Housing Crisis is still getting worse - 2 more years

[KC Scott]

If this is correct, 9% of all US homeowners are either behind in their Mortgage or in Foreclosure:

http://www.chron.com/disp/story.mpl/bus ... 86311.html

There's now a forecst for a second wave of foreclosures to hit in 2009/10 and what was thought to be a possible bottom is still a year to two away. So far this year there's been 12 bank failures, and when these next waves hit, more will follow.

The Fed is financing back-up for Freddie-Mac and Fannie-Mae, lest the foreign (read chinese) liquidate the other 75% of their holdings.
I hate to see that - but in this case, unlike Bear Stearns, it's got to be done.

This is bad shit people. The Tax debt on this will make the S&L look like a newspaper stand.
Add in the spike in Unemployment and it's not looking good for the next administration - regardless of party.

[RJ]

Balloon payments.



Dumb fucks. They deserve to lose their homes.

Couldnt agree more.

Here's a novel idea: How about buying a smaller home you can very comfortably afford instead of stretching yourself razor thin for an extra 1000-1200 foot mini mansion.

Idiots.


I have NO sympathy for the stupid.

[Diogenes]

The real crisis is the economic effect of the government bailing out said dumbfucks. Let them go under. It will lead to a drop in housing prices, enabling responsible people to be able to afford to purchase a home, as well as lower rent prices when availability goes up. That would lead to individuals having more disposable income to spend and invest, spurring the economy.

Of course since this would be political suicide, the opposite will happen.

[Mister Bushice]

The unregulated predatory lenders and even Bush bear part of the blame for this mess as well.

"Over 75 percent of white Americans own their home, and less than 50 percent of Hispanos and African Americans don't own their home. And that's a gap, that's a homeownership gap. And we've got to do something about it." —George W. Bush, Cleveland, Ohio, July 1, 2002

Looks like he did just that.

Some people just wanted to buy a house for their families, no greed involved.

Trying to blame it all on the "Greedy" home buyer is just ignorance of the reality.

The real crisis is the economic effect of the government bailing out said dumbfucks. Let them go under. It will lead to a drop in housing prices, enabling responsible people to be able to afford to purchase a home, as well as lower rent prices when availability goes up. That would lead to individuals having more disposable income to spend and invest, spurring the economy

Thant's happening regardless of the government bailout. The Banks are giving homes away right now at well below market. Unless of course you buy a tiny 40 year upstate New York shithole, your equity is down.

After 10-1 we'll see a big chunk of at risk home loans get converted to FHA loans, with provisos that include a 50% equity kickback to the FHA after 5 years upon sale.

If this is correct, 9% of all US homeowners are either behind in their Mortgage or in Foreclosure

I've talked to a half dozen people in this neck of the woods who are either in danger of losing their homes for one reason or another, or have a family member or friend who is. Most have told me they've tried to talk to the banks about working something out, but the banks just stiff arm them, giving them no options except foreclosure in the end. I spoke yesterday to a neighbor, an engineer with three kids who got laid off two months ago because work has slowed down so much. Normally he'd have no problem paying his mortgage but there are just no jobs out there that hundreds of other people aren't lining up to get.

He called the bank to see if he could work something out regarding the payments, and they just said "pay on time and there'll be no foreclosure" He's going to hang on and hope things turn around.

Bernanke tried to pressure the banks to work with homeowners back in March, theorizing that principal reductions would restore some equity and might stave off many delinquencies and foreclosures.

THAT worked well.

[BSmack]

Two more years of foreclosures and falling values and I'll still have a substantial bit of equity in my house.



WAR doing it right.

Word. My house may not be a McMansion, but it will still be mine after this mortgage mess is sorted out. No upside down loans over here.

[Tom In VA]

Works for me.


But the banks were stupid too, the appraisers and brokers potentially - criminal, and it's a royal clusterfuck.

Exacerbated here by the local government's vigilante style immigration enforcement. Housing values go down, taxes go up.


I'll be getting my GO BOX ready.

[BSmack]

Thant's happening regardless of the government bailout. The Banks are giving homes away right now at well below market. Unless of course you buy a tiny 40 year upstate New York shithole, your equity is down.

There are plenty of markets where home equity values have stayed stable. Those markets would be the ones where home prices stayed consistent with area wages. My house might not be a showcase, but it returned about 6% for me last year. How's your portfolio these days?

[Tom In VA]

But the banks were stupid too,

No, the banks were greedy. In any event, it is imperative that both greed and stupidity have painful consequences.

Well, personally, I prefer the term "IGNORANT". Painful lesson for homeowners to learn. If they do it again, then they're STUPID.

I think banks are stupid, because it seems to me they'd get more out of freezing an at-risk-of-foreclosure-owner's rate and have SOME money coming in rather than foreclosing and taking a huge loss. But I am not, well, I'm not all that smart ... so that might not be a good idea.

[BSmack]

Well, personally, I prefer the term "IGNORANT". Painful lesson for homeowners to learn. If they do it again, then they're STUPID.

I think banks are stupid, because it seems to me they'd get more out of freezing an at-risk-of-foreclosure-owner's rate and have SOME money coming in rather than foreclosing and taking a huge loss. But I am not, well, I'm not all that smart ... so that might not be a good idea.

If you're paying more than 3 times your annual salary for a home, you are taking a huge risk with your family's future. And if in order to afford a mortgage, you are banking on your property value to rise so you can use the equity to make a balloon payment, you are playing Russian Roulette.

[Mikey]

Well, personally, I prefer the term "IGNORANT". Painful lesson for homeowners to learn. If they do it again, then they're STUPID.

I think banks are stupid, because it seems to me they'd get more out of freezing an at-risk-of-foreclosure-owner's rate and have SOME money coming in rather than foreclosing and taking a huge loss. But I am not, well, I'm not all that smart ... so that might not be a good idea.

If you're paying more than 3 times your annual salary for a home, you are taking a huge risk with your family's future. And if in order to afford a mortgage, you are banking on your property value to rise so you can use the equity to make a balloon payment, you are playing Russian Roulette.

If only that were literally true, there wouldn't be anybody around that needs to be "bailed out".

[Mr. Schwump]

Back when people brought houses they could afford, the rule of thumb was 2 1/2 times the breadwinner's annual income. It did not include any spouse's income. Perhaps that was a smart way to go. Why did the banks change that ?

[Cuda]

If this is correct, 9% of all US homeowners are either behind in their Mortgage or in Foreclosure:.

it's not correct, and being behind, and being in foreclosure are two entirely fucking different things

[Tom In VA]

Well who is getting bailed out on an individual level ? As far as I know the banks choose whether or not they will work with the people at risk of losing their homes. Contrary to popular opinion and news hype, most banks are working with people trying to stay in THEIR home. The vast amount of foreclosures - in this area at least - are people who played the game and watched "Flip This House" way too much and tried to play. Those folks are losing their second or third homes. Drags down the sale prices on homes in the same 'hood because the bank sells it at a foreclosure fire sale. Locally, in my area, another problem is that a lot of "illegals" got out of dodge as Manassas and Prince William County got tough on immigration. The fleeing hordes of - RENT and tax paying "illegals" - created a vacuum. House flippers/speculators who were renting their second, third, fourth home, to illegals all of a sudden had no rent coming in, couldn't make the payments - and boom. Foreclosed.

Nobody's hands are clean in this mess. The poor slobs that lose their home because they lose their job or some other major catastrophe are poor slobs - but that shit happens in good markets too. It's called life.

[Cuda]

Back when people brought houses they could afford, the rule of thumb was 2 1/2 times the breadwinner's annual income. It did not include any spouse's income. Perhaps that was a smart way to go. Why did the banks change that ?

Because back in the early 90's, Congress required them to make loans to favored minorities regardless of their income or ability to make the payments.

[Tom In VA]

Back when people brought houses they could afford, the rule of thumb was 2 1/2 times the breadwinner's annual income. It did not include any spouse's income. Perhaps that was a smart way to go. Why did the banks change that ?

Well while it's "cause celeb" to blame Bush, actually it was Bill Clintone who said they could.

http://query.nytimes.com/gst/fullpage.h ... A964958260

[Cuda]

Well while it's "cause celeb" to blame Bush, actually it was Bill Clintone who said they could.

More like Charles Rangell & Chuck Schumer, but Bill was a big, big fan

[Goober McTuber]

Back when people brought houses they could afford, the rule of thumb was 2 1/2 times the breadwinner's annual income. It did not include any spouse's income. Perhaps that was a smart way to go. Why did the banks change that ?

How do you decide which posts are Wolfman’s and which ones are Mr. Schwump’s? Is there a rule of thumb involved?

[BSmack]

Back when people brought houses they could afford, the rule of thumb was 2 1/2 times the breadwinner's annual income. It did not include any spouse's income. Perhaps that was a smart way to go. Why did the banks change that ?

Well while it's "cause celeb" to blame Bush, actually it was Bill Clintone who said they could.

http://query.nytimes.com/gst/fullpage.h ... A964958260

You're forgetting that Clinton also favored a balanced federal budget as a means of facilitating the free flow of credit. Bush's reckless spending policies have sucked money out of our economy, accelerating and exacerbating the situation.

[Tom In VA]

I was speaking more along the lines of the Executive level. Deregulation is a big conservative ticket item, so I'm sure Bush or any other conservative would have done the same thing at the time. 99% of the decisions made are because they seem like good ideas at the time. Once the decision is made - in this particular case - a lot of good things happen. A lot of work was created as loans became easier to get and for quite some time. Then, two years ago, it hit it's peak and started to slide down hill.

Even that, isn't necessarily a bad thing. The lowering of home values will help younger folks be able to buy a home. It's a cycle. The "casualties" in this current cycle are - learning a few lessons about life right now.


No question BSmack. That appears to be the overall consequence of many of Bush's decisions.

[Goober McTuber]

I was speaking more along the lines of the Executive level. Deregulation is a big conservative ticket item, so I'm sure Bush or any other conservative would have done the same thing at the time.

I thought Bush was a liberal? Why don't you clowns make up your mind.

[Mister Bushice]

You're leaving out a whole level of greedy people - those agents/builders who sold the homes to people. Many of the builders had their own loan companies and made these unbelievable deals with people if they used their lenders, requiring little or no documentation, and monkeying with the rates and the load types, making promises or claims that some people accepted at face value when shown pretty charts and a case history or two that had absolutely no chance of becoming reality.

like I said, Like Tom said - Plenty of blame to go around here. I see nothing wrong with someone who has a decent job buying a nice home for his family. The speculators who bought poorly and didn't flip the house or got themselves a really stupid loan? That's their problem.

Truly, greed got to a bunch of people but for some hard working, maybe not highly intelligent people who just trusted their agents/brokers/aka "professionals" in the real estate market they got screwed without greed as a factor for them. Wanting to move out of a shared house or cramped apartment so your kids have their own bedrooms is not exactly one of the seven deadly sins.

And those of you idiots who continue to try and blame a president who is over 8 years out of office for any of this shit. LET IT FUCKING GO. Go back to the blue dress/ blow job scenario.

I said long ago - Bush needed the housing boom to prop up his economic stats, which are now falling down around him like a house of cards. He turned a blind eye to regulation of this industry, which went on a .com like spree, and thus he made it easy for those who should never have qualified to buy a house, to buy a house they could not afford.

There are plenty of markets where home equity values have stayed stable. Those markets would be the ones where home prices stayed consistent with area wages. My house might not be a showcase, but it returned about 6% for me last year. How's your portfolio these days?

You mean overall, including everything? I'm still up 15- 20% overall, which sucks compared to the 150% I was up a year ago, but up is still - up. I'm not at all concerned. Income is stable, and my ratios are good.

Only one property of mine - the one I plan on living in for a long while - is really the main problem that is causing a big dip in the overall equity, but that will straighten out in time, I ain't going no where, and it's a great house. The location, the size and type are all good indicators that it will recover well after the banks get done fucking over some of the neighbors.

You see, I bought well, so my portfolio these days is acceptable.

[Cuda]

You're leaving out a whole level of greedy people - those agents/builders who sold the homes to people. Many of the builders had their own loan companies and made these unbelievable deals with people if they used their lenders, requiring little or no documentation, and monkeying with the rates and the load types, making promises or claims that some people accepted at face value when shown pretty charts and a case history or two that had absolutely no chance of becoming reality

as usual, you don't have a fucking clue.

[KC Scott]

If this is correct, 9% of all US homeowners are either behind in their Mortgage or in Foreclosure:.

it's not correct, and being behind, and being in foreclosure are two entirely fucking different things

Same Cuda same stupity.

9% of Homeowners are behind on their payments. A % not given of those are in foreclosure.

Is that simple enough for you to understand?

[Mister Bushice]

You're leaving out a whole level of greedy people - those agents/builders who sold the homes to people. Many of the builders had their own loan companies and made these unbelievable deals with people if they used their lenders, requiring little or no documentation, and monkeying with the rates and the load types, making promises or claims that some people accepted at face value when shown pretty charts and a case history or two that had absolutely no chance of becoming reality

as usual, you don't have a fucking clue.

Cuda,

If I ever need advice on ass scratching, nose picking, masturbating, or stupid fucking mind numbing posting techniques- IOW all of your basic skills - I will most certainly PM you.

Until that time - resume your continued refinement of the above list.