A Risk Worth Monitoring
Some housing bubble news from Wall Street and Washington. AP, “A reading of U.S. homebuilders’ sentiment remained unchanged in April, just shy of its record low for the third consecutive month as the housing market failed to recover. The National Association of Home Builders said Tuesday its housing market index came in at 20 this month, the third-lowest reading on record. Index readings higher than 50 indicate positive sentiment. The index has been at 20 or below since September, and below 50 since May 2006.”
“The builders’ group’s chief economist, David Seiders, says the housing slump has pushed the economy into a ‘mild recession.’ The trade group has been pushing aggressively on Captiol Hill for legislation, such as a temporary tax credit for home buyers, arguing that doing so could stem the housing downturn.”
“‘Measures that stimulate consumer confidence in the housing market, push the fence-sitters into the ring and put a floor under house prices can successfully halt the drag that housing is exerting on the national economy, and help stabilize financial markets at the same time,’ Seiders said in a statement.”
From Reuters. “The unsettled U.S. mortgage and housing markets mean that Fannie Mae and Freddie Mac remain exposed to serious risks, their federal regulator said on Tuesday. ‘Both companies remain classified as significant supervisory concerns,’ the Office of Federal Housing Enterprise Oversight said in its annual report to Congress.”
“‘The extraordinary declines in the housing and mortgage markets have greatly increased their credit and interest rate risks,’ OFHEO director James Lockhart said in a letter to lawmakers.”
From MarketWatch. “The performance of government-sponsored enterprises like Fannie Mae and Freddie Mac could have a direct impact on the national economy and more importantly, the credit standing of the U.S., Standard & Poor’s said Monday.”
“Fannie and Freddie, which enjoy implicit government guarantees, could cause the U.S. to lose its sterling triple-A rating if the government were forced to come to their rescue, the ratings agency said in a report.”
“‘Even though…credit damage from GSEs is unlikely, the greater risk to the U.S. lies with them than with broker-dealers,’ S&P noted.”
“Fannie and Freddie have become almost the sole issuers of agency mortgage-backed securities, with these agencies holding an 82% market share in new issuance, nearly double their share of 46% in the second quarter of 2007, before the start of the crisis.”
“S&P said it raised these points as a measure of caution. ‘These potential risks are not a prediction, but a risk worth monitoring,’ it said.”
From Bloomberg. “The credit-default swap market has become a lesson in being careful what you wish for now that Wall Street has taken $245 billion of losses partly tied to such exotica. Rather than dispersing risk and lowering borrowing costs as former Federal Reserve Chairman Alan Greenspan predicted, the contracts have exacerbated the debt crisis.”
“The latest version for AAA rated subprime mortgage bonds slumped by 43 percent since it began trading in August, according to Markit, as rising U.S. home loan delinquencies triggered a surge in the cost of credit-default swaps. That implies a 53 percent loss on the underlying mortgages, according to Wachovia Corp. analyst Glenn Schultz, almost four times the 13.75 percent rate predicted by Wachovia.”
“U.S. foreclosure filings jumped 57 percent and bank repossessions more than doubled in March from a year earlier. About $460 billion of adjustable-rate loans are scheduled to reset this year, according to New York-based analysts at Citigroup Inc.”
“Auction notices rose 32 percent from a year ago, a sign that more defaulting homeowners are ’simply walking away and deeding their properties back to the foreclosing lender” rather than letting the home be auctioned, RealtyTrac CEO James Saccacio said.”
“Bank seizures climbed 129 percent from a year earlier, according to RealtyTrac. March was the 27th consecutive month of year-on-year monthly foreclosure increases. In February, foreclosure filings rose 60 percent.”
“Some borrowers are ‘hanging on at the margins’ in the face of resets, said Mark Goldman, a loan officer in San Diego. Goldman said one of his clients is a self-employed contractor whose adjustable-rate mortgage rose by two percentage points two months ago. His mortgage payment has increased to $7,200 from $4,900.”
“‘I’ve had people sitting in my office in tears because there are no loans available,’ said Goldman. ‘There are no loans for someone who’s upside down on their house.’”
The News & Observer. “To see what the national housing meltdown looks like, take a drive to Sandlin Branch. Since December 2005, 45 of the 112 townhomes have been auctioned off in foreclosure sales. At least seven others are being dumped at drastic price reductions as owners scramble to salvage their credit ratings.”
“Banks that repurchased the mortgage loans now hold assets worth a fraction of their original value.”
“The Atlanta developer who sold the townhouses is under federal investigation for mortgage fraud. Investigators would not elaborate, but records show he established inflated prices by selling 12 of the first 17 townhomes to relatives.”
“Dennis Coyle, who earns $19,000 a year as a maintenance worker, He bought the unit he was living in. ‘The way they gave a deal, how could you turn it down with no down payment and you’d own a house?’ Coyle said.”
“His brother, James Coyle, wanted the same deal. James Coyle bought the Kentucky Drive unit he’d been renting, even though his income was low. ‘I shouldn’t have done it, but I had a chance to buy a house, which I had never done before,’ he said. ‘I was shocked I was approved.’”
“Wilma McCarter, an assembly line worker, bought the apartment she had lived in for eight years and three adjoining units. The apartment manager ’said they were selling,” McCarter recalled recently. ‘I said, ‘I’d like to get four.’ The next thing I knew, I was approved.’”
“Lenders and appraisers familiar with Sandlin Branch now agree that the units were overvalued, and the market bears them out: Townhomes originally priced at $105,500 are now selling regularly in the $40,000s. In June, one sold in a foreclosure auction for $37,000.”
The Review Journal. “When Brad Cohen’s monthly mortgage payment jumped from $1,700 to $2,400 and the bank came calling with foreclosure notices, Cohen did what any red-blooded, meat-and-potatoes American would do. He called a lawyer.”
“The pending lawsuit could become the first local test case in a broadening national spate of claims against Realtors and lenders who lawyers say put buyers in houses too pricey for their budgets.”
“Trial attorney Robert Cottle expects to file Cohen’s lawsuit within the next 60 days. Cottle is preparing several lawsuits against Realtors, lenders and appraisers — ‘a triangle of professionals, every one of whom failed consumers most of the time,’ Cottle said.”
“Cottle estimated as many as 15,000 Las Vegans could have solid claims against sales agents, loan brokers and appraisers. Cottle agreed that home owners share some responsibility for taking out suitable loans.”
“‘But if you put food in front of a hungry man, he’s going to eat it,’ he said. ‘The consumer relies upon the professional to do their job to protect his interests. This is professional greed. Greed won, the consumer lost, and now we’re in this mess.’”
“Cohen has owned his 1,968-square-foot home in southeast Las Vegas since 1999. In 2005, the disabled dairyman refinanced his mortgage to pay off credit cards and ‘put some cash in (his) pocket.’”
“Everything was fine, Cohen said, until September, when his interest rate adjusted and his monthly installment swelled to $2,400 a month. He hasn’t been able to come up with a payment since. He owes more than the home is worth.”
“His homeowners insurance has lapsed, and he can’t swing his property taxes anymore. He’s gotten as many as 14 calls in one day from his lender, along with letters denying requests to modify his loan’s terms.”
“‘It’s like everything is crumbling and I feel very trapped,’ Cohen said. ‘I’m down in a hole and I can’t get out.’”
“He’s alleging that the mortgage broker who refinanced his loan falsified his income on the loan application, and he’s also saying she told him he didn’t have to read the 200-page stack of papers she placed before him during the loan’s closing. Because they’d done business before, he trusted her and didn’t study the documents.”
“‘She said, ‘We’ll be here eight hours if you read every page,’ Cohen recalled. ‘Now that I look back, I just feel I was blindly taken advantage of because of trust. All your life, you work for certain things. You get them, and then they’re taken away because of somebody else’s dishonesty.’”
The Gazette. “El Paso County Assessor Mark Lowderman filed a formal complaint this morning with the state Division of Real Estate regarding the November 2006 purchase of five houses on Balsam Street.”
“In his complaint, Lowderman asked the state to investigate allegations and admissions made by Colorado Springs landscaper Andrew C. Aranda, who told The Gazette he bought all five houses using $1.9 million obtained from five different lenders.”
“Aranda said he was approached by real estate broker Robert B. Teegardin, a business associate, to buy the houses. Aranda admitted he signed documents that suggested he planned to live in each of the houses although he never intended to move. The deception allowed him to obtain 100 percent mortgages at lower interest rates than if he had described the purchases as investments for resale or rental.”
“‘How the heck was I going to live in five houses all at once?’ Aranda said, suggesting he didn’t know exactly what he was signing at closing.”
“And he said he signed loan applications representing himself as single although he is married with four children. All five houses ended up in foreclosure and four have resold, each for about $100,000 less than the price Aranda paid.”
“Aranda, 27, says he’s the biggest victim in the Balsam Street case. He admitted signing the loans - which describe the married father of four as single and indicate his plans to live in each, although he said he never intended to move.”
“And he admitted that he expected to get money back to help pay for the mortgages until the houses were resold. He also expected to get rewarded with business for his landscaping company.”
“But Aranda claims he didn’t understand the details and ramifications, including possible criminal charges.”
“A Pueblo man was sentenced to 10 years in prison in February for a similar deal - he used straw buyers and inflated appraisals to obtain about $2 million in loans. He was convicted of racketeering under a Colorado organized crime law.”
“‘I didn’t know what was going on,’ Aranda said. ‘I don’t think there’s any way in the world I can get in trouble for anything. I gained absolutely nothing. They ruined my credit. I have five foreclosures on my record. What did I get out of it?’”
“‘It was just a bad investment deal,’ Aranda said. ‘I thought the deal would never go through. It’s impossible to buy five houses like that. If I got approved for five houses, it wasn’t legitimate.’”
“The overappraisal was key to the deal, Aranda said, because it generated $500,000 to be split between the scheme’s five participants. ‘There was a kickback that was supposed to pay the mortgages for so many months,’ Aranda said. ‘It was a chunk of change.’”
“‘They left me holding the bag,’ Aranda said. ‘They screwed me pretty bad and put my family in jeopardy. I got the houses and suddenly nobody was talking to me about landscaping deals anymore.’”
“Aranda tried to sell the houses, which had sat empty for months after their completion in 2006 as the housing market cooled. ‘I was paying $15,000 a month in house payments,’ he said. ‘I did landscaping to spruce them up. But they wouldn’t sell. I was desperately trying to sell those houses. I was freaking out. I didn’t know what to do.’”
“Besides the monthly mortgages, Aranda said he paid $600 a month on utilities and spent an additional $18,000 or more on landscaping on the houses. ‘I ran out of money,’ he said.”
The Star Tribune. “Loan rescues, known in the industry as workouts, are raising a sweat among lenders and borrowers alike. Despite new government and lender initiatives that promise help is on the way, borrowers and brokers complain of long waits to connect with loan representatives, unreturned calls and conflicting information.”
“‘Once you get behind, you’re always behind. You’re never ahead,’ said Scott McCune, a St. Louis Park resident who believes a loan modification last spring gave his family ‘false hope.’”
“‘I had high hopes, in the beginning, that we’d be able to help more people than we’ve actually been able to help,” said Kris Wilson, loan officer in Bloomington. Summit tries to write new home loans for people who can’t pay off their current mortgages.”
“Some of these lenders refuse to go along with refinancing plans that will repay some, but not all, of their outstanding home equity loans, she said.”
“‘These people already lost their money,’ Wilson said. ‘Their collateral has evaporated. It isn’t there. What we’re asking [the lenders] to do, in many cases, is simply recognize that.’”
“The McCunes’ May modification on their St. Louis Park home dropped the payment from $2,500 at a 13.5 percent interest rate to a $2,058 monthly payment at 8.2 percent. But it still wasn’t enough.”
“In the past two years, the couple’s income was cut in half — first when Scott, 54, went to culinary arts school and switched careers, then when Joyce, 49, lost her hospital administration job of 24 years. They tapped retirement savings and used the $200 their Marine sergeant son sends them each month to try to keep up with the loan modification.”
“But in October 2007 a couple of checks bounced and the loan modification failed. The couple is waiting to hear if a second loan modification will be approved. Even if another modification is approved, Scott doubts they’ll stay in the home. They can’t afford to unless the lender reduces the principal owed. If they rent, the couple could begin to rebuild their savings.”
“‘Do you stay where the memories are or get on with life?’ he said. Financially the answer, while painful, is crystal clear to Scott: ‘Your home is no longer an investment. It’s just a home. It’s a place to be.’”
The Times Call. “Longmont psychologist Louis Krupnick helps his clients deal with a variety of problems, but lately many are talking about their money, or lack of it.”
“Erie psychologist Stephanie Smith said the same thing. ‘People are feeling pretty out of control with their financial lives,’ said Smith, who works with Front Range Psychological Associates. ‘It takes an enormous toll on couples and families.’”
“And today, on Tax Day, many feel worried about money they owe the government, according to the American Psychological Association.”
“‘We all know that we should not spend more than we are bringing in,’ Smith said. ‘But most of us are doing it anyway. And that’s hard to admit.’”
“The Boulder County Housing Authority Housing Counseling Program offers one-on-one foreclosure prevention and homeownership counseling to residents in Boulder and Broomfield counties.”
“‘There is a lot of stigma that surrounds foreclosure,’ said coordinator Christopher Hudak. ‘It’s helpful for people to get beyond that and look at it in purely financial terms for their own mental health.’”
“‘As Americans, we confuse our needs and our wants,’ Hudak said. And if you cannot stay in the house, then walk away in a manner that allows you to do so with dignity. Face the problem and sell the home before foreclosure, Hudak said.”
“It’s important that people separate the house from how they feel about the house, so they can let it go, he said. ‘There are memories, emotions,’ he said. ‘What you have to remember is, it’s a place to live.’”
“Then, he said, focus on the future and not just the problem. How can the move have a minimal impact on your family so you can start anew somewhere down the road?”
“And once you’ve made a change in your life, whether it’s reducing spending or selling your home, find more pleasure in simple things, said Krupnick, the psychologist in Longmont.”
“Get together with friends and play Scrabble. Listen to music. Go for walks. ‘Simple pleasures don’t cost a lot, and in the end, it’s what’s enduring,’ Krupnick said.”
“‘But if you put food in front of a hungry man, he’s going to eat it,’ he said. ‘The consumer relies upon the professional to do their job to protect his interests. This is professional greed. Greed won, the consumer lost, and now we’re in this mess.’”
Is this the plaintiff’s or the defendant’s argument?
Anyone too stupid and complacent to take primary responsibility for looking out for their own interests, deserves to get fleeced. It can’t be society’s job to protect idiots from their own bad judgement and poor choices. And the “victims” were just as greedy as the sharks that preyed on them. As they say, you can’t cheat an honest man.
Actually, you can ONLY cheat honest men. Crooked ones are sharp enough to see the sharks.
Yeah Pussy, you can’t con a con man.
Anyone too stupid and complacent to take primary responsibility for looking out for their own interests, deserves to get fleeced.
What I meant to say was that anyone too stupid NOT to take primary responsibility for their own interests, deserves to be fleeced. Or perhaps they don’t deserve it, but they lose the right to whine about being a victim when they went into these “deals” with their eyes firmly shut, trusting the (choke, gag) “professionals” of the RE industry.
“But if you put food in front of a hungry man”,
And if you put a legal document in fron of a greedy man and tell
him he will be a millionaire in 2 years, he’s going to sign it.
‘Simple pleasures don’t cost a lot, and in the end, it’s what’s enduring,’
Americans seem to be obsessed with being entertained… can people who use retail therapy and who eat out all the time return to something many of them never knew?
Even the stuff that isn’t supposed to cost a lot, say a trip to the public library, costs more when gas is insane.
can people who use retail therapy and who eat out all the time return to something many of them never knew?
Oh, you’d be surprised. I think some chronic belt-tightening would do a lot of Americans a lot of good in the Simple Pleasures Department.
From the original post:
“Longmont psychologist Louis Krupnick helps his clients deal with a variety of problems, but lately many are talking about their money, or lack of it.”
Ummm, excuse me, but I have a couple of questions:
1. If these people are so short of money, how can they afford the psychologist?
2. Or, if they can’t afford one, is Dr. K working for free?
New plaque adorns Louis Krupnick wall:
payments required before service rendered
Ex-Governor Spitzer’s girl-toy had that same policy, didn’t she?
Many health insurance companies will allow eight sessions (two months) of therapy. Beyond that, they often balk, so I’ve been told. Hopefully by then the prozac, zoloft, whatever, will have kicked in. A lot of people are in for a very bad time, it’s sad.
Kinda sad. But not tooooooo sad.
Insurance.
What happens when they can’t afford the insurance premiums? Or when their employer decides to pare back or drop the coverage?
Insurance only covers half the visit cost.
Therefore, a good exercise daily is only affordable remedy long term. People should look into boxing at the gym. So tired you forget what you were upset about.
Marvin Hagler
What a name for a boxer.
Don’t expect him to give up!
Good point. This is similar to the people who hire a company to manage his spending problem. These companies leech a living off the fools.
“The builders’ group’s chief economist, David Seiders, says the housing slump has pushed the economy into a ‘mild recession.’ The trade group has been pushing aggressively on Captiol Hill for legislation, such as a temporary tax credit for home buyers, arguing that doing so could stem the housing downturn.”
“‘Measures that stimulate consumer confidence in the housing market, push the fence-sitters into the ring and put a floor under house prices can successfully halt the drag that housing is exerting on the national economy, and help stabilize financial markets at the same time,’ Seiders said in a statement.”
_____________________________________________________________
Trying to lure fence-sitters into the ring to get mauled as the final sacrificial lambs, after the other sheep have been shorn the door already, is all we ask…
Bring us victims… We need more victims.
The Mayans towards the end of their collapse, needed more & more human sacrifices to appease their gods, are we really all that different?
I assume the Mayans didn’t sacrifice their best and brightest. I wouldn’t mind throwing a few FBs into an active volcano to appease the gods.
Um, didn’t you ever see “The Story of Ruth”? In human sacrifice cultures, you actually do sacrifice your most beautiful, perfect, unblemished children (may not fit your definition of “best and brightest”, but still).
Don’t sacrifice me bro!
“and put a floor under house prices ”
This line pisses me off to no end. All they are doing is prolonging the housing buuble and making more difficult for new home buyers to enter the ring.
Ok Mr. Seiders…. It’s your funeral. Go ahead and put a floor under housing prices if you think you can. Us fence-sitters will step into the ring and stomp the last bit of life out of your greedy ass.
These RE pukes got me wound up today.
exeter,
It’s not just you. I’ve been a fan of Ben’s for years and I’d have to say this is one of the most highly concentrated collection of fraud and sob stories he’s compiled yet! Ben? You’ve outdone yourself Sir!
“Us fence-sitters will step into the ring and stomp the last bit of life out of your greedy ass”.
I wear a size 10&1/2 but for that party I’ll bring a pair of 12’s.
Shouldn’t that be “up your greedy …”?
I’ll bring steel-tipped boots. Hell, I’ll provide steel-tipped ones for all and sundry.
Now that’s funny.
Kind of like putting a floor under a cannon ball dropped off the empire state buidling.
At 100+ stories I imagine it would be at terminal velocity before hitting the ground. So luckily, you could get essentially the same effect by dropping it off a tall condo
In a sea of sharks I will take my chances with…the Case-Shiller index. I feel I can trust the data and they don’t have anything to sell me. When it says the worst is over I will get back in.
“Auction notices rose 32 percent from a year ago, a sign that more defaulting homeowners are ’simply walking away and deeding their properties back to the foreclosing lender’’ rather than letting the home be auctioned, RealtyTrac CEO James Saccacio said.”
We might end up being a really fit country, with all of this walking going on…
Hate to be so cynical but this is the same garbaje we read in 1990-1991. Go back to simplicity, re-use the plastic bags, etc. The New Austerity (remember that as a Time or Newsweek cover). That didn’t last long, did it?
I keep wondering what new way will be concocted to separate the stupid from their money. First it was internet stocks, then house flipping, now what?
California is proposing of charging either 15 cent or 25 cent (news from NBC Monday 4/14/08) per plastic bag you take from the store. California uses about 9 billions bags per year. That is a lot of money for the state even after dividing among who knows what. If approved, this will take effect next summer.
Europeans show up at the store with bags. Been that way for many years. They also require you to put a coin to get a cart, which is returned when you put it back.
We have a lot to learn.
Aldi’s does that.
Aldi is a German company
No it’s not. It’s a knockoff American subsidiary of the German company with the same name, but it is not a German company. Their headquarters is near you, in Batavia, IL.
They only require coins because they don’t have cart attendants.
Their clerks also sit down their shift.
In Copenhagen, this is how the bikes work. Put in a coin, take a bike, leave it in a rack when you’re at your destination, get your coin back. It’s wonderful.
“They also require you to put a coin to get a cart, which is returned when you put it back.”
“In Copenhagen, this is how the bikes work. Put in a coin, take a bike, leave it in a rack when you’re at your destination, get your coin back. It’s wonderful.”
Can you imagine what would happen in this country if they tried that? How long would it take before people started stealing the bikes, stripping them, and then putting the parts up on Ebay?
1 hour? Maybe 2?
They already tried the “honor” system here in Tampa a few years back. The police dept. took all the impounded bikes and fixed them up and painted them orange.
The plan was to station them around the city at various locations and if you needed a ride, just take one and drop it off at your destination.
They lasted about 2 days.
Who cares what they do? I don’t want to live in a country where twits on committees tell me what I can or cannot do according to whatever whim is currently fashionable. One of the benefits of having a constitution is that our core rights aren’t bequeathed by committees, and can’t be taken away by committees. The notion that Americans have a lot to learn from European behaviors is laughable (and so pretentious). I’ll remember that the next time I’m buying my usual piles of soap, which I’ll be sure to package in any plastic bags as possible.
Actually, the notion that Americans have nothing to learn from other countries is far more pretentious.
Well, I believe we invented the biodegradable plastic bad that was discussed on NPR recently. Take that aged Europe!
You mean like democracy, freedom of religion, freedom of the press; that sort of thing? I’ve lived in Europe, and believe me, we have it made here in the U.S.A.
BTW - IKEA in Los Angeles does this already - 5c a bag.
I go shopping on foot with a backpack or on my bicycle. Forces me to be a careful spender — nothing like having to use my own power to haul the goods home. It also cuts down on the number of bags going home with me.
Arizona Slim,
Outstanding! Oh and you forgot to mention you’re getting a decent workout on the way there and back! My wife and I walk to Safeway and when you’re going through the aisles you find yourself thinking… Do I really want to carry that back? Works for us!
I carry a canvas bag in my car.
Yeah we bought a couple of those at Safeway 10 years ago and they hold a LOT. Trick is getting the checker to stuff them to the gills.
‘California is proposing’
Forget about the plastic bags we have moved on too…
Today in California the legislature is busy with more important business. For the third time - they are trying to pass a bill to give the children of illegal immigrants college tution. They say that this will ‘insure’ the state of a talented work force for the future.
“illegal immigrants college tution”
Usually I just try to laugh this stuff off, but some day I will lose it.
“illegal immigrants college tution”
Sacramento is a looney bin.
That’s not exactly what they are proposing. They are proposing that children that were brought here illegally by their parents, but have excelled in school, be allowed to register as in-state students and qualify for financial aid under the same conditions as any other student. Nothing extra or special.
With all due respect, qualifying for any help is something special. They were birthed by people who broke the law to be here.We’re a country, not a job bank or self help program.
Oh yes, getting a student loan is such an honor
Actually it is something “extra and special” because a US citizen from Arizona will pay MUCH more to attend the university as opposed to an “in state” illegal. Also, there is nothing about “excelling” in school being a requirement.
The Cali illegal college tuition package has grant dough in it too. Pell Grant dough is too valuble to hand it over to any lineage of an illegal.
charging either 15 cent or 25 cent (news from NBC Monday 4/14/08) per plastic bag ??
Leave it to the ba$trrds to come up with another tax you can’t avoid….
Buy $2 re-usable bags from Trader Joe’s, or Whole Foods.
Tax avoided.
I’m bad…I bought a bunch of cloth bags, but I keep forgetting them when it’s time to shop.
I think if I knew I was getting charged, I’d make the checkout person wait while I ran to the car to get them. Otherwise, it’s just easier to say to yourself “next time”.
I do this alot
I just throw the groceries into the trunk then when I get home I bring the bags out and haul the groceries in. Since you can carry more with the cloth bags you make fewer trips.
Frankly, of you can’t figure out how to avoid this tax, then you deserve to pay it.
Good one!! LOL
I have an entire collection of bags from the US, Europe, and Japan. I would rather try to remember to use the ones I have but if not, I buy one and then walk around locally like a ‘hotshot traveler’. Just kidding. But I do use em.Sainsbury’s in England has the prettiest bags.
Warlock wins.
I don’t recall that particular edition of Time or Newsweek (but I’ll take you at your word) as we usually only rediscover frugality AFTER a period of splurging.
What we should perhaps be saying instead of “Give Peace A Chance” is… “Give Frugality A Chance”?
Plastic bags are in my opinion the number one ecological scourge on the face of the planet — we just don’t see it yet here. Go to any third world country or any place where basic sanitation services have either broken down or are non-existent, and you will be absolutely appalled by what you see. e.g: Fifteen years ago, there were no plastic bags in Bulgaria. 7 years ago, I was in a remote river valley (near Dospat). Think of beautiful rivers and streams, but every square inch of the bank and the surrounding trees were festooned with plastic bags (there had been a flood recently). This devastation went on for sixty miles. Plastic bags, plastic bottles everywhere.
Wife just returned from BG two weeks ago. Says every single minor stream in the country is like that now. Plastic bags blowing everywhere.
Bulgaria pales in comparison to western consumption patterns. The only thing that differentiates us is better sanitation services. The amount of garbage that we are generating on a daily basis is absolutely staggering and is a ticking time bomb. And yet all we do here is filter everything through the usual silly little ideological lens: “Oh, another tax, blah blah blah.” Believe me, we will live to regret our profligacy and short sightedness on this matter.
Agreed. This is the end of the world. Get on the spaceship to Xenu.
/earth is full, please clean up your ecosystem.
http://www.bestlifeonline.com/cms/publish/travel-leisure/Our_oceans_are_turning_into_plastic_are_we.shtml
warlock: Great link — this should be required reading. From the story: “Except for the small amount that’s been incinerated—and it’s a very small amount—every bit of plastic ever made still exists,” Moore says, describing how the material’s molecular structure resists biodegradation. Instead, plastic crumbles into ever-tinier fragments as it’s exposed to sunlight and the elements.
Living in Hawaii as I do, I can attest to some of our beaches, where probably 1/10000 particles is now sand-sized plastic, especially on east-facing shores.
Amazing article/link, Warlock. Thanks.
I agree End, this should be mandatory reading and the picture of the turtle. OMG.
No need for all the junk.
I was in Uruguay a couple of years ago. The South Atlantic shoreline from Chuy south, for a hundred kilometers, has barely any development. What it does have, however, is all kinds of trash washed up on the beach. It was sad, but at least no one tried to downplay it by being a smart ass.
The CRUISE industry is notorious for dumping in mid ocean all their trash. They say “no” but late at night you, I am told, hear splashing and it isn’t the swimming pools.
Saw the same thing in Laos - simply endless miles of roads littered with bags and bottles. Should our collection systems falter, we will be buried…
I noticed the plastic bag infestation when I was in Israel last year. Even at one of the most moving, historic sites in Israel (the Monument to the Negev Brigade) plastic bags were blowing around. Ugh.
I saw a guy at Wal-Mart the other day (no, I couldn’t believe I was there either) put TWO plastic bags around a big package of toilet paper. He put one on and I thought “Ok, he’s gonna use the handles to carry it, I guess that’s ok” then he put ANOTHER one around it!! I felt like getting up and slapping him!
I tell the stores to put my stuff in as few bags as possible. They generally will give one bag per item as it’s easier on the cashier, but i can get a weeks’ worth of food in just two plastic bags.
I didn’t see my reply, so here it is again. I am sorry if you see it twice.
Yesterday I heard on the news - a San Diego channel - reported that they are considering charging either 15 cents or 25 cents per plastic bag you get from the store. California uses 9 billions bags a year. If approved, it will take effect next summer.
Hey, some of us never stopped re-using the plastic bags!
And some of us use them to pick up dog poop…
I like people who do that.
It’s great that you pick up after your dog. Though I do find it ironic that we are carefully storing perhaps one of the most biodegradable things in the world -dogpoop- into something that essentially takes hundreds of years to decompose.
I even remember after 9/11 when so many people thought life would be so different and that people were going to change so much. We were all going to be this warm fuzzy picture of 1950s domestic bliss. Everyone thought I was nuts when I said it wouldn’t last 2 weeks and certainly wouldn’t have any long term effect on day to day social life. Greed seems to always win out over morality. Remember we were told to go out and shop or the terrorists win?
In response to that “Since September 11, Everything Has Changed” mantra, I developed the September 11 Drinking GameTM. The rules were quite simple: Take a drink every time you heard the mantra.
No wonder my liver is almost dead.
What do you expect when our Commander in Chief asked everyone to do their patriotic duty and go shopping. If GW had gotten up and said our economy and use of oil has to change I think he could have moved mountains. Instead he told us to go shopping.
Look Ma, I was told to Go Shopping and I’ll I got was this lousy McMansion
Blah, blah, blah
*****************************************************************************
“Cohen has owned his 1,968-square-foot home in southeast Las Vegas since 1999. In 2005, the disabled dairyman refinanced his mortgage to pay off credit cards and ‘put some cash in (his) pocket.’”……
….. All your life, you work for certain things. You get them, and then they’re taken away because of somebody else’s dishonesty.’”
*******************************************************************************
This story is the same as all of the MSM stories.
Man has house. Man borrows much money from supposed house equity. Man spends money on credit card debt and to put some money in pocket. Bank wants money paid back. Man disavows knowing anything, seeing anything, hearing anything and it is “somebody else’s dishonestys (sic)”.
RE: Man disavows knowing anything, seeing anything, hearing anything and it is “somebody else’s dishonestys (sic)”.
Somehow I can’t find it within myself to bad-mouth a disabled dairy farmer.
Its fine to badmouth anyone who gets themselves in over their heads without doing their due diligence.
I bought a condo in 2006. Sure, my condo has depreciated. But you know what? Before I got into the crazy market I did research (all for free, easy to find on the internet) about mortgage products. I insisted that I get a fixed rate loan. I waited until I had 6 months of living expenses in the bank (not including the DP), and I waited until I could buy something that would be
Thats what i do when i want to buy an important purchase, i wait until i can buy something that would be.
Why do these people that lose their job or become disabled expect the bank to pay for their prior lifestyle ?Prior to the boom if people lost their job or became disabled they usually would have problems keeping up their prior lifestyle . This guy should of sold his house when the getting was good and he had equity instead of taking out a liar loan he didn’t deserve . While it’s true that the loan agent was a creep and she might get her due for her part in this fraud ,the FB also was betting on real estate going up IMHO . So many of these FB’s did not make the right choices based on the self-serving and often times fraudulent encouragement of the real estate industry ,but the borrowers do not have “clean hands ” in these loan situations either .
‘prior lifestyle’
- You made me spit out my ‘Little Debbie’ cake that I was enjoying for desert!
Here in SoCal everyone seems to be fixated on the imaginary lifestyles that are portrayed in the media. Somehow, there is a transubstantiation and they take on the lifestyle of their entertainment. The worst of the lot is the ‘rappers’…..they dream that they will be the next ‘20cents’.
“…the ‘20 cents’”.
LMFAO. Is that deflation, or something. I thought it was 50cent.
It’s pronounced Fitty cent if you want to be all Bronx about it.
“It’s pronounced Fitty cent if you want to be all Bronx about it.”
And exactly what language is that?
Bronx-ese, man! You gotta be smoove.
LOL. Very nice
Victimhood aside, if the lenders really did falsely state Cohen’s income in order to sell him a more profitable loan, would our dairy farmer have a case? And where does “good faith” come into this? Lenders shouldn’t be using their training to maximize their profit with these loans, any more than a doctor should order unnecessary medical tests to maximize his profit.
I wonder how many of the future jurors will be in foreclosure? The laywers will surely talk up the sob story aspect. And it may set precedent for future bailouts. The wild-card factor is that it was a cash-out refinance, not your typical first-time buyer trying to achieve the American nightmare. Popcorn in the courtroom!
How is Cohen going to prove that he didn’t know the loan was fraudulent regarding income ? This is a guy that was down on his luck and went for whatever he could get at the time IMHO. I don’t agree with the loan agent taking advantage of this guy ,but these borrowers were in la la land regarding these loans in thinking they could repeatedly refinance and live a life beyond their means .
Would this borrower of screamed “victim” had real estate gone up and he continued to pull equity to live off the increases ? People get pissed when the plans don’t work out as expected . I don’t agree with how the industry took advantage of these these needy cases ,or even committed fraud ,but it’s hard to believe that all these borrowers didn’t know they had a adjustable loan . It’s even harder for me to believe that the borrowers didn’t count on real estate going up to bail them out in the long run . In fact ,not only the lenders but the borrowers were counting on real estate going up to resolve all loan sins . Not to say that many borrowers weren’t victims .
The real estate industry sold the FB’s a song and dance about the riches of real estate and leverage and the FB’s believed it at the time .When you have the whole darn World believing the same real estate investment myths ,than what are you going to do ? The real estate industry should not of been allowed to sell home and loans on future price appreciation expectations .
Manias are usually curtailed by proper lending ,but we all know what happened . Do all the FB’s get the “Mania Defense” and tax dollars get wasted on bailing them out or do we just get about the process of getting housing back to the proper prices ?
Does it say some where in the Constitution or standing law that Americans have the right for a bail out because a investment bubble popped ? Lets face it ,the majority of people were believing that real estate always goes up and that lead them to taking out bad loans and taking risks they normally wouldn’t .
If fraud was involved with a loan application , than thats a matter for the civil or criminal Courts to decide IMHO . The whole darn REIC was corrupt as far as I’m concerned ,but you got to have proof in the court of law .During manias all parties to the transaction engage in the fraud ,based on a perceived gain ,so what are you going to do ?
“Everything was fine, Cohen said, until September, when his interest rate adjusted and his monthly installment swelled to $2,400 a month. He hasn’t been able to come up with a payment since.
Okay. Not trying to stomp the guy while he’s down. But everytime I hear this tale, I can’t help thinking the same thing–why can’t you at least come up with the same payment you were making before the reset, if everything was “fine” before? Why haven’t been able to make any payment at all since the increase?
aimee,
Good point and perhaps a question we should ask more often? If that were the case loan work-outs would be a snap! Oh, sorry you signed up for a 30 yr. mort but if that’s all you can afford to pay it’s now a 40 yr. (or whatever amoritization works out to be) Next! Yet all we ever hear about is “free rent”?
The problem is that after 30 years, the payment doesn’t go down much. Find an amortization cal on the internet and run it. For any amount, a 50 year mortgage will not cost much more than 100 or even a 1,000 year mortgage, since interest is what does you in on these monster loans.
OCDan,
Sorry if I lost a post there, and I agree. It won’t help much if at all. I’m just trying to brow-beat these people and put and end to the free rent/free ride.
I just don’t understand — does he honestly think it’s reasonable and fair for him to be able to continue living in the house without making any payment at all? No matter how dishonest his mortgage broker was, I’m sure she didn’t tell him the house was FREE.
OCDan,
Point taken, and I’m not oblivious to that. After all one of my major objectives is to help people get out from under their debt more quickly. Then…. there’s some people that are just beyond help. Many of these sob stories ARE! While I doubt seriously it would improve the borrower’s situation at least it would help put an end to the free-ride bandwagon.
Or even “free for awhile”.
Like I say, we have the “Pick-a-payment plan” and then we have the “Pick-to-not-make-a-payment-plan”!
Yes.
Everything wasn’t fine with this loan - everything was fine with the original loan he had. He decided to refi into a new arm loan with a reset to put a little cash in his pocket and pay off the old credit cards. I love how they all act like life was like a disney cartoon with all the little animals siging zippity doo dah and all of the sudden out of nowhere a meteor hit their house and changed their loans into these unlivable burdens.
“Cohen has owned his 1,968-square-foot home in southeast Las Vegas since 1999. In 2005, the disabled dairyman refinanced his mortgage to pay off credit cards and ‘put some cash in (his) pocket.’”
“Everything was fine, Cohen said, until September, when his interest rate adjusted and his monthly installment swelled to $2,400 a month. He hasn’t been able to come up with a payment since. He owes more than the home is worth.”
—————————————————————————
…and now this clown is sueing the lender…using the “If you put food in front of a hungry man he’s goping to eat it” defense!!?
Good luck with that!
How did a disabled dairyman end up in Las Vegas? I’m just saying. It’s been a year or two since I was there - but I don’t recall seeing any cows - several homo sapiens who resembled cows, yes, but actual bovines - no.
“I don’t think there’s any way in the world I can get in trouble for anything.”
Dude buys 5 houses with fraud loans and inflated appraisals to make room for huge chunks of cash-back at closing.
His only defense is that the devil let him do it.
“…AAA rated subprime mortgage bonds…”
oxymoronica
“‘We all know that we should not spend more than we are bringing in,’ Smith said. ‘But most of us are doing it anyway. And that’s hard to admit.’”
I’m not spending more than I take in. And I admit it.
Anyhow, jeeze, what IS all this whining?! Everyone seems to be a victim, is everyone also a moron? How do people as stupid as this get their shoes on in the morning; does it take a diagram or something? I can’t believe all these idjits. Maybe they exist only to make me laugh.
whut, u got shoes?
I am spending more than I take in….. and it sucks.
Olygal, you`re a gem. Are you married? Can you cook?
Better yet, can you fish? As in own a boat?
If you own a boat, can you post a pic of it?
Or a picture of yourself on the boat?
B…b..but spending more than you take in is GOOD !
“Wilma McCarter, an assembly line worker, bought the apartment she had lived in for eight years and three adjoining units. The apartment manager ’said they were selling,” McCarter recalled recently. ‘I said, ‘I’d like to get four.’ The next thing I knew, I was approved.’”
“MAKE that four town house apartments.. and err..umm..a Happy Meal to go. NOW !!!
LOL. The bubble truly was real estate reduced to the level of fast food. The bank should have asked if she wanted fries with that.
Hey, it’s worked for them before, why not now? You always go with what you know and these people have gotten by on whining before. Why stop?
who are “these people?” that have gotten by on whining before?
Yeah, Gal, I just get tired of it all too.
With every one of these sob-stories, I ask rhetorically - ’so, did someone point a gun to your head to make you sign the paperwork?’ and in every case the answer is ‘no’.
99% of them expend more effort on checking the bill at the diner than they did understanding the terms of the loan application.
I keep on hearing Flip Wilson in drag shouting “THE DEVIL made me buy this dress!”.
At least he was being intentionally ironic…..
It is easy to harsh on these borrowers. I doubt they are all stupid idjits. Many work in steady jobs and live normal lives. But they do not understand financial transactions. Many of these people were played or simply followed the crowd. The stories of the renters conned into buying their rentals are especially sad.
The loan brokers, realtors and most especially, the banks and the end purchasers of the mortgage backed securities. Those people should have known better and deserved to get screwed for malpractice - whether they can be sued is another matter.
Oh pulllleeeeezzz - most were played? They all jumped on the get rich quick through buying houses bandwagon and were happy as clams as long as the market was going up or their loans hadn’t reset from the “low introductory rate.” Most of them had decent loans on decent houses but chose to suck out the equity or move up. There are so few real victims of fraud in this whole mess.
This is the problem when there is an industry that doesn’t have fiduciary responsibility hiring the least educated people to hawk products.
Mortgage brokers should be licensed and tested, but that really didn’t work with the real estate agents did it?
Better yet, caveat emptor (or buyer beware)
Foreclosure = E-Victim
“Dennis Coyle, who earns $19,000 a year as a maintenance worker, He bought the unit he was living in. ‘The way they gave a deal, how could you turn it down with no down payment and you’d own a house?’ Coyle said.”
And yet another slack jawed yokel taken advantage of. It’s one thing to read about greedy yuppies trying to retire early on someone else’s buck and getting taken to the cleaners but when you’re going after dumb slobs making $19K a year thats really scraping the bottom of the barrel.
Excellent insight Mo.
This is why I really don’t think we have a lot of real reasonably qualified buyers setting on the sidelines. Lets say that only 1% of qualified buyers set this bubble out. This sounds reasonable. So roughly the number of qualified buyers today or better when we reach 3x income is 80-90% less than we had at peak ?
You don’t get a negative national savings rate without a lot of people being stupid.
You don’t increase homeownership rates by 5% without robbing say 10-15 years worth of people that could have eventually bought a home.
The bottom line is that very few Americans can now afford to buy a house and even after they drop to 3x average income this number won’t increase by all that much. Simply because of the other debt loads most people have coupled with destroyed credit/trust. To many Americans are now small time con artists.
To many Americans are now small time con artists.
—————————————————————-
I suspect too many Americans have been watching too much CNBC.
could it be a case of “monkey see, monkey do”?
Right on Denquiry. It’s the obvious outcome of the “all for me, f@$ck you” culture. And yes, we were led here. We didn’t magically wake up one morning and all of sudden become a dog eat dog society. So much for “free markets”.
It all goes back to the lack of real education here in the good ole USA. But the funding is reduced, the teachers are harrased, the parents sue, and the idjits get graduated out cause the Pres said “no child left behind” if they can pass tests but it ain’t not matter if they don’t know nuthin.
And then there are the real dummies who just never ever think things through to conclusion. And they come in all ethnic, economic groups. Lawdy hep us.
I am so impatient with idjits.
Ex.. it all goes to this society behaving as if its okay for “me” to do it but not you, and darnit, if “I” act like an arse, you should thank ” me ” for behaving like one. Be thankful “I” am in your presence at all.
I see that behavior all the time and just want to ask, didn’t their parents teach them good manners?
“Trial attorney Robert Cottle expects to file Cohen’s lawsuit within the next 60 days. Cottle is preparing several lawsuits against Realtors, lenders and appraisers — ‘a triangle of professionals, every one of whom failed consumers most of the time,’ Cottle said.”
A ‘triangle of professionals’? Try ‘an Axis of Weasels.’ Or an Unholy Trinity. ‘Professionals’ they most emphatically were not.
I’ll enjoy seeing this FB sueing the “professionals” who led him down the primrose fact, even though I hold him fully and solely accountable for the documents he signed and financial blunders he committed. Still, a jury of his slack-jawed “peers” could very well decide to stick it to the REIC, which would send shock waves and tremors of pure terror throughout this sleazy and corrupt industry. Let’s face it: nothing but lawsuits and the threat of massive financial penalties are going to force the REIC to start policing itself, just as the Catholic Church finally had to acknowledge and confront the deviant behavior of its priests. The Church did so not out of any concern for generations of molested youngsters, but to head off more ruinous jury awards.
So what noww…does Mr. Cottle sue for reduced payments? Back payments? Fraud? Or maybe a third of the house his client can’t afford.
While we’ve seen examples of borrowers with cases that could be more solid, it will be through lawsuits that the sleazier practices in the real estate industry may finally change. The industry isn’t going to voluntarily change. Elected officials, too many dependent on campaign contributions (essentially bribes) from the real estate industry, won’t force change either. Changes will happen as a result of lawsuits or they likely won’t happen at all.
Ben, I would like to see a topic dedicated to “bubble rewind”. Post some of the comments made and published in the media. You know, arguments against the existence of a housing bubble, assurances by the government that everything was fine, real estate leader crap, etc. Take us back to 2005 and 2006 so the new readers know what total bullshit was printed in this country every day 2-3 years ago.
This is one way to call these people to account for their BS.
How about a bubble timeline? Something that perhaps uses time as an x-axis and the quote-source as y-axis, and let it track what each group was saying, year by year, quote by quote. Maybe add a Case-Schiller graph, or ARM resets (or both) behind them, to help track the state of the market at the time. How cool would that be to distribute to the media?
I like how you think!
The apartment manager ’said they were selling,” McCarter recalled recently. ‘I said, ‘I’d like to get four.’ The next thing I knew, I was approved.’”
What did this woman think she was doing? Buying boxes of Bisquick during the monthly “stock-up” sale at Kroger?
‘I’d like to get four.’
Or was that how many bullets she’d like in the chamber when playing financial roulette?
Maybe there could be a top ten quotes of the week every week. Hers would have to be in the running for this week.
The rampant stupidity being continually exposed in these articles from all over the country is making me a little less proud to be an American almost by the week.
Take comfort in the fact that Brits and Irish and Spaniards and Dutch and Danes and Indians and a whole host of others have been, uh, equally smart.
The Swiss, the Germans, the Austrians weren’t on this way.
You couldn’t get a mortgage there without 20% down payment. It was mainly because refinancing there goes in a way which keeps the mortgage-giving bank on the hook. Only if this bank defaults the buyers of the refinancing have to take the mortgages instead.
It’s a century old system. Seems to have worked good.
I am seriously considering becoming an expat of Canada. The retarded koolaid drinking continues, prices are still going up, houses are still selling, the end is not in sight. Rents are skyrocketing as well, a place that cost $900 per month 2 years ago is now $1400 and this is for pretty wretched digs http://victoria.en.craigslist.ca/apa/643233952.html /
How is a young family like ourselves supposed to get ahead?
Southwestern BC & Vancouver has the disadvantage of having earned “Best City to live in” for several years running, and a boom of Asian millionaires.
Just wait until the global recession hits. My guess is that your bubble will continue until after the 2012 Olympics, and Canada starts raising taxes on entrepreneurs and the Canadian dollar strengthens.
My guess is that in retrospect southern BC will point to the peak in prices, and the bubble ending, no later than April 15, 2008.
When this is all over with the Germans might be right back on top too. There are always winners, even during periods of near global stupidity. I met a German couple in Austria a few years ago. They seemed to think Germans were the big winners after the USA folly in Iraq. Their thinking was that the big bad Germans were being replaced with the big bad Americans.
We helped people forget about Germany in WWII.
I can see the logic.
Blano,
agreed.
A out-of-state friend of mine owns a beachfront condo near Cape Canaveral. He wishes he could sue the local appraisers who ran up the valuations of other units in his complex. Those valuations caused his property taxes to triple because he’s not a homesteader, but there’s no way he could sell for the tax valuation and he’s convinced that the tax assessor is not going to lower his assessment anytime soon.
I still think it should be a law that any time your home is reassessed, the assessing authority must offer to purchase that home at that price within 90 days of the assessment becoming final. The property owner would then either pay tax on the higher assessment or be bought out by the state/county/town/whoever. Then the authority would either lower the assessment or buy the property.
I got ARM IN 10/04 but we knew on 10/07 it was going to reset. I knew about how much it was going to be then. But I always knew we made enough to pay the mortgage when it did reset. Because we purchase a house we want to stay in it was not for an investment. So I don’t feel sorry for anyone these people were aware these loan where going to change. I bet they ask the same question to there lenders we did and was told don’t worry you can just get a new loan. Bull is what I tried to tell my friend and relative who all got new house, one cousin purchase three new home in Las Vegas. If you don’t have the income for the original loan payment how the hell does refinances to higher mortgage do you any good. Now you just owe more and have paid fees and cost out of what equity you had to a third party how dumb are people.. Today everyone I know is back renting and surprisingly happy without those 3k loan payments plus TI. They are never going to own a home again because there income was never enough for even a 150k loan and never for the 360k ones they had. We are in still in our home but we’ve loss 35% of purchase value and 60% off 2005 value. But we always plan to be here for 10-15 years so if value comes back good if not so be it.
why not raise small claims limit to 75K then have
thunderdome- 2 men in 1 man out
who lied ? who cries
“Cottle estimated as many as 15,000 Las Vegans could have solid claims against sales agents, loan brokers and appraisers. Cottle agreed that home owners share some responsibility for taking out suitable loans.”
Just curious - are you trying to refinance to a fixed now? Are you able to do so? If not - what’s holding you back - equity or income?
I’m sure you’re handling it okay - but an ARM would make me nervous, personally.
We can’t refinances to a fixed for two reason. First home value will not support the loan balances of 275k. I will not put the difference up to refinances it I’d be a fool to. House across the street was REO last month for 202K. Second my ARM started @3.75 and now it is 4.75, but was up to 6.25 before recent Fed rate reduction. Unless rate go in to the teens we are able to absorb the increase albeit 8%+ is a big increase in monthly nut. But we live simple no kids at home and save a lot on our 401k’s so there is little wiggle room. Oh and we are old so our thinking was only stay until we retired in 15 years and give to the grand kids a partial paid for home to start out in. We had figure before the bubble busted that houses will be averaging 750k for 3/2 in LA by the year 2019 and impossible to buy with out family help. So we took a chance on this ARM just lucky we did not buy more than we could afford and yes I should have gotten a fix rate loan. We had the score but rate on ARM was so low COMPARE TO 6.25% fix the offer is. I figured I’d roll the dice and refinances to fix in three years. Did not work out like we plan but we are still ok.
“‘I’ve had people sitting in my office in tears because there are no loans available,’ said Goldman. ‘There are no loans for someone who’s upside down on their house.’”
Let them eat…
http://en.wikipedia.org/wiki/Upside-down_cake
Someone should of told these FB’s when they took out the toxic loans that there was no assurance that they could refinance . Of course the industry told people the opposite of the truth .I wonder how many people would of taken the loan they did if they knew anything about tight money markets .The real estate industry verbally promised people they could just refinance when the loan adjusted up .
I don’t know how Courts of law are going to rule on all this hype that went on during the mania .
They would have taken the loans even if they would have had to hand over their first-born male child. All they cared about was getting the house and the initial monthly payment.
PS: The oral promises mean nothing. Typically, real estate finance documents specifically state that any and all oral representations are meaningless. The only exception would be if the customer was blind, or could not read English, and the broker claimed to have been quoting the documents. In such instances I believe you would have a good fraud claim.
From Bloomberg. “The credit-default swap market has become a lesson in being careful what you wish for now that Wall Street has taken $245 billion of losses partly tied to such exotica. Rather than dispersing risk and lowering borrowing costs as former Federal Reserve Chairman Alan Greenspan predicted, the contracts have exacerbated the debt crisis.”
So let’s make sure to give the man pages and pages of coverage in the press and hours and hours of air time on TV. Sheesh, it’s like going to Rumsfeld for advice on Iraq.
Slightly OT, but the transmogrification of Austin in to just another Dallas-Houston-San Antonio continues….It’d be a shame if they were to allow billboards along Loop 360 or Bee Caves Rd.
http://www.statesman.com/news/content/news/stories/local/04/15/0415billboards.html
Note to self: write a country-western song using the word “transmogrify.”
“‘As Americans, we confuse our needs and our wants,’ Hudak said. And if you cannot stay in the house, then walk away in a manner that allows you to do so with dignity. Face the problem and sell the home before foreclosure, Hudak said.”
__________________________________________________________
If you loan to someone & they can’t pay you back, set them free..
If you get the house back it’s yours, if they wont leave-call the cops
(with apologies to J.L. Seagull)
“‘Measures that stimulate consumer confidence in the housing market, push the fence-sitters into the ring and put a floor under house prices can successfully halt the drag that housing is exerting on the national economy, and help stabilize financial markets at the same time,’ Seiders said in a statement.”
Wow. Wrong on all counts.
What will stabilize the market and industry is letting housing prices crash through the floor like an anvil through a tent; vigorously prosecuting loan fraud; publishing bank capital reserves and strictly marking derivative losses to the current market or zero value, if need be; and a trillion dollar class action lawsuit against the NAR and associates for fraud, misrepresentation, and conspiracy.
Just a slighly different tack than Seiders was suggesting.
I am very surprised the NAR and CAR have not been sued yet. Maybe they have, but I haven’t seen it. They should be.
No way these assholes get off without taking a hit for this. I would also like to see the newspapers and media outlets that ran endless stories (and quoted real estate insiders almost exclusively) get sued as well. Sue the entire rat-infested real estate complex.
Doesn’t the Department of Justice have the NAR in its antitrust sights?
Not sure, but that would be a good start.
push the fence-sitters into the ring OR put a floor under house prices
It is amazing how many REIC folks don’t understand basic economics.
When I see guys like MormonTea advocate a class action lawsuit against NAR and conspirators Leareah and Yun, I know we’re getting somewhere.
Thank you MT.
This is the part that drove me crazy:
“In the past two years, the couple’s income was cut in half — first when Scott, 54, went to culinary arts school and switched careers, then when Joyce, 49, lost her hospital administration job of 24 years. They tapped retirement savings and used the $200 their Marine sergeant son sends them each month to try to keep up with the loan modification.”
So, their son is (probably) in Iraq, and they are taking the money he sends home, and flushing it down the toilet? So he will have nothing left when/if he gets home? Grrrrrr……
When people lose their job they usually sell or get foreclosed on if they can’t get re-employed at similar wages . Why are the news reporters acting like normal misfortunes or bad choices is something the tax payers should bail out .
With all this bail out talk ,the FB’s are acting like the banks should support them in their home through thick and thin . They never should of started this bail -out talk . Let the lender do loan modifications if its in their best interest to do so on their own dime .
Now we have a guy who bought 5 houses with kick backs acting like hes a victim . What a crazy real estate mania .
Why did the guy change careers anyway? Especially culinary school? Despite what you see on TV, the average C.S grad makes about $20,000 a year in low paying line chef and chain jobs - if they can get them. Uncounted thousands are working fast food joints because they can’t find “culinary” work. Even upscale restaurants pretty much pay minimum wage to the help.
Biggest con ever. However, for many many, the only way out.
I’d argue that the best way to make money off cooking is to have a real job, and make food for yourself.
Culinary school is mostly a ripoff, and I speak as fan of the culinary arts, with probably 700+ odd books on food and cooking in my apartment.
I’m with you… Though I do love watch Food network and Bourdain on Travel Channel - Yayaya - I know, sellouts, but I still love em.
Don’t own a tee-vee.
Well, technically, don’t own a hookup to the system since I’m a movie buff so I do own a thing to watch movies on.
Watched Bourdain at my sister’s place on vacation. Entertaining for a bit. Got bored real quick.
I think the standard “pacing” of tee-vee bores the crap out of me. Just f*ckin’ say it, and if you don’t have anything to say, don’t stretch it out for an hour.
The whole cliffhanger-commercial-cliffhanger-commercial model is so unbelievably stupid when seen through the eyes of someone who hasn’t owned a tee-vee for two decades.
If I owned a tee-vee, I bet you I’d put a brick through the screen before a week was up.
A former neighbor decided to try the culinary program at our local community college. This is a very good program, and we neighbors found his “homework” to be quite tasty.
But reality intruded upon this lovely scene. He realized that he’d be making quite a sacrifice if he were to go into the culinary field. And he’d already made a similar discovery after he graduated from a university music school with a guitar performance degree: There aren’t that many gee-tar jobs out there.
So, he stayed in his office equipment repair business. He was quite good at fixing just about everything, and I’m sure his customers were happy to see him stay in the field.
Please tell me that all these folks that “didn’t know what they were signing(loan docs)”
will note be permitted to VOTE. PLEASE !
“There is a lot of stigma that surrounds foreclosure”
As there should be.
When Brad Cohen’s monthly mortgage payment jumped from $1,700 to $2,400 and the bank came calling with foreclosure notices, Cohen did what any red-blooded, meat-and-potatoes American would do. He called a lawyer.”
Which is, or course, a big, fat lie.
This red-blooded American pays his bills as agreed.
This low-life should take responsibility for his own actions and pay the bills he agreed to pay, on the terms he agreed to pay them.
How is it lawyers think that backing out or a contract is as simple as saying that the person who entered it really was deceived? A grown adult is responsible for their actions. If he didn’t understand the terms of the loan, he should have called a lawyer BEFORE he made the agreement.
I am very surprised the NAR and CAR have not been sued yet. Maybe they have, but I haven’t seen it. They should be.
—————————————————————————–
They get sued all the time but they got DEEP POCKETS for legal defenses and even DEEPER CAMPAIGN CONTRIBUTIONS to ensure that no systemic consumer protection legislation gets enacted.
Of course if this RE meltdown continues the way it’s been going…who knows what interesting surprises may occur!?
What this blog and others are documenting is the decay of a civilization fueled by greed, allergic to work, and willing to adopt a moral relativism thats suits their desires.
All these scumbags buying places like they were donuts should be exterminated. It would go a long way to solving our various problems: pollution, crime, traffic, etc. Less is more.
Kinda sounds like what happened to the Roman Empire.
http://www.azcentral.com/realestate/articles/0414gl-nwvlawsuit0416cover-ON.html
“1,000 homeowners sue developer Del Webb”
“Bob Leslie moved to Surprise’s Sun City Grand with his wife Barb seven years ago, picked up golf and settled down for a nice retirement. Then his house began to crack - on the ceiling, on the floor and out to his patio.
Leslie sought help from the developer, said he received none, and considered suing his last resort.
Now Leslie and owners of 1,000 other homes in the Sun City Grand retirement community are seeking legal action to repair alleged construction defects ranging from cracks in the foundation to insufficient noise protection.”
“‘The extraordinary declines in the housing and mortgage markets have greatly increased their credit and interest rate risks,’ OFHEO director James Lockhart said in a letter to lawmakers.”
—
You can tell how “good” all these changes are when every thing they do raises poor James’s blood pressure.
OFHEO: The “Lost Battalion” of the Housing Bubble Great War.