Posted on 08/08/2007 6:47:57 AM PDT by Hydroshock
NEW YORK - The dream of owning a home is fading away for many Americans with less than stellar credit.
On Tuesday HomeBanc Corp. said it will not issue any more loans, and Impac Mortgage Holdings Inc. shut down a type of loan called “alt-A” for people with limited documentation or slight credit issues.
That followed bankruptcies for two of the country’s biggest home lenders — American Home Mortgage Investment Corp. and New Century Financial Corp. — and tighter terms at most other lenders that are thus far surviving a shakeout in the industry.
“Every day I hear about a number of lenders that are reducing their products,” said George Hanzimanolis, president of the National Association of Mortgage Brokers. “It is going to take a while before the dust settles.”
(Excerpt) Read more at msnbc.msn.com ...
Homes are usually a person's biggest debt. It is insanity to buy a house without the means to do it. It's a set-up for failure. And, the bigger the investment of money, heart and hope, the bigger the failure when the bank repossesses. Who needs that?
Sorry, people, high returns are associated with high risk. You put your money in the high return because you were greedy and didn't want the lower (safer) return. You gambled...you lost. Not my problem, and sure as Hell don't use my tax dollars to reward those companies or investors who played that game.
To me, the same logic applies here. Those mortgage companies and their investors made their bed, now let them sleep in it, even if it is out on the sidewalk.
You obviously need to take a Economics 101 course.
Vacant, boarded homes are a physical and economic blight on any neighborhood. They devalue EVERYBODY's home. The only help these people who are upside down in their mortgages is government intervention
People who are liquid will be able to take advantage of the inventory glut. Right now, it's 'investors' with cash who are buying bank/REO properties before they even reach the papers.
I know of one who services the network of the largest law office that specializes in going after people behind in their mortgage or condo/HOA fees. He's purchased 3 of them already this year.
1) See him lose his house
2)See the lender incur costs foreclosing (It's expensive)
3) See the investor who funded the 2nd trusts..the 10%, 15% or 20% mortgages get out of the market.
Unlikely that they saw a dime from the mortgage insurance, or would have. I've been in the business for 7 and a half years. more likely, they did a "lender-paid" MI program, which is normally a slightly higher rate with no MI, and ate the cost to "shut you up" (no offense intended.)
As far as the first point, yes, you do often have to remind them. Just like I have to remind my car insurance company I am turning 30 this weekend to get my corresponding rate drop.
What's a "foll?" ;-)
Oh, you are correct, completely. Just saying that subprime does not always equal disaster, and, for many years, subprime loans were profitable.
The ones that really make me chuckle are the ones that are cheering on a 75% drop in prices (which is more than I think we'd ever see...) so they can get "good deals" on real estate...but fail to realize...if that happened across the board, they too would probably lose their job or otherwise be in a situation where they aren't buying ANY property.
Rubbish! He should be personally inspecting and fixing every crumbling bridge in every deteriorating Rust Belt s**t-hole. Presidents have to set priorities, after all. Lives are at stake.
I'm afflicted with a bald patch, and have been standing in line longer. I can't believe how he could turn his back on me...a fellow Texan.
Excerpt:
The peak month for the resetting of mortgages will come this October, according to Credit Suisse, when more than $50 billion in mortgages will switch to a new rate for the first time. The level will remain above $30 billion a month through September 2008.In all, the interest rates on about $1 trillion worth of mortgages, or 12 percent of the U.S. total, will reset for the first time this year or next. A couple of years ago, by comparison, only a marginal amount of mortgage debt - a few billion dollars a month - was resetting each month.
So all the carnage in the mortgage market thus far has come even before the bulk of mortgages have reset. "The worst is not over in the subprime mortgage market," analysts at JPMorgan recently wrote to the firm's clients. "The reason for our pessimism is that loans originated in late 2005 and all of 2006, the period that saw peak origination volumes and sharply decreased underwriting quality, are only starting to reset in large numbers." * * *
This slow motion train wreck is just getting started.
This is misleading. It gives the impression that the thing implodes all at once when the rates re-set. Not true. It’s going to be a slow leak and then a very fast one.
Like the character in the Hemingway novel who answers the question of how he went broke, “Two ways,” he says. “First slowly, and then very fast.”
Tip of the iceberg.
Sort of sums up the real estate agent sales game . . .
Looks like North Rodeo Drive in Beverly Hills..........she missed a nice commission : )
A friend of mine purchased a lot of property along Biscayne Boulevard in Miami following the Overtown Riots. Sold most of it three years ago at the height of the boom, and he is a very wealthy man. Which puts me in mind of Rothschild's old axiom to buy at the sound of cannons and sell at the sound of trumpets. Or, when there's blood in the streets, its time to buy.
Ouch!!! But between the symbolism of them being blindsided by a truck a perfect metaphor for how the rapid changes in the market have hit them. And the ad for a company willing to undercut the traditional 6% commission is telling on how many will be saling there properties in the future.
It’s the folks who did what they thought they should be doing who will get hurt. It always is.
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