FW: Hello from Prof. Sam Bornstein. Housing "Double Dip"

Do any of you have Adjustable Rate Mortgages? If so do you know when they come up?

A lot of small businesses have used their home as collateral and it is because of that a lot of small businesses will be facing foreclosure.

According to Professor Bernstein California has 60% of these ARMs and note his studies show that there are significant numbers of small businesses that are affected by this especially in the Hispanic Community. See below.

If you would like a copy of the studies please let me know.

One of the bills introduced in this session is AB 10 which increases the minimum wage to $8.50 effective 2012 and in 2012 will include a cost of living adjustment.
How do you feel about this.


Scott Hauge
President
Small Business California
2311 Taraval Street
San Francisco, CA 94116
shauge@cal-insure.com
415-680-2188

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From: BornsteinSong@aol.com [mailto:BornsteinSong@aol.com]
Sent: Thursday, March 31, 2011 7:39 AM
To: Scott Hauge
Subject: Hello from Prof. Sam Bornstein. Housing "Double Dip"

Good Morning Scott,

Re: The "double-dip" in housing and the 2nd Tsunami Wave of Foreclosures

In my Testimony before Toni's committee on May 5 and October 19, 2009, I expressed concern for California's small business at the expected 2nd Tsunami Wave of Foreclosures which will result from the Alt-A and Option ARMs resets/recasts. This wave was expected in 2011 through 2012. Well, it is now happening.

"A new industry report yesterday warned that an "enormous backlog of foreclosures" among adjustable rate mortgages, known as option ARMs, is ready to swamp the fragile housing market, where home values have continued to slide for the sixth straight month with no clear bottom in sight. Foreclosures involving ARMs have soared by 23 percent in the past six months alone -- accounting now for 18.8 percent of all foreclosure actions -- a rate higher than subprime mortgages ever reached, said Lender Processing Services, which services about half of US mortgages."

All three of my Bornstein & Song Small Business Toxic Mortgage Surveys: U.S. National (11/08), California (4/09), and California Hispanic (6/09) confirmed that a significant number of small business owners will be part of this foreclosure wave. California will be hit hardest as 60% of these Toxic Mortgages originated in California.

Let's discuss.
Be well,
Sam

Samuel D. Bornstein
Professor of Accounting and Taxation
Kean University, School of Business, Union, NJ
Partner-Bornstein & Song, CPAs & Consultants, Oakhurst, NJ
bornsteinsong@aol.com
Tel: (732) 493 - 4799
Fax: (732) 493 - 3399