” I too wonder how much “shadow inventory” the banks still have, either because they don’t want to have to recognize the loss, or because the paperwork is so fouled up they haven’t been able to foreclose.”
They have plenty, especially in northern ans southern California. There are many people living in 2-5 million dollar homes who haven’t made a mortgage payment for 2 or more years.
An entire industy has sprung up that teaches homeowners how to stay in their homes. Usually, a lawyer files paperwork with the(alleged) lender of record, requestiong 50-100 pieces of paperwork(paper chase). They demand proof that the mortgage bank is the REAL owner. This can take a year or more. Meanwhile, the home owner pays no mortgage or rent.
That usually puts a further delay in the process.
If the borrower wants to stay in the home, those delinquent payments can be capitalized in the new loan. Under HAMP, the rate can be as low as 2%.
The vast majority of the mods I've seen are done for borrowers with a documented hardship. Those trying to game the system are easy to spot, but they still slip through.
With apologies to Samuel Clemens, there are 3 kinds of lies:
1. Lies
2. Damn Lies
3. HAMP modifications
But the Dems will never audit the fed -- not in a million years. Too much bribery and corruption.
Did anybody listen to Jesse Ventura unloading on our totally corrupt political class last night on Coast to Coast AM ____ ?
As usual your insight to California banks appears to be right on target.
Last month, we met the daughter of a church friend. She had worked for a couple of the big banks in N California. The last bank had her get her real estate license to help them in short sales. She saw a big business opportunity in the “lower priced”* homes in default.
She and a few other ex bankers formed a realty company specializing in the short sales of the “lower priced”* homes in the North Bay counties.
I asked her why no bigger/formerly more expensive homes in the just under under 1 million $ or over 1 million $ bracket were being dumped or discounted.
She said that the big banks’s top officers were told behind
closed doors not to start dumping the big and formerly expensive homes until after the November election.
I asked her, who told the bankers not to dump the expensive homes behind closed doors. She said, she couldn’t tell me. I asked if the evil Republicans told the bankers. She said no.
” I too wonder how much “shadow inventory” the banks still have, either because they don’t want to have to recognize the loss, or because the paperwork is so fouled up they haven’t been able to foreclose.”
They have plenty of the formerly High $ homes, especially in northern and southern California. There are many people living in 2-5 million dollar homes who haven’t made a mortgage payment for 2 or more years.
*The lower priced homes in the N Bay were the ones selling over $500 to $750 K and were now selling for half of the price before Pelosi/Reid’s recession hit.