%1

A federal bankruptcy court judge has approved the sale of two downtown property by the Archdiocese of New Orleans, which filed for chapter 11 protection more than two years ago in the face of mounting lawsuits related to past child sex abuse, NOLA.com reported. Bankruptcy Judge Meredith Grabill approved the sales last week in advance of a hearing on the matter that had been scheduled for Nov. 17 but was canceled after neither side objected to the pending deals. Judge Grabill’s order means that the archdiocese can execute two purchase agreements with separate buyers it has lined up to acquire adjacent properties on the edge of the Central Business District. One property is the 12-story office building at 1000 Howard Ave., which is under contract to a Lafayette developer. The other is the parking lot at 1032 and 1042 Loyola Avenue, which is under contract to a local investor group. Together, the deals will generate nearly $10 million for the archdiocese, which, until now, has sold just one other property since filing bankruptcy — the former St. Elizabeth Ann Seton School in Kenner, which fetched $1.9 million in 2020.

A Texas judge temporarily blocked an embattled student housing operator from using the $14 million in commissions it received from the sale last month of a student housing complex in Arizona, the New York Times reported. On Friday, the judge, Karin Crump of Travis County, ordered Patrick Nelson’s firm, Nelson Partners Student Housing, to transfer the $14 million to a registry run by the Texas courts for safekeeping until litigation over who should get to keep the sale proceeds is resolved. “It appears to me that there has been some highly improper behavior by your client,” Judge Crump told Mr. Nelson’s lawyer, Gregory Noschese. “You need to have a real hard and long conversation with your client. It doesn’t look good.” The ruling is in response to a motion filed this week by the administrator of a court-approved fund that is supposed to collect and distribute $50 million to more than 100 people who invested in Skyloft, a luxury student housing complex that Nelson Partners had bought and managed in Austin, Texas. The administrator had asked the court to put a temporary hold on the $14 million in commissions paid to Nelson Partners from the Arizona property sale until it could be determined if the money should have been paid into the $50 million restitution fund. Investors in Skyloft have said in lawsuits that Mr. Nelson defrauded them and improperly diverted investor money to other uses, including the purchase of a student housing complex in Tucson, Ariz., called Sol y Luna. The settlement between Mr. Nelson and investors in Skyloft required him to sell other properties in order to raise money for the restitution fund. Lawyers for the fund administrator said Mr. Nelson had told the court just a few weeks ago that the sale of Sol y Luna would generate about $18 million for the restitution fund. But the sale produced only $9.3 million for the fund, with Mr. Nelson’s firm taking $14 million in commissions, according to legal filings.

The Consumer Financial Protection Bureau (CFPB) is taking action against Carrington Mortgage Services for deceptive acts or practices under the Consumer Financial Protection Act in connection with mortgage forbearances, according to a CFPB press release. The CFPB found that Carrington failed to implement many protections, provided to borrowers with federally backed mortgage loans who were experiencing financial hardship, during the COVID-19 public health emergency. The CFPB found that Carrington misled certain homeowners who had sought a forbearance under the CARES Act into paying improper late fees, deceived consumers about forbearance and repayment options, and inaccurately reported the forbearance status of borrowers to the big three credit-reporting companies: Equifax, Experian and TransUnion. The CFPB is ordering Carrington to repay any late fees not already refunded, repair its faulty business practices, and pay a $5.25 million penalty that will be deposited into the CFPB’s victims relief fund.

The average long-term U.S. mortgage rate tumbled by nearly a half-point this week, but will likely remain a significant barrier for potential homebuyers as Federal Reserve officials have all but promised more rate hikes in the coming months, the Associated Press reported. Mortgage-buyer Freddie Mac reported Thursday that the average on the key 30-year rate fell to 6.61% from 7.08% last week. A year ago the average rate was 3.1%. The rate for a 15-year mortgage, popular with those refinancing their homes, fell to 5.98% from 6.38% last week. It was 2.39% one year ago. Late last month, the average long-term U.S. mortgage rate breached 7% for the first time since 2002. Two weeks ago, the Fed raised its short-term lending rate by another 0.75 percentage points, three times its usual margin, for a fourth time this year as part of its inflation-fighting strategy. Its key rate now stands in a range of 3.75% to 4%.

More than two years after filing for chapter 11 bankruptcy protection in the face of mounting lawsuits related to past child sexual abuse, the Archdiocese of New Orleans is beginning to raise cash by selling some of its vast real estate holdings, NOLA.com reported. Attorneys for the local Roman Catholic Church will ask a judge this week to allow two separate property transfers to move forward. One is the sale of a former 12-story office building at 1000 Howard Ave. to a Lafayette-based investor. The other is the sale of a parking lot on Loyola Avenue behind the Howard Avenue building. Together, the deals would generate nearly $10 million for the local church, and follow property sales totaling some $1.9 million earlier in the bankruptcy process. It's unclear how far the millions raised by the property sales will go to resolving the 450 abuse claims levied at priests and other clergy who served in the archdiocese. And it's also not known what other financial steps Archbishop Gregory Aymond and his advisers will take to pay off what is expected to be a multimillion-dollar settlement with abuse victims. When the New Orleans Catholic Church joined two dozen other U.S. archdioceses by filing for bankruptcy protection in May 2020, it listed $243 million in assets and $139 million in liabilities. At the time, Aymond said that the church, which serves 500,000 Catholics across 112 parishes, needed to seek chapter 11 protection due to the mounting costs of abuse settlements and the fallout from the pandemic. Financial records have previously valued archdiocesan-owned buildings and land at some $70 million. But that estimate is likely significantly lower than what the properties would fetch on the market, because it is based on the prices that the archdiocese paid for the properties.