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Private equity rushing in as banks retreat from mortgage deals

With banks less willing to tackle distressed loans, private equity and hedge funds have surged into the market, but critics say the new players are too quick to foreclose.

HOME SWEET HOME: Chuck Hubbard and his wife Pamela outside their home in Sacramento, California, in June 2015. They briefly lost their home when Lone Star's Caliber subsidiary dealt harshly with their request for a loan modification. Fortunately for them, they managed to get a quick foreclosure rescinded only after going to court.

New York

PRIVATE equity and hedge fund firms have bought more than 100,000 troubled mortgages at a discount from banks and federal housing agencies, emerging as aggressive liquidators for the remains of the mortgage crisis that erupted nearly a decade ago.

As the housing market