"This raises another problem with any public transportation scheme that requires employees to operate (can't think of one that doesn't, but hey.) Anyone who depends on public transportation can be held hostage by labor actions. No surprise that the employees can extract insane compensation."
the commies had a line - he who fails to steal from the state steals from their family. now that BAC and C are owned by the state and GS runs the state - truer than ever here in the land of the free.
Friend of friend lost job, tried to negotiate house payment down by 50%.
Of course, bank said "No way."
So they stopped paying.
.
That was a 14 months ago.
Still haven't been foreclosed on, still living in the house.
.
Two points: 1. Banks are way behind on foreclosures. 2. For some reason, banks are preferring no loaf to half-loaves.
We are turning Japanese, oh yeah we are turning Japanese. When a bank did not disclose all of its potential losses, they (Japan) call it - "saving the face" tradition. Now, should we expect our executives to carry it to the end and resign taking the blame? Fat chance.
I say it without snark because under the calvinball rules it is true.
It's not quite that dramatic either. The sheriff just shows up to give notice, then you have a window of time, weeks to get your alternate living arrangements worked out...
I'm sure we'll continue to watch people-doing-the-right thing get punished over and over.
that's because they aren't in the business of extending credit, holding mortgages, etc. they're in the business of taking YOUR tax dollars, both through direct bailouts, sitting on treasuries and through continuing to stuff new garbage into the mouths of fannie and freddie.
actually foreclosing is filed under "mark-to-market" - i.e., something which ends the salaries, perks, insider sweetheart loans, etc.
I'm kind of mystified by this person...if you walk away, then walk away...unless they were getting nastygrams from the local government as the owner of record. In which case, yes, absolutely: stay until you are notified the Sheriff is coming.
It's not half-a-loaf...as observed above, they, the banks, are made whole up-front, whatever the losses, there will be no losses because of taxpayers. So, why would I reduce my income stream by half by lowering your payment when I can get all of it via TARP?
Then we'll whine and bitch about the collapse of modern society, the lack of values in our social fabric, and "kids these days" in general, and call 'em Ruthless Defaulters. Hey, they learn from the big dogs how it's done. Paraphrasing Leona, "Rules and Taxes are for the Little People".
"2. For some reason, banks are preferring no loaf to half-loaves."
If the bank forecloses, it has to write down the loan. Otherwise, it's mark-to-fantasy. At the same time, trickling inventory onto the market is better for RE prices (and the underlying asset). The borrowers are much less likely than bandos to make a mess of things inside the house. I'm not sure, but it wouldn't surprise me to find out that there are liability advantages to not foreclosing. On top of all that, going through foreclosure costs a bunch of money in employee and lawyer time.
Foreclosure only really makes sense from the bank's point of view if there's significant 'owner' equity that can be seized.
who cares about the little people, as long as the executives at Citi get raises of 50% or more this year (they are) and those at Goldman record bonuses(they are).
Step 1: write horrific loans
Step 2: Loans blow up
Step 3: get govt bailout
Step 4: avoid foreclosure process so that you can keep mark to myth accounting
Step 5: give yourself record bonus and raise.
Step 6: profit!
There is something to what you are saying. Once foreclosed, ie. on the banks' books, they are liable, including the ugly things like someone is injured or killed on their property. But if they haven't completed the loop of foreclosure than you the 'owner ' of record are liable. And you better have insurance, in which case, if your paying the insurance, you ought to live on the property rent free, minus the utitlies to keep the lights on and the furance running in the winter.
I do short sales all day every day. The shadow inventory is waaaay bigger than anyone is willing to recognize. For every SS that closes there are five that are hopeless. Yes, anecdotal evidence, but true from my stand-point.
Your correct, and they should stiff whover they are renting from since she has already gone through BK to begin with...her credit is already destroyed.
If the bank forecloses, it has to write down the loan. Otherwise, it's mark-to-fantasy.
This is exactly my thought. The banks are doing FAR worse than any MSM thinks. They're just hiding it on the books by taking longer and longer to bring a house to auction.
Bill Gates Let's call Pewterschmidt.
Michael Eisner No, wait. Let's take the jetpacks!
Bill Gates Cool!
Michael Eisner Man! The people look like ants from up here.
Bill Gates They are ants, Michael. They are ants.
From the photo, she needs to get her money back from the landscapers. And the boarded up windows and yellow caution tape seem to hint at more problems.
Another hidden liability is The Western European exposure to Eastern European countries and the subsequent exposure that US banks have to those European banks.
I don't think so. They are completely under staffed to address the problem. Their means for tackling the problem are antiquated. The SS decision making matrix revolves around a broker price opinion of value. This BPO is conducted by a low end of the totem pole real estate agent. It takes 30 days to get it ordered. 30 Days to get the BPO conducted. And another 30 to review it. And the irony is that "it" isn't worth the paper it is printed on.
Foreigners are loving our securities. I performed a quick long hand division (thank you to Sister Mary Consolata ) and it appears that foreign central banks bought 62 percent of this issue.
dp, what you describe isn't understaffing. It's intransigence.
Rising numbers of foreclosures didn't start yesterday or last month or even last fall. If it were the intent of these lenders to service defaults, they'd be staffed and competent by now.
No corporation that is 34% owned by the federal government should be making any compensation decisions that aren't consistent with the locale-adjusted GS and SES scales.
"Ensuring compensation for employees by increasing salaries could be a move banks facing government restrictions take to avoid losing workers to competitors. Some banks that received government loans during the mushrooming credit crisis last fall have already paid back their debt, and are no longer subject to compensation oversight. That could allow them to offer lucrative deals to entice employees away from banks where restrictions are still in place."
====
great, sounds like the market is working: weak banks should die, any actual residual talent will be captured by surviving competitors
As I've mentioned earlier, my son rents in a home in Berkeley; the landlady hasn't paid mortgage since last August (and in fact has moved out herself). Wells-Fargo finally issued a NOD this month, 10 months after last payment.
Should be noted that (1) this was originally a World Savings loan that came to Wells via Wachovia aquisition and (2) foreclosures are extremely rare in Berkeley due to very low turnover rate.
There a house near me that I have paid close attention to since I wanted back in 2006, but couldn't afford. The buyers were, of course, in real estate and got 100% loan.
According to public records, they are three years behind on property taxes- meaning they may have made one tax payment. The matching Escalades in the driveway went away about a year ago. They had a notice of default recorded almost two years ago, then nothing happened. A new NOD was recorded about nine months ago. Finally, it is scheduled for foreclosure auction this Friday. I suspect it will be delayed/cancelled, like they all are.
What is shocking to me is that the bank has let over $30,000 in delinquent taxes build up. The cash out of pocket for the bank when they take at the foreclosure auction and resell it. And if they let it go a couple more years, it would have reverted to the county with the Bank's lien gone.
the lender- (apparently still holding the loan) IndyMac!, hence I think the FDIC has been in charge for a while now. And yes, you and I are "sharing" in the loss.
I know the local market well, and if IndyMac just took it back a year ago, knocked 15-20% off the 2006 price, it would have sold right away.
""No one is in a rush, lender-wise, to deal with the property," he said. "If you have to sell at a loss, why rush?"
If the banks wanted the houses, they'd take the houses. They don't want houses. They want nice numbers on their books. The sooner they take the houses, the sooner the numbers get less nice.
Nothing different than health care claims: claims are slow to process because the companies make more money that way. Most "incompetence" is policy.
i sympathize with Jenkins:
I stopped paying in January 2008 (once i saw where things were headed it was an easy choice). After three months of trying to work a solution with the lender, I moved my family 2 miles away. the neighborhood was an improvement and my girls are closer to their school. I kept contact with my neighbors, let them know what was going on, and kept the yard maintained. The lender did not move on the house until March 2009. other than a 1099, i had no contact with the lender after move-out.
not trying to justify anything- i did what i felt right; i shared a similar experience, torn between cutting loose from a losing situation and not wanting to f*ck over my neighbors.
dp, you should see all that Tanta had to say regarding the run-up to today's conditions.
Sales ran rough-shod over back office functions, and then back offices were gutted - seasoned servicers found themselves in a bricks-without-straw environment. And they left, or soldiered on, some of them.
I understand the backlog. Willing to bet every aspect of the process is in utter disarray from years of ignoring the cries of dismay from the back office "nerds".
What a stupid article. The house was ON FIRE for god's sake. Let's drum up the sob stories to sell some more papers. Would somebody please shoot the closest reporter....
Well said Burnside. I have read much of what Tanta has written on the topic. It's amazing how she has chronicled this catastrophe in such a way that only few will ever know.
This is why RE prices will be held at a high plateau, collapsing SLOWLY. The actual inventory will be held in shadows and trickle out very slowly.
Even if loss of jobs causes default, if banks are holding back inventory, you have no RE price descent.
In this picture, inventory will continue to dwindle with even minuscule sales. Expect to see published months-of-supply stats to continue to creep down.
If you stretch out the RE collapse over 23 years (aka Japan), you end up catching EVERYBODY in the net of destruction. For those momentum traders, this is the "MAX PAIN" scenario if you know what I'm saying.
THE PTB are making the collapse stall, so that new home buyers have 2 choice, buy at a high price, or wait / rent forever.
Sucks to be renter, or worse yet....someone lucky enough to still have a job and too honest to NOT pay their mortgage.
Maybe it's time we review our goals as a society....and then have a look at what we have in place now in terms of an behavioral incentive structure to see if they are in agreement.
I just had a contract to buy a condo in Falls Church, VA fall through. The appraisal came in $20,000 below sales price, seller wouldn't budge. The sales price seemed pretty good compared to the other units in the same building, I guess owners don't want to, or can't lower their prices. I told them you can sell it to me for for the appraised value, or I will pick it up next year at a foreclosure. With this deal fallen through, I did another search on my realtors website, saw 2x - 3x more foreclosures and shortsales than there were just 2 months ago.
Now I need to find a place to live, since I've already given notice at my apartment complex.
the landlady hasn't paid mortgage since last August
====
I hope they have spread the goodwill by not paying her the rent
Landlady is an elderly hippie that never grew up. Think what you may, hippies are WYSIWYG!
She told my son in September that since she wasn't paying her mortgage, she didn't want any rent money from him. Furthermore, two other units went empty 'cause even though she had been trying to rent them, she honestly told any potential renter that she was likely to default on her mortgage.
So he's paying the utilities and keeping the place looking reasonable.
maybe if i were single and broke. but listening to my wife worry about the sheriff showing up for an entire year would have put me over the edge. Also, the move was a move-up for us. the house we are renting now is twice as nice, with a bitchen view, for 400 dollars less that the mortgage was. no contest
Sheet that's nothing..I know of at least 3 that did this in 2006 and still have no foreclosure.
This is a huge phenomenon that won't be touched by anyone but lower level reporting and blog's.
All about the foreclosure rate vs actual registered NOD (Notice of Disclosure) not notice of default as is widely reported when anyone bothers to check it out.
"Sheet that's nothing..I know of at least 3 that did this in 2006 and still have no foreclosure."
I have seen mortgages that are over 1000 days late, which would confirm what you have seen.
I am not sure what is up with these that nothing has been resolved, but I would guess there is a problem finding docs, etc that prevents the bank from foreclosing, since they know they would lose. So they just keep hoping the docs will "turn up" in some box at Iron Mountain.
So let's say you "jingle mail" your keys in. The bank doesn't foreclose, leaving your former home empty. Squatters move in and damage the property. Is the to be foreclosed owner on the hook for damages?
What about the mark-to-market fear as described above? You foreclose and not only do you have to write down that one, you also have to write down all the comps?
"If you stretch out the RE collapse over 23 years (aka Japan), you end up catching EVERYBODY in the net of destruction. "
which is why these attempts to delay the inevitable are so harmful.
funny how we criticized the Japanese for their zombie banks, but we go and do the same thing.
just shows the power of the political and financial elite. without all the ties to the govt, Citi would have been shut down by now and liquidated, with something stronger emerging in its place.
instead they announced today they will not buy correspondent mortgages for a couple weeks because their systems were screwed up.
All about the foreclosure rate vs actual registered NOD (Notice of Disclosure) not notice of default as is widely reported when anyone bothers to check it out.
If Alameda County is typical, public records such as NODs are easily found via the web. No details like address or $$$, but you can see when the original deed was transferred (property purchase) and subsequent Notice of Trustee Sale and Trustees Deed (actual transfer to lender) in any.
I've noticed more recently that the time between NOD an Notice of Trustee Sale has increased recently. Could be various moratoria or could be overload. ...or could be they just DON'T WANT THE HOME.
claims those fake bonds were the real deal. any1 have an alternate source for the same?
and who decided grover cleveland was a good choice for the face of the billion dollar bill?
"What about the mark-to-market fear as described above? You foreclose and not only do you have to write down that one, you also have to write down all the comps?"
I was going to comment on that earlier. Not an issue, any loan 1000 days late has been marked to some very low recovery value. Even writing off the whole thing wouldn't make a big difference, since it is probably marked at 20cents on the dollar or less by that point.
Besides, the people in loss mit/recovery barely even know the marks. It is usually something procedural.
figure it, you are a clerk in loss mit, and you have a file on your desk that you know is going to be a hassle - the city is going to be on you for cleanup, taxes, the HOA is going to come after you for fees, etc. are you gonna work that file, or put it at the bottom of the pile and work on a cleaner transaction?
not like you don't have a stack of 30 on your desk to chose from.
Another funny side-note to all of this is the lack of exposure that "deed-in-lieu" of foreclosure gets. IMO, this option should be getting tons of play right now.
Basel Too (profile) wrote on Wed, 6/24/2009 - 10:31 am
What is shocking to me is that the bank has let over $30,000 in delinquent taxes build up.
Foreclosure sale extinguishes non-priority (e.g. IRS) tax liens, no?
No. Taxes first. Always. Then it gets tricky. Usually it is the first lien holder and then a pecking order. Exceptions include HOA as second, mechanics liens and judicial judgements. IANAL but I've never heard of anyone getting out in front of the tax man.
California to close 48 state parks..
no more swimming,no hiking,no camping and NO TRESPASSING in some of the must beautiful parks in America..this is insane..they can bailout the banksters with trillions but not a penny to keep these parks open..
this is just the beginning of the beginning as they continue the planned shutdown of the United States...
where is the outrage? the people are so doped up on pharmaceutical drugs and fluoridated water and toothpaste they don't even care
the banksters could stop this nonsense in a minute..IF IF IF
they wanted to..problem is THEY DON"T
America is dying and the international banksters at the PRIVATE un-federal no-reserve are killing it.
It's not that they can't do it...the absolutely can. If they do foreclose they have to take ownership, possibly sell it and, god-forbid, eat the difference.
As I pointed out above the rate of actual filed notice of disclosure's (in any area) is way below the actual foreclosure rate.
It's nothing more then "Level 3" at the street -level IMO. They are holding and hoping. Another example I know of , like one of them above, is about 28k arrears in prop. taxes. It may be that the banks are simply waiting for the liens to get filed against them and then turn over the property to the county...problem solved for the bank. They can then count it as a distressed sale and not have to utilize any of the pricing inputs for the rest of the crap they hold....waiting for it to occur again,and again,and again etc.
I tried to explain alot of this to my wife and she just can't get past the part where actual accounting is dismissed and rules followed in the past are just not followed any longer...and she's an ex mortgage broker.
"So let's say you your keys in. The bank doesn't foreclose, leaving your former home empty. Squatters move in and damage the property. Is the to be foreclosed owner on the hook for damages?"
What's the bank going to do? Sue someone who's probably already in big debt, and then try to collect?
Foreclosure is the natural process to failure to pay your mortgage. Historically, lender cost would be mitigated by a deed-in-lieu through reduced processing and legal fees. Lenders are very reluctant to DILs these days. This is an obvious indication that they don't want the collateral....not even remotely.
"At least 19 states still have to approve their fiscal 2010 budgets before next Tuesday. If they don't, staffers might not be paid and services might shut down."
shill (profile) wrote on Wed, 6/24/2009 - 11:01 am
California to close 48 state parks..
no more swimming,no hiking,no camping and NO TRESPASSING
That's an interesting legal theory. How can an owner trespass on their own property?
Regardless, make no mistake. "Closing" these facilities will not save money. The costs associated with closure are greater than continued operation at current revenue levels. This is nothing but pure retaliation against those uppity voters who denied the last round of tax increases.
Well the actual home is the secondary part of delaying the transaction...it's eating the loss that the NOD finalizes so hence you've got all these properties in a perpetual state of limbo-land.
I really, really think that the end result is forcing all these properties to be taken over by the various local county registrar's based on back taxes owed. Banks would have to eat some loss but by the time they did it would play out exactly how ghost described above.
"...for others, it simply prolongs the financial distress, leaving them on the hook for the condition of the property."
This makes no sense. On the hook to whom? The bank you just defaulted on? Trust me, they're not going to mind about the lawn, they just want you to pay the dang mortgage.
General comment. We are not talking about homes. We are talking about houses or housing. There's a difference and that difference is playing a large part in the current situation.
"It's not that they can't do it...the absolutely can. If they do foreclose they have to take ownership, possibly sell it and, god-forbid, eat the difference."
All the models I have seen do not take into account the legal status of the loan, just the level of delinquency. Thus, a 120day late loan that is in foreclosure is treated no differently than a 120day late loan that is not. the expectation of that loan becoming current is zero.
the recovery rate is driven by bpos, expected expenses, etc.
contrary to what you may think, for whole loans, once a loan is severely delinquent, there is not a lot of wiggle room in determining the recovery value. unless you have seen different valuation practices than I have seen.
The bankers (and pretty much the govt at this point) sees 2 class of citizens:
A. Mortgage debtors.
and
B. Mortgage debtors-to-be.
B are obviously enemies of their existence. If you have enough people in B camp, bankers cease to be all powerful and important. They may even disappear.
Thus,
Policies are crafted to convert the maximum number of people from B to A.
Accordingly, there also won't be any policies that forces them to recognize that A is now a lot smaller than they think. In other words, they want to mark to fantasy, not just their books, but their entire business model and way of thinking.
In that world, People who're renters or totally owning your home is (and can be made) into an enemy of the state.
There is the bubble shadow inventory, then there is the 'normal' shadow inventory, of which I am one... In 'normal' times I would be downsizing now, but since I have no debt I can wait... The entire 'normal' real estate market is in this situation, except for those who are forced to sell... Who knows how many people would sell and move if the market was 'normal'... Just another reason to think that it will be quite a while before real estate starts appreciating again, although it does seem to be off last winter's lows... There is so much on the market everywhere it would be a miracle to find a buyer though...
This is nothing but pure retaliation against those uppity voters who denied the last round of tax increases.
Good. Let him piss off the masses. He wants a maximally broken system? Let's give him a maximally broken system.
Well, sometimes that is the only way to get people to recognize what the choices are...everybody thinks the government is bloated and can just cut...fine, cut...I was listening to a story on NPR this AM on the way into work, about California closing down the Poison Control Center...now all those folks can just head to the emergency room.
Thanks for the suggestions and kinds words everyone, my plan is to downsize to a 1 bedroom apt in my current complex. Will make moving a lot easier and won't have to adjust to a new neighborhood. I'm just not sure if I should keep on looking, or wait until spring of next year.
I was really looking forward to that $8,000 tax credit. Was going to pay off my car (my only debt) and either take a little vacation or keep it for a rainy day.
"The two Japanese men arrested by Italian Police while trying to smuggle $134 Billion in U.S. Treasury Bonds concealed in suitcases..are employees of the Finance Ministry of Japan. They were ordered to move the Bonds by the government of Japan"
"South Carolina Governor Mark Sanford re-emerged in public today after a seven-day disappearance .......he’d been in Argentina."
wtf - Is all this strange sh** a prelude to something worse? Kinda like animals "freaking out" before a major earthquake or something?
"unless you have seen different valuation practices than I have seen."
In essence, that is the fundamental problem we have.....everyone uses a different model when any forecast of recovery is done both at the macro and micro level.
@ BSR
It's much easier to flock to the Governor story than deal with the ramifications of SC's 12%+ unemployment rate.
or our 56% high school graduation rate.
Great insight, BD...The insurance company makes money off the float between payment of premium and payment of claim...perhaps coop/mutual health insurance could be a viable alternative. Sort of like the mutual life insurers...the policyholders would be the shareholders and this would eliminate some of the agency issues maybe...
he's been doing it since late last year.....it's not going to change but I hope you weren't expecting a confirmation of it continuing...he has no choice...it will NEVER STOP.
Jan 2009- The statewide adult illiteracy rate in South Carolina was 14.7 percent. Rates across the state ranged from 29 percent in Allendale County to 10.25 percent in Lexington County.
Re: public transit employees holding riders "hostage."
That would seem to be true of the TBTF banks & their CEOs/upper management as well, as they appear to be holding the entire nation hostage or at least the Bush & Obama administrations seem(ed) to think so.
So automation of the financial services industry is a solution?
It would seem that a type of automation, i.e., the complex mathematical models, etc, used by the investment banksters and hedgies (starting perhaps with LTCM?), hasn't worked out too well. Or maybe it's how they were applied.
@Brendan
Check with your landlord or management company to see if they actually have a tenant yet. If not, they will probably let you sign a new lease. This RE disaster going to get worse before it gets better, and lots of apartment complexes have significant vacancy. The landlord would probably have to look hard and give concessions to a new renter, whereas they would actually save money on repainting and cleaning the carpet if they let you renew the lease.
I know 5 people in CA including myself with around 6 months of non-payment and no NOD. All are on loans with LTV ratios over 200%. Sadly I thought I was doing a good thing when I refused an interest only ARM and forced a FRM 40 year loan, turns out I was just a big sucker. I'm really in the same boat as the person in this article. Free rent is great and I have a nice amount of cash in the bank now, but I'd really prefer to get this process over with so I can start rebuilding my credit. Its extremely stressful not knowing when you are going to get kicked out and also knowing you are going to have to find another place to rent with horrible credit.
The only protection that a borrower has in the United States in my opinion to protect themselves in a foreclosure is to file Chapter 7 Bankruptcy.
Forget the hired priced money grabbing attorneys, forget all the programs, forget all the "help that is available", file bankruptcy and get on with your life.
It is curious that all Obamas goverment programs give the billions and the inccentive to the banks who by their own design created this financial holocaust. These programs to help you stay in your house are not for your benefit, but to save the banks and help them to maintain their
billions of dollars. By staying in your house which is worth less than you owe on it ,you keep paying real estate taxes , principal and interest plus
insurance, upkeep and utilities. You are paying for a dead horse. You are just supporting banks, the local government, your Congress and every Tom,Dick and Harry that comes along in the name of home ownership. These government programs are just a financial pass through to the wealthy and powerful banks. If the government was honestly trying to help you, those Billions and Billions of dollars
would have gone to save you. Nobody is going to save you. The government won't even hold those responsible for this meltdown accountable.
But they will dam sure use you to keep paying and paying on losing property. Your elected Congress people took their annual raise. They live better than you do on any given day. They have better pay, better healthcare and great retirement benefits. Think about it.
Did you ever wonder why the call the credit bureau the credit bureau. It is for the wealthy and the powerful banks to keep track of you.
So if you file bankruptcy the credit bureau will tell everyone for 10 years that you are a credit scumbag. What do they call the bank that cheated you out of your house? They don't call them anything, they give them billions and billions of dollars.
If you do not agree with me then you certainly are not one of the millions and millions of people that got screwed by your bank.
A friend long ago told me the story of his real estate macher uncle, who advised a banker friend planning to foreclose on a gas station that had just gone belly up on a $250K lot (it was a long time ago indeed). "Don't foreclose, said the uncle."
"But if I don't we'll be out the 250 grand!"
"You will not foreclose on this lot, because if you do, sure as I am standing here before you, you will be the owner of every ounce of gasoline that has leaked out of the storage tanks, every quart of crankcase oil that has ever seeped through the drains in the service bays, and every drop of degreasing solvent leached off the dirty rags in the yard. " Several million dollars of state-funded cleanup later, the banker thanked him.
It's probably not as easy for a bank to go down millions on a foreclosed house (unless a trespasser slips on some ice in the driveway or it turns into a crack den where a neighborhood kid gets killed), but it's pretty easy to come out below zero even after you sell that damn thing off. Better to let the county take it.
Don't walk away mad, Just walk away
CR has mad posting skilz!
From the article:
"Prices will fall to the point where you have equilibrium, and it won't reach that until there is no longer this foreclosure overhang," Bellack said.
/endsnip
amen.
--bh
It's.. it's... it's almost like some of the posters on CR knew this was happening.
Repost from Sm landlord
"This raises another problem with any public transportation scheme that requires employees to operate (can't think of one that doesn't, but hey.) Anyone who depends on public transportation can be held hostage by labor actions. No surprise that the employees can extract insane compensation."
Hear hear
...the angst of losing a home is bad enough. Having to "baby it after it's dead" is totally unnecessary.
The self-preservation thing to do in this circumstance was not to move out and pay rent somewhere else, but live rent-free until the sheriff shows up.
She filed BK and could have been banking savings, cold hard cash by not having to pay living expenses.
arghh.
--bh
Hucudanode? With all the incentives on the banks not to write down the underwater mortgages.
From the article: "We hold ourselves responsible."
Well its a start
Also: "The house caught fire in January"
That really ups the resale value.
What a gargantuan MESS !
(I've never had the chance to use that word in conversation...)
"live rent-free until the sheriff shows up."
...so obvious it is painful.
the commies had a line - he who fails to steal from the state steals from their family. now that BAC and C are owned by the state and GS runs the state - truer than ever here in the land of the free.
"The self-preservation thing to do in this circumstance was not to move out and pay rent somewhere else"
.....many wouldn't feel right living in a home not being paid for. Not to mention the trauma for kids and parents when the Sheriff shows up.
Tell me...if you were the bank...would YOU be rushing over to take this place?
This ain't the Hamptons
Seems like if you are going to stop paying, it's silly to move out right away.
Wait until they evict you. Looks like many months of free rent.
Dow 6000
Plus she is taking care of the Lawn
"Take my house please!"
".....many wouldn't feel right living in a home not being paid for."
god forbid poor Mr. Mozillo doesn't get his cash on time, right?
Friend of friend lost job, tried to negotiate house payment down by 50%.
Of course, bank said "No way."
So they stopped paying.
.
That was a 14 months ago.
Still haven't been foreclosed on, still living in the house.
.
Two points: 1. Banks are way behind on foreclosures. 2. For some reason, banks are preferring no loaf to half-loaves.
We are turning Japanese, oh yeah we are turning Japanese. When a bank did not disclose all of its potential losses, they (Japan) call it - "saving the face" tradition. Now, should we expect our executives to carry it to the end and resign taking the blame? Fat chance.
to foreclose, do you need title? Maybe the banks are having a tough time coming up with deeds, etc.?
BSR,
I say it without snark because under the calvinball rules it is true.
It's not quite that dramatic either. The sheriff just shows up to give notice, then you have a window of time, weeks to get your alternate living arrangements worked out...
I'm sure we'll continue to watch people-doing-the-right thing get punished over and over.
It's sad.
--bh
Not to mention the trauma for kids and parents when the Sheriff shows up.
===
well you don't have to wait until the actual day that the sherriff shows up, just wait until the bank gets serious about repo
"banks are preferring no loaf"
that's because they aren't in the business of extending credit, holding mortgages, etc. they're in the business of taking YOUR tax dollars, both through direct bailouts, sitting on treasuries and through continuing to stuff new garbage into the mouths of fannie and freddie.
actually foreclosing is filed under "mark-to-market" - i.e., something which ends the salaries, perks, insider sweetheart loans, etc.
HollywoodHack +1
-bh
=======
I suspect it's the slippery-slope argument, "if we cut the payment for you we have to do it for everyone"
Of course, eventually they will have to do it for everyone, but they haven't realized that yet
I'm sure we'll continue to watch people-doing-the-right thing get punished over and over.
=======
Eventually those people will learn their lesson
I'm kind of mystified by this person...if you walk away, then walk away...unless they were getting nastygrams from the local government as the owner of record. In which case, yes, absolutely: stay until you are notified the Sheriff is coming.
Can I haz free rent?
It's not half-a-loaf...as observed above, they, the banks, are made whole up-front, whatever the losses, there will be no losses because of taxpayers. So, why would I reduce my income stream by half by lowering your payment when I can get all of it via TARP?
--bh
Eventually those people will learn their lesson
Then we'll whine and bitch about the collapse of modern society, the lack of values in our social fabric, and "kids these days" in general, and call 'em Ruthless Defaulters. Hey, they learn from the big dogs how it's done. Paraphrasing Leona, "Rules and Taxes are for the Little People".
"2. For some reason, banks are preferring no loaf to half-loaves."
If the bank forecloses, it has to write down the loan. Otherwise, it's mark-to-fantasy. At the same time, trickling inventory onto the market is better for RE prices (and the underlying asset). The borrowers are much less likely than bandos to make a mess of things inside the house. I'm not sure, but it wouldn't surprise me to find out that there are liability advantages to not foreclosing. On top of all that, going through foreclosure costs a bunch of money in employee and lawyer time.
Foreclosure only really makes sense from the bank's point of view if there's significant 'owner' equity that can be seized.
It's not too late for the Jensens.
They should just move back in.
This story illustrates why the "Jingle Mail" meme is an anachronism.
Why mail in the keys when you can live rent-free?
who cares about the little people, as long as the executives at Citi get raises of 50% or more this year (they are) and those at Goldman record bonuses(they are).
sm_landlord- from previous post, try telling that to the air traffic controllers.
Why mail in the keys when you can live rent-free?
Hell, why not tell the bank that you're willing to take care of the place, for a fee of course.
Sorry, I should segue:
Step 1: write horrific loans
Step 2: Loans blow up
Step 3: get govt bailout
Step 4: avoid foreclosure process so that you can keep mark to myth accounting
Step 5: give yourself record bonus and raise.
Step 6: profit!
NateTG,
There is something to what you are saying. Once foreclosed, ie. on the banks' books, they are liable, including the ugly things like someone is injured or killed on their property. But if they haven't completed the loop of foreclosure than you the 'owner ' of record are liable. And you better have insurance, in which case, if your paying the insurance, you ought to live on the property rent free, minus the utitlies to keep the lights on and the furance running in the winter.
--bh
I do short sales all day every day. The shadow inventory is waaaay bigger than anyone is willing to recognize. For every SS that closes there are five that are hopeless. Yes, anecdotal evidence, but true from my stand-point.
For every SS that closes there are five that are hopeless.
====
DP - do you see that changing as the banks adapt to the "new reality"?
Scotto,
Your correct, and they should stiff whover they are renting from since she has already gone through BK to begin with...her credit is already destroyed.
--bh
If the bank forecloses, it has to write down the loan. Otherwise, it's mark-to-fantasy.
This is exactly my thought. The banks are doing FAR worse than any MSM thinks. They're just hiding it on the books by taking longer and longer to bring a house to auction.
Responsibility is overrated.
Obscure Family Guy reference:
Bill Gates Let's call Pewterschmidt.
Michael Eisner No, wait. Let's take the jetpacks!
Bill Gates Cool!
Michael Eisner Man! The people look like ants from up here.
Bill Gates They are ants, Michael. They are ants.
From the photo, she needs to get her money back from the landscapers. And the boarded up windows and yellow caution tape seem to hint at more problems.
Dafox
Another hidden liability is The Western European exposure to Eastern European countries and the subsequent exposure that US banks have to those European banks.
If the bank forecloses, it has to write down the loan.
====
Same would be true of a short sale or voluntary cramdown, correct? That explains the half-a-loaf thing.
sdtfs,
yes, it burned. As in caught fire and had to be put out. My guess is she didn't make the repairs either.
I'm sure this added that quaint lived-in look a la post-Sherman's March that it so needed.
--bh
TREASURY AUCTION 5 YEAR NOTE NONCOMPETITIVE RESULTS
Noncompetitive $107,079,600
FIMA (Noncompetitive) $0
Tentative Total1 $107,079,600
Approximate Amount Remaining for Competitive Bids $36,892,920,400
@ Scotto
I don't think so. They are completely under staffed to address the problem. Their means for tackling the problem are antiquated. The SS decision making matrix revolves around a broker price opinion of value. This BPO is conducted by a low end of the totem pole real estate agent. It takes 30 days to get it ordered. 30 Days to get the BPO conducted. And another 30 to review it. And the irony is that "it" isn't worth the paper it is printed on.
Would be funny if it weren't so sad.
thanks for putting the uptick rule in place...
up to 23 hits on YouTube for CR piggie... c'mon you momentum players
Thanks DP
Shill Thanks
Five Year Result
Foreigners are loving our securities. I performed a quick long hand division (thank you to Sister Mary Consolata ) and it appears that foreign central banks bought 62 percent of this issue.
[hat tip]
dp, what you describe isn't understaffing. It's intransigence.
Rising numbers of foreclosures didn't start yesterday or last month or even last fall. If it were the intent of these lenders to service defaults, they'd be staffed and competent by now.
"Are you ready boots? Start walking."
dp, what you describe isn't understaffing. It's intransigence.
====
one cause of which is plain old corporate inertia
I clicked on the link to the article and there is an ad for DR Horton within the article! Classic! Buwahahahaha!!!
Regarding the C compensation restructure:
No corporation that is 34% owned by the federal government should be making any compensation decisions that aren't consistent with the locale-adjusted GS and SES scales.
Had to google intransigence.
Burnside, I agree with that . Given that, I would change my response to Scotto's question to "no".
Calif unemployment climbs to record 11.5 percent
Calif unemployment climbs to record 11.5 percent
California's unemployment rate climbed to 11.5 percent in May, the highest in modern record-keeping, the U.S. Department of Labor reported Friday.
"This is a perfect opportunity to acquire distressed companies and assets at attractive valuations"
Cebus Capital Management.
HollywoodHack: the commies had a line - he who fails to steal from the state steals from their family
Just because I have to nitpick: That sounds more like an anarchist than a commie to me.
Comrade de Chaos: I really think so.
the highest in modern record-keeping
There is always tomorrow...
/cue orchestra sweeping violin music ...
From the C compensation article on AP:
"Ensuring compensation for employees by increasing salaries could be a move banks facing government restrictions take to avoid losing workers to competitors. Some banks that received government loans during the mushrooming credit crisis last fall have already paid back their debt, and are no longer subject to compensation oversight. That could allow them to offer lucrative deals to entice employees away from banks where restrictions are still in place."
====
great, sounds like the market is working: weak banks should die, any actual residual talent will be captured by surviving competitors
dimitris,
ahh, sounds pretty russian to me. About right.
--bh
There is always tomorrow...
====
breaking unemployment records:
CAN WE DO IT? YES WE CAN!!!
/to avoid losing workers to competitors/
Define Competitors?
I don't think that word means what they think it means.
--bh
"The California Employment Development Department said the government posted the largest job declines in the month, down by 14,200 jobs. "
wait, isn't that the department they need the most right now?
blackhat: Greek actually, but same difference: both species are in abundance there too.
Top Chinese banker Guo Shuqing calls for wider use of yuan
Top Chinese banker Guo Shuqing calls for wider use of yuan - Telegraph
***** HEY BEN!...CAN WE SPEAK WITH ROU? *****
As I've mentioned earlier, my son rents in a home in Berkeley; the landlady hasn't paid mortgage since last August (and in fact has moved out herself). Wells-Fargo finally issued a NOD this month, 10 months after last payment.
Should be noted that (1) this was originally a World Savings loan that came to Wells via Wachovia aquisition and (2) foreclosures are extremely rare in Berkeley due to very low turnover rate.
There a house near me that I have paid close attention to since I wanted back in 2006, but couldn't afford. The buyers were, of course, in real estate and got 100% loan.
According to public records, they are three years behind on property taxes- meaning they may have made one tax payment. The matching Escalades in the driveway went away about a year ago. They had a notice of default recorded almost two years ago, then nothing happened. A new NOD was recorded about nine months ago. Finally, it is scheduled for foreclosure auction this Friday. I suspect it will be delayed/cancelled, like they all are.
What is shocking to me is that the bank has let over $30,000 in delinquent taxes build up. The cash out of pocket for the bank when they take at the foreclosure auction and resell it. And if they let it go a couple more years, it would have reverted to the county with the Bank's lien gone.
the lender- (apparently still holding the loan) IndyMac!, hence I think the FDIC has been in charge for a while now. And yes, you and I are "sharing" in the loss.
I know the local market well, and if IndyMac just took it back a year ago, knocked 15-20% off the 2006 price, it would have sold right away.
""No one is in a rush, lender-wise, to deal with the property," he said. "If you have to sell at a loss, why rush?"
If the banks wanted the houses, they'd take the houses. They don't want houses. They want nice numbers on their books. The sooner they take the houses, the sooner the numbers get less nice.
Nothing different than health care claims: claims are slow to process because the companies make more money that way. Most "incompetence" is policy.
Define Competitors?
====
I think they mean "collaborators"
For some reason this put me in mind of Edgar Allen Poe's "The Masque of the Red Death"
The Masque of the Red Death - Wikipedia, the free encyclopedia
i sympathize with Jenkins:
I stopped paying in January 2008 (once i saw where things were headed it was an easy choice). After three months of trying to work a solution with the lender, I moved my family 2 miles away. the neighborhood was an improvement and my girls are closer to their school. I kept contact with my neighbors, let them know what was going on, and kept the yard maintained. The lender did not move on the house until March 2009. other than a 1099, i had no contact with the lender after move-out.
not trying to justify anything- i did what i felt right; i shared a similar experience, torn between cutting loose from a losing situation and not wanting to f*ck over my neighbors.
dp, you should see all that Tanta had to say regarding the run-up to today's conditions.
Sales ran rough-shod over back office functions, and then back offices were gutted - seasoned servicers found themselves in a bricks-without-straw environment. And they left, or soldiered on, some of them.
I understand the backlog. Willing to bet every aspect of the process is in utter disarray from years of ignoring the cries of dismay from the back office "nerds".
From the sfgate article:
"Since then, he said, there have only been one or two shifts to pick up each week at his job packing pillows."
==
??
(emphasis added)
What is shocking to me is that the bank has let over $30,000 in delinquent taxes build up.
Foreclosure sale extinguishes non-priority (e.g. IRS) tax liens, no?
the landlady hasn't paid mortgage since last August
====
I hope they have spread the goodwill by not paying her the rent
@dp: thanks for the observations...
Basel- its the county property tax that is unpaid, and that is always first in line. So it will get paid. Oh yes, it will be paid.
What a stupid article. The house was ON FIRE for god's sake. Let's drum up the sob stories to sell some more papers. Would somebody please shoot the closest reporter....
cake eater: In hindsight, would you have been better off doing exactly the same but not moving out of the house until the bank started moving on it?
Bob Dobbs -
Yep. The backlog gives it all deniability.
Well said Burnside. I have read much of what Tanta has written on the topic. It's amazing how she has chronicled this catastrophe in such a way that only few will ever know.
energycon,
I was thinking more Cask of Amontillado...we bury the banks alive, brick by brick.
--bh
Thank you NateTG!!!
This is why RE prices will be held at a high plateau, collapsing SLOWLY. The actual inventory will be held in shadows and trickle out very slowly.
Even if loss of jobs causes default, if banks are holding back inventory, you have no RE price descent.
In this picture, inventory will continue to dwindle with even minuscule sales. Expect to see published months-of-supply stats to continue to creep down.
If you stretch out the RE collapse over 23 years (aka Japan), you end up catching EVERYBODY in the net of destruction. For those momentum traders, this is the "MAX PAIN" scenario if you know what I'm saying.
THE PTB are making the collapse stall, so that new home buyers have 2 choice, buy at a high price, or wait / rent forever.
This is why RE prices will be held at a high plateau, collapsing SLOWLY. The actual inventory will be held in shadows and trickle out very slowly.
====
The Wile E. Coyote phenomenon
Why would anyone pay their mortgage nowadays?
And why move out after you stop paying it?
Doesn't look like anyone is anxious to make you.
Sucks to be renter, or worse yet....someone lucky enough to still have a job and too honest to NOT pay their mortgage.
Maybe it's time we review our goals as a society....and then have a look at what we have in place now in terms of an behavioral incentive structure to see if they are in agreement.
I just had a contract to buy a condo in Falls Church, VA fall through. The appraisal came in $20,000 below sales price, seller wouldn't budge. The sales price seemed pretty good compared to the other units in the same building, I guess owners don't want to, or can't lower their prices. I told them you can sell it to me for for the appraised value, or I will pick it up next year at a foreclosure. With this deal fallen through, I did another search on my realtors website, saw 2x - 3x more foreclosures and shortsales than there were just 2 months ago.
Now I need to find a place to live, since I've already given notice at my apartment complex.
inevitabilis?
Also, I don't like Shadow Housing Inventory applied to this phenomenon.
I prefer Foreclosure Moratorium Inventory...or even Accounting Fraud Inventory.
the landlady hasn't paid mortgage since last August
====
I hope they have spread the goodwill by not paying her the rent
Landlady is an elderly hippie that never grew up. Think what you may, hippies are WYSIWYG!
She told my son in September that since she wasn't paying her mortgage, she didn't want any rent money from him. Furthermore, two other units went empty 'cause even though she had been trying to rent them, she honestly told any potential renter that she was likely to default on her mortgage.
So he's paying the utilities and keeping the place looking reasonable.
Maybe Silent But Deadly.....Inventory.
@scotto:
maybe if i were single and broke. but listening to my wife worry about the sheriff showing up for an entire year would have put me over the edge. Also, the move was a move-up for us. the house we are renting now is twice as nice, with a bitchen view, for 400 dollars less that the mortgage was. no contest
"nearly a year later"
Sheet that's nothing..I know of at least 3 that did this in 2006 and still have no foreclosure.
This is a huge phenomenon that won't be touched by anyone but lower level reporting and blog's.
All about the foreclosure rate vs actual registered NOD (Notice of Disclosure) not notice of default as is widely reported when anyone bothers to check it out.
Ciao
MS
I suggest that you take your time Brendan. I have seen more than one poor decision made in false haste concerning an expiring lease.
Brenden, your apt complex probably needs the occupancy.
Why not try to strike a deal to stay?
I just had a contract to buy a condo in Falls Church, VA fall through. The appraisal came in $20,000 below sales price, seller wouldn't budge.
Lawrence Yun was right. Appraisers hate America,
Basel, that is great.
"Sheet that's nothing..I know of at least 3 that did this in 2006 and still have no foreclosure."
I have seen mortgages that are over 1000 days late, which would confirm what you have seen.
I am not sure what is up with these that nothing has been resolved, but I would guess there is a problem finding docs, etc that prevents the bank from foreclosing, since they know they would lose. So they just keep hoping the docs will "turn up" in some box at Iron Mountain.
Just a guess, but what else could explain it?
man, Berkeley is Berkeley I guess!
I have seen more than one poor decision made in false haste concerning an expiring lease.
======
+1, have made bad decisions that way, too quick to pull the trigger
So let's say you "jingle mail" your keys in. The bank doesn't foreclose, leaving your former home empty. Squatters move in and damage the property. Is the to be foreclosed owner on the hook for damages?
... i should note that we chose to rent from a friend whose house was paid for. ruthless, yes. morally hazardous, probably. but my eyes are wide open
Just a guess, but what else could explain it?
=====
What about the mark-to-market fear as described above? You foreclose and not only do you have to write down that one, you also have to write down all the comps?
"If you stretch out the RE collapse over 23 years (aka Japan), you end up catching EVERYBODY in the net of destruction. "
which is why these attempts to delay the inevitable are so harmful.
funny how we criticized the Japanese for their zombie banks, but we go and do the same thing.
just shows the power of the political and financial elite. without all the ties to the govt, Citi would have been shut down by now and liquidated, with something stronger emerging in its place.
instead they announced today they will not buy correspondent mortgages for a couple weeks because their systems were screwed up.
She told my son in September that since she wasn't paying her mortgage, she didn't want any rent money from him.
===
It's the "new commune" philisophy
"baby I'll be there to share the land"
All about the foreclosure rate vs actual registered NOD (Notice of Disclosure) not notice of default as is widely reported when anyone bothers to check it out.
If Alameda County is typical, public records such as NODs are easily found via the web. No details like address or $$$, but you can see when the original deed was transferred (property purchase) and subsequent Notice of Trustee Sale and Trustees Deed (actual transfer to lender) in any.
I've noticed more recently that the time between NOD an Notice of Trustee Sale has increased recently. Could be various moratoria or could be overload. ...or could be they just DON'T WANT THE HOME.
My kid said at their HOA meeting last night some guy stated he quit paying his mortgage and HOA to get help from Obama! Cures cause problems?
saw this on turner radio network (i know, i know):
http://www.turnerradionetwork.com/index.php?option=com_content&view=article&id=59
claims those fake bonds were the real deal. any1 have an alternate source for the same?
and who decided grover cleveland was a good choice for the face of the billion dollar bill?
man there have got to be some bankers shivering at the thought of the "shelter in place for free" philosophy catching on among the mainstream
"What about the mark-to-market fear as described above? You foreclose and not only do you have to write down that one, you also have to write down all the comps?"
I was going to comment on that earlier. Not an issue, any loan 1000 days late has been marked to some very low recovery value. Even writing off the whole thing wouldn't make a big difference, since it is probably marked at 20cents on the dollar or less by that point.
Besides, the people in loss mit/recovery barely even know the marks. It is usually something procedural.
figure it, you are a clerk in loss mit, and you have a file on your desk that you know is going to be a hassle - the city is going to be on you for cleanup, taxes, the HOA is going to come after you for fees, etc. are you gonna work that file, or put it at the bottom of the pile and work on a cleaner transaction?
not like you don't have a stack of 30 on your desk to chose from.
thanks investah that was educational
Another funny side-note to all of this is the lack of exposure that "deed-in-lieu" of foreclosure gets. IMO, this option should be getting tons of play right now.
Basel Too (profile) wrote on Wed, 6/24/2009 - 10:31 am
What is shocking to me is that the bank has let over $30,000 in delinquent taxes build up.
Foreclosure sale extinguishes non-priority (e.g. IRS) tax liens, no?
No. Taxes first. Always. Then it gets tricky. Usually it is the first lien holder and then a pecking order. Exceptions include HOA as second, mechanics liens and judicial judgements. IANAL but I've never heard of anyone getting out in front of the tax man.
dp - how so?
California to close 48 state parks..
no more swimming,no hiking,no camping and NO TRESPASSING in some of the must beautiful parks in America..this is insane..they can bailout the banksters with trillions but not a penny to keep these parks open..
this is just the beginning of the beginning as they continue the planned shutdown of the United States...
where is the outrage? the people are so doped up on pharmaceutical drugs and fluoridated water and toothpaste they don't even care
the banksters could stop this nonsense in a minute..IF IF IF
they wanted to..problem is THEY DON"T
America is dying and the international banksters at the PRIVATE un-federal no-reserve are killing it.
ghost-
It's not that they can't do it...the absolutely can. If they do foreclose they have to take ownership, possibly sell it and, god-forbid, eat the difference.
As I pointed out above the rate of actual filed notice of disclosure's (in any area) is way below the actual foreclosure rate.
It's nothing more then "Level 3" at the street -level IMO. They are holding and hoping. Another example I know of , like one of them above, is about 28k arrears in prop. taxes. It may be that the banks are simply waiting for the liens to get filed against them and then turn over the property to the county...problem solved for the bank. They can then count it as a distressed sale and not have to utilize any of the pricing inputs for the rest of the crap they hold....waiting for it to occur again,and again,and again etc.
I tried to explain alot of this to my wife and she just can't get past the part where actual accounting is dismissed and rules followed in the past are just not followed any longer...and she's an ex mortgage broker.
Ciao
MS
"So let's say you your keys in. The bank doesn't foreclose, leaving your former home empty. Squatters move in and damage the property. Is the to be foreclosed owner on the hook for damages?"
What's the bank going to do? Sue someone who's probably already in big debt, and then try to collect?
Foreclosure is the natural process to failure to pay your mortgage. Historically, lender cost would be mitigated by a deed-in-lieu through reduced processing and legal fees. Lenders are very reluctant to DILs these days. This is an obvious indication that they don't want the collateral....not even remotely.
Citi: More Mortgage Fraud?
Citi: More Mortgage Fraud? - The Market Ticker
"At least 19 states still have to approve their fiscal 2010 budgets before next Tuesday. If they don't, staffers might not be paid and services might shut down."
shill (profile) wrote on Wed, 6/24/2009 - 11:01 am
California to close 48 state parks..
no more swimming,no hiking,no camping and NO TRESPASSING
That's an interesting legal theory. How can an owner trespass on their own property?
Regardless, make no mistake. "Closing" these facilities will not save money. The costs associated with closure are greater than continued operation at current revenue levels. This is nothing but pure retaliation against those uppity voters who denied the last round of tax increases.
"...or could be they just DON'T WANT THE HOME. "
Well the actual home is the secondary part of delaying the transaction...it's eating the loss that the NOD finalizes so hence you've got all these properties in a perpetual state of limbo-land.
I really, really think that the end result is forcing all these properties to be taken over by the various local county registrar's based on back taxes owed. Banks would have to eat some loss but by the time they did it would play out exactly how ghost described above.
Ciao
MS
Shill,
A buyer bought a short sale that I had listed yesterday. I almost puked when I saw that her loan app listed her job as a "Beverage Manager".
True story.
"...for others, it simply prolongs the financial distress, leaving them on the hook for the condition of the property."
This makes no sense. On the hook to whom? The bank you just defaulted on? Trust me, they're not going to mind about the lawn, they just want you to pay the dang mortgage.
General comment. We are not talking about homes. We are talking about houses or housing. There's a difference and that difference is playing a large part in the current situation.
This is nothing but pure retaliation against those uppity voters who denied the last round of tax increases.
Good. Let him piss off the masses. He wants a maximally broken system? Let's give him a maximally broken system.
Easy there. One of my favorite posters on this blog is a beverage manager. She just chooses not to dress it up as such.
"It's not that they can't do it...the absolutely can. If they do foreclose they have to take ownership, possibly sell it and, god-forbid, eat the difference."
All the models I have seen do not take into account the legal status of the loan, just the level of delinquency. Thus, a 120day late loan that is in foreclosure is treated no differently than a 120day late loan that is not. the expectation of that loan becoming current is zero.
the recovery rate is driven by bpos, expected expenses, etc.
contrary to what you may think, for whole loans, once a loan is severely delinquent, there is not a lot of wiggle room in determining the recovery value. unless you have seen different valuation practices than I have seen.
What is a beverage Manager?..I am serious lol........
eLuxury is finished
Zero Hedge: More Luxury Retail Failures, Buffett On Green Shoots
More retail failures, and many more to come...but look at it this way there is always Family Dollar.
The bankers (and pretty much the govt at this point) sees 2 class of citizens:
A. Mortgage debtors.
and
B. Mortgage debtors-to-be.
B are obviously enemies of their existence. If you have enough people in B camp, bankers cease to be all powerful and important. They may even disappear.
Thus,
Policies are crafted to convert the maximum number of people from B to A.
Accordingly, there also won't be any policies that forces them to recognize that A is now a lot smaller than they think. In other words, they want to mark to fantasy, not just their books, but their entire business model and way of thinking.
In that world, People who're renters or totally owning your home is (and can be made) into an enemy of the state.
There is the bubble shadow inventory, then there is the 'normal' shadow inventory, of which I am one... In 'normal' times I would be downsizing now, but since I have no debt I can wait... The entire 'normal' real estate market is in this situation, except for those who are forced to sell... Who knows how many people would sell and move if the market was 'normal'... Just another reason to think that it will be quite a while before real estate starts appreciating again, although it does seem to be off last winter's lows... There is so much on the market everywhere it would be a miracle to find a buyer though...
OT: the 10 year is starting to spike (price - yield dropping) - someone either betting on the Fed announcement, or they have prior knowledge.
This is nothing but pure retaliation against those uppity voters who denied the last round of tax increases.
Good. Let him piss off the masses. He wants a maximally broken system? Let's give him a maximally broken system.
Well, sometimes that is the only way to get people to recognize what the choices are...everybody thinks the government is bloated and can just cut...fine, cut...I was listening to a story on NPR this AM on the way into work, about California closing down the Poison Control Center...now all those folks can just head to the emergency room.
Thanks for the suggestions and kinds words everyone, my plan is to downsize to a 1 bedroom apt in my current complex. Will make moving a lot easier and won't have to adjust to a new neighborhood. I'm just not sure if I should keep on looking, or wait until spring of next year.
I was really looking forward to that $8,000 tax credit. Was going to pay off my car (my only debt) and either take a little vacation or keep it for a rainy day.
I asked about walkaways yesterday ( Comment by Coruscation from thread 'Housing Bust and Mobility' ) , was answered today. Thanks.
Are there enough walkaways to comprise a significant segment of 'mobility' ?
"The two Japanese men arrested by Italian Police while trying to smuggle $134 Billion in U.S. Treasury Bonds concealed in suitcases..are employees of the Finance Ministry of Japan. They were ordered to move the Bonds by the government of Japan"
"South Carolina Governor Mark Sanford re-emerged in public today after a seven-day disappearance .......he’d been in Argentina."
wtf - Is all this strange sh** a prelude to something worse? Kinda like animals "freaking out" before a major earthquake or something?
shill (profile) wrote on Wed, 6/24/2009 - 2:10 pm
What is a beverage Manager?..I am serious lol........
Bartender....which is the noblest of professions. However, it makes me wonder why the loan officer felt the need to jazz up the title.
... the glitches in the MatriX become more numerous...
beverage manager HHAAHAHA!
like ive told ppl i know, i had a much easier time getting my mortgage than my car loan.
"unless you have seen different valuation practices than I have seen."
In essence, that is the fundamental problem we have.....everyone uses a different model when any forecast of recovery is done both at the macro and micro level.
ciao
MS
"South Carolina Governor Mark Sanford re-emerged in public today after a seven-day disappearance .......he’d been in Argentina."
I was beginning to think he'd gone "Galt".
BSR-
my thoughts exactly......
Ciao
MS
damn, no more QE. this is gonna kill the bond market.
Bartender ok I figured as much....
I guess sommelliesse didn't apply because she wasn't serving wine?
looks like the board overruled BB.
@ BSR
It's much easier to flock to the Governor story than deal with the ramifications of SC's 12%+ unemployment rate.
or our 56% high school graduation rate.
Yeeehaw!
beverage managers generally stay on top of multiple bars within a complex - ie casino - inv control, staffing, etc.
"56% high school graduation rate."
Boggle
......or OUR 49% high school graduation rate.
Great insight, BD...The insurance company makes money off the float between payment of premium and payment of claim...perhaps coop/mutual health insurance could be a viable alternative. Sort of like the mutual life insurers...the policyholders would be the shareholders and this would eliminate some of the agency issues maybe...
Ghost-
he's been doing it since late last year.....it's not going to change but I hope you weren't expecting a confirmation of it continuing...he has no choice...it will NEVER STOP.
Ciao
MS
Isn't hard to fleece the illiterate sheep...
Jan 2009- The statewide adult illiteracy rate in South Carolina was 14.7 percent. Rates across the state ranged from 29 percent in Allendale County to 10.25 percent in Lexington County.
Can we do it?
YES! we can.
Re: public transit employees holding riders "hostage."
That would seem to be true of the TBTF banks & their CEOs/upper management as well, as they appear to be holding the entire nation hostage or at least the Bush & Obama administrations seem(ed) to think so.
So automation of the financial services industry is a solution?
It would seem that a type of automation, i.e., the complex mathematical models, etc, used by the investment banksters and hedgies (starting perhaps with LTCM?), hasn't worked out too well. Or maybe it's how they were applied.
"Preventive war was an invention of Hitler. Frankly, I would not even listen to anyone
seriously that came and talked about such a thing."
When the people fear their government, there is tyranny; when the government fears the
people, there is liberty.
~Thomas Jefferson
hat tip to Financial Opinions Updated Daily iamned.com for the good articles
@Brendan
Check with your landlord or management company to see if they actually have a tenant yet. If not, they will probably let you sign a new lease. This RE disaster going to get worse before it gets better, and lots of apartment complexes have significant vacancy. The landlord would probably have to look hard and give concessions to a new renter, whereas they would actually save money on repainting and cleaning the carpet if they let you renew the lease.
I know 5 people in CA including myself with around 6 months of non-payment and no NOD. All are on loans with LTV ratios over 200%. Sadly I thought I was doing a good thing when I refused an interest only ARM and forced a FRM 40 year loan, turns out I was just a big sucker. I'm really in the same boat as the person in this article. Free rent is great and I have a nice amount of cash in the bank now, but I'd really prefer to get this process over with so I can start rebuilding my credit. Its extremely stressful not knowing when you are going to get kicked out and also knowing you are going to have to find another place to rent with horrible credit.
The only protection that a borrower has in the United States in my opinion to protect themselves in a foreclosure is to file Chapter 7 Bankruptcy.
Forget the hired priced money grabbing attorneys, forget all the programs, forget all the "help that is available", file bankruptcy and get on with your life.
It is curious that all Obamas goverment programs give the billions and the inccentive to the banks who by their own design created this financial holocaust. These programs to help you stay in your house are not for your benefit, but to save the banks and help them to maintain their
billions of dollars. By staying in your house which is worth less than you owe on it ,you keep paying real estate taxes , principal and interest plus
insurance, upkeep and utilities. You are paying for a dead horse. You are just supporting banks, the local government, your Congress and every Tom,Dick and Harry that comes along in the name of home ownership. These government programs are just a financial pass through to the wealthy and powerful banks. If the government was honestly trying to help you, those Billions and Billions of dollars
would have gone to save you. Nobody is going to save you. The government won't even hold those responsible for this meltdown accountable.
But they will dam sure use you to keep paying and paying on losing property. Your elected Congress people took their annual raise. They live better than you do on any given day. They have better pay, better healthcare and great retirement benefits. Think about it.
Did you ever wonder why the call the credit bureau the credit bureau. It is for the wealthy and the powerful banks to keep track of you.
So if you file bankruptcy the credit bureau will tell everyone for 10 years that you are a credit scumbag. What do they call the bank that cheated you out of your house? They don't call them anything, they give them billions and billions of dollars.
If you do not agree with me then you certainly are not one of the millions and millions of people that got screwed by your bank.
A friend long ago told me the story of his real estate macher uncle, who advised a banker friend planning to foreclose on a gas station that had just gone belly up on a $250K lot (it was a long time ago indeed). "Don't foreclose, said the uncle."
"But if I don't we'll be out the 250 grand!"
"You will not foreclose on this lot, because if you do, sure as I am standing here before you, you will be the owner of every ounce of gasoline that has leaked out of the storage tanks, every quart of crankcase oil that has ever seeped through the drains in the service bays, and every drop of degreasing solvent leached off the dirty rags in the yard. " Several million dollars of state-funded cleanup later, the banker thanked him.
It's probably not as easy for a bank to go down millions on a foreclosed house (unless a trespasser slips on some ice in the driveway or it turns into a crack den where a neighborhood kid gets killed), but it's pretty easy to come out below zero even after you sell that damn thing off. Better to let the county take it.