Pressured To Buy In California
The Ventura County Star reports from California. “Dark days haunted Mike and Kristin Bertrand after they learned they were losing their Newbury Park home. Mike Bertrand was skeptical of solicitations from real estate agents, brokers and scam artists. ‘It’s not like somebody gives you a handbook and says, Here’s how to go through foreclosure,’ said Bertrand.”
“Frustrated by the lack of support, the Bertrands decided to start Moving Forward, a nonprofit, peer-based group that meets every other Friday at St. Matthew’s United Methodist Church in Newbury Park.”
“The purpose of Moving Forward is to share ideas, and not to place blame on how it happened, said Kristin Bertrand. The stigma surrounding foreclosure can be overwhelming for homeowners. They often get criticized for making bad decisions and buying rashly. Many people facing what seems like financial ruin are afraid to come forward, not wanting to hear ‘I told you so’ by others who might have warned them about the market crashing.”
“Even though red flags in the market began surfacing in late 2005, some people probably felt pressured to buy after seeing home values surge in double-digit percentages from year to year. There also was a projection that the median sales price for a Ventura County home would exceed $1 million by 2010.”
“Kristin and Mike Bertrand say they were not casualties of the mortgage crisis, but of a faltering economy. When the couple purchased a home in 2001, their combined income was more than $140,000. They determined their mortgage, then around $360,000, was affordable.”
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
“Mike Bertrand has had job changes and had been out of work since February. He started a new job in mid-April with an annual salary of $62,500 — not nearly enough to afford the $4,200 monthly payment on a new mortgage.”
“He admitted that if they hadn’t refinanced, there is a chance the family could have stayed in the house. The Bertrands went into default last June. Three months later, the property went into foreclosure. The Bertrands are in the process of moving to another home they leased last week.”
“At one point, Mike remembers Kristin telling him, ‘We can’t be the only ones feeling this.’ They’re not. In Ventura County, there were 791 foreclosure filings in March according to RealtyTrac. And there were 2,415 filings in the first quarter, up from 1,514 a year ago.”
The Monterey County Herald. “As the national tide of foreclosures sweeps Salinas, hundreds of homeowners are reaching panic levels, many fearing they are becoming targets for scams. They are inundating the phones of local home-retention counselors, often burdening them with personal problems that come with financial woes.”
“Given the demographics of Salinas, most of those affected are low-income Latino families.”
“‘They’re undereducated, underpaid field workers,’ said Socorro Bernal, lead housing counselor for the Monterey County Housing Alliance. ‘They were given loans with negative amortization instead of being given a realistic number. A person who makes $25,000 a year should have never qualified for a $700,000 loan. It’s outrageous. It was designed for failure.’”
“Blanca Arias bought a three-bedroom, two-bathroom home in East Salinas for $595,000 two years ago. The cabbage harvester and her husband were struggling to pay $4,300 a month, but when she received a notice the payments would climb to almost $5,000, she decided to phone her bank.”
“‘I was calling and calling, they told me to wait, and finally they told me they couldn’t help me because they were helping those who were not making their payments,’ Arias said in Spanish.”
“With an estimated 822 bank-owned homes, 250 on auction or being sold by secondary lenders, and nearly 2,000 homes on the brink of foreclosure, according to the State and Consumer Services Agency, the market is saturated. Homes that two years ago sold for $600,000 are now barely fetching $400,000.”
“Congress is working on a rescue package that would allow thousands of homeowners to salvage their homes, but such aid is not likely to take effect for months.”
“‘We’ve heard people say we’re going to crawl out of this in five years,’ Bernal said. ‘Those loans, those funds politicians are (looking for), those should have been here yesterday. Tomorrow is too late, we need them now.’”
The Recordnet. “A national homebuilder is hoping for a sales boost for its 1,412-home Manteca development by heavily promoting an expansive clubhouse and recreation area with radio and newspaper ads and mailers.”
“‘We’ve slowed down,’ said Kayo Hagelin, VP of marketing in the Ripon office of Pulte Homes, Del Webb’s parent company. ‘The big challenge isn’t that they don’t want to live here. It’s selling their house so they can move here.’”
“Gregory Group president Greg Paquin said Del Webb’s ‘active adult’ community does give the developer a sales advantage by being able to tap into a built-in market of people who as potential home buyers ‘may be less influenced by some economic conditions.’”
“Del Webb is selling slightly better than the average project because of that built-in market, he said. ‘The caveat, though, is that a fair amount of folks, if not most of them, do have to sell an existing home first,’ he said.”
“Paul and Lana Duenweg are two of the approximately 500 residents of the Manteca community dubbed Woodbridge. After six years of looking, they decided to buy one of the first homes in the Woodbridge development.”
“Since they bought their 2,000-square-foot home for $425,000, Del Webb cut the price on that model to about $375,000, he said, but he and his wife don’t mind. The valuation on the Concord house they sold in order to buy in Manteca has dropped about $100,000, he figures.”
“‘You can’t time everything in life perfect,’ Duenweg said.”
The Daily Bulletin. “The 140 townhomes being built by J.H. Snyder near Holt Boulevard and Euclid Avenue are nearly complete and are expected to go on the market in June. The 160 so-called affordable apartments in the Ontario Town Square project will be close behind.”
“But the anticipated reinvigoration of the city’s downtown may take much longer.”
“‘As you know, the credit market has tightened up. So that’s making it more difficult for them,’ said Brent Schultz, Ontario’s housing manager.”
“Mark Smiley, executive director of the Chamber of Commerce, said he is thrilled with the work under way to liven up an area that in recent years has failed to draw many visitors. ‘The attention being put toward it is obviously a recognition that it needed a face-lift,’ he said. ‘I think it’s going to attract a different clientele.’”
“‘It will have a couple of restaurants, a coffee shop and a juice shop, and those types of businesses will attract people to come in and sit out on the patios,’ he said.”
“Today, however, several buildings are empty along the east side of Euclid, where Yangtze Restaurant and a few other tenants hang on next to bare lots slated for retail and construction at Holt.”
“Dave Puscizna, owner of Euclid Loan and Jewelry, said the city bought his property two years ago, and he’s waiting to move across the street. He says business at his pawn shop has actually improved with the downturn in the economy, but he thinks the activity in downtown won’t take off for a considerable amount of time.”
“‘Are people in California going to rush to get into places over storefronts? I don’t think we’re there yet,’ Puscizna said. ‘This could be a five- or 10-year deal.’”
“‘I guess in the long run the changes could be positive, but now it feels like everything is in limbo,’ said Sharon Baca, a 15-year employee of Gemmel’s Pharmacy on the west side of Euclid.”
The Union Tribune. “As the U.S. economy struggles to recover from the ongoing housing slump, the appraisal industry is undergoing changes designed to improve professional standards and reduce the temptation for appraisers to overvalue homes.”
“Freddie Mac and Fannie Mae, the largest mortgage purchasers in the U.S., have agreed to shield appraisers from outside pressure in an arrangement with New York Attorney General Andrew Cuomo and the Office of Federal Housing Enterprise Oversight.”
“In part, Freddie Mac and Fannie Mae have agreed to stop purchasing loans from lenders who use in-house appraisers.”
“Ted Faravelli Jr., executive director of the California Association of Real Estate Appraisers, said it’s unfair to blame appraisers alone for the decline of home prices. Pressure to inflate values came from all quarters, he said. Everyone from buyers and sellers to mortgage brokers and real estate agents had a stake in seeing home loans approved as prices soared between 2000 and 2005, he said.”
“‘I think there is enough culpability to go around,’ Faravelli said. ‘All of the participants should shoulder some of the blame. Many people were complicit. Everybody had some chips in the pot.’”
“Longtime San Diego appraiser Rick Foos served on an Appraisal Institute committee charged with reviewing the Cuomo agreement and an accompanying code of conduct.”
“‘You can have two competent appraisers who appraise the same property and have different opinions. Is it reasonable for what someone is willing to pay? If not, that’s the time you have to raise your hand and say ‘Something is wrong here,’ Foos said.”
“Appraisers who do so often find themselves under fire from clients, he added. When you tell someone a home isn’t worth an agreed-upon sales price ‘you are affecting the commission to a loan agent, you are affecting the commission to a real estate agent.’”
“‘The source of the problems is the highly incentivized nature of the mortgage business,’ said Sara Schwarzentraub, a La Mesa-based appraiser. ‘What will happen is a lender will call and say, ‘Gee, I see your range of value is from $550,000 to $575,000, couldn’t it be $580,000?’ she said. ‘Or they will call up and say, ‘Gee, do you have to make this comment about the condition of the roof?’ Over the time it becomes a big deal.’”
‘Ever since his election in 2005, Mayor Antonio Villaraigosa has been portrayed as a political comer with a future that possibly included the governorship…Until the real estate bubble burst, he oversaw a building boom downtown and elsewhere, casting himself as a visionary re-creating L.A. as a model of ‘elegant density.’
‘But when it came to that part of the city’s economy not connected to real estate, Villaraigosa might be compared to Emperor Nero. As the city has continued to lose thousands of middle-class jobs in aerospace, manufacturing and high-end business services since 2005, Villaraigosa has basically stood by and fiddled. From February 2007 to February 2008, the county suffered the biggest percentage of job losses– 0.7% — of the 10 largest metropolitan areas in the country, according to the U.S. Bureau of Labor Statistics’ most recent report.’
‘The combination of the housing meltdown and steady job losses in non-real estate sectors means that Los Angeles is now surpassed only by a handful of the bigger Rust Belt economic basket cases, like Detroit, for the title of worst big-city economy in the nation.’
Manifest Density downtown didn’t work out so well in the city of angles…
Building condos within easy reach of skid row needed a certain kind of urban pioneer that was willing to overlook squalor.
I know a guy who rents in downtown LA for about $1500/mo for a $900 sf studio, and absolutely hates it. He gave up his car and spends all day bored watching TV on the couch, though he can at least walk to work and has no automobile or liquid gas bills. Supposedly they were going to build street level retail and have a nightlife that rivaled Manhattan’s…thank goodness he didn’t decide to buy, and is just biding his time until his lease runs out.
That’s wild. Can you imagine, he can’t even drive to Pasadena or Santa Monica. I cannot believe he sold his car.
Did he tell you where he wants to move next?
Maybe NYC? Ben keeps posting articles about one place after another that wants to be like Manhattan. But they think all you need to do is put in some condos and apartments and you are all set.
Here’s a day in NYC. I get up, slam a green Monster. I get into a battle on the blog with Tim. I make lunch for my wife and I. We then get cleaned up and go for a walk. We walk the South Street Seaport and the over to Brooklyn Bridge. There is a demonstration for the 2008 Olympics so we decide not to walk the bridge. We go over to Battery Park City instead. We walk along the water, watching the boats and seeing the tall green chick with the torch. We stop at an outdoor bar for drinks and a salad. We then walk through Battery Park and back home. I am now checking out the blog and shared my thoughts on the legal profession (no offense, miss Chick). The little woman is taking a nap.
I have said it many times. I like this place but it’s not Fantasyland. Still, there are very few cities where you could have an “urban” experience like this. There is so much to see and do. It is more than just a bunch of condos and apartments. I’ve driven a car for one week in the past 3 years and don’t miss it at all. Can L.A. ever match that?
Hey, your day sounds a lot like mine!
Here’s a day in SE Utah. I get up, slam a cuppa mud. I read NYCityBoy’s and Tim’s battles on the blog (very entertaining). I make lunch for my dogs and me. We then get cleaned up and drive a mile or two out in the country and go for a walk. We walk the lower layers of the Morrison Formation looking for dino bone. There is a rancher moving his cattle, so we decide not to walk the other side of the canyon. We go over to the Chinle Formation instead and look for petrified wood. We walk along the Green RIver, watching the boaters and seeing the tall white geyser across the river. We stop at our outdoor bar (the car) for drinks and a snack. We then drive home. We check out the blog and read more of NYCityBoy’s gems. The little dogs are taking a nap.
See, NYC and SE Utah aren’t that different after all.
Utah, here we come. That sounds pretty good, too. It’s not a dry county. Is it?
Naw, no such thing in Utah, they just try to keep that rumor going so they can keep it all to themselves…
Wait! You weren’t referring to the weather, were you?
He wants to move back home to Tucson. I think he just takes a bus or taxi when he wants to go out, or has a friend drive him around. Not bad, except that downtown LA is essentially a wasteland on the weekends and evenings…kind of like Battery Park City in Manhattan.
And to think you sealed the Green River deal without even mentioning Ray’s Tavern…
LOL! Man, is that place crowded lately, boaters everywhere. I thought it was too cold! (Though nice today…)
I just bought GTA4 instead, way cheaper than the NYC rent and I can get away with murder!
I foresee a rent REDUCTION in his future, maybe $300 less per month will ease his boredom.
“Supposedly they were going to build street level retail and have a nightlife that rivaled Manhattan’s…thank goodness he didn’t decide to buy, and is just biding his time until his lease runs out.”
The dwtn boosters, city leaders and LA times have been running nonstop PR campaines to bolter dwtns image .
Every week it seems we have yet another article about this new development or that development which will change the face of dwtn. There was that grand ave project which has been put back due to funding problems. There was another recent article spiffing up the virtues of the grimy warehouse district(ugh!!).
They are having problems getting folks to buy into dwtn and for a reason. Dwtn is ugly, barren, ringed by fwys and barrios,and without a decent park to speak of. No riverfront or even a speck of a lake except the polluted concrete-lined & graffitied LA River, actually just an industrial drainage ditch.
Not surprizing that the city & county continues to bleed hi-paying job sectors. Housing way too high, much of the city is a third-world dump, and the city is taxed to death. They are talking about imposing all kinds of fees which will hit the small & large businesses hard.
Villarigosa is a flat-out failure, interested only in looking out for the cities immigrants and making sure every LA housing & urban development is green lighted.
Villarigosa is a flat-out failure, interested only in looking out for the cities immigrants and making sure every LA housing & urban development is green lighted.
Expect more of the same once he’s governor.
“Expect more of the same once he’s governor.”
Aieeeeeee! Flee! Flee!
I can’t imagine that bozo as governor.
Villaraigosa is the Yasir Arafat of SoCal. On English-speaking stations he’s all about “unifying” and “everyone’s Mayor,” but on Univision and the like it’s “La Raza” and “Amnestia.”
“Building condos within easy reach of skid row needed a certain kind of urban pioneer that was willing to overlook squalor.”
Then again, there are worse locations:
http://news.yahoo.com/s/ap/20080504/ap_on_re_mi_ea/iraq_growing_the_green_zone
I suppose there’s another reason to be grateful for the housing crash and related economic downturn. It might prevent this incompetent and corrupt politician from becoming governor. That would be an even bigger disaster. Sometimes the incompetence of a politician becomes apparent early enough to prevent a disaster in a bigger office.
I know misery loves company, but we’ve already got an incompetent and corrupt governor as it is.
Luckily he’s an ex-pat arty Austrian strongman type, so there is no way he can become our fuhrer in the future…
They often get criticized for making bad decisions and buying rashly. Many people facing what seems like financial ruin are afraid to come forward, not wanting to hear ‘I told you so’ by others who might have warned them about the market crashing.”
I have NO sympathy any of these A$$CLOWNS. They weren’t just warned by others, they were told they that they would be sorry.
And is sympathy what they need?
“Blanca Arias bought a three-bedroom, two-bathroom home in East Salinas for $595,000 two years ago. The cabbage harvester and her husband were struggling to pay $4,300 a month, but when she received a notice the payments would climb to almost $5,000, she decided to phone her bank.”
I ask you, what favors is anyone doing these folks by keeping them in 595K home. Okay, so you reduce the loan balance to 350K. I then ask you, what favors are you doing keeping a cabbage picker in a 350K loan. Okay, okay, so you reduce the loan balance to 250K. Once again, what favors are you doing a cabbage picker keeping them in a 250K loan?
End it now and get it over with for gods sake.
A spider and a toilet bowl quickly comes to mind.
“Kristin and Mike Bertrand say they were not casualties of the mortgage crisis, but of a faltering economy. When the couple purchased a home in 2001, their combined income was more than $140,000. They determined their mortgage, then around $360,000, was affordable.”
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
“Upgrades”
“Reduction in income”
They are not casualties of a faltering economy - they are stupid greedy low life fools living beyond their means and deserve every bit of scorn and contempt that can be heaped upon them.
ex-nnvmtgbrkr and crisrose: The Bertrands have been fallen farther than Blanca Arias - she started off picking cabbages and will end up picking cabbages. The Bertrands started off professional-level and will end up working class.
“It doesn’t matter how you got here,” said Bertrand, a campus supervisor for Banyan Elementary School in Newbury Park. “The point is to help you get through it.”
…Mike Bertrand, who builds and markets Web sites, has had job changes and had been out of work since February. He started a new job in mid-April with an annual salary of $62,500 — not nearly enough to afford the $4,200 monthly payment on a new mortgage.”
From the photo accompanying the article, most of the Bertrands income seems to be spent on food (even the children are fat).
Though a step above field labor, a playground ’supervisor’ and a website builder are hardly “professional level” - they are working class on their way to lower class.
Unfortunately, quite a few Americans will be joining them.
From Wikipedia:
“Villaraigosa failed the California Bar Exam in each of four attempts, and thus remains unlicensed to practice law.”
“Villaraigosa also serves as one of four national co-chairmen of Hillary Rodham Clinton’s 2008 Presidential campaign.”
“Before being elected to public office, Villaraigosa had a long career as a labor organizer.”
I don’t know anything about this guy but just seeing this information I’m wondering how he could possibly do a bad job. I’m shocked.
I didn’t even know he was a democrat
I didn’t even know he was a democrat
The Major is neither demo no repug. He is simply a power- hungry, headline- grabbing , smooth talking, self- seeking politico only interested in himself and climbing the political ladder. He could care less about actually improving LA or making it a more livable city or making it more attractive for businesses or middle class folks. In fact he knows nothing about business-building but does know how to extract bribes & favors from developers who more often than not trash their districts thru cramming abundant cheap condo- tracts into every nook and cranny of LA.
Good lord! The California bar is hard but not that hard!
Better think again; Antonio has made LA a ’sanctuary’ city with the illegals running wild.He wants to let them live (off of our money) and vote for him.
“Better think again; Antonio has made LA a ’sanctuary’ city with the illegals running wild.He wants to let them live (off of our money) and vote for him.”
LA was a sanctuary city for illegals ever since the 80’s. It has taken about 30 years for LA to descent into the third world craphole it is today. And 50% of the former middle class tidy burgs of LA have declined into heavily immigrant blighted slumburgs, including over half of the entire SVF, comcentrated mostly in the east half.
Villarigosa just rode the tide of this hugh growing wave of recent Hispanic immigrants into the mayorship. It would take the rare Presidential talents of a Roosevelt(either one) to clean up LA’s mess and Villa dosen’t come near close to that. He is a complete lightweight.
I just want to say in my opinion the problem is the type of immigrants LA has attracted. I’d say Orange County is heavily weighted to new immigrants generally form Asia, Europe or the ME. But overall wealthy except for part of the Vietnamese community. Same for Silly Valley. professional immigration is overall a good thing. Despite peoples complaints about H1B etc I have no problem competing with the world for professional jobs. If your good you make money. However we really don’t need one more poor mouth to feed etc in the US we have enough of our own. Don’t want to start a flame fest but professional immigration including skilled labor is not the same as cabbage pickers.
Well, of course Michael Emmel, the CEO, doesn’t mind H1-B folk. That’s how he pads his own pocket book!
“Despite peoples complaints about H1B etc I have no problem competing with the world for professional jobs.”
Yup, nothin’ quite like that race to the bottom (for working class citizens –CEOs and Richistanis exempt, of course). Personally, I embrace it!
“Sir, I don’t mind working 70hrs/week (uncompensated and “off the record”, of course), but I’m a little hungry. May I please have some more gruel? No? Well… back to the salt mines for me!”
Guys like old Tonio there have this dream of dressing in a quasi military outfit, with a shiny visored cap and relective mirrored sunglasses, standing on a balcony speechifying and gesticulating and being adored by the masses.
‘…dream of dressing in a quasi military outfit, with a shiny visored cap and relective mirrored sunglasses, standing on a balcony speechifying and gesticulating and being adored by the masses.’
That’s MY goal!
Hey, wait…I live my goal!
‘Course, ‘the masses’ is a bunch of frogs and a 200 year old giant moss-covered tree or two. They can’t clap for crap. Still, we all do what we can, after all. It doesn’t detract from the style, and that’s what matters, surely.
It probably wouldn’t hurt if some the Demos that get elected out there would support their aerospace industry, rather than attacking and trying to shut it down (either by not supporting programs, or by regulating existing businesses to death).
I guess Southern California gets what it votes for…3rd World status.
Middle class California gone with in 10 years as they just can’t keep up their cost increase from taxes rising, gas, etc, and manufacturing jobs gone money from service employment won’t be enough to continue living in a expensive state. Smart ones will move before the real exit starts.
alternatively, land values will go down to match the incomes.
I’m bailng from Socal but headed to NorCal. Not sure being that close to Socialist City (San Fran) is going to be a picnic either.
All this talk about people being warned. A year or more ago we were like heretics when we talked about real price declines. People would say prices are only going to flatten out. Other coworkers said “Its time to pull out a little more HELOC money” and called me a “loser”. Other guys asked me if this happens then what happens to X that bought recently?
There was plenty of bad advice out there. I work in aeropsace with some highly paid people. We had to keep our heads down for a long time. There are bunches of people with realtor spouses. Anything about the bad loans causing inflation could get you dragged to HR.
My company also had a retention policy and was offering 50K bonus to people to buy a house. I know a lot of young people took the offers. I begged a good friend not to do it and finally convinced him that it was not worth it. So, saved one from a horrible decision.
Otherwise its a damn mess out there. Plenty of bad or dangerous advice. Lots of buy as much as you can with maximum leverage. These are educated people too; not fruit pickers or laborers. And this was 2006 time frame…
Remembering how it was in 2004-2005!!!!!
I thought I’d get tarred and feathered and got a warning note from HR about bad mouthing housing.
Well we just made that jump a month ago (LA to San Fran) and boy are the people in East Bay drinking the koolaide BIG TIME!! The people up here make the Angelnos look like true bears! I’ve neve seen so many people who believe their houses are truly worth $1mil. It drives us NUTS!! And the smugness! It about makes you want to gag! I am really hoping these people go down HARD! All the boomers with their money and Mercedes and Porsches (we have 2 PAID OFF Bimmers) who think their stuff doesn’t stink is really annoying. We are hoping to find some people who have a clue here, but it is hard. We even got hit up about real estate at church today (needless to say we won’t be back!). They looked at us as though we were crazy when we said we would not pay 50% of our income for housing. This is really the twilight zone!! The only good thing is our jobs where the people are really nice and is a good place to work. The food is also much better here - other than that and the clean air you can have it!!
“There was plenty of bad advice out there. I work in aeropsace with some highly paid people. We had to keep our heads down for a long time. There are bunches of people with realtor spouses. Anything about the bad loans causing inflation could get you dragged to HR.”
The paper trail is crystal clear. Once the financial markets are stable the government will start prosecuting these mortgage and reality professionals who led the gullible public to ruin; it will take some time, but it will happen.
Sorry state of affairs when HR approves worker’s thoughts.
Amen regarding aerospace. I had several offers from the big ones in Southern Cal in the “80’s. I never gave it a thought. (2) folks , I knew took the offer up. $10,000 raise. Please understand that it was the 80’s. In any case they came groveling back in less than a year. Even then, prices were off the wall. AH Yes. You get rich with aerospace. After (40) years, I have only been laid off just (3) times. Only (3) you say. I have been lucky.
“Apparently, Villaraigosa didn’t see the economic downturn coming; he has already conceded that he didn’t recognize how precarious the revenues from the real estate boom might be. Had he known in August what he knows now, the mayor has said, he would not have approved big raises for city workers.”
Are you kidding me?? After the near crack-up in August, this buffoon okays big raises for city workers?? He has to wait an additional 8 months before he notices there’s a problem??
So who owns this hack…I’m assuming his PAC money comes from the building boyz, who like him because he’s completely stupid and has a latino name.
Here’s the real distance between NYC and LA…Bloomberg vs. a field hand.
Isn’t Antonio Villaraigosa the troll who used to post here with frequent ad hominem attacks on posters who doubted that L.A. real estate always goes up? Or was this a case of identity theft?
You mean it doesn’t go up forever?
Bwahh ! You’ll be telling me next that Santa Claus doesn’t exist.
Relax, Stan. Be calm. Santy C. exists, of course he does. He’s running around with the Tooth Fairy, after all, innit he?
I’m no fan of this guy, but c’mon, LA was a sanctuary city well before this guy came around, and he took office I think in June 2005. 98% of the real estate crack already smoked by then.
As it is, he’s presently running around fashioning himself as the “pothole king” filling in potholes.
Ya know, that’s good enough for me. That’s all I really want a politician to do.
If capitalism works by by allowing individuals the chance to succeed or fail based on their own efforts, and the pandering politicians want to eliminate failure, we take away a basic incentive for those who would take risk. What will we be left with, mediocrity?
I give you Antonio Villaraigosa…
Citizen Villaraigosa is typical of lightweights that accompany the run up. Apart from public speaking engagements of various sorts, what accomplishments of his can you name? That’s because there aren’t any. People like that don’t survive hard times unless they somehow figure out how to get things done.
Capitalism is about markets and value. Politics is about humbuggery and manipulation. Neither ever holds entirely over the other.
“Citizen Villaraigosa is typical of lightweights that accompany the run up. Apart from public speaking engagements of various sorts, what accomplishments of his can you name? That’s because there aren’t any. People like that don’t survive hard times unless they somehow figure out how to get things done.”
We have paid mightily for W having been governor of Texas during an economic boom for the country. Incompetence is more easily exposed during challenging times.
Read a biography on Calvin Coolidge… Hoover gets much of the rap for the Great Depression but it was really the Coolidge administration (or lack there of) that deserves most of the blame.
Imagine being ’ssshrubery nowadays?
He looks about a year older, every time I see him lying to a camera…
He is looking rather tattered, isn’t he? I believed him once, I’m ashamed to say. I mistook ‘hubris’ for ‘authenticity’.
I think lying is wrong. I do all sorts of other non-ten-commandment things, and am not too certain about judging others, but I think lies get you and eat you, in the end, so NO lying, and that’s that. At this point, I think the lies are tying on their napkins and getting ready for a ’shrubbery dinner, and the poor ol’ jug-eared dupe knows it.
“He looks about a year older, every time I see him lying to a camera…”
Scary thing is that he appears to believe his own lies.
One side impact of the Davis recall was that it exposed the incompetence and corruption of Cruz Bustamante who might have otherwise been in line to become governor following the Davis administration.
There’s no way that Villaraigosa should ever be a governor of California and I don’t want to be put in the position of having to vote for either for him or a Republican I can’t stand. I’d be happy to see his career as a politician implode before this could happen. Is Villaraigosa L.A’s Marion Barry?
If it isn’t Villaraigosa the next Dem candidate will be another Aztlanista. They will wait for the Governator to either step down or hit his term limits however.
Spoken like a true Objectivist!
Apparently, there is nothing wrong with privatizing profits and socializing risk these days. The only way to make a better life for yourself and your buddies these days is to create your own Ponzi scheme and drive the competing ones out of town, then cash in your chips when the tower starts to crumble. Ask Uncle Greenspan.
Now that was the best example regarding the USA going down the shitter I have ever heard.
My regards.
I know now after being a lurking tyro for 1 1/2 years on this site why I return. 99% of the individuals who populate this site, think like myself. Scary, is it not. That perhaps might not be a good deal. $700,000 for a (2) bedroom. (1) bath hovel in Richmond, CA might be a deal.
This poor man from “The Great American Desert” has been to Richmond. He has been to Gary, Indiana, Detroit and East Saint Louis. Did I stay long? NAH!
“What will we be left with, mediocrity?”
Cool. I’ll fit right in!
There’s a methodist to their madness…
“Frustrated by the lack of support, the Bertrands decided to start Moving Forward, a nonprofit, peer-based group that meets every other Friday at St. Matthew’s United Methodist Church in Newbury Park.”
That’s got to be a miserable experience once your house hits the foreclosure lists. I”m sure people are inundated day and night by amateur “investors”, various scam artists and the like, none of which can do a damn thing for you.
“That’s got to be a miserable experience”……
It is.
At least they’re focusing on moving forward instead of picketing banks and whining about being victims.
I know a halfwit real estate ‘investor’ who attempted to scam people who were about to be foreclosed. Didn’t quite work out for her. After the mortgage reset in November, her OWN house is now a ’short sale.’
he stigma surrounding foreclosure can be overwhelming for homeowners. They often get criticized for making bad decisions and buying rashly. Many people facing what seems like financial ruin are afraid to come forward, not wanting to hear ‘I told you so’ by others who might have warned them about the market crashing.”
This sounds like a “Weight Watchers” meeting, where you commiserate with and support the other poor obese souls about how miserable you are being fat, but are not allowed to discuss that you got there because of overeating and lack of exercise…
you obviously have not been to one of those meetings at WW.
It is usually about encouragement. Not pity, or commiseration.
Otherwise the offering at the front door would be a Pill like xanax for your coming or current depression over weight issues.
Well, now, that may work too!
I believe you’re referring to overeaters anonymous.
Do they give out xanax? Maybe I will go and bring friends.
Pills anyone?
How fun.
Just kiddin.
Thanks for pointing that out: I wasn’t knocking a real genuine weight watchers meeting, since I have never been to one…I was making an analogy about how ridiculous it would be to hold a meeting in that vein and avoiding discussion of something integral to why they are all there in the first place.
“Frustrated by the lack of support, the Bertrands decided to start Moving Forward, a nonprofit, peer-based group that meets every other Friday at St. Matthew’s United Methodist Church in Newbury Park.”
What is this?…..12-step recovery for FB’s?
“Hello, my name is Kristin, and I’m a FB”
Step 1 - Admitted I was a speculating moron, and my life is unmanagable
Step 2 - Came to believe that a power greater than myself might be able to remove the JT spines permanently wedged in my anus.
Steps 3 thru 12 I’ll leave to the rest of you. Have fun with it, ’cause I’m going golfin’.
“His Westlake Village company buys property from people in default, and gives them a chance to stay and rent their homes. Those who choose to do a short sale have a lease option to buy back their homes at market level after a set time. If the former owner does not wish to buy, Kaufman can sell to a different party.
The rent-back program typically lowers the cost of shelter by 40 to 45 percent, which might allow some families to squirrel away enough savings to buy back their homes, Kaufman said. He’s currently in this process with 21 homeowners in Ventura County.”
The new Mr potter of “its a wonderful life” and based in Westlake Village were else? I know of a Broker on the lake I wonder how hes doing? he was making buckets of money and had many celeberity investors.
testing to see if my ISP is still blocked!
Yep, still blocked. Sorry.
comments from yesterday, but worth repeating.
I agree with the comment that was made about people and entitlement. It is down right scary what people seem to think. They borrowed $500K. The owe $500K. The fact their POS is now worth $250K is irrelevant to me. They GOT $500K and chose to spend it on an overpriced Mc$h!tbox is their problem
If they get their loan balanced reduced, I want Mozillo and Countrypuke to reduce mine in half. Fair is fair. Now, I bought something I could afford. Payments current. House worth more than loan balance for me is irrelevant. I DEMAND a loan renegotiation. LOL.
This sounds right, but in practice has no value. The town drunk may be an easy object of derision, but spending public money to find him a place to pass out may be cheaper than attending him with emergency responders, first aid from the hospital, and preciously expensive jail time.
People are calling foul on a fraud scheme. Appraisal shopping and other techniques are also junk for which people bear responsibility. Cheap houses were sold as expensive, so redo the loans. All of the pros involved with this should bear the burden as well. A society full of safety nets may be a bummer, but that is the only way our society works. Without the little sign that says “wet floor” next to the mop person mopping people walk right by, slip, sue, and profit. The housing industry needs better wet floor signs, and there shouldn’t be any problem getting banks and others who profit from the trade to pay for all that.
We know from John Rockefeller that markets left to themselves operate in ways that are bad and self-defeating. That is why we continue to police monopolists. Because markets need boundaries and guidelines to work properly.
As Forrest Gump might have said:
‘”Sometimes there’s just not enough places for drunks to pass out.”
They GOT $500K and chose to spend it on an overpriced Mc$h!tbox is their problem
WRONG WRONG WRONG
No one handed these idiots $500,000.00, They were handed the keys and a stack of paper only. Hand these people real money and they disappear before the closing
Actually the Bank bought the house for the lendees, “banking” them on repaying them their money with the “interest” as compensations.
So it’s the BANKS problem — along with their subscribers — that their attempt to live parasitically off of wage earners (just looking for a place to live and raise their kids) should not turn out.
The banks could go back to the way it was 20% down, 33% DTI, but they changed the rules so now they can lie in the bed they made.
Actually, if you have CDs or some money in money market account that holds MBS, you may find out it is your problem.
With 9:1 lending my $10,000 CD should give the bank $90,000 x 6% = 54% return. No need to get clever and lend my $10,000 to migrant farmworkers fer chris’s sake.
RE: I want Mozillo and Countrypuke to reduce mine in half. Fair is fair.
NO….NO bail-out for YOU! (done in the Soup Nazi tone)
“I give you Antonio Villaraigosa… ”
—————————————————————
I went to a rare Dodger game last week at Dodger Stadium (downtown LA) and was again reminded of how “3rd World” Los Angeles has become…and to think that craker box houses in LA were selling for as much as $ 600 k is truly mind boggling.
LA’s in the process of crashing and buring.
I grew up in the OC, and visit regularly.
OC is crashing and burning too…in my view the quality of life is even worse than Los Angeles: Overpriced supersized McMansions in a vast cultural wasteland of overbuilt and overcrowded malls, McJobs, and day-round stop and go traffic is not worth it. It is ground zero for FBs and financial market corruption in CA. Plus the keeping-up-with-the-Jones attitude is far more prevalent in the fabled OC.
Life behind the Orange Curtain is not nearly worth the premium that is put on it. They have a much harder crash coming than LA does.
I love the far north part of CA, but the rest of it appears to be more or less entirely icky, in my observation. That’s a technical term, by the way.
When I used to visit my sister in San Diego–she moved to a different urban crap-hole, that would be Happy Valley, SLC, the Land of the Righteous, to go to grad school–anyway, when I visited her there in SD I would spend much of my time pawing at my eyes and blinking and complaining about the pain, and the rest of the time dramatically wheezing and wondering aloud if the car wash could provide some lung lavage, if I inhaled one a them pressure washers. Sweet Baby Jeebus, the quality of air, water, general surroundings was such that I wouldn’t inflict it on a goat. On an evil goat, even.
I was glad when Rachel left to go to a place with better air.
Oh….wait.
San Diego has good air quality because of the ocean. Are you sure you aren’t allergic to pollen?
What? Good..air…qual…?
That’s my sneery face ‘what’. You must live in a different parallel dimension SD than the one I visited. Does your SD also have free magic ponies with colorful rainbow wings? A chicken in every pot?
Goshamighty, I about hawked out 3 extra lungs, the time I was there. This is before all the illegals stole them right out of my body when I glanced away.
You must have allergies.
Does your big IQ tell you that? Because my big doctor, whom I know better than I know your big IQ, tells me that I am as inert as gold (AU).
I asked him on the subject, because I said, ‘I’ve sneezed a bunch lately and fel poorly’, and then he said, ‘Well, have you slept much for the last week? Or longer than that?’ and I thought and said, ‘No, I’m busy. There’s lots of wetlands to save and stuff like that,’ and he said, ‘Well, I told you to sleep, didn’t I,’ and I said ‘Why don’t you just give me a pill of some sort, because it’s pollen season, and it’s extra heavy this year I understand from the media?’, and he said, (first the ‘inert as gold’ thing,) and then moved on to: ‘I’m not giving you a pill. Stop sleeping around and fussing about stuff you can’t help. Anxiety is a terrible stress on the body’. and I said, ‘But there’s a wetland right upslope of YOUR house, don’t you care what happens to it?’ And he said, ‘What wetland?’ And I said, ‘Oooooh, wait! Haw har! Let me just run out to my carrrrrr, Mr. Smarty-Doctor Mannnnnn…’. But it turns out I didn’t have those files in my car, contrary to expectation. They were back in my office. I’ll bring them by later.
Look, the point is, I don’t have allergies. Or maybe I do. I forget the point here, but anyway, I bet you have allergies, too!
“Look, the point is, I don’t have allergies. Or maybe I do. I forget the point here, but anyway, I bet you have allergies, too!”
How very Seuss-ian! Well played.
Olympiagal:
Go to one of those government air pollution websites. I was going to give you a link earlier just to prove my point, but it’s gone from my clip board now. You’ll see that San Diego does not have bad air quality. When did your doctor tell you that your weezing and coughing problems were from bad air in San Diego? I think you forgot to relay that part in your story. Did the coughing and red eyes happen at the same time that you were smoking pot?
Olympiagal:
My other post got eaten, so I’ll repeat myslef. Your story is very cute and sarcastic. However, you never got to the point where your big doctor told you that your eye problems and coughing were due to poor air quality in San Diego. Go to one of those government websites that track air quality. Your doctor in Washington may not have tested you for the type of allergens that are common in Southern California.
I grew up on the borderline between el lay and the orange curtain, and the OC went from being a place where they grew a lot of oranges when I was a lad, to being a showplace for telemarketers to ply their trade.
A bright and shining example of money for nothing and your chicks for free…
I’m sorry to hear it, lad. I don’t know if you loved the place of your childhood, but if you did, well; it is terribly painful to watch the mistreatment and defilement of a beloved home. I mean the whole county, not just a single homestead, as a ‘home’. (I have a very expanded personal space, normally about a county wide area. I consider it all ‘Mine’, which of course means I have a very long and complicated ‘To Do’ list.)
When I was a lad, I had vast swaths of backcountry to play in, build forts, & swing from 4 inch thick ropes suspended on the limbs of oak trees on the side of a hill. (Tarzan had nothing on us)
My play area got filled up with suburbia, so I had to move my sandbox elsewhere.
L.A./O.C. seems like some sort of vague beige Hell to me, nowadays.
Aladin and Olympia, my wife and I discuss this often. Having moved to Seattle, we realize the only way we could return to the LA we love is if we build a time machine.
Once you’ve made a clean break past the wire and can see with awesome clarity what a hellwhole you’ve left behind, there’s no reason ever to go home, again.
I loved it as a kid, but used to wish all the houses and bldgs would disappear and leave the trees. Sadly, the trees were planted by people because SoCal is pretty barren by nature.
Place where I grew up, Eagle Rock area, was great circa 1920. I’ve seen pix. But subdividing came hard and heavy after that.
I spent a few weeks in OC doing some consulting for a company there, they rented me a nice apartment, I’d go for a walk near the apt. and have people stare at me (yeah, I AM good-lookin’, but not THAT much…lol). It quickly dawned on me that for some reason I was the only person walking around. I like to walk, so I’d DRIVE over to the nearest subdivision and walk around there, hoping to not be so obvious.
Now, is the OC really that car-based, or was it the magenta rhinestone cowgirl hat and boots I borrowed from Olygal…
Its the rhinestone cowgirl hat and boots from Olygal..
No one dresses up in SCal. And when I moved back to S.cal from NYC, I was the only one walking in SMonica during the day or evenings. It was downright scary.
NO one walks. Few exceptions.
It had to be the rhinestones.
Add Charleton Heston, Edward G. Robinson and a few other notables, and you have the southwest version of Soylent Green.
(For the youngsters: http://en.wikipedia.org/wiki/Soylent_Green )
BayQT~
‘…the only way we could return to the LA we love is if we build a time machine.’
Well, come on down to Olympia one a these days. Me and the frogs is working on it. It’s idle practice for when we start gearing up for the big devices.
“Having moved to Seattle, we realize the only way we could return to the LA we love is if we build a time machine.”
Ah, but ya see, what do you think all the native Seattle-ites are thinking about all the homes going in - and farms and forests being paved - to support an influx of former Angelinos??
There also was a projection that the median sales price for a Ventura County home would exceed $1 million by 2010.”
And just what was the average salary prediction? $300K? Sure, Countryfried was willing to pay a secretary $200K.
There is nothing more dangerous than a few morons with graph paper, a few sales data points, a straight line ruler and an agenda. I guess it was too difficult to graph incomes over the same time period.
What about all those retired rich Americans, Foreign rick buyers and HI-B employees that B. Gates wants to bring to the USofA. Can’t they afford all those $1,000,000 homes in CA?
After living in Westlake Village for a few years I still don’t really get it. Ventura County to me seems like an Oklahoma experience with a California pricetag. I don’t wish to bag on Oklahoma but I did grow up in Kansas so I can’t help it.
“Blanca Arias bought a three-bedroom, two-bathroom home in East Salinas for $595,000 two years ago. The cabbage harvester and her husband were struggling to pay $4,300 a month, but when she received a notice the payments would climb to almost $5,000, she decided to phone her bank.”
Wow, she has lasted more than 2 years so far! I wonder if there is more profit in harvesting cabbages than strawberries?
Hey!..The cabbage patch in Salinas is different
How long did the strawberry picker last with his mortgage? I don’t recall.
BayQT~
Big Question:
Does the white bus hauling the port-a-potties stop in the neighborhood to pick them up along with the other farm workers?
TIA
Pick em up??? They drive their brand Cadillac Escalade to the job you fool..Don’t you know anything
What I do recall about the strawberry picker was that he made only $15K/yr. The cabbage harvester and her husband “were struggling to pay $4300 a month” so I supposed their joint income must’ve been at least $80K/yr?
Hmm bet they took out a HELOC to help with the “struggle”.
Or they where into a different type of cabbage to help out.
Wonder how many drug dealers went with the no doc loans ?
This has got to be a new HBB classic!
Cabbage harvester, indeed!
I worked for the telephone company in CA. It was the largest private employer in the entire state. Ave pay was $40-80K for the majority of the workforce. A few higher-up got maybe a $100K or more. The telephone company was considered a good paying job. This would have included many jobs in Ventura county. Who are they thinking was going to pay $1M for an average house. Certainly wouldn’t be the highly paid telco workers (at least the smart ones - enough of them drank the koolaid and are now foreclosure folks).
No not the phone company or even the firemen It was “Amgen ”
I wonder how that working out for them ?
Kristin and Mike Bertrand say they were not casualties of the mortgage crisis, but of a faltering economy. When the couple purchased a home in 2001, their combined income was more than $140,000. They determined their mortgage, then around $360,000, was affordable.”
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
So, if I look up the term “DUMB$H!T” in the dictionary, am I going to see a picture of these buffoons? No sympathy for these folks.
“Frustrated by the lack of support, the Bertrands decided to start Moving Forward, a nonprofit, peer-based group that meets every other Friday
maybe he aint all that dumb.. created a job for himself.
Not really. Nonprofit group. The service he is providing is free. His new job is paying him $62,500.
BayQT~
Free? FREE?? His fellow FBs will fall for that again, but there’s no way I will. Nothing is free, so they will either pay or they will get nothing!
hehe.. i’m just kidding.. well, half-kidding.. you’re right .. evidently the services are free except for the occasional speaker.. but a “non-profit” is certainly allowed to make a profit. They can and often do pay large salaries.
Large salaries (and we don’t know what “large” really is here) for the key positions only.
BayQT~
A while back i remember reading something about Elizabeth Dole’s salary for the Red Cross.. some hundreds of thous.. 400? 800K during some of her years? But she was a money magnet and able to bring in multi-millions in contributions.. so who cares.. I don’t.
“But she was a money magnet and able to bring in multi-millions in contributions..so who cares.. I don’t.”
I do. I guess that money I sent to Tsunami victims actually went towards a new handbag, one that was probably branded in France and made in China. I have more respect for the cabbage harvesters. At least they give us coleslaw.
The faltering economy isn’t what did these @sswipes in. It was their inability to live within their means.
Hey Need: And note that they almost admit if they hadn’t refied, they probably wouldn’t be losing their house. I suspect we’re going to find out the vast majority of foreclosures were originally reasonable homes with reasonable mortgages where the FBs sucked the equity out and now owe more than the current value. Sympathy? I think not. I wonder how long it takes before the first thought upon waking is “OMG what have I done.”
that assumes they can fall asleep.
The lady at the checkout counter the other day was having a hard time.. taking too long and talking too loud.. repeating herself.. the forced, fake smile.. overall, a pained expression with big, sad bloodshot eyes.. essentially had FB written all over her face.
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
Why do people think taking out a loan is income? A firend of mine, who is out of work, says he is okay for at least two years if he can’t find a job. He says he has a $150K LOC he could tap into when he needs it. I asked how is he going to to pay it back if you don’t job. I secretly hope the bank takes back the LOC soon.
“But they refinanced a few times, taking out equity to pay for bills.
Translation: For several years they spent more than they earned by borrowing. The loans were easy to get because they paid high fees and put their house up as security.
“Blanca Arias bought a three-bedroom, two-bathroom home in East Salinas for $595,000 two years ago. The cabbage harvester and her husband were struggling to pay $4,300 a month, but when she received a notice the payments would climb to almost $5,000, she decided to phone her bank.”
This type of anecdote still beggars belief. Speaking from experience, even with a milllion in liquid assets, I’d think twice about tying up that much money in a house and all its obligations. Even with a million in assets, I still would not be comfortable buying a house for that kind of money.
10 years ago, the same people could not afford a $100,000 house yet suddenly they believed this would all work out …
My custom spreadsheet says a $600K loan has a monthly carrying cost of around $3000.
Insane lending was the cause of this price boom, 2004-2006.
DUMBasses, from our president for instituting his “Ownership Society” program to this field worker in E Salinas and everyone in between. A nation of MORONS.
Wouldn’t that be closer to $5,000 if you are factoring in mortgage, utilities, taxes and upkeep? Your $3,000 seems awfully low unless it is one of those whacky-weed loans that funded the enterprise.
I’m counting the interest and property tax deductions ($1300/mo), and yes, not counting principal repayment (~$600/mo) since that is a form of savings.
But it’s not a form of savings if the house is decreasing in value. Maybe you need to add on to the monthly nut to account for depreciation of price.
Plus, if a couple is subject to AMT they may not even get the interest deduction.
In a normal market, ie. one I would buy into, valuations at least beat inflation.
All my friends who bought 1994-2003 are sitting on 100 thousands of free equity.
And the AMT still lets you have the interest deduction.
In a normal market, ie. one I would buy into, valuations at least beat inflation.
Schiller chart (going back to 1890) says otherwise.
And the AMT still lets you have the interest deduction.
Mostly true, unless you increased the balance owed when you refi’d or HELOC’d:
WASHINGTON — Qualified housing interest, which generally is deductible for alternative minimum tax purposes, includes interest paid on a mortgage that has been refinanced more than once, the Internal Revenue Service confirmed today.
In Revenue Ruling 2005-11, the IRS stated that interest paid on a loan that is refinanced more than once will retain its status as qualified housing interest, to the extent that the amount of the loan is not increased.
http://www.irs.gov/newsroom/article/0,,id=136889,00.html
I’m amazed that they managed to make even one $4300 payment between them. Cabbage picking must pay more than I thought.
I’m willing to bet the cash back at closing made the payments.
If his wife was good looking but only had one eye, would that make her a cabbage patch doll?
Marry me, houston! Seriously. I can cook and I’m cute.
There could be other significant qualities, but I think those are the most important ones, right? Right.
Also she was a dwarf with a flat head top. I think I’ll stop here. hehehehehehe
It boggles the mind that people who refuse to invest in the stock market (”too risky!”) will turn around and chain themselves to a large, illiquid piece of “equity” of which the value may easily drop 30%-50%.
If you’re going to speculate, why not at least diversify one’s speculations?
Because recently it was possible to speculate using almost entirely other people’s money, if you confined your speculation to houses.
East Salinas is gangland, too, so they’re getting drive-bys delivered right to the doorstep of their $600K home, free of charge, without even asking. Salinas is in the middle of a gang war right now.
The foreclosure.com stats on Salinas are amazing. This fall and winter are going to be a real estate slaughter to match that on the streets.
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
I wonder when the change in thinking happened? In the past, when you lost your job or had similar salary reductions, you reduced your expenses. Instead, people took out gigantic loans to cover lost income? Crazy.
Not so crazy when the big banks made borrowing OPiuM (other people’s money) essentially free.
Banks, lenders made “their ” money! That’s all that counts. Hell with the future. Scam set up government [taxpayers] would bail them out. Put on the sun glasses. Everything is alright. Bonus, fees kept and no harm done.
make money? hmm.. My calculator might be broken, but if i subtract a loan amount from the loan-fees it spits out a relatively large negative number.
So, the lenders must have not only planned on forever rising RE prices, they must have also predicted a govt bail-out if prices should fall.. jeeze.. those guys are sharp.
that’s why they have all the money.
Don’t forget your downpayment assistance — more of OPM used to help deals go through that never should have. I am guessing lots of bank profits in recent years came out of downpayment assistance that helped unqualified buyers purchase homes they could not afford with no skin in the game.
“Kristin and Mike Bertrand say they were not casualties of the mortgage crisis, but of a faltering economy. When the couple purchased a home in 2001, their combined income was more than $140,000. They determined their mortgage, then around $360,000, was affordable.
____________________________________________________________
“A hallucination is a fact, not an error; what is erroneous is a judgment based upon it.”
Bertrand Russell
Sooner or later even without a faltering economy they would have borrowed their way into a corner, it’s just the way they handled their finances in general that was at fault.
I am sorry to say that this nation’s adults are worst than children. Unwilling to assume responsibility. Short attention span. Spoiled. Uneducated. This is the type of an audience that business wants to sell products and services of no real value at a high cost.
“The…Ontario Town Square project…will have a couple of restaurants, a coffee shop and a juice shop, and those types of businesses will attract people to come in and sit out on the patios”
Very bad idea to be sitting outside in Ontario. I worked in downtown Ontario for a short time in the early 1990’s. The office hired an armed security guard to discourage any more gunfire aimed at employees exiting their vehicles in the company parking lot. There were still lots of car windows shot out, though. It was a scary time till I got the hell out of there.
What I don’t understand is, how do they line up the businesses to lease these spaces? I mean, who’s dying to move in - who would commit to it, and how viable are their business plans?
They’re always planning sh!t like that here, too - condos abov,…”and the ground floor will have several retail spaces…” Oh yeah, gimme three of those.
So…since you left, the place is safer? Or am I reading that wrong?
Who could ever resist becoming their very own landlard?
“A national homebuilder is hoping for a sales boost for its 1,412-home Manteca development by heavily promoting an expansive clubhouse and recreation area with radio and newspaper ads and mailers.”
“‘We’ve slowed down,’ said Kayo Hagelin, VP of marketing in the Ripon office of Pulte Homes, Del Webb’s parent company. ‘The big challenge isn’t that they don’t want to live here. It’s selling their house so they can move here.’”
“The purpose of Moving Forward is to share ideas, and not to place blame on how it happened, said Kristin Bertrand.
Ummm…if you don’t own up to the fact that *you* got *yourself* into this mess, you’ll never learn.
What they should be doing is starting with step 1:
“Hi, I’m Kristin, and I have a problem with money.”
“The purpose of Moving Forward is to share ideas, and not to place blame on how it happened, said Kristin Bertrand…Mike Bertrand…admitted that if they hadn’t refinanced, there is a chance the family could have stayed in the house.”
*sigh*
As an aside, one of the (many) concepts that I drum into my children’s’ heads is that it’s OK to make mistakes; making mistakes are actually one of the ways we learn.
What I tell them over and over is that it’s OK to make mistakes, as long as you:
1. tried your best to avoid the mistake.
2. LEARN FROM IT.
Part of learning from it involves admitting that you made the mistake in the first place.
We want our kids to not be afraid of taking some risks…but we don’t want them to blame someone else when taking those risks leads to unpleasant consequences. Otherwise, they will never learn from them.
“‘They’re undereducated, underpaid field workers,’ said Socorro Bernal, lead housing counselor for the Monterey County Housing Alliance. ‘They were given loans with negative amortization instead of being given a realistic number. A person who makes $25,000 a year should have never qualified for a $700,000 loan. It’s outrageous. It was designed for failure.’”
I thought the strawberry picker who bought the $700,000 loan with $25,000 in income was from Gilroy. Perhaps this phenomenon was common throughout the California agricultural sector?
Gilroy? Isn’t that the garlic capitol? We watch Food Network, on occasion.
Gilroy is the garlic capital but the
strawberry pickernose picker was from Hollister, CA.Close but no cigar.
Here’s the link to the original article.
Thanks for the reference and the correction
It used to be, but who knows these days?, they’ve probably subdivided all the garlic fields and now have to ship garlic in from China for the annual garlic festival.
“‘You can have two competent appraisers who appraise the same property and have different opinions. Is it reasonable for what someone is willing to pay? If not, that’s the time you have to raise your hand and say ‘Something is wrong here,’ Foos said.”
That sounds like a reasonable appraisal standard, unless lenders are handing out $700,000 loans to field workers with $25,000 in income. I suspect lots of similarly-qualified field workers were willing to pay some hefty prices before the subprime lending sector imploded.
Market update from the central coast…there are now a few (2?) houses for sale at under $300K in Arroyo Grande. I haven’t seen that in quite a while. House sales are still happening in the area, but I don’t think that the spring selling season has taken off like some were hoping. Welcome to year 3. A close friend originally had his house listed in high sixes, now reduced to high fives, after being about 6-9 months on the market.
Nice photos on your link, AG.
Similarly, in Morro Bay, there are now some actual houses under $400K and some condos under $300K, and twice as many units under $600K as the average 2006-2007 inventory in that range.
How are things in Cayucos? I stayed at a ranch up in the hills there when I was a kid, circa 1962. That was paradise back then.
“But they refinanced a few times, taking out equity to pay for bills. It compensated for a reduction in income, tens of thousands of dollars in loan fees and for upgrades.”
This seems to be a running theme. Like the people who are putting off forclosure by putting everything on credit cards –(not a good idea to pay interest for the next 10-20 years on the top ramen you eat today). Whatever happened to saving for a rainy day and not spending more than you can afford? I take it there are very few parents who teach their kids these values anymore.
Just came back from a walk around my neighborhood in Newark, CA (lake area). Tons of houses for sale at relatively low asking prices ($600k for nice 3/2s), quite a few REOs, and at least a couple of abandoned houses with no sign in the yard. One of them is being used as a squat.
But hey, Silicon Valley is invincible! Hahahahahahahahahah!
They call Newark “Silicon Valley” now? That’s a stretch! It’s nowhere near the Santa Clara valley.
Most of the Silicon Valley jobs are within easy commuting distance to Newark. I have lived here for a couple months, and I still think this city is basically the Silicon Suburb.
Wikipedia thinks Newark is a part of Silicon Valley.
http://en.wikipedia.org/wiki/Silicon_valley
I live in Sunnyvale and have no idea where Newark even is.
Thanks to Prop 13 I don’t think the quality half of Silicon valley will ever become affordable to the eg. $150K/yr household.
Rents are too high and supply is simply too low.
All bets are off if an 80s-style mass layoff fairy returns.
Really? You think that rents being 1/3 to 1/2 of the monthly mortgage is high? Well, people don’t have to get laid off to lose their house. All that has to happen is that their mortgage has to reset. Remember, the population in Silicon Valley has been decreasing for years, rents are a lot lower today than they were a few years ago, and incomes haven’t been keeping up with inflation, so overpopulation and high income are not good explanations for the house prices; only exotic lending is. I sure hope you haven’t put too much of your own $$ into Silicon Valley real estate. If so, you’ve still got a lot to lose.
PS: I like to look at maps when I move somewhere new, then go around and check out the areas. It helps me be less ignorant.
rents are a lot lower today than they were a few years ago
my rent started at $1320 in 2006 and it’s $1570 starting next month. 95%+ occupied so the owners have the whip hand here. I made the mistake of leasing too close to the Indian temple I guess.
I live in Sunnyvale, too. The thing about prop 13 is that without it, you may be forced to sell your house because you can’t afford the property tax because some idiot paid too much for the house next door! I paid 300K for my house. During the “peak” last year, a house actually sold on my block for 1.4 million. I’d be damed if my property tax went up 5x in 16 years because of some specu-vestor with E-Z credit.
Sigh, I agree with you.
Pathetic
http://dallas.craigslist.org/fns/667839857.html
LOL! They can’t be serious! That seriously sounds more like an outright scam.
Why do people think taking out a loan is income?
They were liberating their equity.
UBS to Layoff 8,000…
May 5 (Bloomberg) — UBS AG may cut as many as 8,000 jobs as it grapples with the biggest credit writedowns of any European bank and a 12 billion-franc ($11.4 billion) first-quarter loss.
Switzerland’s biggest bank, which had a 3 billion-franc profit a year earlier, is set to spell out plans for layoffs when it reports detailed results tomorrow. The company will probably say it’s eliminating between 2,500 and 3,000 jobs in its investment bank, more than 10 percent of the division, two people familiar with the matter.
Hmmm… Looks like lots of layoffs coming up. Home Depot is closing some shops. I remember when they first got big they were supposed to be a good place to work and retire. Apple is laying off I think about 170 jobs in the Sacramento/Elk Grove area.
Actually, Apple is relocating some of those jobs to Austin (and the people if they want it) while the rest of the jobs are temp jobs they’re letting time out.
My husband got very annoyed when I brought this up (he works three buildings down, in a completely different department) because as per usual, the reports got a lot of the facts very wrong. Net effect DOES equal fewer jobs in the area, but most of them were apparently short-term anyway.