Question for the bulls

[CA renter]

Are the bulls asserting that there is no “shadow inventory” at all, or are they saying that it just isn’t on the market right now, and may take a long time to get there. Two very different things, no?

BTW, as far as I know, seconds can indeed foreclose on a borrower, but most of them would be wiped out at this point (most of these homes are down 20% or more on the 80/20 loans, so their position is wiped out), so they are not going through with it. That does not mean that they won’t go through with it if the PTB manages to inflate housing prices again.

That, right there, could put downward pressure on prices if all the seconds tried to collect by foreclosing as prices neared levels that would clear their loans.

[sdrealtor]

CAR
There is lots of potential shadow inventory but not as much as the most bearish hope there is and it is being handled in a large variety of ways such that much of it will never see the open market. It is also being doled out very slowly so as not to crush the market. A market is being masterfully manipulated.

Seconds can foreclose but if they are sold out (i.e. completely underwater) they get nothing and lose their right no pursue for deficiency because of 580b (the one action rule). If the 1st forecloses and the 2nd is purchase money they are SOL. If the borrower declares BK they are SOL also. If it is a recourse loan they can hang out there and some day try to collect on an unsecured loan which aint the eaisest thing in the world to do. They are generally better off getting whatever they can today and most understand that.

[sdrealtor]

CAR
There is lots of potential shadow inventory but not as much as the most bearish hope there is and it is being handled in a large variety of ways such that much of it will never see the open market. It is also being doled out very slowly so as not to crush the market. A market is being masterfully manipulated.

Seconds can foreclose but if they are sold out (i.e. completely underwater) they get nothing and lose their right no pursue for deficiency because of 580b (the one action rule). If the 1st forecloses and the 2nd is purchase money they are SOL. If the borrower declares BK they are SOL also. If it is a recourse loan they can hang out there and some day try to collect on an unsecured loan which aint the eaisest thing in the world to do. They are generally better off getting whatever they can today and most understand that.

[sdrealtor]

CAR
There is lots of potential shadow inventory but not as much as the most bearish hope there is and it is being handled in a large variety of ways such that much of it will never see the open market. It is also being doled out very slowly so as not to crush the market. A market is being masterfully manipulated.

Seconds can foreclose but if they are sold out (i.e. completely underwater) they get nothing and lose their right no pursue for deficiency because of 580b (the one action rule). If the 1st forecloses and the 2nd is purchase money they are SOL. If the borrower declares BK they are SOL also. If it is a recourse loan they can hang out there and some day try to collect on an unsecured loan which aint the eaisest thing in the world to do. They are generally better off getting whatever they can today and most understand that.

[sdrealtor]

CAR
There is lots of potential shadow inventory but not as much as the most bearish hope there is and it is being handled in a large variety of ways such that much of it will never see the open market. It is also being doled out very slowly so as not to crush the market. A market is being masterfully manipulated.

Seconds can foreclose but if they are sold out (i.e. completely underwater) they get nothing and lose their right no pursue for deficiency because of 580b (the one action rule). If the 1st forecloses and the 2nd is purchase money they are SOL. If the borrower declares BK they are SOL also. If it is a recourse loan they can hang out there and some day try to collect on an unsecured loan which aint the eaisest thing in the world to do. They are generally better off getting whatever they can today and most understand that.

[sdrealtor]

CAR
There is lots of potential shadow inventory but not as much as the most bearish hope there is and it is being handled in a large variety of ways such that much of it will never see the open market. It is also being doled out very slowly so as not to crush the market. A market is being masterfully manipulated.

Seconds can foreclose but if they are sold out (i.e. completely underwater) they get nothing and lose their right no pursue for deficiency because of 580b (the one action rule). If the 1st forecloses and the 2nd is purchase money they are SOL. If the borrower declares BK they are SOL also. If it is a recourse loan they can hang out there and some day try to collect on an unsecured loan which aint the eaisest thing in the world to do. They are generally better off getting whatever they can today and most understand that.

[sdcellar]

CA Renter– Yeah, I’m not suggesting that the shadow doesn’t exist, I’ve just stopped thinking that it’s going to flood the market any time soon.

I’ve heard that it’s happening Real Soon Now™ from folks of all walks of life. Everybody from neighbors to the friendly barista who assembled my Caramel Machiatto this morning. And, of course, here (first, of course!).

Keep in mind that some markets are still dropping in price and given all the intervention, that’s pretty amazing, and more importantly seems unsustainable. Heck, if nothing else, “lowest interest rates in our lifetimes” would seem to be starting to lose its allure, if for no other reason than that’s probably starting to look like the new normal. So, will we see downward pressure pick up? I think so.

[sdcellar]

CA Renter– Yeah, I’m not suggesting that the shadow doesn’t exist, I’ve just stopped thinking that it’s going to flood the market any time soon.

I’ve heard that it’s happening Real Soon Now™ from folks of all walks of life. Everybody from neighbors to the friendly barista who assembled my Caramel Machiatto this morning. And, of course, here (first, of course!).

Keep in mind that some markets are still dropping in price and given all the intervention, that’s pretty amazing, and more importantly seems unsustainable. Heck, if nothing else, “lowest interest rates in our lifetimes” would seem to be starting to lose its allure, if for no other reason than that’s probably starting to look like the new normal. So, will we see downward pressure pick up? I think so.

[sdcellar]

CA Renter– Yeah, I’m not suggesting that the shadow doesn’t exist, I’ve just stopped thinking that it’s going to flood the market any time soon.

I’ve heard that it’s happening Real Soon Now™ from folks of all walks of life. Everybody from neighbors to the friendly barista who assembled my Caramel Machiatto this morning. And, of course, here (first, of course!).

Keep in mind that some markets are still dropping in price and given all the intervention, that’s pretty amazing, and more importantly seems unsustainable. Heck, if nothing else, “lowest interest rates in our lifetimes” would seem to be starting to lose its allure, if for no other reason than that’s probably starting to look like the new normal. So, will we see downward pressure pick up? I think so.

[sdcellar]

CA Renter– Yeah, I’m not suggesting that the shadow doesn’t exist, I’ve just stopped thinking that it’s going to flood the market any time soon.

I’ve heard that it’s happening Real Soon Now™ from folks of all walks of life. Everybody from neighbors to the friendly barista who assembled my Caramel Machiatto this morning. And, of course, here (first, of course!).

Keep in mind that some markets are still dropping in price and given all the intervention, that’s pretty amazing, and more importantly seems unsustainable. Heck, if nothing else, “lowest interest rates in our lifetimes” would seem to be starting to lose its allure, if for no other reason than that’s probably starting to look like the new normal. So, will we see downward pressure pick up? I think so.

[sdcellar]

CA Renter– Yeah, I’m not suggesting that the shadow doesn’t exist, I’ve just stopped thinking that it’s going to flood the market any time soon.

I’ve heard that it’s happening Real Soon Now™ from folks of all walks of life. Everybody from neighbors to the friendly barista who assembled my Caramel Machiatto this morning. And, of course, here (first, of course!).

Keep in mind that some markets are still dropping in price and given all the intervention, that’s pretty amazing, and more importantly seems unsustainable. Heck, if nothing else, “lowest interest rates in our lifetimes” would seem to be starting to lose its allure, if for no other reason than that’s probably starting to look like the new normal. So, will we see downward pressure pick up? I think so.

[SD Realtor]

Some quick facts of recent trannies I have closed that were short sales.

1 – There is not a single case where a second received anywhere close to full value on the loan.

2 – Just closing one in Vista. Second is getting about 18% of the total balance of which half of it is coming from the first and the buyer and buyers agent are coming in with the balance.

3 – From what I have seen the firsts generally offer the seconds about 3% of the balance. The seconds usually demand much more.

Most seconds do not choose to foreclose because of the existing risk. They then not only become responsible for the first, and the property taxes, and IRS liens, and other liens but it is simply not even close to profitable for them to do so because if it was they would be flipping properties right and left.

************

If you want to check sdrs statistics guys, he does do alot of short sales so what he does say about the process carries alot more real life experience and truth then most internet articles and speculative statements made by posters. I do a few and cannot disagree with what he says at all.

[SD Realtor]

Some quick facts of recent trannies I have closed that were short sales.

1 – There is not a single case where a second received anywhere close to full value on the loan.

2 – Just closing one in Vista. Second is getting about 18% of the total balance of which half of it is coming from the first and the buyer and buyers agent are coming in with the balance.

3 – From what I have seen the firsts generally offer the seconds about 3% of the balance. The seconds usually demand much more.

Most seconds do not choose to foreclose because of the existing risk. They then not only become responsible for the first, and the property taxes, and IRS liens, and other liens but it is simply not even close to profitable for them to do so because if it was they would be flipping properties right and left.

************

If you want to check sdrs statistics guys, he does do alot of short sales so what he does say about the process carries alot more real life experience and truth then most internet articles and speculative statements made by posters. I do a few and cannot disagree with what he says at all.

[SD Realtor]

Some quick facts of recent trannies I have closed that were short sales.

1 – There is not a single case where a second received anywhere close to full value on the loan.

2 – Just closing one in Vista. Second is getting about 18% of the total balance of which half of it is coming from the first and the buyer and buyers agent are coming in with the balance.

3 – From what I have seen the firsts generally offer the seconds about 3% of the balance. The seconds usually demand much more.

Most seconds do not choose to foreclose because of the existing risk. They then not only become responsible for the first, and the property taxes, and IRS liens, and other liens but it is simply not even close to profitable for them to do so because if it was they would be flipping properties right and left.

************

If you want to check sdrs statistics guys, he does do alot of short sales so what he does say about the process carries alot more real life experience and truth then most internet articles and speculative statements made by posters. I do a few and cannot disagree with what he says at all.

[SD Realtor]

Some quick facts of recent trannies I have closed that were short sales.

1 – There is not a single case where a second received anywhere close to full value on the loan.

2 – Just closing one in Vista. Second is getting about 18% of the total balance of which half of it is coming from the first and the buyer and buyers agent are coming in with the balance.

3 – From what I have seen the firsts generally offer the seconds about 3% of the balance. The seconds usually demand much more.

Most seconds do not choose to foreclose because of the existing risk. They then not only become responsible for the first, and the property taxes, and IRS liens, and other liens but it is simply not even close to profitable for them to do so because if it was they would be flipping properties right and left.

************

If you want to check sdrs statistics guys, he does do alot of short sales so what he does say about the process carries alot more real life experience and truth then most internet articles and speculative statements made by posters. I do a few and cannot disagree with what he says at all.

[Author]

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