HOUSING
Foreclosure rules eased for unemployed
The Obama administration is making it easier for out-of-work homeowners to stay in their homes, as it tries to revamp its troubled foreclosure-prevention program.
Starting Aug. 1, the Federal Housing Administration will extend the period for unemployed homeowners to miss mortgage payments to a full year from three or four months. That will allow qualified homeowners to go without making a monthly payment for 12 months before the foreclosure process begins.
The extended grace period only applies to FHA-backed loans, which are usually given to low- and middle-income borrowers and represent about 14 percent of all active mortgages and roughly 25 percent of new mortgages, and homeowners in the government’s foreclosure-prevention program. About 10,000 homeowners in the foreclosure program and 3,500 FHA-backed homeowners per month would be eligible, officials said.
CONSUMERS
Strong June sales seen by retailers
NEW YORK | Colossal sales enticed consumers to shop like it was 1999 last month. But higher prices ahead could cause the party to end.
Warm weather and discounts of up to 80 percent on summer merchandise helped retailers deliver the best revenue gains since June 1999 in what is typically the second-biggest shopping month of the year.
But pressure on stores to pass along higher costs for everything from clothing and handbags to food has raised concerns that the momentum may not continue heading into the busy back-to-school shopping season.
Big merchants Target Corp., Costco Wholesale Corp. and Limited Brands Inc., as well as teen retailers such as Buckle, were among the companies that posted June results that beat Wall Street estimates. Luxury retailers such as Nordstrom Inc. and Saks Inc. also posted another month of stellar gains, as wealthy shoppers have gone back to spending.
DEBT
Buffett: Risks seen in failing to hike debt ceiling
OMAHA, NEB. | Billionaire investor Warren Buffett said Thursday that Congress is playing a dangerous game by considering not raising the U.S. debt ceiling.
The CEO and chairman of the conglomerate Berkshire Hathaway Inc. said on the cable TV network CNBC that there is no way to tell what might happen if the debt limit is not increased, but it’s a dangerous idea.
Mr. Buffett compared the debate over raising the debt limit to a game of Russian roulette with one bullet in a revolver.
He said refusing five times out of six to raise the debt limit might not be dangerous, but the sixth time could have catastrophic consequences.
“You’re playing with fire when you don’t need to play with fire,” he said.
Mr. Buffett said Congress raised the debt ceiling seven times during President George W. Bush’s administration, so it would be silly not to do so now.
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