buy custom The Countrywide Financial Corporation essay

buy custom The Countrywide Financial Corporation essay The Countrywide Financial Corporation was founded in 1969 by Angelo Mozilo and David Loeb. Angelo Mozilo was the founder and chairman of the corporation. He is also thought to be behind the collapse of the company. In 1969, David Loeb founded the Countrywide in New York. Its intention was to create a nationwide lending firm specializing in mortgage loans. The company proceeded to open retail branches in California and by 1980 they had 40 branches in eight states. The company grew in leaps and bounds and saw it attain a loan origination of 2.2 million totaling to $408 million with 661 branches spread in 48 states. In the year 2008, the company was acquired by Bank of America for $4 billion. Its market value rose to $24 billion in 2006, but in 2007 it rapidly fell, when it emerged that the countrywide mortgages that had been during housing boom were overly risky and was faced with the risk of default. The company set pace on reforms that protected lenders from risks related to loan default. It also led to protection of borrowers with low income from exorbitant interest rates. Was the U.S. federal governments in 1932 intervention in the market for home ownership desirable? How did the creation of Fannie Mae in 1938, Ginnie Mae in 1968, and Freddie Mac in 1970 expand homeownership and shape lending practices at banks and other mortgage lending ?rms? Basing on the achievements realized it is clear that the intervention by the U.S government in the market was desirable. The creation of the Federal Home Loan Bank, for example, gave a provision on which lending to financial institutions is short-term prompting the desire for additional funds for home mortgages. The 1934 National Housing Act promoted homeownership. This is because it provided a system of insuring loans that protected default by borrowers. The creation of Fannie Mae facilitated secondary markets for mortgages. This was issued through guidelines of FHA program. This gave an opportunity to lenders who operated privately. This enabled private lenders to come up with a large count of FHA loans. Furthermore, due to the reason that loans could be sold in the secondary market. Another reason is that the borrower did not have to hold the loan until the loan term elapses. It also meant that another new loan could be created every other time the lender sold enormous loan bundles to secondary market inventors. Fannie Mae also bought mortgages that conventionally conformed to mortgages from the lenders. The reconstituting of Fannie Mae to trade publicly as a government sponsored enterprise saw its activities wiped out from the budget of the U.S federal government and moved its government insured portfolio, FHA mortgages, to corporation, which the government kept under total control. This was later known as Ginnie Mae. However, it remained in custody of Fannie Maes balance sheet. Th chartering of Freddie Mac facilitated the pooling of conforming loans, and came up with securities that were backed by mortgages (MBSs). These were sold as pooled shares on loan to the investors. The yield on interest for these security agencies lay between the U.S Treasury and AAA corporate. This obligation reflected low security risk. The MBSs development widened the secondary market for loans meant to be mortgaged. The reason being that the investors could buy portfolio of loan share other than buy intact portfolio loan. The Fannie Mae and Freddie Mac value to capital share in the market was equivalent to the MBSs obligations and debt guarantee of implicit government of the U.S. It is also important to note that, the Federal Charter demanded that they aid the residential mortgages through the secondary markets. It also obligated them to fund families whose incomes were low or moderate. They were also required to consider mortgage funding geographic distribution. This entailed finance on mortgage for geographic sectors that seemed undeserved. Another benefit that comes along with package of MBSs is that its mandate is to appraise the credit history of the borrower, and guidelines to establish the financial capability of the borrower in meeting the obligations of debt. This is important in establishing the probability of the borrower defaulting. This facilitated the growth of market of mortgage. Also the bolstering of loan program by the Veterans Administration led to zero down payment and reduced interest rates on loans. The housing burst of bubble in the year 2007, when the economy of the United Sates started weakening with the decline in demand for housing caused prices on homes to plummet. The appreciation in prices of homes almost coming to an end saw most of their properties go down. The equity position that was negative led to mortgage balance, which in turn led to fair market value of most of properties. The intervention, therefore, was desirable. This is because most of the issues that affected lending were deliberated on. It led to streamlining of mortgage business. It went along way in ensuring that the lenders were protected from risk that may arise. The borrowers too were not left behind as this ensured that no borrower was discriminated against based on race or geographical locations. The rate on interest towards the borrowers was also fully addressed by the enactment. Why did the U.S. Congress enact the Community Reinvestment Act, the Home Mortgage Disclosure Act, the Depository Institution Deregulation and Monetary Control Act, and the Housing and Community Development Act? Was this legislation effective in expanding homeownership? Did the governments promotion of subprime mortgages and high loan-to-value (LTV) subprime mortgages create additional risks for lenders and the holders of mortgage backed securities (MBSs) or collateralized debt obligations (CDOs)? In order to answer why the U.S Congress enacted the Community Reinvestment Act, it is important to note the reason for enactment. Sources indicates that the CRA and HMDA were enacted after the social activists group started pointing to the statistics that showed that FHA and lenders were involved in the systematic discrimination that was of race. This was directed to minority consumers who leaved in low income neighborhood. This practice was termed as redlining. The activist mobilized the Carter administration and Congress of the United States to come up with this enactment to curb this social injustice in lending and housing. The depository Institution Deregulation and monetary control addressed the concern on lenders who showed the sign of low income redlining of neighborhoods from their disclosures. However, the lenders defended this evil by pointing to the risks associated with loans made to low income earners, employment histories that were not stable, inadequate funds to enable them to make a down payment, or high debt to income levels. The acts, therefore, were enacted to address the concern by wiping out caps on interest rate and giving the lenders the opportunity to highly charge, or subprime rates to borrowers of higher risk. The Housing and Community development act of 1981 set goals for lenders borrowers of low income and gave an opportunity to FHA borrowers with credit records that are not perfect to access loans on mortgage with 90 to 95 percent LTVs. In the year 1995, the administration of Clinton increased the LTV subprime loans causing the CRA to increase home ownership for the Americans who in one way or another were not able to acquire mortgage loans through the conventional criteria of underwriting. The subprime mortgage created an additional risk to the lender. The reason being that-: the lender did not need the borrower to demonstrate how capable he is to repay the loan. The lender granted the borrower with low credit score, a high debt to income level, or a small down payment. The increased MBSs appetite on Wall Street, the brokers of mortgage expanded their net sales to entail requirements on documentation that was relaxed and limited or impaired the history on credit. This lending technique ensured that many borrowers accessed the loan. However, this could impact negatively on the lender incase the borrower defaulted in repaying. It is also important to know that the crisis of S L facilitated mortgage business unbundling. The origination of mortgage and servicing of loans led to a split. It led to pushing of most originations of mortgages into secondary markets as debt which is collateralized known as Collateralized Debt Obligations (CDOs). The ability of originators of mortgage to sell mortgages that were newly recorded as MBSs led to an increase of mortgage originators. The less strict nature of lending poses a risk on the side of the lender incase of default by the borrower. Buy custom The Countrywide Financial Corporation essay

The Pros and Cons of Year-Round School

The Pros and Cons of Year-Round School Year-round school in the United States is neither a new concept nor an unusual one. Traditional school calendars and year-round schedules both provide students with about 180 days in the classroom. But instead of taking off much of the summertime, year-round school programs take a series of shorter breaks throughout the year. Advocates say the shorter breaks make it easier for students to retain knowledge and are less disruptive to the learning process. Detractors say the evidence to support this assertion is unconvincing. Traditional School Calendars Most public schools in America operate on the 10-month system, which gives students 180 days in the classroom. The school year typically begins a few weeks before or after Labor Day and concludes around Memorial Day, with time off during Christmas and New Years and again around Easter. This school schedule has been the default since the earliest days of the nation when the U.S. was still an agrarian society, and children were needed to work in the fields during the summer. Year-Round Schools Educators began experimenting with a more balanced school calendar in the early 1900s, but the idea of a year-round model didnt really catch on until the 1970s. Some advocates said it would help students retain knowledge. Others said it could help schools reduce overcrowding by staggering start times throughout the year.   The most common application of year-round education uses the 45-15 plan. Students attend school for 45 days, or about nine weeks, then take off for three weeks, or 15 school days. The normal breaks for holidays and spring remain in place with this calendar. Other ways to organize the calendar include the 60-20 and 90-30 plans. Single-track year-round education involves an entire school using the same calendar and getting the same holidays off. Multiple-track year-round education puts groups of students in school at different times with different vacations. Multitracking usually occurs when school districts want to save money. PeopleImages / Getty Images Arguments in Favor As of 2017, nearly 4,000 public schools in the U.S. follow a year-round schedule- around 10 percent of the nations students. Some of the most common reasons in favor of year-round schooling are as follows: Students tend to forget a lot during the summer, and shorter vacations might increase retention rates.School buildings unused in the summer are wasted resources.Short breaks provide time for students to receive enrichment education.Remediation can occur when it is most needed during the school year.Students get bored during the long break of summer.It gives families more options for scheduling vacations, rather than restricting travel to summertime.Other countries around the world use this system.Schools on year-round schedules can accommodate more students through multitracking. Rushay Booysen / EyeEm / Getty Images Arguments Against Opponents say year-round schooling hasnt proven to be as effective as its advocates claim. Some parents also complain that such schedules make it more difficult to plan family vacations or child care. Some of the most common arguments against year-round schools include: Studies have not conclusively proven the academic benefits.Students forget information just as easily with a three-week break as 10. Therefore, teachers on a year-round system end up with four periods of review instead of just one at a new school year.Summer programs such as youth camps suffer.Student summer employment becomes virtually impossible.Many older school buildings do not have air conditioning, making a year-round schedule impractical.Band and other extracurricular programs can run into problems scheduling practices and competitions, which often take place during the summer months.With multitracking, parents could have students at the same school on different schedules. School administrators considering year-round education should identify their goals and investigate whether a new calendar can help achieve them. When implementing any significant change, involving all stakeholders in the decision and the process improves the outcome. If students, teachers, and parents dont support a  new schedule, a transition could be difficult. Sources National Education Association staff. Research Spotlight on Year-Round Education. NEA.org, 2017. Niche.com staff. Schools Without Summer Break: An In-Depth Look at Year-Round Schooling. Niche.com, 12 April 2017. Weller, Chris. Year-Round School is Booming but Its Benefits Are Overhyped. BusinessInsider.com, 5 June 2017. Zubrzycki, Jacklyn. Year-Round Schooling Explained. Edweek.org, 18 December 2015.

Laws on Property Essay Example | Topics and Well Written Essays - 2250 words

Laws on Property - Essay Example The Supreme Court in a divided decision held that the City's purpose of expropriation, which is to give the property to a private entity for development, falls under the term, for "public use." The Court held that the City as a whole would benefit because the development would bring much-needed capital, investments and work to the City of New London which is in dire need of an economic uplift. Thus, despite the fact that the City would expropriate the property and give it to a private entity, it would still be for "public use" Real property is protected by the registration through the Torrens System of Land Registration, which is popularly used all over the world. This system was invented by Australian Sir Robert Richard Torrens, as a means of simplifying how we transfer ownership of real property. As an owner of the land, I would have it registered and have to follow the requirements set by law, and upon registration, I am issued a Torrens Title, which is my evidence or proof of ownership of the land. The great characteristics of the system are that upon registration, the Title binds and protects my ownership of the land forever to the whole world unless I decide to transfer it or sell it, which should be registered as well. The essential idea [] is simple: Artists and creators should be able to enjoy the fruits of their labor for a specified time period, after which the material becomes available for public use. Society benefits because this incentive to create will yield a rich and varied cultural menu for its citizens. (On-line) Therefore, it is clear that laws are created to protect an individual's intellectual property, and gives him ample time to benefit from his creations, and upon the expiration of the time given, the protection is lifted, and the public may benefit. Another case I briefed is on the topic of protection of intellectual property, entitled Wal-Mart Stores, Inc. vs. Samara Brothers Inc., (2000). In this case, the defendant Samara Brothers, Inc. is a company that designs and manufactures children's clothes. Samara filed a case against Wal-Mart Stores because it found out that Wal-Mart Stores had entered into a contract with Judy-Philippine, Inc. to manufacture children's outfits based on pictures of clothes made by Samara and would be sold under a Wal-Mart label, "Small Steps." The case was on the charge of infringement of unregistered trade dress on the legal basis of section 43(a) of the Trademark Act of 1946. Upon reaching the Supreme Court on Certiorari, the Court held that the designs of Samara did not constitute the legal definition of an unregistered trade dress that would warrant protection under the law. This reasoning came about due to the fact that the product's designs are not distinctive enough to constitutional protection under Section 43(a). Just because a product's design almost always identifies the product to the manufacturer, Samara's designs do not make them so distinctive as to cause confusion on the consumers.