The lawyers will lock this up further on all fronts.
Small example: Chula Vista passed an ordinance requiring the bank to take care of it's repossed homes. Think of all the lawsuits filed by neighbors when the lenders won't (can't) do it and the neighborhood's value drops due to the blight.
Countrywide owns 10000+ homes rotting away. Somebody's gonna sue them faling to maintain them.
I'm sure this decision results from Moody's decision which means that these loans can't be re-packaged or sold for a premium. It is sure funny that bubble television is not reporting on any of this.
Joe-i still envision you driving around in your cop car trading stocks while counting reos. "2 niner, niner, 2 niner, niner; i told you to short that sucker, dude!"
"Just got this from Nat City. They were the ones to turn to for 2nds behind other institutions neg-ams."
I had heard about this, but didn't really believe it. I wondered who would be dumb enough to fund a 2nd behind a negatively-amortizing OptionARM. Now we know.
Homeowner: "Just one more hit! Please, that's all I need, just one more!"
Broker: "Who are you? Have I ever met you before? Please get out of my office right now!"
Both CFC, and Chase just announced this morning that they're increasing the add-on fees for all their Alt-A products. I;ll update you guys on the amount of the change.
If my analysis of the market action is correct, huge equity positions are being dumped to suckers.
What I love, absolutely love, and believe me I am a Democrat who is going to go to the polls and vote for the Democratic Presidential Candidate with a beaming smile on my face, but what I love is that the Clinton's are out of the market.
Banker, my natural tendency is to label myself as the next best thing to a paranoid schizophrenic and disregard all my black helicopter thoughts, but this time I simply cannot help but think that the big boys passed the word to get out awhile ago, and now they are doing it in earnest.
How do I think it's possible? Leverage is power. Unlimited leverage is unlimited power.
The market should detumesce at the end. Watch the yen overnite to see if the same thing is going to happen tommorrow.
Add UBS to the Alt-A add on fee changers. About 125bps overall price drop from yesterday to today. Price adjusments with changes up to 400bps change. Its catching fire rapidly in Alt-A world
Tony Crecenzi argued that today's uptick in pending home sales could be due to increased buying of foreclosures.
This seems unlikely to me, since it seems that foreclosures are not being sold aggressively. A shift to selling foreclosures will hardly bail out builders or desparate sellers or even lenders, but I wonder whether a possible increase in sales of foreclosures (by banks not to banks) could be enough to increase the national home sales rates. Any ideas?
An Alt A issue
My impression, not based on hard data, is that certain S&Ls, perhaps including IndyMac (IMB), Downy S&L (DSL) and First Fed (FED) specialized in Alt A. Is this true? If it is, it would seem that these companies would be in big trouble.
Banker,Arbo-take a look at the last hours fight swinging around the zero point of the Dow. PPT desperately trying to avoid another down day. they can goose but not control the ultimate mkt outcome.
I'm just wondering whether these thrifts could experience a run on the bank? I mean, I could imagine safer places for my savings than these Alt-A specialists. Even if I didn't have a significant amount in there (insignificant meaning an FDIC insured amount) I would jump ship right about now just to avoid the possible future hassle.
Damn, it does sound like the secondary market for Alt-A must be dead. It definitely dosen't look good for DSL, FED, etc., but more importantly, it's another big kick in the ass for home sales, particularly new home sales and those in California, where 20% of loans were subprime and 20% Alt-A last year.
I'm betting the homebuilder shares lose a minimum of 25% more.
General Motors Corp. completed an ugly trifecta of steep July U.S. sales declines for domestic automakers on Wednesday, as the housing slump and stubbornly high gasoline prices kept potential car buyers away from the showrooms.
You thik it's disturbing that the mortgage brokers are watching. I saw on sitemeter that someone accessed this article of mine eariler today from fdic.gov. Funny.
Yal-as i recall we got up to 380 or so the nite of the BSC fallout announcement a couple of wks ago. btw did you ever short HLT? HOT has taken a big beating since.
I hope they are getting really good prices on those foreclosures, since it's looking like we aren't anywhere near the bottom of this mess. I think a lot of vultures will end up being cannibalized.
All, I usually try to stay away from anything that looks like a rumor - but this Alt-A story seems pretty important for housing.
ac, housing has really hit the auto sector. You wouldn't believe how many people told me - back in '04 and '05 - that they took out a 2nd (or ReFi'd) and bought a new car. The auto sector was one of the first areas impacted by declining MEW, along with home improvement and home furnishing, but I expect other retail areas to have problems later this year.
"2/28, 2nd Lien Performance Worsens
Fitch Ratings announced Wednesday downgrades on 150 vintage 2006 and 2005 RMBS classes. The downgrades were the first in a series of planned actions as a result of recent adjustments to the agency's surveillance methodology. One of the issues of concern to the ratings agency is the poor performance of 2/28 adjustable-rate mortgages and loans with subordinate liens. "
Interesting. My understanding is that forclosures are considered "sales" when the properties go back to the bank. Strange but true. This may be causing an uptick in sales.
Speaking of auto sales, I am in the market to buy a new car. I can easily wait another year though. Based on the economy and the predictions of what things will be like in the near future, is it better to buy one this year or would it be more prudent to wait until next year?
ac, housing has really hit the auto sector. You wouldn't believe how many people told me - back in '04 and '05 - that they took out a 2nd (or ReFi'd) and bought a new car.
I did that back in the dot.com days. =)
I bought a very expensive car because it seemed like I was well on my way to being richer than Bill Gates and had piles of options, etc.
Didn't quite work out that way, but I still have the car and I honestly can't say I regret buying it. It was never a financial stress, but sometimes I think about what I could have done with the money... and then I stop thinking about it and feel a lot better.
CR, I cant tell you how much the auto people have been trying to deny that housing made an impact. But my clients are no longer thinking Im nuts when I trot out the argument now. For the last few years,though, I could not convince anyone that housing would eventually bust, so how was I going to convince them that when it does, it will take down their industry???
Funny, we've been watching the mortgage brokers and now they're watching us.
Hi MORTGAGE BROKERS. Looking for a new career? I hear that nuclear power is making a comeback and they'll need lots of people to work in those plants. Of course it's gonna take about 10 years to get them built...
cathy: I'd probably wait until next year to buy a new car. By then the incentives should be even better and you might be able to find some really great deals on slightly-used cars that are a year old or less... people are going to need to raise cash somehow.
ok, WTF, the deputy chief economist is named Amy Crews Cutts? Why didn't i know this?! i swear to god i hope she used to work in a warehouse lending group...
This whole thing mystifies me. The junk market is dead for now, same with the leverged loan market, so LBo's are dead (for now).
It doesn't seem like banks have the ability to increase liquidity by selling mortgage positions or corporate positions which sort of narrows things down a bit. It anecdotally sounds like credit is getting squeezed across sectors/assets/quality etc.
If I'm right about that, it just doesn't seem that that adverse impact can be outweighed by ongoing longer-term positives, none of which is new (wages, exports, corporate profits).
Now I still think it hasn't been going on long enough to do major economic damage, but it sure isn't good. I'm not a stock expert, but it seems to me that that the 4-5%ish correction we've seen doesn't account for all this.
"You thik it's disturbing that the mortgage brokers are watching. I saw on sitemeter that someone accessed this article of mine eariler today from fdic.gov. Funny."
I've heard of even the smaller bubble blogs getting hits from the Fed, FDIC, Treasury, IRS, FBI, Fannie, you name it. Probably a lot of bored sinecure-holders rather than anything sinister though.
Looks like one of those manufactured short squeezes.
I'm not so happy about the dip buyers. At the correction in late February there was panic all over the very first day of decline. After a few days, market was free and clear to move up again. This time around, dip buyers are more tenacious and need to be shaken out before it can go up again. This will remain nasty for some weeks. Nothing like a bear market, though.
What say ye about the strong uptick in pending home sales? It's the biggest one in 2 years and that in the face of all mortgage blow-ups and credit tightings.
This is also my observation ~ despite all the turmoil, the RE market keeps up pretty well.
Also, the FED has not even strted to cut rates and making lending a lot easier again for banks (yield curve wise) and cheaper for borrowers. There is tremendous strenght in the economy.
Some food for thought, O-Joe, how many of those pending home sales are actually going to close given the fact that much of the easy financing has now dried up, or is about to?
Put another way, imagine you had a contract on a house and the buyer financed through AHM ... with the closing date, say yesterday after the company shut down.
Didn't someone just estimate that AHM just dropped the ball on 1500 mortgages (give or take) . . . maybe they'll all find alternative financing quick . . . maybe they won't.
Bill,
I think part of the answer to your question about the uptick in pending sales comes from the sudden tightening of credit over the last few weeks. Buyers who had their loans pre-qualified at the first of July for end of the month closing got told that their terms were being changed due to the tightening; and so the buyers have to scurry around and come up with a down payment or more of a down payment and so although they have a house under contract, the need to fix the financing delays closing. Thus the increase in pending sales.
This actually happened to me this last week; I had sold my home(at a nice profit) to a couple who were first time buyers. My wife and I go to the title company to sign, and our realtor gets a call from the buyers' realtor saying that the buyers won't be able to sign until Wednesday because they had to change lenders and get 5% to put down and so their paperwork was delayed by a couple of days. Needless to say, my blood pressure went up for a few seconds, until my realtor reassured me that they actually had the financing in place and it was just a question of a couple of days delay.
So my home seems to be part of that pending number. How nice to noticed by the press:)...
My mistake, I didn't see that the pending numbers were for June. So my sale will show up in July's number. Stands to reason, no way that the numbers could be gathered and reported by the next day.
The error is in thinking you can forecast the day to day random walk of the market. You might as well go to Vegas and play craps as try to call the hourly movements of the stock market.
Any idea if Nat City was selling these HELs that are sitting behind the neg am 1st to ETrade? Nat City is one of the major providers of paper to ETrade.
My comments on today's pending home sales . First , to the extent that these numbers are believable ( my recollection is that interest rates jumped up fairly significantly in June .... watch for next month's revisions ! LOL Second , how many of these "pending " home sales will actually close ? Subprime and Alt A are dead ... who's going to fund these fricking home loans ? AHM ? Nuff said ! I guess you know I was a Marvel Comic fan growing up . BTW , Friday's employment numbers will be a piece of fiction as well.... I bet construction and manufacturing jobs will show another increase ! LOL FBTW... wow , that was a really impressive trip to China Paulson , you really got the Yuan moving my friend !
The FDIC's internal employee email system has a huge daily distribution of on-line newspapers, magazines, financial publications, legal news, including USAToday, Washington Post, NY Times, Dallas Morning News, etc. It also emails a daily "FDIC in the news" update which tracks all published articles nationwide that mention "FDIC" from mundane stuff on CD insurance coverage to Congressional testimony, bank closings and beyond. Employees are free to access any of these on-line publications and read as many as time permits. Some read all day.
I think you are right on Fredw. My wife and I are watching and waiting to buy a house. The realtor we are working with keeps showing us houses way out of our price range and saying "well I really think this will sell for a lot less than this." Yesterday, I dropped in to see him and he mentioned his last 4 deals have fallen through because of financing or disagreements over the purchase price. It came up because he showed me a contingent home and said "we'll see if it actually closes." This is happening in an exclusive area not some suburb.
Bear Stearns hedge fund investor files claim
| Reuters
The lawyers will lock this up further on all fronts.
Small example: Chula Vista passed an ordinance requiring the bank to take care of it's repossed homes. Think of all the lawsuits filed by neighbors when the lenders won't (can't) do it and the neighborhood's value drops due to the blight.
Countrywide owns 10000+ homes rotting away. Somebody's gonna sue them faling to maintain them.
Joe-you are so pessimistic.
I'm sure this decision results from Moody's decision which means that these loans can't be re-packaged or sold for a premium. It is sure funny that bubble television is not reporting on any of this.
Joe-i still envision you driving around in your cop car trading stocks while counting reos. "2 niner, niner, 2 niner, niner; i told you to short that sucker, dude!"
selling code-3,
need cover now!
The first line of the broker outpost post:
"Just got this from Nat City. They were the ones to turn to for 2nds behind other institutions neg-ams."
I had heard about this, but didn't really believe it. I wondered who would be dumb enough to fund a 2nd behind a negatively-amortizing OptionARM. Now we know.
Homeowner: "Just one more hit! Please, that's all I need, just one more!"
Broker: "Who are you? Have I ever met you before? Please get out of my office right now!"
"Just got this from Nat City. They were the ones to turn to for 2nds behind other institutions neg-ams."
Wouldn't burning the money accomplish the same thing and involve less paperwork?
Only if you collect fat fees for burning the money.
I do not view this as a positive development.
HKP PhD
CR, care to revise that brand new house sales forecast yet?
ot a good sign-energy capitulating to the downside now despite huge drop in crude inventories this AM with an initial run up.
Both CFC, and Chase just announced this morning that they're increasing the add-on fees for all their Alt-A products. I;ll update you guys on the amount of the change.
If my analysis of the market action is correct, huge equity positions are being dumped to suckers.
What I love, absolutely love, and believe me I am a Democrat who is going to go to the polls and vote for the Democratic Presidential Candidate with a beaming smile on my face, but what I love is that the Clinton's are out of the market.
Banker, my natural tendency is to label myself as the next best thing to a paranoid schizophrenic and disregard all my black helicopter thoughts, but this time I simply cannot help but think that the big boys passed the word to get out awhile ago, and now they are doing it in earnest.
How do I think it's possible? Leverage is power. Unlimited leverage is unlimited power.
The market should detumesce at the end. Watch the yen overnite to see if the same thing is going to happen tommorrow.
And for the love of God, do not be long equities.
Add UBS to the Alt-A add on fee changers. About 125bps overall price drop from yesterday to today. Price adjusments with changes up to 400bps change. Its catching fire rapidly in Alt-A world
Buh bye any housing market with median prices over $400k.
Arbogast,
If after all this gyrating the DJIA ends up closing close to the open, I am going to hold you, the Knights Templar, the PPT and Jack Ruby responsible.
Tony Crecenzi argued that today's uptick in pending home sales could be due to increased buying of foreclosures.
This seems unlikely to me, since it seems that foreclosures are not being sold aggressively. A shift to selling foreclosures will hardly bail out builders or desparate sellers or even lenders, but I wonder whether a possible increase in sales of foreclosures (by banks not to banks) could be enough to increase the national home sales rates. Any ideas?
An Alt A issue
My impression, not based on hard data, is that certain S&Ls, perhaps including IndyMac (IMB), Downy S&L (DSL) and First Fed (FED) specialized in Alt A. Is this true? If it is, it would seem that these companies would be in big trouble.
Someone needs to Kick the Ft lady in the crotch...she is not hitting her High Note.
Shhhh we are being watched by...
by...
MORTGAGE BROKERS!
More "Fear Mongering"....
Banker,Arbo-take a look at the last hours fight swinging around the zero point of the Dow. PPT desperately trying to avoid another down day. they can goose but not control the ultimate mkt outcome.
"FAT" Not Ft
Cal-everyone watches everyone on their way out the door.
I'm just wondering whether these thrifts could experience a run on the bank? I mean, I could imagine safer places for my savings than these Alt-A specialists. Even if I didn't have a significant amount in there (insignificant meaning an FDIC insured amount) I would jump ship right about now just to avoid the possible future hassle.
But that's just me.
The market should detumesce at the end.
(spelling forgiven)
That always happens to me, too, and I hate it!
wally-yeah, but she appreciates your efforts.
Damn, it does sound like the secondary market for Alt-A must be dead. It definitely dosen't look good for DSL, FED, etc., but more importantly, it's another big kick in the ass for home sales, particularly new home sales and those in California, where 20% of loans were subprime and 20% Alt-A last year.
I'm betting the homebuilder shares lose a minimum of 25% more.
I should have puts quotes around that and thanked arbo for his hard work.
I just noticed that the number of "visitors" on-line is 236.
it just crossed 200 for the 1st time few days ago.
CR - you are a popular guy and I wonder how many of the new visitors are from wall street ?
btw, where did dc100, short buster and (I should not mention them in the same line but i will) our dearest Turbo and Risk capital ?
(no I am not missing Seb that much...
arbo:
DSL/FED falling hard now.
On a more positive note:
General Motors Corp. completed an ugly trifecta of steep July U.S. sales declines for domestic automakers on Wednesday, as the housing slump and stubbornly high gasoline prices kept potential car buyers away from the showrooms.
Auto sector rattled by brutal July U.S. sales decline
You thik it's disturbing that the mortgage brokers are watching. I saw on sitemeter that someone accessed this article of mine eariler today from fdic.gov. Funny.
Market Factors: No Run On US Banks or Check Cashing Outlets Foreseen in Global Market Turmoil
Yal-as i recall we got up to 380 or so the nite of the BSC fallout announcement a couple of wks ago. btw did you ever short HLT? HOT has taken a big beating since.
M-F, that article of yours is hilarious. And it answered my question: no, these thrifts won't experience a run on the bank..
Thank you Finn. It does make a rock solid case that there will not be a run on the banks, doesn't it?
That's what I'm seeing in KC, Bill. Investors snapping up foreclosures, to rent to people who are being foreclosed upon...
I hope they are getting really good prices on those foreclosures, since it's looking like we aren't anywhere near the bottom of this mess. I think a lot of vultures will end up being cannibalized.
All, I usually try to stay away from anything that looks like a rumor - but this Alt-A story seems pretty important for housing.
ac, housing has really hit the auto sector. You wouldn't believe how many people told me - back in '04 and '05 - that they took out a 2nd (or ReFi'd) and bought a new car. The auto sector was one of the first areas impacted by declining MEW, along with home improvement and home furnishing, but I expect other retail areas to have problems later this year.
Best to all.
"2/28, 2nd Lien Performance Worsens
Fitch Ratings announced Wednesday downgrades on 150 vintage 2006 and 2005 RMBS classes. The downgrades were the first in a series of planned actions as a result of recent adjustments to the agency's surveillance methodology. One of the issues of concern to the ratings agency is the poor performance of 2/28 adjustable-rate mortgages and loans with subordinate liens. "
Mortgage News for Mortgage Brokers provided free | MortgageChronicle.com
Bill -
Interesting. My understanding is that forclosures are considered "sales" when the properties go back to the bank. Strange but true. This may be causing an uptick in sales.
Speaking of auto sales, I am in the market to buy a new car. I can easily wait another year though. Based on the economy and the predictions of what things will be like in the near future, is it better to buy one this year or would it be more prudent to wait until next year?
ac, housing has really hit the auto sector. You wouldn't believe how many people told me - back in '04 and '05 - that they took out a 2nd (or ReFi'd) and bought a new car.
I did that back in the dot.com days. =)
I bought a very expensive car because it seemed like I was well on my way to being richer than Bill Gates and had piles of options, etc.
Didn't quite work out that way, but I still have the car and I honestly can't say I regret buying it. It was never a financial stress, but sometimes I think about what I could have done with the money... and then I stop thinking about it and feel a lot better.
OT- Foreign remittance revenue for Western Union are down 7% for 1st half of 2007.
CR, I cant tell you how much the auto people have been trying to deny that housing made an impact. But my clients are no longer thinking Im nuts when I trot out the argument now. For the last few years,though, I could not convince anyone that housing would eventually bust, so how was I going to convince them that when it does, it will take down their industry???
Cal, you are precious.
I got (sic)'d by a mortgage broker! My life is complete.
Hey, Outpost doods: the "viscous cycle" thing came from one of your high-falutin' comrades over at BrokerUniverse.
If foreclosures and jingle mail count as sales, I'd like to add 2+ million to my entry in the contest, please.
Statistical meaning has completely thown the domino out the window with the tide water when a repo counts as a sale.
So THIS is what it looks like when the market does what the lenders, borrowers, and regulators did not ... exercise discipline in lending.
Funny, we've been watching the mortgage brokers and now they're watching us.
Hi MORTGAGE BROKERS. Looking for a new career? I hear that nuclear power is making a comeback and they'll need lots of people to work in those plants. Of course it's gonna take about 10 years to get them built...
This series of topic titles on Broker Outpost was amusing in an Eeyore-ish kind of way:
Who is still doing 100%?
does anyone???
Who's left?
Free Falling!
Pricing Needed ASAP!!!
{{sound of crickets chirping}}
cathy: I'd probably wait until next year to buy a new car. By then the incentives should be even better and you might be able to find some really great deals on slightly-used cars that are a year old or less... people are going to need to raise cash somehow.
Every talking head is saying that they are buying in this weakness.
If so, who is doing the selling?
Seems that all the gloomers and doomers are already on the sidelines.
Unless they are talking one thing and doing another.
Talk about site meters, the Cramer "walk away" video has almost 16,000 hits on youtube.
I just never remember it going green to red to green so much in one day (other than it bouncing around unchanged).
Thanks bofiz.
Geoff, The auto industry crashed before the housing industry...
they are pushing hard on the dow going into the close....
hold it...hold it....hold it.......she's breaking up....I need more power......I'm giving it all I've got!
"I just never remember it going green to red to green so much in one day"
Similar to last Wed before the huge crater. This is looking really ugly.
Ten minutes left for detumescence.
Guess something else might be going on. It's confusing.
NEW BULLLLLLL MARKETTTTTTTTT
Oh C_B ROFLMAO
Check your advancers/decliners and the new highs/new lows when the day is over...
NEW BULLLLLLL MARKETTTTTTTTT
Looks like one of those manufactured short squeezes.
I suspect we'll be seeing quite a few of those. If one gets out of hand it could take us up several hundred points.
Tanta, there are so many layers of irony in that (sic) . . . it creates a beautiful patina.
ok, WTF, the deputy chief economist is named Amy Crews Cutts? Why didn't i know this?! i swear to god i hope she used to work in a warehouse lending group...
LoanPerformance - RiskSummit
sorry, DCE at Freddie, just to be clear.
Looks like the carry guys didn't get arbo's memo...
I need a chiropractor!
This whole thing mystifies me. The junk market is dead for now, same with the leverged loan market, so LBo's are dead (for now).
It doesn't seem like banks have the ability to increase liquidity by selling mortgage positions or corporate positions which sort of narrows things down a bit. It anecdotally sounds like credit is getting squeezed across sectors/assets/quality etc.
If I'm right about that, it just doesn't seem that that adverse impact can be outweighed by ongoing longer-term positives, none of which is new (wages, exports, corporate profits).
Now I still think it hasn't been going on long enough to do major economic damage, but it sure isn't good. I'm not a stock expert, but it seems to me that that the 4-5%ish correction we've seen doesn't account for all this.
Anybody got that "Tin Foil Hat" order form?
"You thik it's disturbing that the mortgage brokers are watching. I saw on sitemeter that someone accessed this article of mine eariler today from fdic.gov. Funny."
I've heard of even the smaller bubble blogs getting hits from the Fed, FDIC, Treasury, IRS, FBI, Fannie, you name it. Probably a lot of bored sinecure-holders rather than anything sinister though.
AC:
NEW BULLLLLLL MARKETTTTTTTTT
Looks like one of those manufactured short squeezes.
I'm not so happy about the dip buyers. At the correction in late February there was panic all over the very first day of decline. After a few days, market was free and clear to move up again. This time around, dip buyers are more tenacious and need to be shaken out before it can go up again. This will remain nasty for some weeks. Nothing like a bear market, though.
O-Joe
BULLS WIN!! BULLS WIN!!
It's amazing how much confidence people will take (or lose) from 15 minutes of trading. It's all a matter of timing.
Arbogast,
Oh shoot!.. they put the juke box on today..
"It's going down! Oh! OH! WTF! Up (almost) 2% in under 30 minutes!! Ah! DAMN! OH! Backing off a little into the close! Ug, I need a drink.."
Hehehe.. I love to imagine what the average heart rate is on Wall Street right now. For shorts or longs..
" The market should detumesce at the end."
BWWWAAAAAHHHHHAAAAA
The market doth make fools of us all.
Mood swings
All,
What say ye about the strong uptick in pending home sales? It's the biggest one in 2 years and that in the face of all mortgage blow-ups and credit tightings.
This is also my observation ~ despite all the turmoil, the RE market keeps up pretty well.
Also, the FED has not even strted to cut rates and making lending a lot easier again for banks (yield curve wise) and cheaper for borrowers. There is tremendous strenght in the economy.
O-Joe
If indeed there is tremendous strenght in the economy, there will
be no rate cuts. there will be no rate cuts anyhow, too much inflation.
They got you on good meds Joe, what are they? Just curious.
Detroit Dan,
I dont work for any of the US producers. Im talking about the US sales rate, not the fortunes of the big 3.
Pending home sales DOWN y-o-y.
Daisy,
Give Arbo a break. He stepped up and took a shot. So he was wrong this time, it happens to all of us...a lot.
O-Joe,
One thing to keep in mind is that the pending numbers are for June and the stuff didn't really hit the fan until July.
Some food for thought, O-Joe, how many of those pending home sales are actually going to close given the fact that much of the easy financing has now dried up, or is about to?
Put another way, imagine you had a contract on a house and the buyer financed through AHM ... with the closing date, say yesterday after the company shut down.
Didn't someone just estimate that AHM just dropped the ball on 1500 mortgages (give or take) . . . maybe they'll all find alternative financing quick . . . maybe they won't.
Bill,
I think part of the answer to your question about the uptick in pending sales comes from the sudden tightening of credit over the last few weeks. Buyers who had their loans pre-qualified at the first of July for end of the month closing got told that their terms were being changed due to the tightening; and so the buyers have to scurry around and come up with a down payment or more of a down payment and so although they have a house under contract, the need to fix the financing delays closing. Thus the increase in pending sales.
This actually happened to me this last week; I had sold my home(at a nice profit) to a couple who were first time buyers. My wife and I go to the title company to sign, and our realtor gets a call from the buyers' realtor saying that the buyers won't be able to sign until Wednesday because they had to change lenders and get 5% to put down and so their paperwork was delayed by a couple of days. Needless to say, my blood pressure went up for a few seconds, until my realtor reassured me that they actually had the financing in place and it was just a question of a couple of days delay.
So my home seems to be part of that pending number. How nice to noticed by the press:)...
My mistake, I didn't see that the pending numbers were for June. So my sale will show up in July's number. Stands to reason, no way that the numbers could be gathered and reported by the next day.
I guess the good doctor used the gloves from the freezer to check Mr. Market's prostate
I guess the good doctor used the gloves from the freezer to check Mr. Market's prostate
LOL and on that note I'm out, bye folks.
Banker
The error is in thinking you can forecast the day to day random walk of the market. You might as well go to Vegas and play craps as try to call the hourly movements of the stock market.
Any idea if Nat City was selling these HELs that are sitting behind the neg am 1st to ETrade? Nat City is one of the major providers of paper to ETrade.
Statistical meaning has completely thown the domino out the window with the tide water when a repo counts as a sale.
Error structure modelling. No question that stats/econometrics will have to account for the systematic peculiarities of lots of data from this era.
My comments on today's pending home sales . First , to the extent that these numbers are believable ( my recollection is that interest rates jumped up fairly significantly in June .... watch for next month's revisions ! LOL Second , how many of these "pending " home sales will actually close ? Subprime and Alt A are dead ... who's going to fund these fricking home loans ? AHM ? Nuff said ! I guess you know I was a Marvel Comic fan growing up . BTW , Friday's employment numbers will be a piece of fiction as well.... I bet construction and manufacturing jobs will show another increase ! LOL FBTW... wow , that was a really impressive trip to China Paulson , you really got the Yuan moving my friend !
The FDIC's internal employee email system has a huge daily distribution of on-line newspapers, magazines, financial publications, legal news, including USAToday, Washington Post, NY Times, Dallas Morning News, etc. It also emails a daily "FDIC in the news" update which tracks all published articles nationwide that mention "FDIC" from mundane stuff on CD insurance coverage to Congressional testimony, bank closings and beyond. Employees are free to access any of these on-line publications and read as many as time permits. Some read all day.
I'd like to take a moment and explain the subtle distinction between 'scales back' and 'shuts off'.....
article on Wells Fargo
I think you are right on Fredw. My wife and I are watching and waiting to buy a house. The realtor we are working with keeps showing us houses way out of our price range and saying "well I really think this will sell for a lot less than this." Yesterday, I dropped in to see him and he mentioned his last 4 deals have fallen through because of financing or disagreements over the purchase price. It came up because he showed me a contingent home and said "we'll see if it actually closes." This is happening in an exclusive area not some suburb.