[quote=spdrun]”The NAR was the main lobby behind the ouster of DeMarco. With so many “would-be sellers” living “free” while waiting months for a (dicey) SS approval or to be foreclosed upon (with both possibly occurring simultaneously or in-tandem), they’re not listing because they are underwater …. hundreds of thousands of them grossly so.”
Even if a loan gets modified, they’d still be underwater. As far as I know, even after a mod, people can’t sell at the new loan amount — they need to basically do a short sale. This would just make more people sit tight, not less.
In other news, I was at the Morris County (NJ) sheriff’s auction this week. 25 homes went under the hammer with few bidders; a few months ago it was maybe four or five per week. *BANG* *BANG* Going once … SOLD! Should be some interesting grist for the mill as the REOs get offered through the fall and winter of 2013.
Good thing is that:
(a) the stooge may not be confirmed, and this will take a few months (b) changing FNMA’s charter will take time as well
(c) hopefully I’ll have enough rental property not to give a fuck by the time the bums get a free pass.[/quote]
spdrun, perhaps it is because NJ is a judicial foreclosure state. The lenders there obviously had to go through a LOT in recent years just to get the right to take properties which they have long had the right to take were in not for the parade of bogus MERS robo-signing lawsuits and other assorted time-consuming legal challenges to foreclosure, which, in the end, were meritless.
Perhaps there are fewer bidders at a foreclosure auction there because the opening bids are higher (relative to actual market value) due to high cost of foreclosure? Also, perhaps the stock of housing in that area is quite old and/or in school districts that are not the best. I don’t know. It seems the average flipper who would send someone to a foreclosure auction to bid on properties would be targeting homes with a wide appeal which would sell fast for top dollar to a captive audience (read young Gen X and Gen Y with families).
And thanks for pointing out that FNMA’s Charter will have to be changed to provide for mass cramdown. This will take an act of our (dysfunctional, at-odds-with-themselves) Congress :=D
The vast majority of those “bums” who have permanent modifications on their principal residence no doubt have mods which allow the stiffed lender to get back most or all of their “forgiven” debt upon sale unless the modified trustor hangs onto the property for a given length of time (5-10 yrs?) and pays them religiously and on time every month according to the modified terms. This keeps the poor slobs in their houses until such time as they get to keep some of the equity upon sale, whether they want to stay … or not.
I personally feel that the families who signed up for this foolishness did so ONLY because their credit was shot or nearly shot (they HAD to default in order to get their application for modification accepted) and they are now enjoying ultra-low house payments in an area they couldn’t otherwise afford to buy or rent in. They did it expressly to buy enough time to get their kid(s) through HS graduation (in their school attendance area of choice) and then they will address the degree that they are actually upside down (IF they still are at that time) and the degree that they will have to share equity upon sale with the lender(s) they stiffed in the past.
It’s just kicking the can down the road. Maybe 365 more bright sunny days will lift them out of their hole and maybe not. But they don’t care right now. They just want to continue living in an area they will never be able to afford to get into again until they don’t need to be there anymore.
It’s that simple.
Note: In CA, it is not mandatory for a “Modify Trust Deed” to be recorded if the same lender who held the TD to be modified (or their purchaser) is the same lender who modified the loan.
So, unfortunately, the public isn’t able to review the exact terms of 99% of mortgage modifications a trustor/borrower worked out with their lender(s).
