Banks adjusting delinquent loans?

[kev374]

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.

[no_such_reality]

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?

[no_such_reality]

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?

[no_such_reality]

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?

[no_such_reality]

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?

[no_such_reality]

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?

[kev374]

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??

[kev374]

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??

[kev374]

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??

[kev374]

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??

[kev374]

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??

[Coronita]

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%.

[Coronita]

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%.

[Coronita]

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%.

[Coronita]

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