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52 BUFFETT INVESTS IN BofA Bank of America will be getting a new investor soon, according to a press release— and that investor's name is Warren Buffett, Chairman and CEO of Berkshire Hathaway. e company invested $5 billion to secure warrants to purchase 700 million shares of stock with the bank in 2011. Buffett said in a letter to his stockholders that he intends to capitalize on these warrants. As July 10, Bank of America's stock traded at $24.88; however, Berkshire Hathaway's warrants allow the company to purchase Bank of America stock at $7.14 per share. With Bank of America recently increasing its dividends to $0.12 per share in response to the Fed's stress test results in June, 700 million shares amounts to nearly $336 million in dividend payouts over the course of the year. is isn't the first time Berkshire Hathaway has invested in a bank. e organization has held American Express stock since the 1960s and also has positions in Well Fargo, U.S. Bancorp, and Bank of New York Mellon. e bank stands to benefit from the long term investment, and it serves as a vote of confidence in its future performance. Bank of America's stock has been struggling since the housing bubble burst when it peaked at around $55 a share. By 2009, the stock was as low as $5 per share. Since that time, Bank of America has struggled with legal expenses, elevated operating costs as a result of industry- mandated regulations, and loan charge-offs. It is estimated that the bank has incurred expenses of close to $200 billion. Since 2009, the bank's stock has slowly been climbing back but remains 46.6 percent lower than its highest point. Berkshire Hathaway's investment in Bank of America will make the conglomerate the bank's largest shareholder. GSE FORECLOSURE PREVENTION ACTIONS NEAR 4 MILLION Of the total 16,521 GSE foreclosure prevention actions in April, which are designed to help homeowners retain ownership of their property when they're struggling financially, 11,328 of those were permanent loan modifications, according to the recent Foreclosure Prevention Report from the Federal Housing Finance Agency. April's numbers bring the enterprises' total loan modifications to more than 2 million since September of 2008 and the total foreclosure prevention actions to just under 4 million. e share of modifications with principal forbearance accounted for 32 percent of all GSE modifications, while extend-only terms accounted for 38 percent. e agency attributes this change to improving home prices. Serious delinquency rates were also down 0.03 percent, from 1.04 percent to 1.01 percent month-over-month, as were active HAMP trials, down from 1,597 to 1,176. e share of loans 60 or more days delinquent fell from 1.35 percent to 1.34 percent, but the share of homes that were 30-59 days delinquent rose to 1.45 percent from 1.14 percent. e number of loans in bankruptcy only accounted for 0.20 percent. In terms of home forfeiture actions, numbers were down from March, totaling 1,650 in April compared to 1,827—a 10 percent decrease. Of the 1,650 forfeiture actions, 1,055 were short sales and 595 were deeds-in-lieu. Short sales were down compared to March's numbers (1,262), while deeds-in-lieu were up, comparatively (565 in March). ird-party and foreclosure sales were down significantly, dropping from 6,581 in March to 5,523 sales in April. Foreclosure starts, however, increased 10 percentage points, rising from 15,478 to 17,056 month-over-month. According to Harvard University's Joint Center for Housing Studies, more than 38 million American households are cost burdened, or pay 50 percent or more on housing expenses. KNOW THIS

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