Loan Survivor

U.S. Housing: More Homes in Delinquency than for Sale

I wish "experts" would STOP quoting the Fed Bank of Boston study that showed over 50% of modified loans redefaulted within 6 months.

That same study ALSO stated that of the modified loans in the pool studied, less than 23% actually lowered the homeowner's payment.

Given that homeowners wouldn't be behind in the first place if they could afford their payments, what idiot would expect them to be able to make a higher payment?

This is not an endorsement for loan mods (although I am partial to them), but if you're going to do them, do them with the intent to succeed, not fail.

Also, if you're going to reference studies, make sure you actually read the study and don't just repeat someone else's propaganda:)

Check out this post for more info: drewsmortgagenews.blog...

First-Time Homebuyers Proliferate: What Are the Consequences?

Which is worse - bailing out the Wall Street elite responsible for this mess in the first place or a housing market played like a fiddle by the elite?

My personal pick is the lesser of the two evils - the housing market and the corresponding taxpayers.

FYI - buying a new home and walking away from the old one is much tougher now that phantom rental income from the old home can't be used to qualify for a mortgage on the new one. FNMA/FHLMC & FHA have implemented minimum equity requirements in existing home to use rental income from it.

Mortgages: More Support for Principal Reduction

Over 25% of financed homes in this country are upside down a this time. First American published a study last October that almost 25% of financed homes had less than 5% equity in them. Well, housing prices have fallen more than 5% since than, so we can conclude that over 25% are now upside down.

Also, reagarding your comment about over 50% of loan mods redefaulting within 6 months shows you've fallen for the banks' propaganda. That "stat" came out of a Federal Reserve Bank of Boston study taht skewed the number by only using loan mods done in 2008. That same study showed that only 26% of the loan mods included in the study actually LOWERED payments. for more on the TRUTH about that study read: drewsmortgagenews.blog....

NAR Keeps Whining About Appraisals

Good info Tom. There are problems with HVCC, but it's not going away. Biggest problem I see is the "race to the bottom" on AMC's pushing for the cheapest price & fastest turn times. Leads to very shoddy work.

On NAR - they have a code of ethics they've published for their members. Maybe it's time they create a code of ethics for the organization so they stop being so selfish.

178 Loan Mod Companies Pursued by Government - It's About Time

Jack & Karen - interesting comparison.

Tony - that is funny!

Moon - the people with the money rarely get prosecuted:(

John - free market is great in theory, but if it worked perfectly we wouldn't need 80% of the laws we have.

Phoenix - great insight and numbers. Problem is I haven't found a computer yet with an "emotion" button on it. People love their homes and will do irrational things like paying thousands to strangers for a possible loan modification to try to save them. Also, if we extrapolate your argument then everyone in this country should pull their money out of the stock markets and either invest elsewhere or sit on it until market returns to its "highs".

Thank you all for your comments:)

Mega Jumbo Loan Default Rates Rising in Florida

Great investigation work! Push this to a reporter in your area.

Obama's Foreclosure Plan Du Jour: Own-to-Rent

Crazy idea. What next - can't afford my car payment so the government subsidizes that?

This is a sign that the government is a lot more worried about the housing market than they're letting on. Maybe all that shadow inventory is piling up and getting to be a problem.

Also, how much would it cost taxpayers when the government has to hire oodles of accountants, admins and executives to execute the program?

Underwater Borrowers Not So Shy About Mailing Back the Keys

If we all follow the ethics and morals of Wall Street we'd be back in the Dark Ages.

Homeowners need to do what's best for them, forget what society deems is right.

Also, the Kellog study is seriously flawed - it asks the walk-away question in a vacuum, which is not reality. Part of the question should have asked would they walk-away if they would only save $X/month by renting instead of owning.

People keep paying on upside down cars all the time because they need transportation and they can't get anything significantly cheaper per month. Most people will do the same when it comes to their house.

Bad News: House Prices Are Stabilizing

I've stated numerous times that there is a shadow inventory of houses that the banks are sitting on to prop up the market. This inventory needs to be worked through before private sellers can be optimistic.

Why Mortgage Modifications Have Failed

The world's biggest Ponzi scheme EVER is what Wall Street did to homeowners. They gave them crazy mortgage products that artificially drove up housing values while the government was bribed to look the other way.

When the housing bubble popped, these people got to keep all their bonuses and walk-away from their failing institutions.

Of course, the government then stepped in to prop up most of these institutions.

Now, the taxpayers will be stuck with the bill. If you're a taxpayer that also owns a home - tough luck. No one really wants to help you. You get the bill for the bailout and on top of that, you're also stuck with an upside down home.

There are two classes of people in this country - the rich & their government pawns, and everyone else.

We've gone from the Dark Ages where the average person was a serf tied to a noble's land, to the Finance Ages where the average person is a serf tied to the debt they've been hoodwinked ito by the "nobles" on Wall Street.

Should CIT Be Saved? I Think Not

From the comments above it appears that CITI doesn't need a government bailout. Great news for taxpayers!

Unbelievably, the No-Doc Loans Movement Gains Steam

I'm not sure asking banks to do police work for the IRS is a good idea. If we do that, where so we stop? Do we require auto dealers to verify income and assets for car loans? How about for credit cards? How about utility bills? How absurd do you want to get?

Also, why should residential lending be any different than commerical lending? In commercial lending, loans are made all the time to people with bad personal credit, but the projects are sound. The interest rate and loan terms are stuctured according to the risk.

I think we are all over-reacting to the financial mess we're in and forgetting business fundamentals.

The No Doc loans we should all be against are the ones that misrepresented the risk being peddled to the financial markets.

I remember seeing a 0% down, stated income loan for investment properties. Stupid loan, even stupider system for offering it. The product should never have been offered as there is no way to price the risk! But a Lehman Bros company offered it, securitized it and sold it to an entity they suckered in by understating the risk.

On the other hand, I see nothing wrong with a No Doc or Stated Income loan for a primary residence only, that requires 20-25% down, great credit & reserves and is priced to accomodate the higher risk.

Foreclosures Getting Out of Control

There is no easy solution. It will get uglier before it gets better.

I also believe the government is trying to force banks into hiding the true extent of the problem. How many of us see vacant houses around us that aren't for sale? Why is that? What will happen to the number of homes in this category when banks increase their actual foreclosures?

Some type of incredible intervention will be needed to break the negative feedback loop on the housing crisis.

BTW - America may be broke, but so is most of the civilized world.

This Just In: Refinance at 125% of Market Value

John, you make some good points, I can tell you though, from being in the "trenches" that most people have a highly emotional attachment to their homes. They won't follow the rational logic of your argument and will go pretty far to try to save their homes.

In reality, it all boils down to can they afford the payment. If they can't, they can always go for the modification part of Obama's housing intitiative.

More Reckless Home Lending, Courtesy of Fannie and Freddie

Edward, please explain how the 125% LTV program on only exisiting FNMA/FHLMC debt will be bad for banks?

The only facts you present are that HBOS in the UK had problems because they offered 125% PURCHASE loans.

We're talking 125% LTV REFINANCE loans here that FNMA/FHLMC are already on the hook for, meaning taxpayers are on the hook.

If lowering interest rates to lower payments, means taxpayers have to bailout fewer foreclosures, why are you against that?

Before responding, please read my post that discusses this in detail and addresses many of the misplaced concerns about the porgram - seekingalpha.com/insta...