While mortgages that allow consumers to put little, if any, money down when buying a home have largely disappeared as a financing option available from private lenders, they are still available — and growing more popular — through a government-backed program, the Wall Street Journal reported today. That’s raising concerns among critics who blame no-money-down mortgages for many of today’s housing market woes. While federal housing officials are moving to end the practice, home builders are currently promoting the programs to move unsold inventory. The offers — including “100 percent financing” — are made possible due to down-payment assistance programs run by nonprofit organizations. These programs are funded largely by home builders and also by private homeowners desperate to sell. The seller-funded groups provide enough down-payment money to buyers that they can qualify for a mortgage backed by the Federal Housing Administration, which requires at least a 3 percent down payment.

The Bush Administration issued a Statement of Administration Policy yesterday opposing various provisions of the Senate housing assistance package. As it has stated previously, the Bush Administration strongly opposes a program to provide block grants that would allow State governments to purchase foreclosed properties. The Administration said that it believes the principal beneficiaries of this type of plan would be private lenders - who are now the owners of the vacant or foreclosed properties - instead of struggling homeowners who are working hard to stay in their homes. It also opposes provisions within the Senate legislation increasing the conforming loan limit beyond a reasonable level based on median area home prices, as calculated by the Office of Federal Housing Enterprise Oversight, as well as a provision to grant explicit legal protection to servicers that follow certain prescribed steps.

Bankruptcy Judge Kevin J. Carey yesterday approved Dura Automotive Systems Inc.’s third amended plan of reorganization, clearing the path for the auto parts maker to exit bankruptcy protection, Bankruptcy Law360 reported. Incorporating only technical amendments, the approved plan resembles the reorganization plan submitted on May 8, which lowered the value of the company from $600 million to $495 million. In addition, the plan also stipulates that Dura will pay all debtor-in-possession facility claims in full and in cash.

Delphi Corp., the bankrupt former parts subsidiary of General Motors Corp., asked the court to approve a $254 million increase in its loan package after more lenders showed interest in funding the loan than the company expected, Bloomberg News reported yesterday. Delphi said that its debtor-in-possession loan was oversubscribed during a syndication process, giving Delphi the opportunity to restructure the loan on more favorable terms and increase the total borrowings. Delphi filed a motion May 9 with the U.S. Bankruptcy Court in New York seeking approval of the changes. Delphi won an extension of its bankruptcy loan on April 30 from Bankruptcy Judge Robert Drain. The Troy, Mich.-based company’s loan was to mature on July 1.

Though the chapter 11 reorganization plan of New Century TRS Holding Corp. has come under fire from several parties in the lender’s bankruptcy, the company continues to push for approval, Bankruptcy Law360 reported yesterday. The company and its unsecured creditors’ committee said in post-hearing brief on Wednesday that the plan does not inflate the claims of certain creditors. New Century’s post-hearing brief comes in response to an objection filed at the end of April in which the ad hoc committee of beneficiaries of New Century’s pension plan urged the court to deny confirmation of the lender’s March 18 liquidation plan because it threatened to disperse the funds held in trust for the exclusive benefit of employees.

Mortgage lender Countrywide Financial Corp., which is under investigation for inflating certain borrowers’ fees, acknowledged at a Senate Judiciary Committee hearing yesterday that it made errors and pledged to take steps to improve its operations, the Associated Press reported. Steve Bailey, chief executive for loan administration at Countrywide, said that the company will hire an outside auditor to review its actions in cases involving homeowners who have filed for bankruptcy court protection. Bailey, however, disputed accusations made by hundreds of borrowers in Pennsylvania, Florida and other states that the company has sought to collect inflated fees and other payments by filing inaccurate bankruptcy documents. The Justice Department is currently investigating thes accusations. Katherine Porter, a professor at the University of Iowa, testified that mortgage companies and servicers have improperly sought repayment for attorneys’ fees and other costs without fully disclosing or documenting the fees. Sen. Charles Schumer (D-N.Y.) said that Bank of America Corp., which agreed to buy Countrywide in January for approximately $4 billion, should reconsider the deal’s price tag. If the purchase price for Countrywide was “based in part on profits from these bad practices, Bank of America should demand a lower price, because these practices will not be allowed to continue,” he said.

A large California land partnership involving one of the largest U.S. pension funds has received a notice of default on a $1 billion loan after failing to meet certain terms of its lenders, the Wall Street Journal reported on Saturday. LandSource Communities Development LLC, a partnership that involves the California Public Employees’ Retirement System, received the default notice Tuesday, amid talks to restructure $1.24 billion of debt. The partnership, which owns 15,000 acres in Southern California, had received an extension to meet its current loan terms, including a required payment, but the deadline expired on April 16. The default notice applies to about $1 billlion of the total debt.

The mortgage industry, facing the prospect of tougher regulations for its central role in the housing crisis, has begun an intensive campaign to fight back, the New York Times reported today. As the Federal Reserve completes work on rules to root out abuses by lenders, its plan has run into criticism from bankers, mortgage brokers and other parts of the housing industry. One common industry criticism is that at a time of tight credit, tighter rules could make many mortgages more expensive by creating more paperwork and potentially exposing lenders to more lawsuits. Four months ago, the Fed proposed the new standards on exotic mortgages and high-cost loans for people with weak credit. The Fed’s proposals came after it was criticized sharply as a captive of the mortgage lending industry that had failed over many years to supervise it adequately. Proposals are pending in Congress on mortgage standards, but it is not clear whether they will be adopted this year. The Fed has its own authority under housing and lending laws to adopt mortgage standards.

Frontier Airlines Holdings Inc. is asking for bankruptcy court permission to sell off four airplanes for $106 million, noting in court papers that the company’s budget for the coming months relies on the infusion of cash the sale would generate, Bankruptcy Law360 reported yesterday. Denver-based Frontier filed a motion on Friday seeking authorization to enter into a letter of intent and to sell two Airbus A319-111 aircraft and two Airbus A318-111 aircraft to Verulamium Finance Ltd. Verulamium would pay $106 million for the four planes, $68.5 million of which would go to pay for the mortgages on each of the aircraft, leaving Frontier with $37.5 million.