The Boston Globe reports from Massachusetts. "If home shoppers are frustrated by the lack of bargains in the real estate market, they might want to follow John Pesa's lead. When sellers would laugh at his outrageously low offers, he would counter with a lower figure. He would dig up information on comparable, but less expensive, houses to buttress his point and learned as much about the pricing and movements in the market as the brokers showing homes knew."

"The result was a house in Halifax that they bought at the end of summer for $81,000 below the seller's original price. 'I was able to put myself in a frame of mind where I was a complete businessman,' Pesa said. 'I was a stone cold hunter.'"

"For home shoppers who don't have Pesa's tenacity, the current soft real estate market has been something of mixed bag. Home prices have only fallen around 5 percent, hardly the kind of discount that would get buyers rushing off to a department store sale, much less to make the largest purchase of their lives."

"Karl Case, an economics professor at Wellesley College, said the most recent annual survey he and a colleague conducted among home buyers revealed growing pessimism about buying in a down market. 'They're scared they're going to buy something very expensive that's going to fall in value,' he said. Sellers, meanwhile, he said, are being 'stubborn. They seem to be holding out so far.' The result: 'People are staring each other down.'"

"Buyers should not panic at a sudden resurgence in the market and make rash offers, said Pesa. Be patient, be selective, he counseled; but more important, get to know the target market inside and out. 'You'll get to a certain point where you'll be able to recognize what's a good deal,' Pesa said, 'and what's not a good deal.'"

The Enterprise. "After being on the market for more than a year, the house in Taunton is finally under agreement. But while the house sold for about $100,000 less than the original $459,000 asking price, its $421,900 assessment is likely to remain the same next year."

"It's a situation that property owners throughout the region are experiencing: Property values are plummeting but assessments, done at the height of the market, aren't budging."

"Abington assessors, expecting the situation to cause some confusion, have put homeowners on notice that lower values of today's sagging real estate market, they've told homeowners, cannot be reflected until next year, fiscal 2008."

"Even if the values drop, East Bridgewater assessor David Lincoln Phillips said tax bills will not necessarily be lower because the tax levy or amount the town needs to collect generally increases. 'The tax rate is driven more by what the town needs for revenue,' Phillips said. 'So if the values are high the tax rate may be less. If the values are lower, the rate may have to go up.'"

"The three-bedroom house at 10 Tania Drive is assessed at $421,900, according to city records. But listing agent Jim Ricker says the agreed selling price is mid-way between $349,000 and $379,00. In this slow real estate market, it is not unusual for houses to sell below their assessed values, according to municipal assessors and real estate agents."

"'It's really a strong buyers market,' said Jean Sawtelle, spokesman for the Plymouth and South Shore Board of Realtors. 'Values are down, the demand has eased and the sales pace is moderate. It's helped boost the affordability level.'"

The Gazette. "Ana Martinez's three-storey house in the Dorchester section of Boston is scheduled to be auctioned in December because she's far behind on her mortgage payments."

"Martinez has become so desperate to save her clapboard house on a quiet working-class street that she's even appealed to America's patron saint of lost causes: Oprah. 'I offered myself as a charity to her,' she says. 'Her workers called me back and said there were thousands of cases.'"

"Martinez has dug a hole for herself by repeatedly refinancing her home over the last decade as its value soared in a real-estate boom that's lifted prices in Boston and other U.S. cities. The downturn in the U.S. real estate market has exposed folly and fraud in an orgy of mortgage borrowing over the last five years."

"Besides a surge in mortgage lending for home purchases, Americans cashed out $740 billion from their houses in 2005 alone through refinancings and home-equity loans, according to the Federal Reserve. The Fed estimates half of that cash went to buy goods and services, cars, granite counter tops, vacations. It's called using your house as an ATM."

"Now, with house prices falling in many cities and the inventory of unsold homes rising, an out-of-order sign has been hung on the mortgage refinancing ATM for many families."

"Lois Meisler runs a Boston company that manages foreclosed properties across the U.S. for banks. Meisler's business gets better with each passing month and she expects the real estate bust to continue for years. 'People have refinanced every dollar out of their house. There's no equity left.'"

"Many upper- and middle-class homeowners and real estate speculators were caught owing too much when the music stopped. For example, a columnist for the Boston Globe newspaper and a Massachusetts state senator narrowly avoided foreclosure this year when they failed to keep up with mortgage payments."

"The situation has been made worse by predatory lending practices. These operators frequently saddle unsophisticated borrowers with high fees and penalties and have gone as far as fraudulently inflating borrowers' incomes on applications to qualify them for mortgages."

"The mortgage companies are in it for the fees and quickly offload their default exposure. They achieve this by selling the loans to Wall St. investment banks that packaged them into 'mortgage-backed securities' that are in turn sold to investors."

"The mortgage broker who arranged Ana Martinez's refinancing recorded her income as $8,420 a month, said Virginia Pratt, a counsellor at an community group. In fact, she was earning only about $2,500 in rental income at the time the deal was closed."

"To close this refinancing, she had more than $16,000 in charges tacked on to the loan, including an astonishing $12,825 fee paid to the mortgage broker. Martinez says she was supposed to have received $28,000 from the refinancing, but claims never to have received the sum."

"Martinez has repeatedly remortgaged her three-storey home since buying it in 1994 for $97,500, moving down the chain from bank lenders to sub-prime mortgage companies. In all, she has taken more than $300,000 that she says went for major house repairs and trips to Honduras to visit her ailing mother."

"Most recently, she refinanced through a California sub-prime lender in October 2005. She ended up with two loans, one for $427,500 and another for $28,500. The interest rate on the larger loan was fixed for two years at 7.35 per cent. After that, the rate is to ratchet up every six months until it hits a maximum of 13.35 per cent, said Pratt."

"Documents show her monthly payment is to rise from $2,766 to $3,612 beginning June 1, 2008. After paying that amount for 27 years she will still owe a lump-sum 'balloon payment' of $276,938. In all, she is scheduled to pay $1.14 million in interest over 30 years. At the same time, she's supposed to pay $421 a month on the smaller loan."