Menu

Home › Forums › Housing › Banks adjusting delinquent loans?

Viewing 15 posts - 1 through 15 (of 61 total)
1 2 3 4 5
  • Author
    Posts
  • November 19, 2007 at 8:13 AM #10940
    kev374
    Participant

    My cousin who is a mortgage broker tells me that banks are actively adjusting loans. A client of theirs was delinquent on an ARM that had adjusted upward and BofA supposedly has renegotiated her loan to 5% fixed for 30 yrs.

    Is this kind of thing happening right now? And if this becomes a long term trend how will it affect the rate of foreclosures and the decline in values?

    Also, if banks do this on a large scale, lend money at 5% how do they make any money since I’m sure their cost at the fed funds rate of 4.75% is a very thin margin.

    November 19, 2007 at 8:56 AM #101104
    no_such_reality
    Participant

    Let’s say you are a bank, back in late 2004, you loaned $500,000 to someone. They paid up until about June this year, then fell behind. As a bank which would you prefer?

    a) Rework the loan for $550,000 for the next thirty years at 5%, which the bag-holders appear to have the capability of paying.

    b) foreclose, liquidate the property for probably $400,000?

    November 19, 2007 at 8:56 AM #101190
    no_such_reality
    Participant

    Let’s say you are a bank, back in late 2004, you loaned $500,000 to someone. They paid up until about June this year, then fell behind. As a bank which would you prefer?

    a) Rework the loan for $550,000 for the next thirty years at 5%, which the bag-holders appear to have the capability of paying.

    b) foreclose, liquidate the property for probably $400,000?

    November 19, 2007 at 8:56 AM #101202
    no_such_reality
    Participant

    Let’s say you are a bank, back in late 2004, you loaned $500,000 to someone. They paid up until about June this year, then fell behind. As a bank which would you prefer?

    a) Rework the loan for $550,000 for the next thirty years at 5%, which the bag-holders appear to have the capability of paying.

    b) foreclose, liquidate the property for probably $400,000?

    November 19, 2007 at 8:56 AM #101217
    no_such_reality
    Participant

    Let’s say you are a bank, back in late 2004, you loaned $500,000 to someone. They paid up until about June this year, then fell behind. As a bank which would you prefer?

    a) Rework the loan for $550,000 for the next thirty years at 5%, which the bag-holders appear to have the capability of paying.

    b) foreclose, liquidate the property for probably $400,000?

    November 19, 2007 at 8:56 AM #101220
    no_such_reality
    Participant

    Let’s say you are a bank, back in late 2004, you loaned $500,000 to someone. They paid up until about June this year, then fell behind. As a bank which would you prefer?

    a) Rework the loan for $550,000 for the next thirty years at 5%, which the bag-holders appear to have the capability of paying.

    b) foreclose, liquidate the property for probably $400,000?

    November 19, 2007 at 9:28 AM #101118
    kev374
    Participant

    yeah, I got that point but what is the impact of this on the decline. If banks adjust loans then the foreclosure situation will be controlled, will it not? If foreclosures are controlled then the impact of the ARM resets will be negligible right? If so, people will not lose their homes and prices will stay put or not decline by much. Am I missing something??

    November 19, 2007 at 9:28 AM #101205
    kev374
    Participant

    yeah, I got that point but what is the impact of this on the decline. If banks adjust loans then the foreclosure situation will be controlled, will it not? If foreclosures are controlled then the impact of the ARM resets will be negligible right? If so, people will not lose their homes and prices will stay put or not decline by much. Am I missing something??

    November 19, 2007 at 9:28 AM #101216
    kev374
    Participant

    yeah, I got that point but what is the impact of this on the decline. If banks adjust loans then the foreclosure situation will be controlled, will it not? If foreclosures are controlled then the impact of the ARM resets will be negligible right? If so, people will not lose their homes and prices will stay put or not decline by much. Am I missing something??

    November 19, 2007 at 9:28 AM #101232
    kev374
    Participant

    yeah, I got that point but what is the impact of this on the decline. If banks adjust loans then the foreclosure situation will be controlled, will it not? If foreclosures are controlled then the impact of the ARM resets will be negligible right? If so, people will not lose their homes and prices will stay put or not decline by much. Am I missing something??

    November 19, 2007 at 9:28 AM #101235
    kev374
    Participant

    yeah, I got that point but what is the impact of this on the decline. If banks adjust loans then the foreclosure situation will be controlled, will it not? If foreclosures are controlled then the impact of the ARM resets will be negligible right? If so, people will not lose their homes and prices will stay put or not decline by much. Am I missing something??

    November 19, 2007 at 11:00 AM #101245
    Coronita
    Participant

    If that's the case, i'm wondering if it make sense to intentionally fall back on a few loan payments. I wouldn't mind having them adjust my loan to sub 5%.

    November 19, 2007 at 11:00 AM #101274
    Coronita
    Participant

    If that's the case, i'm wondering if it make sense to intentionally fall back on a few loan payments. I wouldn't mind having them adjust my loan to sub 5%.

    November 19, 2007 at 11:00 AM #101273
    Coronita
    Participant

    If that's the case, i'm wondering if it make sense to intentionally fall back on a few loan payments. I wouldn't mind having them adjust my loan to sub 5%.

    November 19, 2007 at 11:00 AM #101256
    Coronita
    Participant

    If that's the case, i'm wondering if it make sense to intentionally fall back on a few loan payments. I wouldn't mind having them adjust my loan to sub 5%.

  • Author
    Posts
Viewing 15 posts - 1 through 15 (of 61 total)
1 2 3 4 5
  • You must be logged in to reply to this topic.