Home › Forums › Financial Markets/Economics › Loan mods not working… Really??? Kicking the can down the road doesn’t work??? Who would have thought…
- This topic has 29 replies, 13 voices, and was last updated 11 years, 10 months ago by
sdrealtor.
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June 24, 2012 at 9:40 AM #746356June 24, 2012 at 9:48 AM #746357
sdrealtor
ParticipantYou need to get past your angst on this. We did years ago. Now is the time to look forward and exploit the situation not bitch about those that fell prey to it.
June 24, 2012 at 10:23 AM #746358spdrun
ParticipantAm I forbidden from doing both? 😀
June 24, 2012 at 10:38 AM #746359ParticipantYou can do whatever you like. You will just lose your audience here beating a dead and buried horse.
June 24, 2012 at 8:48 PM #746378ctr70
Participant[quote=SD Realtor]FLU solved the problem in his very first line…
“How about just giving even more cheap credit to well qualified borrowers? We’ll clean up this mess by buying…”
Plain and simple.
If there were no loan mods, and all of the foreclosures could have happened in a normal manner, and cheap credit would have been available to those who were REALLY QUALIFIED then we would:
— Have a much healthier market.
— Seen all that distressed inventory get absorbed
— Let the housing market operate more freely.
— Rewarded those who have saved money and been prudent with fantastic real estate opportunities.
— Formed a much more solid foundation for the entire housing market.This would have been a back to the basics policy where owning a home was not considered an entitlement but rather a reward that was earned.[/quote]
Awesome post. What has been done by the Government intervention is an absolute disgrace forcing all the loan mods and letting people sit in their houses for 3 years not paying. As you say we should have never stopped the foreclosures in 2008 and we would have flushed it all out and the properties would have went to those that deserved them vs. rewarding the people who don’t pay their bills. These policies made me disgusted with our Government. Now they want to enact eminent domain and allow cities to force mortgage lenders to write down principles see this NYT article about San Berardino (http://www.bubbleinfo.com/2012/06/24/shillers-eminent-domain/). Time to get scared! Is this Cuba in 1959? Stalinist Russia? China under Mao??
June 24, 2012 at 8:55 PM #746379ParticipantUnlikely to happen on a large-scale basis:
If it’s proven that mortgages can’t be enforced, then banks won’t be able to give mortgages. With the future fate of Fannie and Freddie unknown at present, this has the potential of freezing the mortgage market in CA entirely.
June 24, 2012 at 9:36 PM #746380CA renter
Participant[quote=spdrun]If you’re STUPID, you don’t have good luck.
People who mortgaged their firstborn to buy a house that it would be 50% cheaper to rent at the height of the bubble with no cash down, were STUPID. G-d helps those who help themselves.
I have no problem with wealth redistribution. But I also have no sympathy for the people who bought in the mid-2000s, because they should have thought for 2 seconds before following the lemmings off the cliff.
Lastly, if one bought with little to no cash down, they never really owned the property. More like leasing it from the bank. Leases are revocable.[/quote]
Sometimes, it’s fun to beat a dead horse.
Bravo on your post!
June 25, 2012 at 12:11 AM #746382bearishgurl
Participant[quote=spdrun]Unlikely to happen on a large-scale basis:
If it’s proven that mortgages can’t be enforced, then banks won’t be able to give mortgages. With the future fate of Fannie and Freddie unknown at present, this has the potential of freezing the mortgage market in CA entirely.[/quote]
spdrun, first of all, I find your posts quite astute and insightful for the age you profess to be here (in comparison to other Piggs who claim to be the same or similar age as you).
HOWEVER, the LAW in CA gives lenders the right to non-judicial foreclosure (auction) on the 111th day after the first due date of their (late) mortgage payment:
http://www.defaultpros.com/programs/foreclosure.php
OR, the 141th day after, , depending on which category the borrower falls under, that is:
2923.5. (a) (1) A mortgagee, trustee, beneficiary, or authorized
agent may not file a notice of default pursuant to Section 2924 until
30 days after initial contact is made as required by paragraph (2)
or 30 days after satisfying the due diligence requirements as
described in subdivision (g).
(2) A mortgagee, beneficiary, or authorized agent shall contact
the borrower in person or by telephone in order to assess the
borrower’s financial situation and explore options for the borrower
to avoid foreclosure. During the initial contact, the mortgagee,
beneficiary, or authorized agent shall advise the borrower that he or
she has the right to request a subsequent meeting and, if requested,
the mortgagee, beneficiary, or authorized agent shall schedule the
meeting to occur within 14 days. The assessment of the borrower’s
financial situation and discussion of options may occur during the
first contact, or at the subsequent meeting scheduled for that
purpose. In either case, the borrower shall be provided the toll-free
telephone number made available by the United States Department of
Housing and Urban Development (HUD) to find a HUD-certified housing
counseling agency. Any meeting may occur telephonically.
(b) A notice of default filed pursuant to Section 2924 shall
include a declaration that the mortgagee, beneficiary, or authorized
agent has contacted the borrower, has tried with due diligence to contact the borrower as required by this section, or that no contact
was required pursuant to subdivision (h).
(c) If a mortgagee, trustee, beneficiary, or authorized agent had already filed the notice of default prior to the enactment of this
section and did not subsequently file a notice of rescission, then the mortgagee, trustee, beneficiary, or authorized agent shall, as
part of the notice of sale filed pursuant to Section 2924f, include a declaration that either:
(1) States that the borrower was contacted to assess the borrower’s financial situation and to explore options for the borrower to avoid foreclosure.
(2) Lists the efforts made, if any, to contact the borrower in the event no contact was made.
(d) A mortgagee’s, beneficiary’s, or authorized agent’s loss mitigation personnel may participate by telephone during any contact required by this section.
(e) For purposes of this section, a “borrower” shall include a mortgagor or trustor.
(f) A borrower may designate, with consent given in writing, a HUD-certified housing counseling agency, attorney, or other advisor
to discuss with the mortgagee, beneficiary, or authorized agent, on the borrower’s behalf, the borrowers financial situation and options
for the borrower to avoid foreclosure. That contact made at the direction of the borrower shall satisfy the contact requirements of
paragraph (2) of subdivision (a). Any loan modification or workout plan offered at the meeting by the mortgagee, beneficiary, or
authorized agent is subject to approval by the borrower.
(g) A notice of default may be filed pursuant to Section 2924 when a mortgagee, beneficiary, or authorized agent has not contacted a
borrower as required by paragraph (2) of subdivision (a) provided that the failure to contact the borrower occurred despite the due
diligence of the mortgagee, beneficiary, or authorized agent. For purposes of this section, “due diligence” shall require and mean all
of the following:
(1) A mortgagee, beneficiary, or authorized agent shall first attempt to contact a borrower by sending a first-class letter that includes the toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.
(2) (A) After the letter has been sent, the mortgagee, beneficiary, or authorized agent shall attempt to contact the borrower by telephone at least three times at different hours and on
different days. Telephone calls shall be made to the primary telephone number on file.
(B) A mortgagee, beneficiary, or authorized agent may attempt to contact a borrower using an automated system to dial borrowers, provided that, if the telephone call is answered, the call is
connected to a live representative of the mortgagee, beneficiary, or authorized agent.
(C) A mortgagee, beneficiary, or authorized agent satisfies the telephone contact requirements of this paragraph if it determines, after attempting contact pursuant to this paragraph, that the borrower’s primary telephone number and secondary telephone number or numbers on file, if any, have been disconnected.
(3) If the borrower does not respond within two weeks after the telephone call requirements of paragraph (2) have been satisfied, the mortgagee, beneficiary, or authorized agent shall then send a
certified letter, with return receipt requested.
(4) The mortgagee, beneficiary, or authorized agent shall provide a means for the borrower to contact it in a timely manner, including a toll-free telephone number that will provide access to a live representative during business hours.
(5) The mortgagee, beneficiary, or authorized agent has posted a prominent link on the homepage of its Internet Web site, if any, to the following information:
(A) Options that may be available to borrowers who are unable to afford their mortgage payments and who wish to avoid foreclosure, and instructions to borrowers advising them on steps to take to explore those options.
(B) A list of financial documents borrowers should collect and be prepared to present to the mortgagee, beneficiary, or authorized agent when discussing options for avoiding foreclosure.
(C) A toll-free telephone number for borrowers who wish to discuss options for avoiding foreclosure with their mortgagee, beneficiary,
or authorized agent.
(D) The toll-free telephone number made available by HUD to find a HUD-certified housing counseling agency.
(h) Subdivisions (a), (c), and (g) shall not apply if any of the following occurs:
(1) The borrower has surrendered the property as evidenced by either a letter confirming the surrender or delivery of the keys to the property to the mortgagee, trustee, beneficiary, or authorized agent.
(2) The borrower has contracted with an organization, person, or entity whose primary business is advising people who have decided to
leave their homes on how to extend the foreclosure process and avoid their contractual obligations to mortgagees or beneficiaries.
(3) A case has been filed by the borrower under Chapter 7, 11, 12, or 13 of Title 11 of the United States Code and the bankruptcy court
has not entered an order closing or dismissing the bankruptcy case, or granting relief from a stay of foreclosure.
(i) This section shall apply only to mortgages or deeds of trust recorded from January 1, 2003, to December 31, 2007, inclusive, that are secured by owner-occupied residential real property containing no more than four dwelling units. For purposes of this subdivision, “owner-occupied” means that the residence is the principal residence of the borrower as indicated to the lender in loan documents.
(j) This section shall remain in effect only until January 1, 2013, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2013, deletes or extends
that date.I understand what you are saying here about “FF,” and their “viability” being paramount to continuation of conventional mortgages being sold on the “secondary market” and being available to the masses in CA. However, mortgage (delinquency) has been and will continue to be legally “enforced” in CA, by law. The $64M question here is WHY haven’t the majority of the defaulted-upon lenders exercised their right to foreclose in a timely manner on CA mortgages?
In my mind, there is absolutely no excuse. Even though these lenders may be compensated by the GOV “in the back room” to “work with delinquent (often `cunning’ strategic-defaulting) borrowers,” I call this non-action “lender malaise” and see no other term to describe it.
In the end, “lender malaise” affects every property owner’s values, including those “potential sellers” who “played by the `rules'” and those “potential sellers” who own free and clear. Neither will likely be putting their propertie(s) on the market under today’s artificially-screwed-up “conditions” unless they are nearly incapacitated and in need of “board and care.” (If they’re terminally ill, they’ll just let their heirs deal with the disposition of their property.)
And there you have it … (severely) reduced “inventory.” All due to CA lenders having a CHOICE to foreclose (with the law on their side) and instead opting to play the current “GOV game.”
It is what it is.
June 25, 2012 at 11:30 AM #746404scaredyclassic
ParticipantI used to care.
I could care less now.
Or is it I couldn’t care less?
Or was it carefree?
The amount I care is so trivial that a smaller amount doesn’t exist.
June 25, 2012 at 12:10 PM #746411Participant[quote=CA renter][quote=spdrun]If you’re STUPID, you don’t have good luck.
People who mortgaged their firstborn to buy a house that it would be 50% cheaper to rent at the height of the bubble with no cash down, were STUPID. G-d helps those who help themselves.
I have no problem with wealth redistribution. But I also have no sympathy for the people who bought in the mid-2000s, because they should have thought for 2 seconds before following the lemmings off the cliff.
Lastly, if one bought with little to no cash down, they never really owned the property. More like leasing it from the bank. Leases are revocable.[/quote]
Sometimes, it’s fun to beat a dead horse.
Bravo on your post![/quote]
I agree it can be fun to beat a dead horse and there is no horse deader than yours.
You called for 45%+ declines in prime NCC areas.
I said 30% would be worst case scenario and beleived the number would be about 20 to 25%.
Surprise surprise! 5 years later we bottomed out at a 20 to 25% decline and are starting to head back up albeit slowly. CV didnt even get that low.
Giddyap Dead Horsey!
June 25, 2012 at 12:44 PM #746426Participant[quote=sdrealtor] . . . You called for 45%+ declines in prime NCC areas.
I said 30% would be worst case scenario and beleived the number would be about 20 to 25%.
Surprise surprise! 5 years later we bottomed out at a 20 to 25% decline and are starting to head back up albeit slowly. CV didnt even get that low.
Giddyap Dead Horsey![/quote]
Might you be “jumping the gun” a little here??
I don’t know about you but I haven’t seen or heard the “fat lady’s” encore yet.
June 25, 2012 at 2:47 PM #746455
CoronitaParticipant[quote=bearishgurl][quote=sdrealtor] . . . You called for 45%+ declines in prime NCC areas.
I said 30% would be worst case scenario and beleived the number would be about 20 to 25%.
Surprise surprise! 5 years later we bottomed out at a 20 to 25% decline and are starting to head back up albeit slowly. CV didnt even get that low.
Giddyap Dead Horsey![/quote]
Might you be “jumping the gun” a little here??
I don’t know about you but I haven’t seen or heard the “fat lady’s” encore yet.[/quote]
Can we at least agree that it did for Ron Paul, finally?
June 25, 2012 at 3:06 PM #746462ParticipantNo we cant! Ron Paul has a better chance than CAR!
Mail it in! The trend is up! The bet ends at the end of 3rd Qtr 2012. Prices would have to fall over 10% PER MONTH for the next 3 months for us to even to get close to there being a judgement call.
June 25, 2012 at 5:29 PM #746480Participant[quote=sdrealtor][quote=CA renter][quote=spdrun]If you’re STUPID, you don’t have good luck.
People who mortgaged their firstborn to buy a house that it would be 50% cheaper to rent at the height of the bubble with no cash down, were STUPID. G-d helps those who help themselves.
I have no problem with wealth redistribution. But I also have no sympathy for the people who bought in the mid-2000s, because they should have thought for 2 seconds before following the lemmings off the cliff.
Lastly, if one bought with little to no cash down, they never really owned the property. More like leasing it from the bank. Leases are revocable.[/quote]
Sometimes, it’s fun to beat a dead horse.
Bravo on your post![/quote]
I agree it can be fun to beat a dead horse and there is no horse deader than yours.
You called for 45%+ declines in prime NCC areas.
I said 30% would be worst case scenario and beleived the number would be about 20 to 25%.
Surprise surprise! 5 years later we bottomed out at a 20 to 25% decline and are starting to head back up albeit slowly. CV didnt even get that low.
Giddyap Dead Horsey![/quote]
I always honor my bets, and you may well win by the end of this year.
That being said, I don’t think the “downturn” is anywhere near over at this point in time. As pointed out before, interest rates and the control of inventory are nowhere near “normal,” so we’ll have to see what transpires going forward.
While I will probably have to give you the win on this particular bet, based on the specific examples and tracts, there have indeed been many homes in this area that have sold for ~40%-50%(+) below what they sold for during the bubble. I’d also add that prices in our area, in general, have been about 30-35% below peak levels, not just 25% lower.
No matter, we’ll all be able to enjoy a nice dinner, and that’s what counts!
June 25, 2012 at 5:38 PM #746482ParticipantNo no more but but buts! Prices are nowhere near 30 to 35% below peak nor have they ever been. Do you think you house ever would have sold above 900k because that is what you are postulating now.
I’m calling BS on you again. Show me 10 houses in this area that sold 50% off. Show me 5? Show me 3? Or stop with the BS because that’s what it is.
You continue to make excuses. I factored in all the manipulation. I saw it coming and predicted it all. Perhaps you were most wrong when you as many others would say the problem was far too big for TPTB to even begin to contain.
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