Catholics For Sebelius

Foreclosures rose 8% nationally last month from December, but were down 15% from a year earlier, foreclosure listing firm RealtyTrac said Thursday.

All told, 210,941 US homes received a default notice, were scheduled for auction or were repossessed by a lender in January, RealtyTrac said.

• STORY: Government exends deadline for foreclosure reviews

Thats up 3% from December, but a drop of 19% from January last year. The foreclosure rate translates to one in every 624 US households.

Despite the annual decrease at the national level, some states posted sharp increases compared to January 2011. In New Hampshire, foreclosures jumped 62%. In Massachusetts, 75%.

That trend is expected to strengthen this year in light of last weeks $25 billion settlement between the nations biggest mortgage lenders and 49 state attorneys general over the industrys handling of foreclosures.

Many banks and mortgage servicers processed foreclosures without verifying documents. Some employees signed papers they hadnt read or used fake signatures to speed foreclosures — a practice dubbed robo-signing.

Major banks temporarily put foreclosures on hold after the problems surfaced in the fall of 2010. Some had to refile previously filed foreclosure cases and revisit pending cases to prevent errors. Those delays and uncertainty over state and federal probes into the industrys foreclosure practices led to a sharp slowdown in foreclosure activity last year.

The settlement between the banks and state attorneys general helps clarify the rules banks must follow to foreclose on borrowers, said Daren Blomquist, a vice president at RealtyTrac. That will pave the way for more foreclosures, he said.

The settlement will accelerate the foreclosures that are happening this year and it will accelerate the process of lenders catching up on the backlog of foreclosures that has been building up over the last year and a half, Blomquist said.

Credit rating agency Fitch Ratings also anticipates foreclosures will climb nationally this year, but not right away, noting it will take some time for lenders and mortgage servicers to make sure they are in compliance with the rules set forth in the settlement.

You probably are going to see the pace pick up as the year goes on, said Grant Bailey, a managing director at Fitch.

RealtyTrac projects foreclosures will rise 25% this year to 1 million homes. Last year, lenders took back 804,000 homes.

Even so, the rise in foreclosures isnt expected to be uniform nationwide. Thats because the settlement isnt likely to ease the backlog of foreclosure cases in states where courts play a role in the process.

In addition, some states have taken steps to slow lenders down.

Throughout the housing downturn Nevada has had the nations highest foreclosure rate. There, a law that went into effect in October requires that foreclosure documents must be filed in the county where a property is located and a lender must provide a notarized affidavit detailing their legal right to proceed.

That has contributed to fewer homes entering the foreclosure process, but also a smaller pool of foreclosed homes available for sale in places like Las Vegas.

There are as many as 3,000 fewer homes listed for sale in the greater Las Vegas market than just a year ago, said Rosa Herwick, a broker and owner of Century 21 JR Realty in Henderson, Nev.

Thats made multiple offers on foreclosures and other properties priced up to $250,000 commonplace, she said.

There are tons of homes sitting out here vacant that people havent paid on for two years, or whatever the case, that should be in the foreclosure pipeline and are not yet, Herwick said.

Foreclosure activity in Nevada fell 8% last month from December, but was down 52% from January last year, RealtyTrac said.

High unemployment, a sluggish housing market and falling home values remain major factors in homeowners falling behind on their mortgage payments. Many borrowers also have simply stopped paying their mortgage because they owe more on the mortgage than the home is worth.

In the final quarter of 2011, 7.6% of homeowners missed at least one mortgage payment, the Mortgage Bankers Association said Thursday. In a normal market, the percentage of delinquent borrowers is about 1.1%, according to the trade group.

Delinquent mortgages have come down from a record high of more than 10% of residential mortgages in 2010. The quarterly survey covers nearly 88% of primary residential mortgages, or nearly 44 million loans.

Still, part of the reason for the decline is a delay in foreclosure filings, especially in backlogged state courts in Florida, New Jersey, Illinois and New York.

The end of a 16-month state and federal investigation info faulty foreclosure paperwork this month will likely increase foreclosures this year.

Jay Brinkman, the mortgage bankers chief economist, said employment is the key driver of mortgage performance and noted that the number of delinquent mortgage payments is falling faster than the nations unemployment rate. Higher unemployment typically leads to more missed payments and a greater number of foreclosures over time.

The unemployment rate has fallen for five straight months to 8.3% in January, the lowest in three years. Companies added 243,000 net jobs last month, the most in nine months.

6:05 pm — Near the end of the day, prosecutors played a recording from Sen. Scott Beason, who wore a recording device as part of the investigation. The recording which Beason said during the first trial had been made accidentally apparently picks up statements made by an unidentified legislator who states that blacks will be bused to the polls on HUD-financed buses if the gambling issue makes it to a statewide vote. Beason appears to concur with the sentiment.

Gilley said the comment was nauseating and did not know Beason held those views. Day then asked Gilley if he would have tried to secure Beasons vote if he had known about the comments.

His views are completely opposite of what mine are, but at the end of the day, I have to be completely honest. If he was the (deciding) vote, I would have offered him the (bribe), Gilley said.

The recording was played by the defense during the first gambling corruption trial,

Testimony resumes Friday at 9 am

3:15 pm Ronnie Gilley testified Thursday the he used Sen. Harri Anne Smith to pressure legislators to vote for pro-gambling legislation, and that Smith was willing to carry out Gilleys wishes after receiving his campaign money.

Gilley spent the first part of his Thursday afternoon testimony talking about what he believed was his influence on Smiths change from opposing gambling legislation to becoming a vocal supporter.

Gilley said he urged Smith to lean on legislators who appeared to waver on supporting SB380 in 2010. Assistant US Attorney Kendall Day played several recordings between Gilley and Smith in 2010 where they discussed the gambling bill.

During a call recorded on March 22, 2010, eight days before the final vote on SB280, Gilley urges Smith to pressure legislators.

I need you to reach out to anybody you can, Gilley said. See if you can lean on (Sen. Scott Beason) or any (expletive) else you can.

I will, Smith replied.

Gilley said Smith vowed to help him pass gambling legislation after he contributed to her campaign in 2008. Gilley said Smith visited him and told him Im yours. Whatever you need, let me know and it is done.

Gilley said that began an almost 2-year business relationship between the two in which Gilley said he funneled hundreds of thousands in cash donations and in-kind donations to Smiths campaign in exchange for Smiths vote and her efforts to sway others.

Smith has repeatedly denied Gilleys accusations and has said she changed her position on allowing people to vote on the issue of electronic bingo due to an overwhelming response from the people in her district.

12:04 pm Country Crossing developer Ronnie Gilley testified Thursday that he used the term democracy tour and the phrase we support those who support democracy as a way to hide the intent to bribe legislators.

Gilley testified Thursday morning that one of the ways he sought to gain the vote of former Sen. Jim Preuitt was to pledge a democracy tour. Gilley said a democracy tour consisted of using country music stars to make campaign appearances for legislators in an effort to gain public support. Gilley said most of the money used to pay the talent came from McGregor and that a $10 charge per person per event would be used as a campaign donation to the legislators.

Gilley often used the phrase we support those who support democracy during his public and private advocacy of pro-gambling legislation. He said he used the phrase to hide illegal activity.

During direct questioning Thursday, US Attorney Kendall Day played a recorded conversation that occurred March 31 2010, the day after Preuitt voted in favor of the pro-gambling bill SB380. During the call, Gilley thanked Preuitt for his vote.

We are rock solid with you and we believe in supporting people who support Democracy, Gilley said while speaking to Preuitt.

Day played another recorded conversation that occurred March 24, 2010, in which lobbyist Jarrod Massey told Gilley that Means wanted $100,000 for his favorable vote.

He can 100 percent count on our support, Gilley said. You tell him that we support those who support Democracy and those who dont support democracy can get ready to get their (expletive deleted).

Why did you use that phrase? Day asked.

It was the term I used to communicate to a legislator, indirectly, how to buy a vote, Gilley said.

Why phrase it that way? Day asked again.

Because I am breaking the law and I am trying to use democracy as a guise, a disguise, Gilley said.

10:31 am Prosecutors used portions of recorded conversations Thursday to suggest VictoryLand owner Milton McGregor and Country Crossing developer Ronnie Gilley turned to bribe offers to pass pro-gambling legislation because they foresaw a radical change in the makeup of the Alabama Legislature.

Under direct questioning of Gilley by US Attorney Kendall Day, a portion of a conversation recorded March 23, 2010, between Milton McGregor and lobbyist Tom Coker was played for the jury. Part of the conversation dealt with the urgency to pass a pro-gambling bill that would be voted on one week after the conversation.

McGregor: If the elections dont go right in November, we are going to be at even a greater disadvantage. In other words, you know what I know, we are not going to have as friendly a legislature to deal with come January.

Coker: Could be that we wont even have control of the committee anymore.

The emphasis on the makeup of the Alabama Legislature suggests a theory for the prosecution that was absent during the first gambling corruption trial in the summer of 2011.

Gilley suggested during testimony that a majority-Democrat legislature would be more friendly to gaming interests. Gilley said there was a belief among he, McGregor and others that Republicans could take control of the Statehouse, making it more difficult to pass pro-gambling legislation.

During the first trial, the defense suggested that a desire to take over the legislature motivated Republican legislators to wear recording devices as part of the vote-buying investigation.

Gilley testified for 90 minutes Thursday morning before the mid-morning recess. Day guided Gilley through a series of recorded conversations involving Gilley, McGregor, Coker, lobbyist Jarrod Massey and lobbyist Jennifer Pouncy as they discussed ways to gain a favorable vote from Sen. Jim Preuitt.

Gilley said he, McGregor and others zeroed in on Preuitt and Sen. Larry Means as the deciding vote needed to pass a pro-gambling bill out of the Senate. Twenty-one votes were needed to pass the bill and send it to the House.

At this point, we were borderline on 20 votes, Gilley said, adding that Means and Preuitt could name their price in exchange for their vote.

Gilley said he offered to bring in country music artists to campaign for Preuitt, and testified Country Crossing spokesperson Jay Walker offered to conduct a poll for Preuitt free of charge. Gilley referred to using country music stars for political campaigns as a Democracy Tour.

During his testimony Thursday morning, Gilley called the term Democracy Tour a guise.

What it meant was using money as well as branding a particular candidate with country music celebrities, Gilley said.

Gilley said McGregor was aware of Gilleys strategy and that most of the money used to offer bribes came from McGregor.

Gilley is expected to spend most of Thursday under direct questioning.

8:33 am – Testimony has begun. Ronnie Gilley is on the stand for direct questioning by US Attorney Kendall Day.

7:59 am Attorneys spent part of Thursday morning behind closed doors to determine several issues about the questioning of Country Crossing developer Ronnie Gilley at the gambling corruption retrial.

Some of the defense attorneys have objected to a few of the visual aids being used by the prosecution during the direct questioning of Gilley. Also, Susan James, attorney for former Country Crossing spokesperson Jay Walker, has some motions filed under seal concerning the areas she will be allowed to explore during her cross examination of Gilley.

In another issue, Bill Baxley, attorney for Tom Coker, has a scheduling conflict and has asked US District Judge Myron Thompson to reschedule Gilleys Friday testimony. Thompson did not rule definitely, but said the prosecution has a right to schedule witnesses in the manner they choose.

Testimony is set to begin at 8:30 am

Despite higher investment levels, overall private equity activity fell during the fourth quarter of 2011, according to the Private Equity Index (PE Index) released today by the Private Equity Growth Capital Council (PEGCC). Strong Q4 investment activity held the Index above its 10-year moving average and higher than its 2010 average level.

As of December 31, 2011, the PE Index registered at 103.9, which is 7.4 points below its revised level of the previous quarter. This decline was primarily driven by muted fundraising and exit activity. Despite this quarterly decline, private equity activity has increased on an annual basis. On average, the PE Index registered at 110.4 in 2011 compared to 96.8 in 2010. Some key observations about private equity activity in fourth quarter of 2011 include:

 Global private equity investment increased from $63 billion in 2011-Q3 to $99 billion.

 Equity contributed by sponsors in leveraged buyout deals increased from 39% in 2011-Q3 to 42%.

 Commitments to global buyout funds fell from $31 billion in 2011-Q3 to $18 billion.

 Global callable capital reserves (“dry powder”) for buyout funds fell to $367 billion.

 US private equity exits fell from $23 billion in 2011-Q3 to $20 billion.

“While private equity activity declined slightly last quarter, on an annual basis most industry fundamentals in 2011, including investment activity, were at their most favorable levels since 2008,” said Bronwyn Bailey, PEGCC Vice President of Research. “We are optimistic that, with more stable financial markets, private equity will continue to make critical investments that will contribute to US economic recovery and growth in 2012,” Bailey concluded.

Designed to provide an accurate snapshot of the state of the private equity market at any given point in time, the PE Index is a composite measure of global private equity activity based on three key factors: the dollar value of total private equity-backed investment, fundraising, and exits (portfolio company IPOs or sales to corporations or other investors). The Index measures 100 when all three components are at their 10-year moving average. These three factors collectively capture the most fundamental elements of the private equity market.

The Private Equity Index is calculated using data provided by Thomson Reuters, Pitchbook and Preqin. The Council updates the PE Index at the end of each quarter.

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