Loans

Billionaire Sumner Redstone is breathing easier. Although the 86-year-old media mogul faces a $500-million debt payment in the next two weeks, substantial gains recently in the value of his family's shares in Viacom Inc. and CBS Corp. have given Redstone some badly needed leverage with his lenders. Redstone's privately held family holding company, National Amusements Inc., had planned to sell most if not all of its theater circuit to cover the looming debt payment. But with an improvement in his financial position as well as a loosening of the credit markets, Redstone has decided to hold on to the cinemas -- at least for now -- and thus avoids a fire sale of those assets at the bottom of the market, according to people close to Redstone.

Small businesses that are having trouble obtaining loans may be eligible for assistance under a new program organized by a San Fernando Valley economic development group. The loan program is designed to provide capital to existing businesses throughout Los Angeles to help offset the effects of the economic downturn and the credit crunch, said Roberto Barragan, president of the Valley Economic Development Center. "This program is specifically a job-saving and job-creation program," he said.

The state of California began withholding more taxes from paychecks last week. And don't believe it if you hear this isn't a tax increase. It's being characterized by the state -- and reported by much of the media -- as merely a "cash advance" or "interest-free loan." Nobody's tax "liability" increases. So it's not really a tax increase, not technically. No? Well, I've yet to hear a convincing explanation of how the state can make big money on the deal -- permanently -- without its being a tax hike.

Fewer U.S. banks tightened lending standards for companies and consumers in the third quarter as the economy grew for the first time in more than a year, a Federal Reserve survey showed. Demand for most types of loans weakened at a smaller number of banks than in the second quarter, the Fed also said Monday in its quarterly Senior Loan Officer survey. For prime residential mortgages, a larger number of banks reported stronger demand, the central bank said. The report helps explain why Fed policymakers last week said "tight credit" remains a drag on the economy and pledged to keep their benchmark interest rate near zero for an "extended period."

Earvin "Magic" Johnson, who has spent his post-basketball career on retailing ventures in underserved urban areas, is targeting another market he figures is in need of help: lending to mid-size companies. The ex-Laker's firm, Magic Johnson Enterprises, is teaming with Los Angeles money manager TCW Group Inc. in a venture to make loans to mid-size businesses with capital raised from big investors, the firms said Monday.

Just what the conforming loan limit is on single-family homes and condos in Southern California -- it was raised last year to $729,750 in designated high-cost areas -- has been a continued source of confusion because it varies throughout the region. And for this year, it changed again. For 2009, the maximum is $625,500. And that's what it is for the Los Angeles-Long Beach-Santa Ana metropolitan area. But for Santa Barbara-Santa Maria-Goleta it's $603,750; for Oxnard-Thousand Oaks-Ventura, $598,000; and for San Diego-Carlsbad-San Marcos, $546,250.

JPMorgan Chase & Co. is joining other large U.S. banks in ending home lending through independent mortgage brokers to reduce losses on such loans. The bank will make loans through its branches and online, and in purchases from other lenders, according to a note sent to brokers by mortgage-lending executives.

JPMorgan Chase & Co. eked out a fourth-quarter profit, but its results were anything but calming to investors worried about the mountain of upcoming losses in the troubled banking sector. Defaults surged in a wide variety of loans, ranging from home loans to credit cards to commercial real estate loans. JPMorgan's investment bank was forced to mark down its portfolio by $2.9 billion. And had it not been for JPMorgan's acquisition of Washington Mutual Inc. late last year, the bank would have reported a net loss for the fourth quarter.

Britain unveiled a package of measures designed to bolster the country's ailing auto sector through the recession and to help fund its transformation into a more energy-efficient industry. The measures include guarantees to unlock loans of up to 1.3 billion pounds ($1.8 billion) from the European Investment Bank and a further 1 billion pounds in loans to fund investment in greener vehicles.

Colorado officials say mortgage lender Countrywide Financial has agreed to provide nearly $6 million to borrowers and to the state government to settle claims that the company put home buyers in high-cost, high-risk loans. Atty. Gen. John Suthers said the program would allow an estimated 6,800 borrowers to renegotiate loans with interest rates as low as 3.5% for five years. Borrowers who have already lost their homes also could get compensation. Suthers says Countrywide will give the state $500,000 to expand its Foreclosure Hot Line.