Comments on: Has the Mass Homeowner Exodus Already Begun?

By: TN

TN — Wed, 02 Apr 2008 16:47:09 +0000

Ok, I just wanted to vent, I am one of those first time home buyer that was 6 months pregnant, and my apartment was only a 1 bedroom so we thought we need to move out and expand, this was during summer 2005 “the crazy rush” to purchase homes. We were only able to afford a $150K home, but it appeared that all the homes in the price range were dumpy and in not so great area, but were snatched within hours of posting on the MLS. There we were, two months later, 8 months pregnant, and still trying to find a suitable home, we had to eventually raise our borrowing price to an uncomfortable $220K and found a fixer upper home. Well in order to afford the home, we had…yes an ARM… we poured over $8k of borrowed money from credit cards to fix the home, backyard was a disaster, kitchen was falling apart, and it wasn’t any upgrade, it was just to fix walls, doors, windows and buy appliances in working condition a little comsmetic touch up and landscaping for our child. Well a year later, husband changed job, we couldn’t sell the house for what we owed, since it still was in fixer up condtion and we had a over $16000 in penalties, if we sold, so the only way was to rent at a slight loss and try to sell before the arm would adjust and the penalties would be removed in order to afford our current home. Long story short, we went into what looked like a promising business with a friend, but it failed in the ensuing months, and husband found a full time job again to recoup the failing business, but then layed off… now we have two homes on short sale. We are good people that just happen to buy both times at the VERY wrong time. and now both homes are valued at $40K less than what we bought it for. We are now in a situation that renting would be a better option for a long while until we sort this mess out!

By: wm

wm — Thu, 13 Mar 2008 19:35:57 +0000

THESE ARE ALL GOOD EXAMPLES!!!AND FACTS!!!
THE FUNNEST THING OF ALL IS I WOULD LIKE TO FIND THE REALTOR’S
BUILDERS AND OF COURSE”STRAW BUYERS” WHO WE HAVE NOT EVEN POINTED THE FINGERS AT YET!!!!!!!!!!!
WHO CREATED THE WHOLE THING “AND OF COURSE THE FEDS”
NUMBER ONE MOST IMPORTANT FACT!!!FALSE VALUE OF HOMES ACROSS THE BOARD!!
WHEN HAVE WE EVER SEEN IN HISTORY YOUR HOME GOING UP 20% TO 50% PLUS A YEAR
HISTORICAL FACT 3% TO 10% 10 IN A GREAT MARKET!!!
SO HOW IN THE HELL DID WALLSTREET EVEN BACK THE PORTFOLIO ON WALL STREET….
BAD LENDERS AND GOOD LENDERS OUT THERE IN THE GAME!!!!!
BUT DOESN’T A HOME HAVE TO START FROM A VALUE INDICATOR TO EVEN VALIDATE THAT A HOME LOAN CAN EVEN MEET GUIDELINES PRESENTED FROM THE BANK?????
THIS IS A MYSTERY ON HOW THIS WHOLE BS WAS EVEN CREATED!!!
1999,2000 AND 2001 WE WERE HEADING INTO THIS DIRECTION!!!!!!!!!!!!!!!! USA WE LOST OUR ECONOMIC POWER PERIOD!!!QUESTION PEOPLE WHAT DO WE EVEN MANUFACTURE ANYMORE??
LAST I CHECKED, EVERYTHING WE BUY AND OWN MADE OVERSEAS…
THANK YOU PRESIDENT NIXON AND THE THANK YOU PEOPLE OF THE UNITED STATES OF AMERICA FOR NOT SUPPORTING USA MADE PRODUCTS!!!!!!
BUT WHAT IT GETS WORSE THE MOST TERRIBLE USA EVENT IN HISTORY
SEPT 11TH 2001……….. WHY DID WE WAIT 2 YEARS TO RE-ACT????
GO TO WAR FOR OIL ETC AND MASK AN ECONOMIC NIGHTMARE THAT WAS BREWING!!!!
WE ARM OTHER COUNTRIES NO WHERE THE LEADERS ARE BUT YET WE CANNOT CAPTURE????HUMMMM FISHY
WE ARE VERY IGNORANT PEOPLE THE GOVERNMENT ONCE AGAIN HAS SHAMMED US AS THEY DID IN IN THE EARLY 90′S “DESERT STORM!!
THEN RECESSION
THEY GAVE MONEY AWAY TO TO HELP AN ALREADY FALLING ECONOMY!!!!!!!!!!!! SAME TIME.. LOWERED RATES TO PAY EVERYONES CREDIT CARDS THAN PEOPLE LOST HOMES THAN AS WELL
THIS TIME THEY LETS BUILDERS AND REALTORS AND LENDERS CREATE A FAKE FAKE FAKE HOUSING RUSH!!!!!!!!!!!!!!!!!!!
MAYBE THEY SHOULD OFF OPENED UP ALL THE OLD GOLDMINES HERE IN CALIFORNIA AND HAD US ALL PROSPECT!!!!!!!!!!!!!AGAIN SINCE WE ALL CAN SEE WHERE ITS GOING!!!!!!
BOTTOM LINE YOUR HOME IS SUPPOSE TO BE A NEST EGG 15 TO 30YRS DOWN THE LINE TO RETIRE:)
NOT TO MAKE 100′S AND 100′S OFF IT TO BUY RV’S CORVETTES
TRIPS ETC..
IF PEOPLE WERE DUMB ENOUGH TO LEVERAGE THEMSELVES TO THE TILT OR BUY A HOME DOUBLE WHAT THEY HAD BEFORE THEN THE ACTUALLY FACT IS THEY DO DESERVE TO LIVE IN THERE FANCY CAR OR RV THEY BOUGHT!!!
I DO FEEL SORRY FOR SO MANY HARD WORKING PEOPLE WHO WERE FIRST TIME HOME BUYERS WHO GOT TAKEN ADVANTAGE OF FROM SOME MANY REALTORS ETC….
PEOPLE THIS MAKES THE S&L SCANDAL LOOK LIKE MASHED POTATOES!!!
WATCH AFTER BUSH LEAVES HOW MANY PEOPLE GET HUNG OUT TO DRY!!
MILLIONS OF DOLLARS STASHED AND MADE!! BYE BYE TO ALL!!
HOMES NEED TO GO DOWN ANOTHER 30%
AND ALLOW ALL REAL BUYERS TO COME OUT AND PLAY:)
GOD BLESS THE UNITED STATES OF AMERICA
IT IS THE BEST PLACE IN THE WORLD BUT ALSO THE MOST F@@CKED UP AND WE ALL KNOW THIS!!!!!!!!!!!

By: gatorbait

gatorbait — Sat, 08 Mar 2008 03:44:39 +0000

the market needs some confidence placed into the system…..this is easily done when the govt buys quality backed mortgage paper…..and would say some statement that they will not allow fannie mae/freddie mac go bust. there is mistrust in even the good mortgages and this is a very bad thing becuase if there are no investors to buy the quality paper then rates will continue to go up and it will close to impossible to get a mortgage.

Thornburg is a perfect example of the hysteria that is playing out in the secondary market. …..thornburg only has high quality mortgage paper and this is not only a fact but proven when you see pimco buying a few hundred million dollars of this paper because it is trading close to 70 cents on the dollar. The major players are buying this stuff because it is on fire sale..

what is happening to thornburg should be the govt’s glaring cue to step in and buy some of the high quality mortgage paper to inject trust back into the high quality end of the mortgage market…..this action would payoff in 2 ways-

1-it will help to get investors back buying a paper mortgages which will cause rates to move down where they should be at this point.. mid 5%

2- the investment in this paper would return a tremendous amount and this return could then be used to offset the cost of whatever program that is going to be required to assist all the troubled homeowners.

By: Ray

Ray — Fri, 07 Mar 2008 18:11:13 +0000

Let’s all face reality. The federal reserve is helpless and won’t be able to fix this mess. The only thing they can do is to continue to pour money into a failed banking system and devalue the dollar. So as they continue to crush the dollar watch long term interest rates continue to rise.

All of those helpless homeowners who wanted a piece of the american dream now have a piece of the american nightmare.

A housing crisis!
A banking system crisis!
A Countrywide Crisis. Now that makes sense. Watch as countrywide falls and Bank of America backs out of the deal.

Countrywide has 26 Billion in pay option arms that cannot be refinanced because of the back end interest causing the borrower to owe more than the home is worth. Thank you Tan face for adding more misery to a devistating situation.

Who is the fed fooling? Just keep printing money and bailing out our failed banking system. This situation is going to get much worse as foreclosures continue to rise. We are only in the second inning of the game and the other team is leading 20 to nothing.

Who will throw a lifeline to Thornberg Mortgage Company? The company is close to the end.

FHA loan limits have now been increased at least until the end of 2008. The government is trying to do a behind the scenes tax payer bailout. It won’t work because you need equity to refinance. No equity then no refinance.

By: Larry

Larry — Fri, 07 Mar 2008 13:48:57 +0000

Rob,
“…you simply cannot place all the blame on the lenders and wall street. Borrowers lied about their income and signed on the doted line for a loan that they knew would adjust in 2 years.”

You’re right about not placing all the blame on just one group. Every person who let their greed/pride get in the way or just let their guard down can take a slice. But you have to have a little sympathy for the poor schmuck who really wanted to improve the lot of his family and fell into the trap set by the “big boys”.

Many of these people were just not intelligent enough or had the resources to figure out the long term game devised by the likes of “Sir” Alan Greenspan and were brought up trusting what the government had to sell. Now, they’ve been hung out to dry in the winds of history.

By: buzz kill

buzz kill — Fri, 07 Mar 2008 07:01:44 +0000

When the Chairman of the FED and our US Treasurey Secretary makes remarks like the ones above, you better be worried, just a bit.

Eff ‘em, let it crash.

By: Lyle

Lyle — Fri, 07 Mar 2008 06:32:41 +0000

reducing principle amounts? Massive principle reductions? WTF?!

Idiot!

By: Ben

Ben — Fri, 07 Mar 2008 03:09:32 +0000

This “too little, too late” offering may not be the most welcome of thoughts to add to a discussion on pending economic meltdown but here goes. I know we all adore our credit cards, credit scores and byzantine financial labyrinths of debt instrument shell games, BUT…..for anyone who remembers that the US Constitution is “the supreme Law of the Land” (Art. 6, Para. 2, clause 2), consider the following: (Don’t take my word for it either. Consult, the Constitution yourself, google an article written by Alan Greenspan in 1966 called “Gold and Economic Freedom”- and YouTube a documentary called “Money As Debt”)
THE CONSTITUTION
1) only provides for CREDIT for the government, overseen by Congress and the
Treasury of the United States of America (Art 1, Sec. 8, clause 2);
2) it only permits money in the form of gold or silver coinage (Art. 1, Sections 8 & 10),
which inherently means that paper money must be backed by it;
3) it does not permit our government to create a central bank “credit card” for itself
(Federal Reserve Act, Dec. 1913), nor use that credit card as a device to artificially
but no less unsustainably support the now institutionalized, private-sector, pyramid
scheme known as fractional reserve banking.
RESULTS OF CONSTITUTIONAL NON-COMPLIANCE:
1) Large-scale, industrialized warfare is impossible without central banks, ours or other
nations’; it can’t be funded.
*WWI began seven months after the Federal Reserve Act was passed; we became
the allies leading funder/supplier of wartime supplies; our private-sector
industries would not have retooled their peace time factories for war purposes
without the promise of payment from government (enter debt-based
government investment/subsidies).
*None of the 20th century’s major wars could have been funded without
debt-based money’s capacity to artificially fund them.
*The Manhattan Project (nuclear warfare) wouldn’t have happened without WWII.
2) Inflation is the natural marketplace’s way of saying that the supply of money
exceeds the marketplace’s sweat equity demand for it. Money only needs to be
created to match the sweat equity growth of the marketplace.
*Inflation caused by the spending needed to produce war supplies and to fund
our military deployments means our soldiers are sent overseas to fight/die as a
result of unconstitutional government policies while we at home work harder
and harder to pay our bills and, oh yeah, pay off our houses.
*Inflation means we have less time, energy and money to spend on our families,
personal business, hobbies, involvement in our communities, educating
ourselves, staying up on current events, keeping an eye on our elected
officials, etc.
*Money problems are a leading cause of divorce
*Our kids are deprived of our input in the day to day happenings of their lives
so they get what they think they need from other sources, e.g. the media,
music, equally uninformed friends, etc.
*As all these problems compound themselves and so we escape into our
national pastimes, e.g. armchair sports, video games, gambling, substance
abuse, spending money as a pacifier, etc.

Adherence to the Constitution could have and still can prevent all this if we use it. Of course, they don’t teach it in school any more though so we don’t know that our passive contempt for it equates to a passive contempt for ourselves and our kids. Oregon has a law (ORS 336.057) that’s been in effect since 1923, pertaining to instruction on the Constitution. They don’t enforce this law, but it IS the LAW. This law requires public schools to provide five full years of Constitutional studies, minimum, no discretion.
If we all had this much opportunity to review, discuss and understand the original intent of our supreme law, we wouldn’t be so dismissive of quaint, “antiquated” notions like metal backed money, which by the way, is the reason why the dollar became the international standard to begin with and why its divorce from this standard is causing it to fall off the table, right along with our national sovereignty and republican form of government. Run rabbits run.

By: GATORBAIT

GATORBAIT — Fri, 07 Mar 2008 01:52:24 +0000

you hit it on the head- only it is supply and demand of the backed securities themselves….
As was said the govt is going to have to buy a good deal of mortgage backed securities (MBS) for there to be confidence restored in the market and to have any chance of any type of recovery….you would think the fed would learn from the 30′s. When you see a greater than 1.50% spread on MBS from the treasury yield it is based off…you do not have a serious issue but close to a complete collapse of the security itself.
A main issue is that investors are not even buying the fannie mae backed stuff unless marked down to 65-70 cents on the dollar and even then at this point the investors are scarce except bond grave dancers who eat this trade all day.
Rates should be in the mid 5% range and we keep pushing towards 7%.
We have the perfect storm for a complete collapse-

distrust in even the well performing fannie mae MBS (mainly due to fear).

home-buyers on the sideline waiting for home values/prices to hit bottom

evaporation of the quality A-paper mortgage products for those who were in need to refi out of their subprime or teaser rate program (elimination of almost all of the A- and Alt-A programs may have had the single greatest influence on the increase in foreclosure rates initially.- If you throw a person in the middle of the ocean with out a life jacket then they will eventually drown)

Govt’s inability to fully understand and the recognition of the response required Aug-Sep 07 (severe intervention was required immediatley)

we will see a bail out of some type because we are smack in the middle of a historic financial crisis that requires the intervention to the degree we have never seen. You keep hearing Bernake “hint” about the different methods on the table. It will be hard to nationalize the industry but you will most likley not ever see a 620 fico no-doc 100% investor program again.
The downfall was not suprime itself (the performace rates on the owner occ stuff is fairly inline with historical data we just have more numbers because there are more people)
what is out of line and traumatic to the system is much of the investor speculation junk (90-100% investor stated, no doc , sign here if you have a heartbeat crud)
our fate was sealed when these type of programs were offered and pushed into the market. We saw a sig increase in the values when these products hit the market and boy not only were builders falling over themselves to set up a mortgage department to offer this junk but just about any bozo who could plug a sign on the corner.
Moral Hazard?? If there is not some intervention very soon we are going to see explicit examples of what moral hazard really means.

By: catherine

catherine — Thu, 06 Mar 2008 20:30:23 +0000

This is supply and demand guys, if you owe 400,000 on a 200,000 piece of property you are walking. THE MORTGAGE SERVICERS CANNOT RENEGOTIATE A RATE AND BALANCE THAT THE INVESTOR BOUGHT. The wake-up call here is there is no reason to stay. The government is going to nationalize (have to, only ones with any money, ours….)the mortgage business and next time values fall from supply and demand, THE IRS WILL OWN YOU, THERE WILL BE NO WALKING AWAY…………..this is the D train on the tracks guys, there is no reason to keep these houses that are the collateral for all this toxic crap, about 38% of all investments and I didn’t believe that number either but look what is happening, IT IS EVERYWHERE, IT WAS THE ONLY INVESTMENT PLACE TO BE AND EVERYONE WENT THERE, 50% REDUCTION IN THE PRICE OF THE COLLATERAL, THIS IS BRAIN DEAD DEPRESSION, THERE IS NO FIX FOR THIS MESS……….STOCK AND HOUSING TANKING TOGETHER, WE ARE WATCHING HISTORY GUYS……………….