Posted on 04/02/2013 8:26:29 AM PDT by whitedog57
Realty Trac reported last week that 300,000 homes in the US are zombies. And another 10.9 million homeowners nationwide remain at risk because they owe more than their property is worth (better known as negative equity).
“While Florida leads in volume of zombie properties, Kentucky, with less than 1,000 zombie properties, leads in percentage, with zombies representing 54 percent of its total foreclosure inventory. Zombies in Washington, Indiana, Nevada and Oregon also constitute 50 percent or more of the properties in foreclosure, according to the report.”
Wait a minute! How can this be true when we have 15 Federal government mortgage modification programs including HARP and the infamous Attorneys General Settlement that were supposed to fix the problem of negative equity and revive the housing market?
Perhaps the Federal government promises too much as they did with the New Jersey shore. Philly.com has an interesting story entitled “Sandy-hit Shore homeowners ask: Where is the money?”
“This was my summer home,” the Delaware County plant manager said of his little rancher on Third Street in Ocean City, N.J., flooded with its foundation cracked – totalled, really – by Sandy.
Why is the Federal government involved with paying damages on a vacation home??
The same holds true for Attorneys General Settlement. Most of the claims against lenders were the non-event called “Robosigning” where an overwhelmed employee stamped a foreclosure file (hint: virtually everyone in those piles of folders had defaulted on their loan). Robosigning spawned “Robocop” Richard Cordray who is now the head of the Consumer Financial Protection Bureau (CFPB), an unaccountable bureau that is staffed by “fair lending” activists. Here is 184 page “Ability to Pay” edict from Cordray himself.
Of course, the CFPB exempts Fannie Mae, Freddie Mac and the FHA (the government housing finance monopoly) for 7 sevens so that they can write their own rules. (Wait a minute! Why weren’t lenders given the same 7 year exemption?)
Like Amity Shlaes’ “The Forgotten Man: A New History of the Great Depression ,” we always seem to forget that government usually causes the problem in the first place (e.g., Clinton/Cisneros/Cuomo’s National Homeownership Strategy) then compounds the problem with confusing and changing “solutions” like HAMP, HARP, the AG Settlement and now … drum roll … FHFA Announces New Streamlined Modification Initiative Essentially, this is a no-doc refi plan for Fannie Mae and Freddie Mac-held/insured mortgages.
Wait a minute! I though Dodd-Frank and the CFPB banned the use of no-doc loans!
And on and on it goes. Rather than letting the housing market heal, the government keeps ripping the bandages off.
The good news? The government-controlled mortgage giant Fannie Mae, which needed a $116 billion federal bailout after the housing bubble burst in 2007, said Tuesday that it earned a record $7.6 billion in fourth-quarter 2012 and $17.2 billion for the year. Fannie Mae has been benefiting from “the housing market’s turnaround and sustained declines in the number of soured home loans. … Fannie is [also] losing less money on homes it sells through foreclosure as prices in many markets rise.”
That allowed Fannie Mae to pay $11.6 billion in dividends to the U.S. Treasury Department last year. Since 2008, it has “paid taxpayers $35.6 billion in dividends.” Looking ahead, “we expect our earnings to remain strong over the next few years,” Timothy Mayopoulos, president and chief executive officer, said in a statement.
Here is Fannie Mae’s stock price as house prices started to slip.
And here is the reaction today of Fannie Mae’s stock after the announcement.
Apparently, even Fannie Mae can’t stem the tide of zombie foreclosures.
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I know; there are places in the USA where property values are in the tank. How sad is that?
All part of our Zombie President’s agenda. Just give them to the poor...
NONE!!
Boy were they sold a bill of goods. P.T. Barnum; There's a sucker born....
Still, very sad.
“An ardent proponent of the CRA (Community Reinvestment Act), ACORN benefactor, organizer, and trainer Barack H. Obama, Esq., contributed to the increasingly hostile environment for banks when he represented the plaintiffs in the 1995 class action lawsuit Buycks-Roberson v. Citibank. The suit demanded that the bank grant mortgages to an equal percentage of minority and non-minority mortgage applicants. The bank settled the case three years later and reportedly agreed to beef up its lending to unqualified applicants.”
http://spectator.org/archives/2008/10/29/acorns-food-stamp-mortgages
“I wonder how many of those 300,000 folks actually, really, truly qualified for loans.”
Before or after they lost their job?
300,000 zombie homes and 6 or 8 million more defaulted and or not paying
mostly because of the government’s bs in attempting to manipulate, or “rig,” the housing market... (plus, of course, Obama’s horrible anti-jobs policies ... people without jobs do not make reliable mortgage repayments)
Because the feds (through FEMA) run the National Flood Insurance program, through which the homeowners paid for insurance, and the homes were damaged by storm surge (flood).
Its my understanding that we are paying for homes which didn’t have flood insurance. That was part of the Sandy bailout.
Yeah, in 2000, a single mom... was so proud to buy my own home! 2012 I owed a little over double what I owed and what it was originally appraised for. Walked away from it.
I couldn’t see sinking money into maintenance, taxes had tripled (Georgia removed homestead exemption and increased millage rate to triple) and pay the mortgage. I now pay rent, but can ‘call the guy’ when the AC goes out.
“I wonder how many of those 300,000 folks actually, really, truly qualified for loans.”
Before or after they lost their job?
***************************
This!!! Worked in commercial insurance for over 20 years. That went kaplunk in 2008. I was paying my mortgage just fine, didn’t have a balloon note, simple 30 year mortgage. But when you have no or barely any income, it’s tough no matter how low. My husband lost his job of 27 years in 2009 (17 factories in Georgia in an industry that had been established since before the civil war went to Brazil).
Wow, that’s a low number compared to a couple of years ago.
Anyone saying this is bad news doesn’t know the market.
Job? Job? We don't need no stinkin' jobs!
Treasure of the Sierra Madres: Alfredo Bedoya, famous Mexican actor said it best when he confronts Humphrey Bogart, gringo fortune hunter in the classic film, “Treasure of the Sierra Madre” who asks the quintessential (and stereotypical) Mexican Bandido, swarthy, greasy, sweaty in a dirty sombrero with a knick in it: “Who are you?” “We are the Federales.” “Well, if you’re the Federales where’s your badges?” “Badges? Badges? We ain’t got no badges! We don’t need no stinkin’ badges!!”
I see you had a little excitement in town...
I assume that Georgia rent is better than Georgia home-owning. Nothing really has changed. Buying and owning a home requires TWO decent paychecks. Always has; probably always will.
Or, parents pass and leave children with some money. That, with a parsimonious nature will allow a home purchase.
Oh, I almost forgot...also a sibling with cash to loan out.
You did what you had to do. I'm glad you worked it out.
My hubby (passed two and a half years ago) and I went overseas to work for five years so we could afford a nice house. I am "taken care of" because of that AND we still had to borrow money from mom.
Whoever sold us the bill of goods that promised us home ownership?
For the summer home owners whose houses were involved in Sandy disaster, that’s what insurance was for. For the rest who are “under water” that has no bearing whether you can afford it or not. You either could make the payments or you can’t. If you have a job and can make the payments, then stay where you are.
If you lost your job, etc. well, bad things happen. It is no reason for the rest of us to bail your mortgage out.
I lost my job in 2009 too. The whole company went belly up. I worked a contract situation for about two years, about half of which actually earned money because I allowed the government client to walk all over me. Now I’m making a third of what I was and have a credit rating that’s just above a pulse. I can hardly get an interview in my field and no job offers. It’s tough to pay your bills when you have no money.
How can you “owe double” 12 years later over what you owed in 2000 without having taken a crapload of equity loans out on your house for other things?
“That’s OK, buy a bigger house! House values only go up! You’re going to get a 5% pay increase every year, and your mortgage payment will always be the same! And you’ll be living in a big house that everyone will be jealous of! You can’t go wrong!”
There’s no such thing as a damn zombie you idiot!
Pay your mortgage or go live under a bush!
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