with gold man sachs and the interest rates are very low right now so a variable rate loan structure may make the most sense but also may make sense to hedge against the risk of rising interest rates. however under the dodd frank act, trading commission regulation we can not have discussions of any sort regarding hedging without having policies in place that allow us to sign a safe harbor letter for gold man sachs this was drafted with the assistance of council and we do have a representation written representation from our financial advisor it's not like the city's policy which is 24 pages long and goes into types of bonds and notes and that sort of thing so it's much more general in nature but includes what we need it to include to have the discussions that we have i'm happy to answer any questions you have we also have bond council as well. >> any questions or comments? seeing none. >> do we have a motion on this item. >> so moved. >> we have a motion, second. >> roll call on this item. >> director beall, metcalf aye director reiskin aye that's 5 ayes and item 10 is appr

loan the remaining part of the loan will be used for the construction costs as well related costs.fter the loan was approved there were several changes set form some additional loan modifications they were paragraphed on may 21st, 2014. first, the changes that necessitated that request the rental income was reduced by over $70,000 due to the medium income and which reduced the project depth and mercy selected an investor they completed that analysis as required by you about is irs requests that a project is repayable at the end of the term loan they don't generate the cash through it's not usual for them to be unpaid and accrued depending on on the terms therefore third they made a h p funds the project was previously denied and is the likely to be awarded funds because of the readiness as well as the criteria change. those funds will mitigate the project income, however, mercy will not receive the prior construction information. therefrom the request to the modifications approved we loan committee are to allow the repayment of residual cash waterfall so they can be repaid. and to

. >> item 9 is approving an amendment to the loan from the -- >> we're on budget and we've negotiated -- tifia amendments and that's wonderful news to us this relates to the tifia loan and that's what we're using to help pay the tifia loan with that i turn it over to sara. >> we closed on our tifia loan and the source of repayment is largely the net tax increment and 4.57 percent interest rate and there's certain conditions in the loan that we need to meet before we can draw down the two main conditions are selling $429 million worth of land and demonstrating full funding for the project we had requested to draw down on the loan before meeting those conditions we had a proposal for a proportional draw that tifia was unable to grant however we have contract certification needs and we did meet another source of funding to keep the contract award on schedule this calendar year so tifia agreed to amend the loan they are making changes that are allowing us to right now we're in the process of negotiation and that will be brought to you late summer or early fall the main amendments are modi

the road. will that make sense for you to take out that much of a loan? if people take out that much debt and do ultimately get into trouble what is the ripple effect? >> well, the ripple isk is what they're concerned about. because if you have debt and are paying it out over a 20-year period or more that can impact your ability to not only buy a home or car loan but even the job you can get. they're looking at the issues very carefully. >> are these loans, a lot of them bundled together and re-sold the way home mortgages were? >> well, one of the things they're looking at is how people are taking out the loans and whether they're adding to loans with private loans and what they can control and 90% of the loans are federal loans, but there are also private loans out there hurting a lot of people. >> interest rates on the loans, there was issue about whether or not the rates would go up. >> well, july, they always revisit. and we'll see that a lot of states will go up. >> all right, sharon, thank you very much. a big, big story. >> one we'll continue to fol

the bank gave him millions of dollars in loans. gave the bank all of his business, credit card transactions, checking accounts, everything. he thought of his bankers almost as if they were his partners. >> if we had a cash flow problem, i'd go talk to the bank president and he would be accommodating to that because they had a vested interest in making sure that this small business and their customer was successful. >> remember last year when things weren't going so well, you didn't lose your house. you think potter would have let you keep it? >> it's the wage george bailey did business in the film "it's a wonderful life." old fashioned personal banking. when jesse went to first tier to talk about a loan modification to delay payments to deal with the problem and get the business back on track, the bank had incentives to be flexible. at least it did until the financial crisis came and first tier failed. hundreds of banks went under during the financial crisis and businesspeople like jesse lost the bankers they'd been doing business

of $3.2 million to move the project towards construction since is predevelopment loan was accepted we got additional funding from the development program. and we'll apply for the low income multiply housing revenue bonds this summer and secured other permits and about commence in september of this year. 0 originally ocii envisioned gap financing and included this in roster 4b with the property tax fund or otherwise known as rb t f f and that will counted towards the ocii traversing the loans to the successor agency to the mayor's office of housing upon completion on september 17th the california department of finance denied to utilize the fund for this project on the grounds that there was construction in place prior to the package in june 2011 and there's no enforceable obligation it was appealed through the process but the denial of the funding was upheld. the rerequest for a final replacement housing is still pending with oc f and may not meet the deadlines for hud. since no additional funding the staff is asking for the loan transfer to cd now to redirect the closi

cost of the loans. this is double in some cases what it takes triple in some cases what it takes to cover the cost of the loans. that means the administrative costs, the bad debt costs the costs of the money borrowing the money. so what we propose is to say last summer congress said, you know, we were looking at new student loans that were coming through. the interest rates were about to double. and congress said, democrats and republicans, the interest rate -- if the interest rate doubles up to 7%, that's too high. so congress said, for all new borrows in 2013, the interest rate would be 3.86% on undergraduate loans 5.41% on graduate loans and 6.41% for plus loans. make no mistake the government still makes money -- not a lot but the government still makes money on those loans. what we propose is to take all of the outstanding student loan debt and refinance it at those interest rates exactly the same rates that virtually every republican agreed to last summer many democrats agreed to last summer, and t

most of the loans now are federal loans compared to private loans. have some differences that are important for borrowers to know about. the one dollar chilean figure in the headline is pretty staggering. loans are now the largest form of consumer debt. they have surpassed credit cards, they have surpassed auto loans. "college graduate in student loan debt, 2012 numbers." so, why are more students taking on more debt? why is it the students? more students than ever are going to college. and the price has soared. it is more expensive, more students are going, leading to that large aggregate number. when you look at the individual -- there are a lot of stories of students who have $100,000 in debt, these astronomical figures. when you look at the average debt load for a bachelors degree , of students who borrow, that is $29,400 -- which does not release where with this larger, six digit number that we hear about sometimes. while an aggregate, there is a lot of student loan debt out there, but the majority of students are borrowing debts that they can r

>> at the bank of america we focus on making sustainable loans to credit worthy borrowe borrowers. and we are out there doing that in the market today. that's what we focus on. so i think, we talk about that, that's what we're looking at. the director talked as well, sustainable homeownership. that's what we're looking today. that's how we focus on lending on our customers, making it sustainable for them. i think as we have moved down this path, mark would be better to talk to the data on this than i would, but we are out there in the market with all of our loan officers making good loans to credit worthy borrowers today and we will continue doing that. >> mark, i will ask you to some people who will make credit easier and they will hear it coming from someone like director watt who was more liberal member of congress and my said oh, my gosh, we're going back to terrible -- is that the wrong way to think about this? how do you walk through that balancing act, that policymakers are facing right now? >> i'll start by saying as an economist i have to start with a joke. on the one hand,

i should also note that the loan, the seismic loan that is being sought, also carries its own local hire requirements which the developer will meet, which the developer has to meet. and the project provides permanent jobs, 400 to 500 jobs, when it's completely filled and occupied. during the construction period approximately 250 jobs, full-time equivalent jobs would be created on site. we believe this activation will animate the neighborhood, there's a new subway coming, the central subway, which will benefit from these new riders. the t line itself already would benefit from these new users and the project creates new space to support the cities and the dog patch neighborhoods thriving manufacturing and industrial uses. in conclusion, commissioners, i would like to thank you for your time, first of all, and your help in moving this project forward over the last several years. today's action by you is a major step forward in returning the pier 70 site to the community. significant historic rehabilitation here will preserve and enliven pier 70 with activity uses and vitality and create vi

still likely pay more over the life of the loan. stafford is cheaper than many of the private loans you can take out. looking at sallie mae, their fixed-rate loans range anywhere from 5.75% above 12%, as much as that much, and a variable rate loan, yes, if if you have outstanding credit, maybe you can qualify for one around 2%, a little more than that, but it's going to fluctuate and could go um more than 10%. >> talking about fluctuating and high numbers, elizabeth warren, senator from massachusetts, is proposing some kind of refinance bill so you could refinance your student loans like we refinance our mortgages. do you think this proposal will go through? >> there's a lot of merit to it. anyone with a big loan balance and not a lot of income, this is supposed to help them. and so bringing those rates down, and she's looking at the rates we currently have, under 4% for that stafford loan, refinancing at that level would be a great idea. but it's very unlikely that this is going to get through with all the different hurdles that we'

but also when you service the loan. ceo jimmypmorgan's dimon said he would not want to serve -- service a defaulted loan. we have seen a lot of servicing transfers, out of any and freddie over to non-bank servicers and in recent months we have seen a lot of scrutiny on those servicers. i was wondering if you could comment on some of those transfers. what we might be able to expect in terms of regulation on those non-bank servicers and what can be done to give originators and servicers some certainty that if the loan to faults they will properly serve that nonprofit. issues has been a topical because there are multiple things that are at play here. jamie dimon is right when he says it is difficult to service a defaulted mortgage. to -- all it is is collecting and remitting. when somebody defaults a gets to be a lot more complicated and there is a growing industry that some of whomround have more expertise in this area than the lenders themselves who tend to focus more on the lending side than on the servicing side. and ba

most of the loans now are federal loans compared to private loans. and they have some differences that are important for borrowers tos know about. but the headline, trillion dollar figure is pretty staggering. now are thes largest form of consumer debt. they have surpassed credit cards. surpassed auto loans. so the top line numbers are prettyes staggering. >> host: here are the numbers. college graduate student loan debt. 1.3 million graduates had student loan debt. 66% from public colleges. 25% from private or and 88% from for-profit colleges. why are students taking on more debt? why is it the students? >> guest: for one, more students than ever are going to college and the price of college is, has soared over the past few decades. so it is more expensive. more students are going and that leads to that large aggregate number but when you look at the individual, you know, there are a lot of stories about students who have $100,000 in debt or these astronomical figures. when you lookin at the average debtload for a bachelors degree, of students who wo

the second issue involves loan limits. as market participants are hfa released a f proposal last year suggesting that the agency might use this conservatorship authority to lower the mortgage amounts eligible for guaranteed by fannie and freddie. many groups and individuals submitted feedback in response to their request for input. i am announcing today that fhfa will not use as -- its authority as conservator to reduce current loan limits. this decision is motivated by concerns about how such a impacton would adversely the current health of the housing finance market. the next part of our maintain goal involves continuing to he -- and improve service servicing and foreclosure prevention standards. experiences in recent years have revealed serious weaknesses in the servicing industry and in the foreclosure or mention alternatives offered to borrowers. as part of the focus in this stabilizerking to communities hardest hit by the foreclosure crisis. launching a we are neighborhood stabilization initiative with fannie, freddie

i thought the interest rates were set for the life of the loan. >> they are set for the life of the loant students take out a new loan every year because schools we look at the parents financial situation each year, so they get a new loan. interest rate is set for the life of the loan, but now, every year, they will be changing. >> how bad could the increase be? >> it is 20% higher. the rates were -- .8% higher. the rates were announced today. if you borrow $10,000 and have a 10-year repayment period, you'll $50 more perut year. >> would it be possible the students would be better off taking out a private loan instead? privatepends because loans have less safeguards. for example, they might have variable interest rates. you might have a terrific rate today, but in a couple of years it might be higher. also, private loans do not have the same protections if you are struggling. for example, federal loans have income-based repayment, and you can pay a certain percentage of your discretionary income. >> the massachusetts senator elizabeth has a proposal on the table that would tie student lo

size of the loan market there. e green one, that's the daddy. >> yeah. >> when that improves, then you will see, as you say, sentiment improve. but, also, growth in general improves most but credit cards are important as is the maintenance of high growth in corporate. >> tell me about this. this is not one we follow as closely. what does this say? this growth? >> companies in general are thinking about increasing their cap ex as we call it, their spending, borrowing from banks. in a lot of cases, they have credit lines that are p pre-arranged by banks but they have been leaving a loan. >> got the access. they don't take the loan? >> they don't take the loan. we call that a utilization rate. the utilization rates have been very, very low but just this quarter, you are starting to see them increase at a lot of banks, which means the businesses are pulling down the loans which were always available to them but now they feel confident to take on that leverage. >> they will generate the business? >> they see the opportun

she has introduced a bill to ease the burden of those student loans. ways an honor to have you on this program. >> always an honor to be here. >> i want to get to the student loans soon. let me ask the public about the new text. there is some powerful stuff. i wonder if you might share with the audience the story of you watching your mother advancing , putting on a dress to go work -- look for work at sears because things had gotten a little tight in your family. tell me that story. >> like a lot of families we had our ups and downs. when i was 12 my daddy was selling carpeting. my three older brothers were often the military, dash off in the military. my mom was a stay-at-home mom. dad had a bad heart attack and was at the hospital for a long time and at home for a long time without work. bills piled up. we lost the family station wagon. we were at the edge of being about to lose our house. that is where i started the book. myemember the day i was in mother's bedroom and she had pulled her best dress out of the closet, and she was 50 years old and was

to over 7% for the next academic year. but many student loanerts that i talked to weren't surprised by the jump. treasury treasury yields were so low a year ago they had nowhere to go but up. how much more will it cost borers? it will amount to $4 more in monthly payments for every $10,000 in federal student loans based on a 10-year repayment period. even with the increase, federal student loans are still generally cheaper over the life of the loan over private loans. >> sharon, stay here. we have a completely insane idea. but that's what we like to do here on "street signs." let's bring in now our buddy derek thompson from "the atlantic." derek, first off, listen to what fed chair janet yellin said earlier today on yield capitol hill. >> the debt loads certainly are high enough that they may play a role, for example, in making it hard for people to buy first homes, to build a down payment, and that may be an effect we're seeing right now already in the housing market. >> so, if student loans are such a problem -- and we know they are, could we

the federal loans are not based on fico score rate. it is pass/fail test much everybody gets same rate. gerri: right. >> that is higher risk borrowers with the private loans that are at higher rates are going to be now i these loans and toes are ones most likely to default. then it will be taxpayer holding the bag. gerri: let me show you why this is such a concern. when you look at inflation and good for all kind of services, across the board, it is college tuition gone up and gone up dramatically, 74% over 10 years. only gas prices and hospital services have gone up more. is there any way, charlie, to contain these costs? >> the best way i would say is to get government completely out of the student loan industry. if we look since the government got in, 894% in tuition hike. beats inflation every single year. i got to say this. every spring we have this debate over and over again. as yogi berra said, it is deja vu all over again. political manueverring on sides. should we lower the rate or not. my solution is simple, reinstate competit

we talked about the green energy loans president obama offered to tesla. they paid the money back but now we find out they decided to open plants in china. >> tesla has. >> right. >> i'm quoting, eric bolling is smarter than i am. >> out of context. >> here's my question. should we be outraged that tesla is moving jobs to china with our money. >> they paid the money back so it's their money. i think it was a bad pr move. i have no emotion invested in tesla. i don't care who makes them. you can make them. but we have to get away from the fossil fuels because of geopolitics. i don't want putin to have power. i don't want opec to have power. i don't want the oil companies to have power. it's $4 a gallon now on long island. >> so bill. >> just listen to me for a minute. in a perfect world we wave the magic wand and all cars are electric. that's all i'm saying. let's work toward that. >> all for that but the problem with the tesla situation is we gave the power to president obama. he chose who was going to get the $500 million loan. >> and sure. it didn't work.

. - i already spoke to the bank about a loan. - what did they say ? they said the cafe isn't making enough money to qualify. i have a meeting tomorrow morning with a vice president. don't let them scare you victor. just give them a firm handshake... and look them straight in the eye like this: "good morning, mr. banker. i need another loan to get a new stove for my restaurant." don't worry. you'll be all right. i hope so. but i am not looking forward to this meeting. well, the oven's working again but i'm not sure for how long. - can it be fixed, jamal ? - it's very old. i think it needs a new heat regulator. you think ? maybe we should find a repairman who knows what he's doing ! perhaps you should mr. brashov. what is everybody staring at ? isn't there any work to be done ? do i have to go, too or can i have my coffee ? - you can stay. - thank you... i think. i don't care what digby says. we got to come up with a fresh approach here. it's got to be something creative. you know, on the cutting edge. no, i know that he's in charge of the project but as

where current market valuations are, you can buy the loans between 60% to 70% of what the loan is worthket. >> exactly. >> this is a crowded strategy. it seems like a lot of funds are starting up, ellington, one williams street and lone star, they're already in the space. >> you're right. if you see the size of the opportunity. there's $600 billion outstanding and the if you discount that fan any or fr-- fanny or freddy wou sell the loans. the total capital raise for the strategy is maybe $10 billion, maybe $15 billion. it is something we think as it picks up momentum more capital needs to be raised. >> i want to talk about your rising interest rate fund. we have been talking how interest rates have remained shockingly low despite what every person has been saying on the street. it's been opened up for a year and doing well. what are you investing in that is doing well when the bond market yields are extremely low? >> well, the thing about interest rates is they're very low and you're right, they have -- i think most economists were calling on rates to go up. it's a question of how much

by east/west bank, [speaker not understood] gives the city's outstanding loans to [speaker not understood], the net loss to the city is 3,0 58,269. however, this loss is 5,1 94,[speaker not understood] 38% less than the 4,65 3,0 90 that the city would incur by not purchasing 1500 page street and this is shown in table 7 on page 33 of our report. we have a recommendation on page 33, mr. chairman. i'm not sure if the department is stating that they don't want to report back to the board of supervisors. our recommendation, and i'll read it, we he recommend that you amend the resolution to request the moch -- mochd to report back to the board of supervisors during the june 2004 budget process on the reliability of financing sources for the 1500 page street project, alternative financing that will be available if the project is not awarded to low-income housing tax credits or other major source of financing and the impact of the 1500 page street and other pipeline projects on the city's access to future low-income housing tax credits and mochd's procedures to manage project costs onc

also to the ift individual bond issue that would, the loan approvals. beyond that we would be at the board budget [inaudible] these documents and the board approval would also be required subsequent to the committee recommendation. at that point would be ready to execute the lease fully an issue port building permits would be applied for and been reviewed by port staff. concession concert as soon as the sum group talk about august which is a good goal and will do our best again to achieve that. with construction anywhere from 24 months in this good market potential a little longer if the market slows down i will be. 2nd was a presentation. again thank you for your time and were available if you have any questions. >> public comment? upper speaker is current words central waterfront advisory group >> good afternoon president@commissioners and director moya. my name is karin was. i am cochair with [inaudible] of the port central waterfront advisory group. we been working on peer 74 more than 12 years now. we are absolutely delighted to recommend the wharton project move forward. fo

that they are providing financing to the private sector loans? doesn't that beg the question, if the private sector will not undertake the risk, why are they forcing the taxpayer to do so? comesxt argument, directly from president obama. long as our global competitors are providing financing, we have to do the same." that kind of sounds like the same argument i hear from my 10-year-old and 12-year-old. everyone else is doing it, daddy. i have never found that argument to be terribly persuasive. if other countries want to subsidize the products they sell us, maybe we should take them instead of copying them. most taxpayers are not interested in subsidies arms race with the rest of the world. the truth is that only a little more than one third of the banks are used to compete with foreign competitors. here is an interesting line. bank's beneficiaries are running ads claiming that the president, ronald reagan, was one of their biggest supporters. president reagan tried three times to zero out the bank's lending program. he actually succeeded in reduc

for the property so if you have the property the loan will be summoned by the new owner and this is pay back for your property taxes and the low rates this is a fantastic option. >> i'm in favor of the program obviously we're going to have a earthquake this is from an investment stewardship. >> after a few minutes with folks even if you don't agree you understand the concept. >> we've talked about being able to do this now we're going to be forced to do this it's a good thing but to pay for it. >> it's not only protecting their property but every dollar is for mitigation it truly is protecting our investment overall the city. >> it's the right thing to do. you can look at the soft story building and theirs like the buildings that collapsed in the earthquake and your shufrtdz to see this >> people are getting caught to get this done and if people can find a place in our homes of shelter it will keep people in their homes. >> together we'll work out of getting out of 0 disaster and making the community bringing back to what we love. >> as a level of folks we've t

in part to refinance the first loan. kind of prolonged use is generally discouraged, and the hope is that countries within 3 years, many programs are 3 years long, the country can get out from under it. current examples, both ireland and portugal have imf loan programs, 3-year programs, and they just ended those programs. here is a tweet from one of our viewers. host: just wondering what the united states get out of supporting the imf. guest: well, 2 points need to be made. lend to all, when we the imf, we get interest. so the costs to the united states is different between which we borrow, treasury borrows, and interest rates we get from lending to the imf. sometimes it is plus, sometimes it is minus. it depends on how you do the arithmetic. over the last few years it has been a wash. don't -- because the imf has never defaulted, the countries have never defaulted on the imf, the money is pretty good. we often have capacity to borrow ourselves from the fund. host: has the united states ever -- guest: the united states h

the lenders had to buy back the loans. the lenders had to buy back the silly and civil loans. as a result they tightened up all other standards because they don't want to be in that position again. that's the access issue we were talking about earlier. they just kept tightening it to the point where people were saying the pendulum has swung too far in the other direction now. basically what director watt was saying was he would loosen some of the restrictions so that they wouldn't have to buy back the loans under certain conditions. >> host: the next call for our two guests franken troy, new york. you are on "washington journal" talking about the housing market. >> caller: thank you very much. i love the information. but i do see that up here in albany in the area that taxes almost supersede the mortgage and it just seems so hard. your mortgage is 2500 in your taxes are 2200 or your mortgage is 1500 taxes are 1100. it's like why do the taxes keep rising and supersede even if you have a rental. you take your rental and in th

that is a fee that is imposed on the loans. it is imposed on the borrowers. that has cut down their share of the market. i think they have 20% of the market right now. when you look at the national economy, what percentage do you think the u.s. housing market contributes? i do not know the answer to that off the top of my head. it is a significant driver of the economy. i think it helped drive the economy on the upside and was argue that, many the reason we got into the great recession tied back to the housing market, which became overinflated and over speculative. it is a significant driver. the interesting thing is we are seeing this recovery, it feels like the two have been more separate. we have seen great signs of housing recovery, but that does not seem to affect and impact the economy as much as we would expect. host: ellen, california. caller: i think one thing that thed change the profile of market is the elimination of the taxed induction for a second home. deduction for a second home. i live in an area that a large percentage of the homes are secon

you want to be able to repay the loan. t you want that borrower to have the benefits of that loan. that's the availability of credit. that's the balance that we operate in our banking system. in our housing finance system in our entire credit system. our credit card system. nobody should want to make a loan to anybody who's not going to be able to repay it. that's the way i think about it. i don't think those two things are inconsistent, but they do have to be carefully balanced and calibrated. >> there are a lot of folks who were hoping that -- were happy to see a democratic nominee get into your job. thetted to see some -- they wanted to see policy changes that fannie and freddie treat borrowers and pay for affordable housing. one of the things you talked about the affordable housing trust fund is for fannie and freddie to pay for low income housing. your predecessor didn't allow for companies to fund it? are you going to fund that? >> he's smiling because he knows what my answer will be. i'm going to say something and th

in fact, the student loan debt has gotten so out of hand that senior citizens in the country owe tens of billions of dollars on student loans. our bill will help millions of responsible borrowers of all ages in every state across the country. the bank on students emergency loan refinancing act is a reasonable, commonsense and fiscally responsible way to address the student loan crisis. this is simply about giving those who want to go to college a fair shot to get ahead, making sure that those who already borw to get an education are not being unfairly weighed down by just just so the government or the big banks can turn a profit. i want to thank senator warren for her leadership on this vital issue. this is about allowing all of those who currently have student loan debt to be able to refinance, to be able to refinance at a rate that was voted on, 3.86%, voted on by colleagues on both sides of the aisle a year ago. it's not a number that's picked out of a hat. but to allow people to exchange an 11%, a 12% on a private loan, or a 6%, 7%, 8% interest rate on a public loan for something

secretary was doing was saying, here guys, i will give you this tool, and this tool unlocks the access to loan income housing tax credits and debt financing. and why does it do that? we are creating these sort of rental assistance vouchers. the lenders a s ans and investo used to project-based rental vouchers. in the 80s there was lots of projects with project-based rental assistance vouchers. and in san francisco after the 20-year cycle, the lenders and the investors are very familiar with this tool. they can underwrite with this and buy credits based on it, they couldn't do that with that section 9 financing. this is part of reason this is part of the solution. in terms why we are looking at rental assistance demonstration program. and the other part, the rental assistance program comes with an obligation. we will talk a little about the rehab obligations and the tenant obligations. and one of the reasons, to take part of this program, you need to be obligated for 20 years. and we have to put more money and we have to increase the housing quality in these units. therefore a part of this, and