Daily Archives: May 9, 2014

How Goldman Sachs Can Get Paid to Keep People Out of Jail

Goldman Sachs is investing $9 million in an effort to reduce crime in Massachusetts, using a financial product called a social-impact bond. If young men in the program — drawn from a pool of men the state believes are at “high risk” of incarceration — spend less time in jail than their peers, then Goldman stands to profit off its investment. If many of the men still end up behind bars, the bank will lose nearly everything it ventured. How the program works: RELATED STORY >>

Helen Galope’s LIBOR appeal case – Order for Rehearing Denied to the banks

Florida loan modifications set to expire beginning this year

Hundreds of thousands of homeowners nationwide and in Florida will be hit with higher mortgage payments as loan modifications granted during the early days of the housing crisis begin expiring this year.

The federal Home Affordable Modification Program, which has reduced interest rates to as low as 2 percent for nearly 900,000 struggling borrowers, has a five-year shelf life before resetting. The first modifications were granted in the fall of 2009, meaning they will start to expire in September.

In Florida, monthly payments could increase by as much as $1,168, as the lowered interest rates grow at a pace of 1 percent per year until they reach the level they were at when the loan was modified.

But the median increase statewide is expected to be much smaller — about $162 per month — according to a report by the Inspector General of the Troubled Asset Relief Program, or TARP.

Federal officials and homeowner advocates are concerned what will happen as modifications expire and are warning borrowers who may not realize their payments are about to increase.

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