executive Office of Housing and Economic Development. "It's only as effective as the numbers prove it to be in time."

Its success will depend on the state's ability to persuade lenders to swallow losses in connection with the refinancings, officials say. Declining property values have left many borrowers with mortgage balances greater than the current value of their homes. Those loans must be replaced with loans that do not exceed the homes' values.

The Patrick administration has said it would urge the holders of the mortgages to accept partial repayments. For example, a borrower who owed $350,000 and lived in a house that is now worth $300,000 would receive a new $300,000 loan through the state program. The original mortgage company would agree to accept a repayment of $300,000 and swallow a $50,000 loss.

Patrick officials hoped lenders would be willing to do so because a foreclosure could result in the loss of a larger sum.

So far, that hasn't happened. But MassHousing director Tom Gleason said he has seen encouraging signs in recent weeks that some mortgage companies are willing to work with the agency.

"Six weeks ago, we were not getting the kind of response from our servicers that would lead to success," Gleason said. "I don't feel that way anymore. We are getting phone calls returned."

Bruce Marks, head of the Neighborhood Assistance Corporation of America and a critic of the Patrick administration's efforts, said he doesn't think the state is putting enough pressure on lenders to accept losses.

He noted that his organization successfully pressured the nation's largest lender, Countrywide Home Loans, to allow NACA to restructure some of its loans to create payments borrowers could afford. In the month since that deal was reached, Marks said his group has restructured loans for 40 Massachusetts borrowers.