loan. we are a financial institution. but if you come to us for a loan and we think there is potential for one, we will provide business advising as well as a loan. to give you a sense of who we reach, we are really seeking to lind to traditionally underserved communities. for example, 35% of our borrowers are hispanic or latino. 22% african-american. 60% free mail, and 30% immigrant. -- 60% female. types of businesses -- we will make loans as small as $500 and as large as $100,000. they can range from home-based very small businesses like child care, people selling in the flea market, on up to janitorial, landscaping, restaurants, dry cleaners, and in some cases, small manufacturers. we sometimes bridges of it in even larger transactions if we think there's community benefits, we might wind collectively with the city's working solutions fund or with another lender. so far, -- and we work throughout the bay area. we work in four bay area counties, said francisco obviously being one of the i

credit unions offer micro loans. we do a lot of micro loans up to $50,000. this is -- we check credit. we need a business plan. then we look at the three-year tax return and that statement. we do a lot of home care and mom-and-pop shops. we also do start ups. we asked for approval through documents. we work a lot with people who do not know how to file taxes properly. we are mainly focused in san francisco. we are small. we focus mainly on the tenderloin, chinatown, bayview, visitation. we do a lot of expansion. people start small through the credit union and then want to go to the bank. we know we are limited. we cannot afford to give out a big loan. starting from the credit union, we educate them about filing taxes properly and then moving on to the bank, a small one, expansion, and we work with the bank. the bank and credit union are similar. we do allow tax returns, projections. credit unions do not charge an additional loan or processing fee. processing time, on a small loan, -- consumer loans probably a few days. because we require a business plan, som

loan. we will start with you, mark. >> absolutely. thank you. i want to thank speaker pelosi for putting this together. i want to thank all of the of for coming out on a smell it -- snowy san francisco date. [laughter] we've been told we should get us know when we go back outside. not sure what to expect. second, i thank speaker pelosi for all the work she did to support the jobs act and before that, the stimulus bill, the original american recovery act bill that allows sba to be able to besba landing more available to small businesses. very important piece of our tools that we have in this really very difficult time for small businesses to get access to credit. finally, i want to find the rest of the folks here, my colleagues on the panel. it is the case that sba works with these organizations to try to help small businesses understand how to get credit and fine tools to be able to do that. sba programs cover a wide range, and i will talk about this range of lending and the kinds of things

>> i already have an sba loan. i went to wells fargo for a line of credit and they would not give me one. >> i can speak to you about it. when we look at funds that are needed, the biggest thing we look at our cash flow. i can address that with you. unless there is an issue, at that point -- [inaudible] >> let's talk, ok. >> i have a couple of more questions. i know that the panelists have agreed to stay after for those who have specific questions. i do have one question for wells fargo. what are the typical rules for applying for sba loan of less than $50,000? how much money do we need to have in your bank to apply for a loan? >> i am on the smaller side of the bank. i am a transaction guy. i do not technically require one to have an account to do a loan with. what i look for, i generally start at 100,000 and up. when it is a requirement of 50,000 or less, i tend to call of the micro guys to help me out. that is right in their box. for us, the capacity for us to do the smaller side is not there as much as it is fo

chairman, those high valence loans, the loans about our loan limit represent about 2% to 3% of our loan volumes in terms of dollars stashed in terms of number loans at about 6% to 7% in terms of dollar volume. and the evidence we have, albeit early evidence is that those loans are lower risk for other loans we are making and therefore i don't think the issue is the loans propose a sick officer to the fun. the real issue is how we encourage private capital to come back while making sure we continue to support the market with crisis. >> thank you. i agree. mr. b. shares. >> thank you. .. >> request you comment on this, and do you think this settlement would be appropriate? >> congressman, i -- i want to make sure this is absolutely clear. it is exactly the opposite. we began an in-depth investigation of the servicing practices of our larger servicers. we found significant problems with the way that they were handling servicing, specifically, their loss mitigation as well as other steps like robo signing and other things you all have heard so much about, and began discussions with fellow a

what affect would have to make loans for recourse loans? >> there is no question they would be substantially more expensive. in exchange for that, there would be some potential improvement in performance. it is hard to predict how difficult that would be. >> if you add any data on that, i would appreciate it. if anybody has prognosticated. i wonder if he might make the awareness, i am heard the same time many people, most recently by senator gramm and that we hear people, are upside-down on their mortgages. he compares that to somebody driving a new car off of their car lot. that does not mean it makes sense to abandon a car and buy another one. i wonder if there is a way you might initiate that in your education program. i know there are financial advisor telling people to walk away. that does not help anybody. if people would hang in there, i think there is a negative propaganda being perpetrated to a large part of the population. no positive information to put in perspective, more reality. reckless endangerment would have been a better t

the sba loan program covers a range of small loans down to $25,000 and large loans up to $5 million,it is a very wide range. can be used for a variety of uses -- debt refinancing, building acquisition, working capital, so it can be used for a wide range of things from a small business point of view. as you heard, we do guarantees for about 90 or 100 banks in the country -- or in the bay area. about 3000 nationwide. there is a lot of lenders that do some sba lending. first thing you want to do is deal with the bank. if they are not able to make the loan by themselves, then go to our website, which is www. sba.gov, and look for the local page to see the local san francisco financing sources. but before you do that, the takeaway message here is that before you go to a bank, make sure you are cleared to do that. you do not want to go to a bank looking for financing for your business and ask them a question that will immediately give them a sense that you are not ready. you go to a bank and say, "how much can i borrow?" they will tell you, "i do not know, but probably not from us." you ne

department of education to subsidize loans as well as unsubsidized loans and also the loan opportunities that are available to parents through the parent flex loans. host: a few stats about college student loan debts 2/3's of seniors grad waited with student debt and the average debt is $25,000. full-time undergrad students borrowed an average of $4 $4,363 and total loans are expected to exceed $1 trillion this year again this year. let's go do john a recent college grad in california. good morning. are you there? caller: yes. hi. host: you have a question about student loans or the cost of colleges? caller: i have a question and a brief comment. host: go ahead. caller: so my question is, i'm wonderinging if ms. cooper thinks that student loan debt is the next big sort of bubble and the costs of our occupations abroad is going to be $4 trillion. i have never understood on why we spend all this money on a totally bloated military budget while we can't help college students, college graduates, graduate students, whatever the case may be, with their debt. host: the question is about the bub

the private loans. and the government can go after you to the point of garnishing your social security so if you make it to sixty five and still haven't paid off your student debt they can still can get it from you. so i'm wondering a little more scary about you you know that that makes student loans fundamentally different from those though the types of doubt there are very few things you can discharge in a bankruptcy and one of their code and why. well our good friend my favorite piece of legislation for the last ten fifteen twenty years is up here from two thousand and five is one of the things we can blame for it before that it's been creeping though i mean that was sort of the last. the last straw in that movement but it's basically they've been moving to make student debt harder and harder to discharge conveniently as tuition has been going up and up and the other thing is that the states i mean we know that we're in a state budget crisis right now one of the first things to get cut and have the s

fha loans. if the gses believe they need more credit risk protection, they can require deeper mi coverage. it's less expensive to the borrower and safer for the taxpayers. in fact, since the crisis began, the mi's paid the gse reducing loss by 15%. in addition to restore this balance, the fha and the private mis have to work closely together complementing each other's strengths to ensure the market is served in an efficient and consistent matter. in conclusion, we believe, like 1990, fha is at a cross roads, and there's actionable steps congress can take to put fha on the road to actuary report -- actuary soundness, provide a greater role, and help the taxpayers. thank you very much, and i'll be happy to take any questions. >> thank you very much. >> thank you, madam chair, and members of the committee, thank you for the opportunity to offer our views of the federal insurance patrol. i'm the 2012 president of the national association of role tores, but more importantly, i'm a practicing real est

the loans are set at ultra-cheap 1% rate for 3 years. the e.c.b.'s goal is to make sure banks have enough money to keep lending to businesses and consumers. otherwise, the fear is the european credit crisis will spread, choking global growth. the generous terms of the loans will also make it easier for european banks to pay off high amounts of their debts coming due next year. the e.c.b. hopes banks will use some of the money to buy debt of struggling governments in the region. but some economists are skeptical that will happen on a large scale. >> financial institutions have also been burned over the past year for holding too much of that debt, so in that environment, a lot of institutions are likely to take a very cautious attitude. >> reporter: the e.c.b. loan program may be helpful, but economists say it doesn't address the root of the european debt crisis: too many government i.o.u.s and no backstops behind them. erika miller, "nightly business report," new york. >> ...it's one great way to bring in people who are already supporters of a cause.

you qualified for a prime rate loan, for a lower-rate loan. in addition, even if you were an african american or latino american borrower who was put in a subprime loan, you were charged higher interest rates and fees. so it's both what we would call steering claims as well as pricing claims so discrimination not just in the state of illinois but across the country. >> brown: and when attorney general holder says " this happen? do the higher ups know what was going on? >> they don't have policies in place that prevent this from happening so we found not just a statistical sis of the loans that they did in illinois but it also involved us looking at what were the policies in place when somebody came in? we learned by talking to brokers in various other countrywide employees that they were given the discretion to be able to decide what the interest rate was going to be what the the were going to be and there was a company policy that gave countrywide employees an incentive to put people into higher interest loans with these toxic features so the

the loans are set at ultra-cheap 1% rate for 3 years. the e.c.b.'s goal is to make sure banks have enough money to keep lending to businesses and consumers. otherwise, the fear is the european credit crisis will spread, choking global growth. the generous terms of the loans will also make it easier for european banks to pay off high amounts of their debts coming due next year. the e.c.b. hopes banks will use some of the money to buy debt of struggling governments in the region. but some economists are skeptical that will happen on a large scale. >> financial institutions have also been burned over the past year for holding too much of that debt, so in that environment, a lot of institutions are likely to take a very cautious attitude. >> reporter: the e.c.b. loan program may be helpful, but economists say it doesn't address the root of the european debt crisis: too many government i.o.u.s and no backstops behind them. erika miller, "nightly business report," new york. >> ...it's one great way to bring in people who are already supporters of a cause.

what effect do you think it would have to make fha loans full recourse loans? >> i think you could argue about the amount but there is no question they would be substantially more expensive. and, in exchange for that i think there would be some potential improvement in performance. it's hard, various people have modeled in different ways. hard to predict how significant that would be. >> i would like if you have any data on that in your office i would appreciate if you would send it to me. if anyone has prognosticated what would happen there. and i wonder if there's somehow you might even make the awareness, i've heard it said by many people, the point made by many people and most recently by former senator graham that we hear a lot of people are upside down in their mortgages and he compares that to somebody driving a new car off the car lot. the second they drive off, if they financed their car they're upside down on their car too. that doesn't mean it makes good sense to abandon a car and go buy another one. so i just wonder if there is some way you might in

between a direct loan and a private loan, but they should. the one critical dpirches is this, mr. president: it wasn't that long ago in america where people could borrow money from the federal government to go to college and beyond and then declare bankruptcy. so we changed the law, said that's not fair. you can't borrow this money from the federal government and then refuse to pay it. so student loans from the government were no longer dischargeable in bankruptcy. i thought there was some sense and justice for that decision. we had cases that were reported of literally students finishing medical school and declaring bankruptcy before they went into practice so they didn't have to pay their student loans. that is unacceptable and unfair. it can no longer be done. just a few years ago we changed the law again and we said that private college student loans -- those are loans from the university, not from the government -- were also not dischargeable in bankruptcy. what does it mean? it means if you have incurred a debt, or if you have signed on

the loans are set at ultra-cheap 1% rate for 3 years. the e.c.b.'s goal is to make sure banks have enough money to keep lending to businesses and consumers. otherwise, the fear is the european credit crisis will spread, choking global growth. the generous terms of the loans will also make it easier for european banks to pay off high amounts of their debts coming due next year. the e.c.b. hopes banks will use some of the money to buy debt of struggling governments in the region. but some economists are skeptical that will happen on a large scale. >> financial institutions have also been burned over the past year for holding too much of that debt, so in that environment, a lot of institutions are likely to take a very cautious attitude. >> reporter: the e.c.b. loan program may be helpful, but economists say it doesn't address the root of the european debt crisis: too many government i.o.u.s and no backstops behind them. erika miller, "nightly business report," new york. >> ...it's one great way to bring in people who are already supporters of a cause.

you qualified for a prime rate loan, for a lower-rate loan. in addition, even if you were an african american or latino american borrower who was put in a subprime loan, you were charged higher interest rates and fees. so it's both what we would call steering claims as well as pricing claims so discrimination not just in the state of illinois but across the country. >> brown: and when attorney general holder says " this happen? do the higher ups know what was going on? >> they don't have policies in place that prevent this from happening so we found not just a statistical sis of the loans that they did in illinois but it also involved us looking at what were the policies in place when somebody came in? we learned by talking to brokers in various other countrywide employees that they were given the discretion to be able to decide what the interest rate was going to be what the the were going to be and there was a company policy that gave countrywide employees an incentive to put people into higher interest loans with these toxic features so the

former heads of fannie mae and freddie mac could be in hot water for misleading investors on subprime loans. >> fannie mae, freddie mac and the executives sought to maintain the illusion that the business involved minimal and manageable credit risk. >> susie: meanwhile, from the mall to the web, america's gearing up for a busy weekend of holiday shopping. but one thing they weren't buying: shares of zynga-- the much anticipated i.p.o. from company that makes the popular game "farmville." >> well, clearly there's a bit of disappointment that we saw it come out to the market at the top of its range at $10 per share and be unable to defend that price across the day. >> susie: it's "nightly business report" for friday, december 16. this is "nightly business report" with susie gharib and tom hudson. "nightly business report" is made possible by: captioning sponsored by wpbt >> susie: good evening, everyone. one of the most sweeping fraud cases brought in the wake of the subprime mortgage collapse was filed today in washington. the securities and exchange commission charged six former fannie mae

that you wind up at the end of every month taking out another loan to pay back last month's loan. not true? >> debt trap. to me, the common sense definition is that there is something unknown about the product. you've been in our stores, you've seen our posters, you've seen our disclosures. did you at any time feel that there was something you didn't know? >> bergman: but to the criticism that the most valuable customers for you are the people who revolve continuously; that, in the end, the amount of money someone pays back may be far beyond the cost of the actual loans themselves. >> lowell, all i can tell you is that it's not the majority of our customers. >> bergman: but it's the most profitable part of the customers. >> it's not the majority of our customers. now, it's no different than someone who, you know, pays a late credit card. would you say that they... they generate the most in fees? those that overdraft their bank account generate the most in service fees? i mean, that is the reality of it. >> bergman: well, the reality is that, in a sense, those who least can afford

you qualified for a prime rate loan, for a lower-rate loan. in addition, even if you were an african american or latino american borrower who was put in a subprime loan, you were charged higher interest rates and fees. so it's both what we would call steering claims as well as pricing claims so discrimination not just in the state of illinois but across the country. >> brown: and when attorney general holder says " this happen? do the higher ups know what was going on? >> they don't have policies in place that prevent this from happening so we found not just a statistical sis of the loans that they did in illinois but it also involved us looking at what were the policies in place when somebody came in? we learned by talking to brokers in various other countrywide employees that they were given the discretion to be able to decide what the interest rate was going to be what the the were going to be and there was a company policy that gave countrywide employees an incentive to put people into higher interest loans with these toxic features so the

loans so for the first time ever remember the e.c.b. just issued over four hundred eighty nine billion euros of three year loans this was our first ever for the life of the duration of the loan it's one percent but more than a dozen italian banks including top lenders unicredit and test the sound paolo tapped one hundred sixteen billion euros of that their figure includes forty point four billion euros of state backed bonds which were used as collateral for the loans so they're issuing debt. in italy to send over to the e.c.b. in exchange for more loans which they can leverage up is this banking or the kama sutra. like this economists of italian banking positions. this is how they're basing their economy going forward. into slot b. you figure it out i actually make a prediction from your statement there max that silvio berlusconi who is now out of a job well you've just given him a job for two thousand and twelve to write the book the karma sutra of finance silvio's bunga bunga finance just look at the pictures and they'll throw up the

but not a loan.he changes to be made significant with the quality and performance of fha loans. they are half of fha borrowers that credit scores below 620 in 2007, today the average fha credit score across all borrowers is over 700 for the first time in fha history. for home purchase loans originate in early 2011, early them default rates are less than 16 what they were in early 2008. for streamline refinance loans they are 112 of what they were at the peak before president obama took office. we've taken other steps including critical enhancements to limit enforcement, withdrawing the approval of over 1600 lenders to participate in fha programs, more than 12 times the number during the entire tenure of the previous administration. with these actual or simulated a very clear message. that if you don't operate ethically or transparently, we won't do business with you. and we will not hesitate to act. mr. chairman, the collective impact of these efforts cannot be overstated. indeed, were it not for the

in exchange for more loans which they can leverage up is this banking or the kama sutra. like this is a come a search of a giant banking positions. this is how they're basing their economy going forward. into slot b. you figure it out i actually make a prediction from your statement there max that silvio berlusconi who is now out of a job well you've just given him a job for two thousand and twelve to write the book the karma sutra finance silvio's bunga bunga finance just look at the pictures they all throw up never try this type of leverage or history hypothecation at home. ok well the biggest amount twelve billion euro is a state backed bonds taken up by in tests a sound pollo which confirmed it had used them as collateral for the loans and said that these would help it complete prefunding for its wholesale medium and long term maturities so where do you see this three hypothecation going nowhere and how where do you go once you've jumped the shark this far well in the case of europe and the e.c. big they are several years behind the federal reserve or the treasury in

, the loans above our old loan limits represent about 2-3% of our loan volume in terms of dollars and -- i'm sorry, in terms of number of loans and about 6-7% in terms of dollar volume. and the evidence we have, albeit early evidence, is that those loans are lower risk than other loans that we're making. and so, therefore, i don't think the issue is that those loans pose a significant risk to the taxpayer or the fund. the real issue is about how we encourage private capital to come back while making sure that we continue to support the market through this crisis. >> thank you. i agree. ms. gutierrez. mr. giewz -- gutierrez. >> thank you. secretary donovan, we've seen in the press american banker, banks likely to gain fha relief under foreclosure servicing setment, that the -- settlement, that the fha is potentially playing a role between the servicers and the states' attorney generals. it sounds like the fha might be letting servicers off the hook for breaking fha rules and failing to work with borrowers to keep them in their home by waiving the fha's right to deny a servicer's claim