5.1 Million underwater more than 75% on mortgages

[xiamiam]

this article talks about people walking away
http://www.nytimes.com/2010/02/03/business/03walk.html?pagewanted=2

since nothing has been put in place to stop the foreclosure/short sale crisis this guarantees further erosion of equity even for those who think they are sitting tight..those homes are in every neighborhood..anyone who bought a home in the last 7 years with 20% down has already lost that..any price range..and more in most places.

more people walking away will glut the market even more..

no end in sight...yet

[leftofcool]

1. Yep, they are just "walking away"

Most have jobs and can actually afford the payments but because they owe more than the house will sell for, they will just walk away, putting the property values for the rest of us in the toilet. That loan contract didn't say you could stop paying just because your home value goes down.

[stray cat]

3. If bankrupt lenders get millions in bonuses how can I condemn a homeowner walking away?

[marmar]

4. Amen.....

The problem is at the top.

[leftofcool]

14. what ever works for you

Okay for you but the rest of us will continue to pay our bills on time. And because we do so, our banker had no trouble lending us 100% financing at 4.2% on a retirement home we just picked out.

[Robb]

25. That's more irresponsible than walking away!

A "retirement" home is never going to hit full maturity on the loan. You're leaving the lender holding the bag when you die! How irresponsible. ;)

[leftofcool]

32. Probably not since this is a 5 year loan

and we have the money in the bank to back it up

[Robb]

35. OK, now I'm really intrigued

Hopefully you knew I was pulling your leg in the other post... :hi:

So you're planning to refinance in 5 years? I'm sorry, but you're the first person I've run across who thinks interest rates will ever be better in five years than now, so I'm really curious why.

[leftofcool]

43. No we will pay it off in 5 years or less

We took the loan so we did not have to use our cash reserve right now. Our money in the bank in drawing interest and we can use the tax write off on a mortgage. We make more this way.

[Hello_Kitty]

100. LOL. I love this.

A lecture on responsibility from someone taking out a mortgage at 100% of the loan value.

:rofl:

[4_TN_TITANS]

116. "the rest of us will continue to pay our bills on time"

What an arrogant post. I too pay my bills on time but realize that my income could evaporate just as easily as it has for millions of Americans. When the government fails you but bails the banks, who could blame someone for walking?

[Lance_Boyle]

118. And when they bail out some who grossly mismanaged their money

and do nothing to help those who are struggling but still paying on time, who could blame those still paying for feeling a bit of resentment about rewarding those who did something stupid?

[Adsos Letter]

121. +1

[xiamiam]

5. the banks are the ones putting the home values in the toilet because they caused this mess

and have no incentive to work with the homeowner..so they don't...they make more if they punish the homeowner who fixed the roof and the floors and provided a safe nest for their children.
we are a community ...being screwed yet some believe it cant affect them..it will..

[Dappleganger]

8. And many who do have jobs have reduced salaries

and are paying for health insurance out of their own pockets (IF they can), so less money to use for basic living expenses.

[leftofcool]

17. Take a second job

We have been there and had to do just that.

[earth mom]

41. Isn't that what * told people to do? Take a second or third job?

:eyes:

[leftofcool]

46. I have had to hold 2 or more jobs in my life to keep my home

and my children fed and clothed. I would rather work 2 jobs than lose my home. Our kids were worth that.

[earth mom]

63. That's fine for YOU. But you can't preach to others and tell them what they should do.

Because what you said is the rethuglican "personal responsibility" meme that the rethugs love to push on everyone else while they themselves game the system.

You can't assume that people are not doing whatever it takes to keep a roof over their heads.

People do not give up their homes easily and when they do it's because they realize they are fighting a losing battle-especially when a home is worth less than what is owed on it.

The blame for the housing crisis lands squarely on the banksters and lenders because they are the ones that gamed the system and ripped people off to the tune of trillions of dollars.

[Fire1]

119. You said it, sister!!! n/t

[Dappleganger]

69. Well goodie for you, you found your bootstraps!

BTW, our family isn't at that point yet but we know plenty who ARE. They are selling all their stuff on ebay and craigslist to just get food on the table. My own 18 yr. old can't find a job even in fast food around here.

This is not a pride or don't want to work issue, the jobs which used to be available to those who needed another one to get by are NOT THERE.

[Hello_Kitty]

105. The next time DU offers a change of user name, you should change yours.

"leftofcool" does not describe you at all.

[Dappleganger]

66. ROFL, WHAT 2nd jobs???

All the people out of work with masters degrees are working at them right now!

Jesus, am I on a progressive board??

[crikkett]

90. You remind me of the guy who said "Are there no poorhouses?"

May you have a good, long, life, sir, full of love and happiness.

[Fire1]

120. You're referring to "Scrooge!" n/t

[Hello_Kitty]

103. Jesus Christ on a Segway. Where have you been the past couple of years?

Under a rock? WHAT jobs??

[Lorien]

124. from whom? Most people are looking for a FIRST job of any kind these days.

Look around. Times have changed. The banksters will have to take the hit for causing the problem in the first place; so far, it's just the people who are shouldering the burden while the powerful walk away with our bailout billions.

[nebenaube]

9. It doesn't say that you can't either... n/t

[SOS]

22. Re

"That loan contract didn't say you could stop paying just because your home value goes down."

The borrower can stop paying for any reason.
Job loss, rate jacking, divorce, death in family, bankruptcy, medical bills etc.
The penalty is forfeiture of the property.

[Dappleganger]

70. Exactly, that's how businesses think.

They know the terms and have no issue walking away from a failing business contract and submitting to the terms (forfeiting the property).

[Hello_Kitty]

108. That's such a great point.

Everyone should take a rational approach to their situation like businesses do instead of thinking they have some personal moral obligation to service a bad loan.

[Fire1]

122. Damn straight! I'm cutting my losses on my rental property

and filing bankruptcy to clear the debt. Don't need any "deficiency judgements" later on down the line.

[Xithras]

95. Sure it does.

A mortgage contract lays out a predefined set of requirements and penalties for both parties to the contract. If the home buyer is willing to accept the penalties contained in the contract in exchange for exercising its escape clauses, then there is no moral, ethical, or legal conflict in doing so.

The banks may not like that sort of thinking, but the simple reality is that the BANKS signed that contract as well. If they didn't want to endure it's penalties, they shouldn't have agreed to it.

If you and I sign a contract saying that I must pay you $500 a month, and that you get to bonk me on the head if I don't, how is it unethical for me to say "I want to save my money, just bonk me and get it over with." The you may whine and gnash your teeth about losing $500 a month, but in the end, you agreed to those terms.

[Hello_Kitty]

115. And you know this how? eom

[DCBob]

2. Walking away may not be such a good idea...

NEW YORK (CNNMoney.com) --

As terrible as it is to lose your house to foreclosure, at least it's a relief to put your biggest financial headache behind you, right? Wrong.

Former homeowners may still be on the hook if there's a difference between what they owed on their mortgage and what the bank could sell it for at auction. And these "deficiency judgments" are ticking time bombs that can explode years after borrowers lose their homes. It can even happen to people who got their bank to approve them selling their home for less than it is worth.

Vanessa Corey, for example, short sold her Fredericksburg, Va., home in April 2008. She and her husband built the house in 2004, but setbacks, both personal (divorce) and professional (housing bust), made it impossible for the real estate agent to keep her home. So she negotiated the short sale and thought that was the end of it. "My understanding was that the deficiency was negotiated away," she said. "Then, last November, I got a letter from a lawyer telling me I owed my lender $65,000. I had to declare bankruptcy. There was no way I could pay it."

more: http://money.cnn.com/2010/02/03/real_estate/foreclosure_deficiency_judgement/?hpt=P1

[stray cat]

7. Seriously, avg houses here are a million so you may owe 250,000 more than the house is worth

You can pay on that extra 250000 for the rest of your life or walk away scott free and rent until you can get credit again. Why should homeowners be more responsible and pay a higher price than lenders? If irresponsibility is a winner for wall street and lenders I can't blame homeowners with salvaging their life.

[DCBob]

36. I cannot imagine paying a million bucks for a house...

even if I could qualify for a mortgage of that amount.

[fasttense]

18. This article's premise does not apply to foreclosures and walk-aways.

Here is a list of states where walking away will NOT mean you owe the difference between the sale of the house and the mortgage. You CAN walk-away without a problem.

CNN money implies that foreclosures will result in owing the difference. (I would like to read the full article but it wont come up for me.) The woman in VA negotiated an agreement and probably signed something she didn't realize. She did not go through foreclosure.

These are all the mortgage walkaway trustee sale states, meaning they are non-judicial foreclosure states.

In those states, generally, when they foreclose on you, they cannot pursue you for their financial losses.

Many, such as California, do in theory allow a lender to choose judicial foreclosure but in those cases the lenders only do so if a borrower has significant other assets. This is the "one action" rule that lets the lender either pursue non-judicial foreclosure, at lower cost and less time, or judicial foreclosure that costs more money and takes more time but lets them go after you for their financial losses.

Alaska
Arizona
Arkansas
California
Colorado
District of Columbia (Washington DC)
Georgia
Hawaii
Idaho
Mississippi
Missouri
Montana (as long as non-judicial foreclosure is used)
Nevada - note that the lender CAN get a deficiency judgment (See below)
New Hampshire
Oregon
Tennessee
Texas (but even in a non-judicial foreclosure, the lender can pursue a deficiency judgment)
Virginia
Washington
West Virginia

These are states that also allow non-judicial foreclosure, and/or where non-judicial foreclosure is more common and deficiency judgments can be obtained more easily:
Michigan
Minnesota
North Carolina
Rhode Island
South Dakota
Utah
Wyoming

http://www.mortgagereliefformula.com/recourse/

[Robb]

30. That list is inaccurate

Colorado, for example, is a trustee sale (non judicial foreclosure) state, but allows a lender to sue to obtain a court judgement on the deficiency. A valid judgment can be used to garnish wages.

Check your own state to be sure, I guess is what I'm suggesting to anyone looking at this.

[DCBob]

33. The article is about foreclosers and walk-aways... here's more from the article..

Can they come after you?

Whether banks can and will pursue deficiency judgments depends on many factors, including what state the borrower lives in and whether there's a second mortgage or other liens. But if borrowers ignore the possibility of deficiencies, it could haunt them.

"Once they have a judgment, they can pursue you anywhere," said Richard Zaretsky, a board-certified real estate attorney in West Palm Beach, Fla. "They can ask for financial records, have your wages garnished and, if you fail to respond, a judge can put you in jail."

In the case of foreclosure, lenders can pursue deficiencies in more than 30 states, including Florida, New York and Texas, according to the U.S. Foreclosure Network, an organization of mortgage law firms. Some states, such as California, are "non-recourse" and don't allow deficiency judgments. But, even there, if the if the original loan was refinanced, some or all of it may be subject to claims.

[earth mom]

44. Debtors prison anyone? With corporations fully in control of this country via the Supreme Court

we could seriously be looking at being thrown into prison for unpaid debt.

Which is NOT what the founding fathers founded this country upon.

[Hello_Kitty]

101. That's why you should declare bankruptcy as soon as possible after foreclosure. eom

[DCBob]

106. Yes, bankruptcy will clear a person's debts but it also tarnishes the person's credit record..

However, bankruptcy would not be an option for someone who has actually has some wealth and is simply walking away to get out of a bad debt.

[Hello_Kitty]

107. Foreclosure isn't exactly good for your credit either.

You'd be surprised how quickly you can bounce back after a bankruptcy. And if you do get stuck with a deficiency judgment, it just makes it even harder for you to keep up with your bills.

[DCBob]

109. I think foreclose/bankruptcy may be a good option for those who truley at the end of their rope..

It the strategic walkers who actually are capable of paying but just want to get out of a bad debt who may get caught owing the bank later on.

[Hello_Kitty]

110. My friend who's an attorney who does bankruptcies says everyone is qualifying for Ch. 7 these days

Meaning they fail the income test and don't have to work out a payment plan. Most foreclosures in my area are not because of subprime loans (though some are), they're because of unemployment or reduced wages.

[DCBob]

112. I think some homeowners with jobs/money are walking away from houses just to get out of bad debt..

These people wont be able to qualify for bankruptcy and may get caught later owing the bank.

[Fire1]

123. That's why bankruptcies will ALSO be on the rise. n/t

[customerserviceguy]

6. What can be done to stop the "foreclosure/short sale" crisis?

This is just the market finding it's own level of value, without speculation pushing up prices, but tax giveaways doing exactly that. When the credits expire in a few months from now, we'll see another year-over-year drop, but I'll bet that Congress and the President will continue this CPR on the market for at least another year.

Whatever we do to stave off the market finding the right level for housing prices, just pushes the pain further on down the line, and lengthens the recession.

[xiamiam]

10. i think the banks make more money if they foreclose because of insurance

i can't be certain of this but its the only thing that makes sense to me as to why they refuse to write the mortgage down..they usually end up selling it for less than is owed anyway..so why not work with the original owner?..instead of punishing the individual for something so widespread it is beyond their control?

[leftofcool]

16. Not quite

Foreclosures usually sell for more money because they all go to realty trac which ups the price so they get their share. If a bank owns a home, it is an asset. Once they sell it off cheapl for less that what is owed on it, it is a debt.

[xiamiam]

21. foreclosures sell for more money than what?

not what is owed on them? have yet to see that

[leftofcool]

26. Actually some do

It is hard to see it and I found out only by watching a couple of short sales in our area. The short sale price on one was 194k where the owner had paid 242k for it. As soon as it went into foreclosure, Realty Trac had it listed for 272k. People actually belive they are getting a good deal on these but in realty, they are not. I started watching more closely and I am seeing this now more often than not. About the only good foreclosures are the ones listed on the HUD site and even those are really bad because there is so much wrong with the homes.

[Fire1]

125. You're absolutly right on that! n/t

[Tesha]

11. Your headline mis-states the article's main claim.

The 5.1 million are people whose house is now worth 75% or less
of the remaining debt owed on their mortgage.

That is, they are "underwater" by 25% or more, and *NOT* by 75%.

That's bad, but not inconceivably bad, and they will hopefully think
long and hard before walking away, especially because the
lender often can come after them years later and try to collect
the amount still owed even afte the jingle-mail.

Tesha

[leftofcool]

29. And too, if you actually close on a short sale

you are responsible for the taxes. Equity on a short sale is still equity as far as Mother IRS is concerned

[Fire1]

126. Depending upon their state. In my state, bankruptcy is the

best option for this very reason.

[Roland99]

If the mortgages average $150,000. That's $765,000,000,000 ($765 BILLION)

that's a lot of "wealth" that could just disappear.

[xiamiam]

13. good point..not just could.but has disappeared from the portfolios of the average american

in many cases, the source of savings..invest in your home.. real estate has been "american dream"...a relatively secure investment in my 60 years...i know whats happening in the real estate market..short sales and foreclosures are the bulk of listings and sales across the country and especially high in california and nevada...that money which those average folks thought they had is gone...gone...gone...

millions of people who did not have a clue that this could happen..yet, they have to be put out into the street to show them how foolish they were as well as without any money, in most cases...

the wealth of equity disappeared and we continue to allow folks to be terrorized and then punished for investing in a home...and now they're broke and have to rebuild their lives.. now someone comes along and tells them how stupid they've been for buying something they couldn't afford even though they plopped down all of their hard earned cash in order to get a home

beyond unbelievable

[annm4peace]

12. Organize and fight back.

Here in MN those most disenfranchised are fighting back

Protest on the opening day of the State capitol

No Cuts to the Poor & Working People!
We Demand Jobs or Income Now! Stop Foreclosures and Evictions!


PROTEST - On the opening day of the MN legislative session
Thursday, February 4, 2010
12:00 noon
State Capitol

Join with MN Coalition for a People’s Bailout as we take our fight to the politicians at the state capitol. The economy is in CRISIS and we the people have to demand relief. Here is what we will be fighting for in 2010:

* A 2-Year Moratorium on Home Foreclosures
* No Evictions for Renters in Foreclosed Properties
* Extend Unemployment Insurance
* Stop the 5-year time limit on MFIP -- because there aren’t enough jobs out there.
* Stop the GAMC cuts. Pawlenty stole healthcare from the poorest of the poor.

Tell Governor Pawlenty and Minnesota’s Politicians:
Don’t Balance the Budget on OUR Backs! Tax the Rich, instead!


Gather on the front steps.
The MN State Capitol is at 75 Rev. Dr. Martin Luther King Jr. Blvd., St. Paul, MN 55155, by University Ave & Rice St

FFI: MN Coalition for a People’s Bailout
www.mn-peoples-bailout.org

[Phoebe Loosinhouse]

15. How many ways are the banks profiting?

How many of these banks have actual standing to sue for deficiencies or sell the deficiency in the first place? A lot of people forget that the actual ownership of the mortgages to many of these properties are questionable, since they have been sliced, diced and securitized. I think a lot of fraud by the big boys may be being perpetrated here.

Also, some of these banks are being compensated by PMI or the FDIC in cases of default. Can they sue or sell deficiencies which are no longer deficiencies since they have already been made whole by other parties? What about the credit default swaps? Aren't some already being compensated for bad debt by the likes of AIG and the American taxpayer? These guys are going to the same well over and over - little guys they can scare and bully and the American taxpayer.

They wrote bad loans because they could write bad loans with no regulation or oversight or mandatory underwriting guidelines. They wrote bad loans because they could sell them in an insatiable bond market which broke the mortgages up into tranches and sold them to multiple investors.

I say screw the banks. They knowingly wrote mortgages which the underlying incomes could not support. No one asked them to create loans with no documentation. If they are stupid enough to write loans with no documentation, then they SHOULD fail and we should all put our money someplace safer run by people with better judgement and integrity who understand the meaning of "fiduciary duty".

I am so sick to death of this BS I could just scream.

The people who should be going to jail for these oceans of bad debt are the people who engineered this whole debacle. "I know! Let's give mortgages to people with no credit, no job and no assets! Don't worry, we can sell the mortgages to the Wall Street boys who will slice 'em up so thin no one will be able to find them and they will liberally salt the good mortgages with these POS mortgages. We'll ALL make money! Why didn't we ever think of this before?"

I just heard someone on morning Joe say that Canada is almost completely untouched by the mortgage crisis because they don't HAVE subprime loans. You put down 20% or you don't get a mortgage.

[xiamiam]

23. great post...however, 100% financing loans are still available

20% down was required usually for those no doc loans which contributed to this mess..that money is poof..i mean like where did it go?

the breakdown i would like to see is how much the banks are covered in the event of foreclosure...in the event of shortsale..versus just writing down the principle

this is the crux in my opinion of how to stop it

[SoCalDem]

87. And, they're still doing it.. HGTV has their House Hunter shows and just the other day

a NEW one showed a young couple getting their FIRST house... TWO young people..

the BANK gave them 100% financing..2 loans..for wait for it ...

$585,000.00 for a 5 bedroom 4000 sq ft behemoth..

Nothing down, pretty much tells me that they are living paycheck to paycheck, and 30 years is a very long time to go with NO financial upheavals..

Everyone wants a lovely brand new house, but if you need more than half a million (it was Georgia, I think) to satisfy your first-home desires...well... it's more than a little sad.

These young people will be house-poor their whole lives, and a few years down the line when one of them gets laid off, they will be back to renting a $750 a month apartment.

[cbdo2007]

19. The same people walking away are the ones who 4 years from now....

will be the ones complaining that the house they walked away from has since regained it's value and they could have not been underwater after all if they had just stuck with it.

Smart people will just keep making their payments like usual, even if they are underwater, so they can still reap the rewards when the market recovers.

[Dappleganger]

20. You really think a house

which is $250K underwater today can recover in four years time??


Damn, that's one hell of a recovery!

[leftofcool]

27. Absolutely

Already we are seeing price increases on listed homes all across the country.

[xiamiam]

28. parallel universe...we haven't hit bottom yet...nt

[leftofcool]

31. We have in our area

[xiamiam]

38. i just cant see how you believe that..if you are anywhere in the united states..nt

[leftofcool]

40. At my age I have lived through 4 housing crises

They all follow the same pattern. Stock market rebounds first (our 401K's indicate this is happening), jobs come back second and housing last. 4 home sold last week in our zip code, they all had price increases.

[xiamiam]

45. i'm 60..have never seen anything like this..ever..your zip code is not in a bubble

not any longer..not until something is done to plug the dam

[leftofcool]

47. Our zip code has some of the highest priced homes in the US

We don't own one of them but they are here.

[xiamiam]

51. is it a place where wall street banker types would buy homes?

[leftofcool]

52. No, not quite that expensive

Mostly rich doctors and the like, although there is one house over in the Falls Church, VA area that I think is owned by a Senator. I don't know which one though.

[Dappleganger]

62. NOVA is unique

their home values will always bounce right back up. The unemployment rate there is one of the lowest in the country, too.

NOVA does not equal the rest of the US, the rest of us are really suffering and your statements are out of touch with OUR reality.

[SOS]

129. Starting with the 1907 crash, housing prices did not recover for 40 years

We will not see 200 again on this index scale in our lifetime.

[dmallind]

50. Several markets are seeing gains right now

Including mine in Buffalo - home prices are up 9% this year, and since we never had an abdurd bubble we never had a painful bust.

[Dappleganger]

64. "Never had an absurd bubble"

That's the key sticking point...the states/cities which did have an absurd bubble are not experiencing that bump.

[dmallind]

93. Agreed - but they are not the whole nation any more than I am

Most of the pain is concentrated in CA, FL, Metro areas of AZ and Las Vegas, and doubtless a few other places I can't remember off the top of my head. Even in strong markets like Northern New Jersey and Minneapolis/St Paul the decline in home prices was nowhere near as severe as it was in the overheated sunbelt bubbles. In weak markets like Buffalo there was hardly much increase in the last ten years so not much decline in the last two.

[slackmaster]

49. California seems to have bottomed out too

Source: http://www.dqnews.com/

[xiamiam]

53. my guess is that those are million dollar homes selling in the median price range...far from over..

or bottomed out..just stalled until the next wave is unleashed

[slackmaster]

56. Look at the legend on the charts, and go read DQNews

Are you familiar with the concept of "median"?

[xiamiam]

58. yes..and i also guess that the bulk of those are short sales or foreclosures

which are the exact topic of this entire thread

[slackmaster]

60. According to the source I linked to, 41% of California home sales in December were forclosures

http://www.dqnews.com/Articles/2010/News/California/RRCA100121.aspx

That's higher than normal but foreclosure rates are falling and have been for several quarters.

[xiamiam]

72. there is a standard and poors link from a poster at the bottom of the page

under the post "some facts"..i went immediately to the jan 2010 outline which shows a steady increase in mortgage delinquencies in each of the 4 yearly quarters beginning 2008
i think the banks stalled re foreclosures in the last quarter of 09 with the millions of loan modifications on their plates..but many of those will be foreclosed or short sales very soon

check it out...

[slackmaster]

76. That's nationwide - I was referring only to California as noted in reply #49

California is interesting because it tends to lead the nation as a whole in real estate trends and cycles.

[xiamiam]

78. foreclosures are one thing..another bigger bulk right now are short sales

which are also displacing families..i can get that info for some of california and i've been curious myself..but i guarantee you it will push that percentage up well beyond 60-65%..maybe more

[slackmaster]

82. For every family that gets displaced by a short sale, ~1 other family gets its dream home

The people who get displaced usually go back to renting. They're not being put out on the streets.

It's not all bad.

[xiamiam]

85. really?..perhaps from your vantage point..not mine, unfortunately..nt

[slackmaster]

86. Housing cycles are generational. I'm sitting pretty now, but was not able to buy until I was 38.

I wanted to buy when I was 30. I had just gotten married and had steady income, but conditions did not become favorable for many years.

[xiamiam]

88. glad you're "sitting pretty" although i could have guessed that

there is an injustice in all of this..i hope you see it before it knocks at your door..

[slackmaster]

111. I suffered my share of injustice already, and just got off the phone with B of A about another one

It's someone else's turn now.

[cbdo2007]

114. People complain about bad things and how they are unfair but when good things

happen they think they deserve it. It all evens out. We all have ups and downs.

My wife was a few years ago when we found out we couldn't have kids naturally. So we had to spend tens of thousands of $$$ adopting and she was pretty depressed about it for a long time, the financial aspect and how so many people can get pregnant and have kids for free, even when they don't want them. Then recently we got a great deal on a house and saved almost $20,000, so it all evens out.

It all evens out for everyone but it's going to be rare to come to DU and see anyone here bragging about their successes and great deals because you get jumped all over for taking advantage of other people and somehow everyone focuses on the unfair negatives. Not the unfair positives.

[xiamiam]

75. here is the link

http://www.standardandpoors.com/servlet/BlobServer?blobheadername3=MDT-Type&blobcol=urldata&blobtable=MungoBlobs&blobheadervalue2=inline%3B+filename%3D2010-1_Residential_Real_Estate_Indicators.pdf&blobheadername2=Content-Disposition&blobheadervalue1=application%2Fpdf&blobkey=id&blobheadername1=content-type&blobwhere=1243646307605&blobheadervalue3=UTF-8

[Dappleganger]

65. When the next ARM resets, another wave is due.

The finance forum I visit frequently is predicting by the end of summer the next wave is going to hit CA, FL and NV very hard.

[Fire1]

127. You MUST be in Michigan! lol!!! n/t

[Dappleganger]

39. And neither has FL

Or CA.

The worst is yet to come.

[leftofcool]

42. Florida was one of the hardest hit

Along with Nevada and California

[Robb]

34. Ha!

Well, I guess everyone has an opinion. I don't share yours, but if you're right the coffee's on me. :D

[leftofcool]

37. Watch the price increases

We are seeing them here. Other parts of the country not so much, but if you were around for the housing crisis in the 70's, it rebounded in about 3 years.

[cbdo2007]

48. Thanks for responding to my post....it's no use arguing with the negative nancy's though

cause they're just sure the market will always get lower and lower and lower and....you get the picture.

Most of the country is seeing price increases, its obvious recovery is just around the corner, so anyone currently underwater just needs to wait it out at this point. Sure it sucks for them, lots of things in life aren't fair, but just like the stock market it's those who panic and sell at the bottom who end up losing out on the big gains that happen during/after the recovery.

[leftofcool]

55. It will take some time but things do get better

They always have in this country and always will. Some people bought more than they could afford at the time and I feel for them. Recovery may not be right around the corner, but it is coming.

[Dappleganger]

59. "Some people bought more than they could afford at the time"

Your talking point is straight from the right-wing playbook.

Lots of people did NOT buy more than they could afford at the time they purchased a home, and even saved to put 20% down on their home. But they are still underwater by hundreds of thousands of dollars! And the more homes which are foreclosed on in their neighborhood, the more their home values sink.

[cbdo2007]

80. See how anyone who studies and understands the economy is automatically "right-wing"? *laughs*

It's hard to argue with people who's argument is to try to offend you right off the bat by calling you names.

[Dappleganger]

57. 'Negative nancy's'???

OK, now I'm convinced that you're not living in reality. The bulk of underwater mortgages are located in CA, FL and NV and things have not begun to recover for the bulk of those with negative mortgages who are desperately trying to keep a roof over their head.

People with ZIP savings and either no job or contract work at much less pay have NO PATIENCE to wait it out. They ran through whatever savings they had to just try to keep up in the first place.

You said, "Sure it sucks for them, lots of things in life aren't fair..."

I am glad that things are SO FUCKING GREAT FOR YOU, but I guess the rest of us just have bad luck, it sure sucks, RIGHT!!

[cbdo2007]

83. Yes things are fucking great for me right now....life is full of ups and downs....

You think I haven't lost tens of thousands of dollars in businesses I've started and had years eating beans and rice?? We've all been there at some point in our lives and if we haven't it will come along one of these days.

Just look at the other thread here about the guy who was making a sh*tload of money, he bought a gigantic house, then took out a second mortgage on the house so he would have exactly ZERO equity, and is now complaining that he's under water. Ups and Downs. Ups and Downs.

Apparently you think people will always have great lives and will always be "winning". Sorry but you're going to spend some of your life on ups and some of your life on downs. The way you deal with both is how your character is shaped.

[jpljr77]

68. They're also going to be whining about how the banks won't lend to them.

It usually appears deep in the articles, if at all, but all of this "walking away" business has serious repercussions for an individual's creditworthiness going forward. That mark isn't just going to magically go away when the economy recovers.

If you walk away now, be prepared to rent for the next seven years...or have enough cash for at least a 25% down payment and a ton of income.

[Dappleganger]

71. That's not necessarily true.

[jpljr77]

73. Oh?

[xiamiam]

74. 3 years short sale..4 years foreclosure..before u can get a loan for a house..nt

[cbdo2007]

98. That's up to the lender. If there are more and more of these the lenders

are going to be less and less likely to give those people a break after 3-4 years.

Would you let someone borrow hundreds of thousands of $$$ if the last time they did it they just walked away from it?

[upi402]

24. Is the death penalty legal in this guy's state?

From linked article:"That is an attitude Wall Street would like to encourage. David Rosenberg, the chief economist of the investment firm Gluskin Sheff, wrote recently that borrowers were not victims. They “signed contracts, and as adults should also be held accountable,” he wrote."

Bankers were very aware of what time it was. They gambled crazy, lost, and WE paid their tab. Folks fell victim to advertising and media propaganda about the market and now we want to claim they should be skinned alive because they had the rug pulled from under them? Now these corporate socialists/fascists want to blame their victims????

OK now I support the death penalty in certain cases...

[Lance_Boyle]

61. what, exactly, is wrong with that sentiment?

People “signed contracts, and as adults should also be held accountable." Do you not believe that legal contracts should be upheld? You're OK with it if you contract with someone to perform some service for you, and they take your money and then refuse to uphold their end?

[xiamiam]

77. it is a good argument in most cases..but the steam roller known as greed run amok

created something so vast that few individuals had any idea how to salvage themselves or their homes...just cant blame the millions who go caught in this mess..while a handful benefited.

[dmallind]

54. Some facts...

Case-Shiller house pricing index chart....

http://www.standardandpoors.com/indices/sp-case-shiller-home-price-indices/en/us/?indexId=spusa-cashpidff--p-us----

[xiamiam]

67. is the key here that mortgage delinquencies have increased steadily from 2008 to 2009

as indicated in the january 10 outline?

[dmallind]

91. Well I suppose that's an input sure but the chart measures house prices NT

[lumberjack_jeff]

97. I know this sound pedantic...

... but the chart measures house price change.

In other words, the chart has hit bottom and is climbing, but that only means that the rate of depreciation has slowed. Not that prices are recovering.

[dmallind]

117. Nope not pedantic - in fact I'm going to get MORE detailed here

You are correct of course and my bad for using shorthand that could be misinterpreted, but if you look at the 20 metro table above which gives individual data you will see several gaining right now. This compound list is if anything a bit too pessimistic as it is based on large metro areas which were more likely to see booms and busts than less chic environs.

[dmallind]

Well I suppose that's an input sure but the chart measures house prices NT

[dmallind]

92. Well I suppose that's an input sure but the chart measures house prices NT

[liberalhistorian]

79. You know, I was reading the other day about

Shay's Rebellion, a couple years after the American Revolution. Shays, who'd served as a Captain in the Revolution, led a large contingent of MA farmers who couldn't pay their farm mortgages and who were being foreclosed on as a result, to a weapons armory to get weapons to stop the foreclosures. They were defeated by the government militia, which passed as the federal military at that time. This finally scared several "founders", Madison and Hamilton among them, into arguing for amending the useless Articles of Confederation, or scrapping them altogether, and holding the Constitutional Convention. I'd already known about it for years, of course, being a history buff and history major, but I like to refresh my memory and re-read things once in awhile.

Then there's the matter of all of the protests and forcible preventions of evictions and foreclosures that occurred throughout the Great Depression, whereby representatives of landlords and banks were forcibly prevented by crowds from foreclosing on homes or evicting impoverished tenants who couldn't find jobs. This was actually a fairly common occurrence during the Depression; it would sometimes stave off evictions or foreclosures altogether, as banks and landlords feared "mob" (as they put it) reaction.

Then I thought about today, with many of the same conditions occuring, yet people are acting like sheep being led over a cliff. If there are any forcible preventions of foreclosures/evictions, or any rebellions against them, I'm not reading about it. And I have to wonder what is different now, why we, as a people, are simply just bending over and taking it or, worse, NOT putting the blame where it belongs, on the banksters, and, instead, turning against our fellow citizens. What has happened here?

[xiamiam]

84. +1

[DireStrike]

104. The cops have tear gas and sound cannons now

I think they just used fire hoses in the days of the depression. The new stuff is more effective. Crowds don't mean what they used to.

As long as we have a shitty job market, and humans continue to get off on keeping others down, we will be a police state.

[Fire1]

128. Guess we don't have the "right stuff." It's been the every man

for himself attitude among us, as a people, for decades since the civil rights movement. I don't know what happened to develop this attitude.

[closeupready]

81. When the $8,000 tax credit expires in April, that will pull bottom out of any existing demand, IMO

It's demand that is being inflated artificially.

[DCBob]

102. Not so sure.. depends how consumer confidence is going..

There is tremendous amount of pent up demand plus a tremendous amount of money sitting "idle".

[Romulox]

89. This SHOULD have been one of the President's first priorities...instead we're on year 2 and no plan.

:wtf:

[lumberjack_jeff]

94. I got as far as this sentence.

It was April 2006, a moment when the perpetual rise of real estate was considered practically a law of physics. Mr. Koellmann was 23, a management consultant new to Miami.

A 23 year old management consultant? He's qualified because he managed to get himself ready for school all by himself?

[closeupready]

113. If you saw "Up in the Air," the starring actress plays a similar role

She is a fresh out of college "management consultant".

[lumberjack_jeff]

96. A more accurate way to describe what the article said is 25% underwater. n/t

[DCBob]

99. yep. misleading title.. 25% is bad enough

Not sure the person posting this misunderstood the story or just a poor wording choice.

[anonymous171]

130. WALK AWAY! Fuck the bannkers. I want to see them asphalt diving from their skyscrapers.