Drees, others file suit over HUD ruling
HUD announced early in 2008 its plans to amend its Real Estate Settlement Procedures Act for the first time in 30 years. The final rule, announced in November and effective Jan. 16, aims to protect consumers from high settlement costs by requiring more disclosures. It also improves and standardizes the good-faith estimate, a list provided by a lender that details the fees expected to be associated with a loan's closing. Moreover, the rule prohibits the ability of builders to require the use of affiliated businesses in order for consumers to earn incentives or discounts with the purchase of their home.

Homeowners burdened by homebuilder's money woes
As hard times fall on a Dallas-based homebuilding company, homeowners are also feeling the weight of the problem. Michael Garver moved into his new Sotherby home two months ago. Within the past two weeks, letters started arriving in the mail from subcontractors threatening to put liens on his house and demanding thousands of dollars.

Builders with unsold homes get little leniency from bankers
In his 35 years as a home builder, Bobby Lunceford earned plenty of accolades. Kennesaw Citizen of the Year in 2000, home builder of the year in 2003 and outstanding Georgian, according to a resolution approved by state lawmakers in 2004. None of that mattered, however, when Lunceford tried to work with five banks to save his business, Bob Lunceford Properties, after home sales plummeted. He asked the banks to suspend loan payments until his homes sold, at which time the loans would be paid off. Instead, "the instant we ran out of money all but one bank began foreclosure proceedings," Lunceford, 56, recalled. He and his wife, Becky, lost their home, their cars, their life savings and their business, and now live in a rented house.

High-end Plano homebuilder suspends some operations
Plano-based Sotherby Homes builds more than 300 houses a year that sell for between $300,000 and $500,000. This week, the company's Internet marketing sites weren't working, and some of its sales offices were idled. Sotherby has been in business for 14 years and builds in Collin and Denton counties. Officials did not return phone calls or e-mails Monday. But the builder released a statement that said "national lenders have severely curtailed financing to builders such as Sotherby due to the recent economic crisis."...Almost two dozen North Texas homebuilders have gone out of business during the last two years because of declining sales and reduced construction.

Councilwoman's property listed in foreclosure
"It has, unfortunately, been a problematic property since the time I purchased it," Freitas said."Over the years I have had to continually pour money into trying to fix some of the shoddy construction work from the original builder," she said. "I've replaced siding, windows, decking, sprinkler systems, etc. You name it and I have probably had to replace or fix it."Given the cost of maintaining the problematic home, "I made the conscious choice to let this property go," Freitas said.

Austin new home construction down 34% in "08
Starts in 2008 totaled 8,987, or 34 percent lower than the 13,624 housing starts in 2007, the report said. For fourth quarter 2008, starts totaled 1,459 new homes, down 51 percent from the same quarter last year, which saw 2,993 new starts. "The convergence of bad news regarding the economy shattered consumer confidence during the fourth quarter 2008," said Mark Sprague, Austin partner for Residential Strategies. "Reports from the builders have been of high cancellations on previous new home orders, and of buyers that are very tentative on purchase decisions until the economic outlook improves."

Saying Yes, WaMu Built Empire on Shaky Loans
We hope to do to this industry what Wal-Mart did to theirs, Starbucks did to theirs, Costco did to theirs and Lowe's-Home Depot did to their industry. And I think if we've done our job, five years from now you're not going to call us a bank."  As a supervisor at a Washington Mutual mortgage processing center, John D. Parsons was accustomed to seeing baby sitters claiming salaries worthy of college presidents, and schoolteachers with incomes rivaling stockbrokers'. He rarely questioned them. A real estate frenzy was under way and WaMu, as his bank was known, was all about saying yes. Yet even by WaMu's relaxed standards, one mortgage four years ago raised eyebrows. The borrower was claiming a six-figure income and an unusual profession: mariachi singer. Mr. Parsons could not verify the singer's income, so he had him photographed in front of his home dressed in his mariachi outfit. The photo went into a WaMu file. Approved.

"Liar Loans' Earn Their Nickname
Congressional leaders say the program's failure "€” only 357 people have signed up since Oct. 1 "€” shows that lenders aren't willing to modify loans voluntarily and they need to be forced to do so. HUD officials believe that people who used "stated income" mortgages which required no documentation of income, are having a hard time qualifying for Hope for Homeowners because of incorrect information on their previous loans. It might not all be the borrowers fault. In many cases, mortgage brokers and lenders fudged loan applications.

Senator's got Sunset on his mind
The agency is supposed to oversee home inspections and help the homeowner and builder come to an out-of-court agreement. But critics contend that this process often gets mired in bureaucracy. "The bottom line is that it doesn't serve the interests of homeowners," said Alex Winslow, executive director of Texas Watch, an Austin-based consumer advocacy organization. Winslow wants the Legislature to abolish the agency and adopt more rigorous licensing standards for home builders, but he will also support making the state commission inspection process optional to homeowners.

Editorial: Builders face drywall issues
Big questions remain about how much damage the sulphur-emitting dry wall actually caused to air conditioners, refrigerators and even home wiring, and whether there was a threat to human health. Builders are already hard-pressed in the current slump. But this dry wall business has the potential of becoming a class-action litigation nightmare. Better to tackle the matter up front, using insurance, special funds, whatever, to satisfy customers once there's a reasonable handle on the issue, than to let lawyers fight it out in court.

Cramer's 'Mad Money' Recap: A Wish List for Santa
Cramer said first on his wish list is for Treasury Secretary Hank Paulson to promise not to give a single cent of the TARP money to the homebuilders. The builders, he said, created this problem by building far too many homes and selling them to unqualified people. If the government gives any aid to the homebuilders, they'll only build even more homes and slow the recovery further.

Moment of triumph for whistle-blower takes a tragic turn
With her death, her impact as a whistle-blower takes on a poignant new dimension. Farmer's complaints to government officials about the federally funded home repair program and subsequent lawsuit helped trigger an investigation by the U.S. Department of Housing and Urban Development that led to a temporary shutdown of the program. Documents Farmer obtained through open records laws and a lawsuit showed that contractors in the home repair program routinely billed the city for excessive materials and for work that wasn't performed or was done poorly. HUD's inquiries into the program led the agency to discover improper spending in other federally funded city-housing programs, prompting a demand for repayment of $15.5 million. The city paid the first of five installments Dec. 1.

Warranty Company Facing Possible Action from Texas AG
When FOX 4 started investigating, we found more than just angry customers of National Home Protection. We also found the New York City based company is not licensed to do business in Texas. The Texas Real Estate Commission ordered the company to cease and desist back in early 2007, and has demanded the company stop selling home warranties in Texas. But the company never responded, according to TREC attorney and Assistant Director of Enforcement Beverly Rabenberg.

High-end Plano homebuilder suspends some operations
One of the Dallas area's best-known custom homebuilders has suspended some operations. Plano-based Sotherby Homes builds more than 300 houses a year that sell for between $300,000 and $500,000. This week, the company's Internet marketing sites weren't working, and some of its sales offices were idled. Almost two dozen North Texas homebuilders have gone out of business during the last two years because of declining sales and reduced construction. Total housing starts in the Dallas-Fort Worth area this year were less than half what they were in 2006.

Chinese drywall fears widen in SW Florida
Richard Cesta's on his third air conditioning coil in a few months at his Bella Terra condominium. The air in his home sometimes smells of sulfur.  Like other Lee County residents, he's worried he may be victim of Chinese drywall leaking corrosive chemicals into his home and endangering his health. "You can actually see all the copper tubing that deals with the air conditioning system has turned black," said Cesta, 61, a retired truck driver from Long Island, N.Y., who bought the condo in south Lee County in 2006 and retired there with his wife, Virginia, last summer.