Comments on: The Tip of the Foreclosure Iceberg http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/ Real Estate News from Real Estate Experts Sun, 12 Feb 2012 13:38:19 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Jay Emerson http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1259 Jay Emerson Sun, 17 Jan 2010 08:15:16 +0000 http://housingstorm.com/?p=2672#comment-1259 I used to own 40,000 shares of Intel stock that was purchased at various prices points between $50 and $75 per share. Since it may never see that price again, did I have an option to "sell short"? No. The difference is leverage. In other words, someone else is bearing the risk in a mortgage. My stock situation is a "short pay" where I get to eat the loss. Banks are eating the losses now. But that was how they played their cards. As long as someone else will bear the risk for a reasonable cost, people will jump at it. And why not? Who's the sucker? I used to own 40,000 shares of Intel stock that was purchased at various prices points between $50 and $75 per share. Since it may never see that price again, did I have an option to “sell short”? No.

The difference is leverage. In other words, someone else is bearing the risk in a mortgage. My stock situation is a “short pay” where I get to eat the loss. Banks are eating the losses now. But that was how they played their cards.

As long as someone else will bear the risk for a reasonable cost, people will jump at it. And why not? Who’s the sucker?

]]> By: jon Maddux http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1245 jon Maddux Fri, 15 Jan 2010 04:03:15 +0000 http://housingstorm.com/?p=2672#comment-1245 How much is the Title of "homeowner" worth? Your neighbors aren't that nice anyways! hehe. Seriously though. If you owe more that your house is worth, then you are worse off than a renter and you don't really own your home... The lender does. How much is the Title of “homeowner” worth? Your neighbors aren’t that nice anyways! hehe.

Seriously though. If you owe more that your house is worth, then you are worse off than a renter and you don’t really own your home… The lender does.

]]> By: dimwit http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1239 dimwit Thu, 14 Jan 2010 23:18:37 +0000 http://housingstorm.com/?p=2672#comment-1239 making a monthly mortgage payment, insurance payments, taxes, and up keep? are you REALLY a "homeowner"? id call it establishing yourself as "on the hook". buy an old car and live in it , if you really want status in amerika. making a monthly mortgage payment, insurance payments, taxes, and up keep? are you REALLY a “homeowner”? id call it establishing yourself as “on the hook”. buy an old car and live in it , if you really want status in amerika.

]]> By: Hold on http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1234 Hold on Thu, 14 Jan 2010 07:23:23 +0000 http://housingstorm.com/?p=2672#comment-1234 AzDave is more right than not..... I'm privy to the data. I know how many of these people cashed out 100's of thousands shortly after buying them with no money down. speculators turned lemons into lemonade. Yes the banks made the loans, but they where way to naive to know that the 'Average Joe' would take full advantage of their game. Basically ... 'Right Back At Em'. Banks thought they had the public up against a wall, but the public screwed them right back. When it's all said and done..... the saver was the bag holder. Earned no income and lost value on his cash savings. AzDave is more right than not….. I’m privy to the data. I know how many of these people cashed out 100′s of thousands shortly after buying them with no money down. speculators turned lemons into lemonade. Yes the banks made the loans, but they where way to naive to know that the ‘Average Joe’ would take full advantage of their game. Basically … ‘Right Back At Em’. Banks thought they had the public up against a wall, but the public screwed them right back.

When it’s all said and done….. the saver was the bag holder. Earned no income and lost value on his cash savings.

]]> By: Jon Maddux http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1228 Jon Maddux Wed, 13 Jan 2010 21:38:32 +0000 http://housingstorm.com/?p=2672#comment-1228 The lenders / banks agreed under contract that the house was adequate collateral for the debt. The recourse agreed to by them is to take back the house. The homeowner is still following the contract by giving back the house. They lost their down payment, their credit score and some of their pride. What really does the lender lose? The lenders write it off and get bailout money. The lenders / banks agreed under contract that the house was adequate collateral for the debt. The recourse agreed to by them is to take back the house. The homeowner is still following the contract by giving back the house. They lost their down payment, their credit score and some of their pride. What really does the lender lose? The lenders write it off and get bailout money.

]]> By: Jon Maddux http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1227 Jon Maddux Wed, 13 Jan 2010 21:22:26 +0000 http://housingstorm.com/?p=2672#comment-1227 Jenny, I've seen the video "Money as Debt" I recommend it. It's very eye opening. I was simply quoting the media that says we need to get people spending again to get our economy going again... thanks for your comment. Jenny,

I’ve seen the video “Money as Debt” I recommend it. It’s very eye opening. I was simply quoting the media that says we need to get people spending again to get our economy going again… thanks for your comment.

]]> By: LD California http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1226 LD California Wed, 13 Jan 2010 20:35:26 +0000 http://housingstorm.com/?p=2672#comment-1226 Not everyone wants to walk away from their houses you know. It involves a lot of researching,talking to professionals and some even spent money to hire a lawyer to help them work with their lender just to be denied and told there is nothing they can do .Maybe you have not experience staying up late every night for last 2 years trying to figure out how you can keep your house and protect your families future at the same time. Maybe you live in LALA land that everything is perfect and houses around you are not in foreclosure. Some people did not use their houses like ATM machines, instead they spent a big chunk of their savings upgrading/fixing up the home they love. You can say what ever you want about strategic defaulters but at the end of the day, this people lost their houses and banks are happy to take them away. I hope you will not encounter any hardship down the road, or you might find yourself in the same boat (unless of course you are rich and have unlimited supply of resources). Maybe you'll understand what other people are going through. Not everyone wants to walk away from their houses you know. It involves a lot of researching,talking to professionals and some even spent money to hire a lawyer to help them work with their lender just to be denied and told there is nothing they can do .Maybe you have not experience staying up late every night for last 2 years trying to figure out how you can keep your house and protect your families future at the same time. Maybe you live in LALA land that everything is perfect and houses around you are not in foreclosure. Some people did not use their houses like ATM machines, instead they spent a big chunk of their savings upgrading/fixing up the home they love.

You can say what ever you want about strategic defaulters but at the end of the day, this people lost their houses and banks are happy to take them away. I hope you will not encounter any hardship down the road, or you might find yourself in the same boat (unless of course you are rich and have unlimited supply of resources). Maybe you’ll understand what other people are going through.

]]> By: Left in limbo http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1224 Left in limbo Wed, 13 Jan 2010 19:40:30 +0000 http://housingstorm.com/?p=2672#comment-1224 I'm encouraged all the time to strategicly default, and believe me, it's very tempting. We never anticipated that our house would become nearly worthless due to massive speculation and fraud by others. We bought in Modesto in 2002, just as prices started to rise and before new construction and housing speculation became ridiculous, propped up by fraud and toxic loans. And our mortgage is a 30-year fixed and affordable as owner-occupied. We never anticipated leaving because that's where I grew up. BUT, we moved in 2005 for job reasons, listed our house in 2006 after we felt confident our new jobs were working out, got a sales contract in 2007 for $300K+, and then everything fell through. We owe nearly $200K and shortsales/REOs in our neigbhorhood are currently listed below $100K. We've got good tenants now, but it doesn't even come close to our mortgage payment. Our first tenants had to move back with their parents due to job loss, and it took several months to find our current tenants. There's tons of rental inventory in Modesto, but not many attractive tenants (i.e. verifiable & stable income, good credit, no pitbulls). To add insult to injury, we're renting a house in the bay area but now our landlord is strategically defaulting. The rental market is pretty tight out here because the banks are taking so long to deal with the problems. So we're getting it on both side. I’m encouraged all the time to strategicly default, and believe me, it’s very tempting. We never anticipated that our house would become nearly worthless due to massive speculation and fraud by others. We bought in Modesto in 2002, just as prices started to rise and before new construction and housing speculation became ridiculous, propped up by fraud and toxic loans. And our mortgage is a 30-year fixed and affordable as owner-occupied. We never anticipated leaving because that’s where I grew up. BUT, we moved in 2005 for job reasons, listed our house in 2006 after we felt confident our new jobs were working out, got a sales contract in 2007 for $300K+, and then everything fell through. We owe nearly $200K and shortsales/REOs in our neigbhorhood are currently listed below $100K. We’ve got good tenants now, but it doesn’t even come close to our mortgage payment. Our first tenants had to move back with their parents due to job loss, and it took several months to find our current tenants. There’s tons of rental inventory in Modesto, but not many attractive tenants (i.e. verifiable & stable income, good credit, no pitbulls). To add insult to injury, we’re renting a house in the bay area but now our landlord is strategically defaulting. The rental market is pretty tight out here because the banks are taking so long to deal with the problems. So we’re getting it on both side.

]]> By: jenny http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1221 jenny Wed, 13 Jan 2010 18:15:09 +0000 http://housingstorm.com/?p=2672#comment-1221 The reason they tell us to spend is not so that the local business won't close. We have a fractional reserve lending system that drives the monetary supply in our economy. Google "Money As Debt". Until you understand monetary policy, you will have no clue about the real relationship between debt, calls for consumers to spend, and the housing crisis / recession. The reason they tell us to spend is not so that the local business won’t close. We have a fractional reserve lending system that drives the monetary supply in our economy. Google “Money As Debt”. Until you understand monetary policy, you will have no clue about the real relationship between debt, calls for consumers to spend, and the housing crisis / recession.

]]> By: kareneldred http://housingstorm.com/2010/01/the-tip-of-the-foreclosure-iceberg/#comment-1218 kareneldred Wed, 13 Jan 2010 16:06:25 +0000 http://housingstorm.com/?p=2672#comment-1218 Not condoning strategic defaulters and not all of these people entered into their mortgages with this intent. Bad things happen to good people and that is certainly the case with some of these homeowners. When you loose your job, can't afford the payments and have lost so much of your equity this is clearly an option. In reality, if enough people did this the banks would have to take notice and maybe they could start acting more responsibly in the loan modification or short sale arenas. Not condoning strategic defaulters and not all of these people entered into their mortgages with this intent.

Bad things happen to good people and that is certainly the case with some of these homeowners.

When you loose your job, can’t afford the payments and have lost so much of your equity this is clearly an option.

In reality, if enough people did this the banks would have to take notice and maybe they could start acting more responsibly in the loan modification or short sale arenas.

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