Tag Archives: Underwater Borrowers

The seductive but flawed logic of principal reduction

Posted on March 10, 2011 by HS

If news stories are true, the administration, in conjunction with the state attorneys general, will soon announce that lenders have agreed to write down borrower principal balances by a grand total of $20–$25 billion as part of a deal to address serious procedural problems in foreclosure filings. Policy wonks and housing experts will greet this announcement with glee, saying that policymakers have ignored principal reduction for too long but have seen the light and are finally going to cure the epidemic of foreclosures that has gripped the country since 2007. Are the wonks right? In short: we think not. Continue reading →

Posted in Banking and Finance, Fresh Perspectives, Home Economics, Mortgage News, Newsletter | Tagged Loan Modifications, negative equity, Principal Reduction, Underwater Borrowers | Leave a comment

23 Percent of Home Borrowers Underwater

Posted on March 8, 2011 by HS

“Negative equity holds millions of borrowers captive in their homes, unable to move or sell their properties. Until the high level of negative equity begins to recede, the housing and mortgage finance markets will remain very sluggish,” said Mark Fleming, chief economist with CoreLogic. Continue reading →

Posted in Home Economics, Newsletter, Real Estate Data, Short Sale News | Tagged negative equity, Strategic Defaults, Underwater Borrowers | 1 Comment

CoreLogic: 11 Million Underwater Homes

Posted on August 26, 2010 by HS

National negative equity rates declined for the second consecutive quarter. According to CoreLogic, 11 million, or 23 percent, of all residential properties with mortgages were in negative equity at the end of the second quarter of 2010, down from 11.2 million and 24 percent from the first quarter of 2010. Continue reading →

Posted in Best Of The Storm, Home Economics, Real Estate Data | Tagged negative equity, Underwater Borrowers | Leave a comment

John Paulson Will Be Wrong

Posted on August 2, 2010 by James Quinn

The combination of expiring tax credits, the failure of HAMP, the conclusion of the Fed buying dodgy MBS, the growing shadow inventory of foreclosures, Option ARM and Alt-A resets, and rising interest rates will result in a further fall in home prices of at least 20% in the next two years. Continue reading →

Posted in Best Of The Storm, Everything About Foreclosures, Fresh Perspectives, Home Economics, Real Estate Data | Tagged Alt-A Loans, Case-Shiller, Foreclosures, HAMP, Home Prices, Housing Bubble, Loan Modifications, Median Home Prices, Obama, Option-Arm Loans, Supply vs Demand, Tax Credits, Underwater Borrowers | 1 Comment

Housing Economics: Massive Supply, Faltering Demand

Posted on July 15, 2010 by Charles Hugh Smith

These stupendous government interventions have simply staved off the consequences of the supply-demand imbalance for the past two years. At some point these interventions will fail and the returns on the investment will go negative: all the trillions of dollars committed to propping up housing prices will fail to boost prices at all.

At that point public support for the prop-job will evaporate and the market will finally get a chance to clear the imbalance between supply and demand. Continue reading →

Posted in Best Of The Storm, Everything About Foreclosures, Fresh Perspectives, Home Economics, Investing, What You Need To Know About Buying and Selling Real Estate | Tagged Fannie Mae, FDIC, Foreclosures, Freddie Mac, Homeownership Rates, Housing Bubble, negative equity, Pending Home Sales, Shadow Inventory, Supply vs Demand, The Fed, Underwater Borrowers | 1 Comment