Question for the bulls

[Rt.66]

This sounds bad for SD mid and upper markets:

“75% of option-ARM holders are paying less than the full interest charges on their mortgages, with the difference added to principal that they must start paying on reset. The pain could be especially acute next summer, when the dollar value of option-ARM and Alt-A loans resetting will be double the amount it was last August.

“The less-than-interest option attracted everyone but especially business owners who wanted more capital and people moving to wealthy areas who couldn’t otherwise afford to,” says Mark Hanson of real estate consultancy M. Hanson Advisors. Within 10 miles of Mill Valley in wealthy Marin County, Calif., 35% of 600 homes in foreclosure (average appraised value: $860,000; average net equity: -$98,000) were financed with option-ARM loans, Hanson says. This time next year, he adds, “time bombs will be going off everywhere.”

Most vulnerable are rich towns in California and Florida, where more than half of these loans reside.”

http://www.forbes.com/2009/10/07/real-estate-mortgages-foreclosures-personal-finance-crisis.html

[sdrealtor]

It sure will be interesting to see what happens with those prime option-ARM’s. I didnt see many of them butI’m just one guy. I have no idea how many are out there and how many that were were refinaced away in the last year. A couple years ago, I expected the problems in upper middle tier to hit between 2010 and 2012 as much of the loans I saw as problematic were 5/1 ARM’s written in between 2010 and 2012. I underestimated the resolve of the Fed to get/keep rates as low as they are and suspect they will stay there for quite some time to come. Will be interesting to see how big the problem actually manifests itself to be.

FWIW, the highlighted text above is a quote from Mark Hanson aka Mr Mortgage who has been wrong all year.

[sdrealtor]

It sure will be interesting to see what happens with those prime option-ARM’s. I didnt see many of them butI’m just one guy. I have no idea how many are out there and how many that were were refinaced away in the last year. A couple years ago, I expected the problems in upper middle tier to hit between 2010 and 2012 as much of the loans I saw as problematic were 5/1 ARM’s written in between 2010 and 2012. I underestimated the resolve of the Fed to get/keep rates as low as they are and suspect they will stay there for quite some time to come. Will be interesting to see how big the problem actually manifests itself to be.

FWIW, the highlighted text above is a quote from Mark Hanson aka Mr Mortgage who has been wrong all year.

[sdrealtor]

It sure will be interesting to see what happens with those prime option-ARM’s. I didnt see many of them butI’m just one guy. I have no idea how many are out there and how many that were were refinaced away in the last year. A couple years ago, I expected the problems in upper middle tier to hit between 2010 and 2012 as much of the loans I saw as problematic were 5/1 ARM’s written in between 2010 and 2012. I underestimated the resolve of the Fed to get/keep rates as low as they are and suspect they will stay there for quite some time to come. Will be interesting to see how big the problem actually manifests itself to be.

FWIW, the highlighted text above is a quote from Mark Hanson aka Mr Mortgage who has been wrong all year.

[sdrealtor]

It sure will be interesting to see what happens with those prime option-ARM’s. I didnt see many of them butI’m just one guy. I have no idea how many are out there and how many that were were refinaced away in the last year. A couple years ago, I expected the problems in upper middle tier to hit between 2010 and 2012 as much of the loans I saw as problematic were 5/1 ARM’s written in between 2010 and 2012. I underestimated the resolve of the Fed to get/keep rates as low as they are and suspect they will stay there for quite some time to come. Will be interesting to see how big the problem actually manifests itself to be.

FWIW, the highlighted text above is a quote from Mark Hanson aka Mr Mortgage who has been wrong all year.

[sdrealtor]

It sure will be interesting to see what happens with those prime option-ARM’s. I didnt see many of them butI’m just one guy. I have no idea how many are out there and how many that were were refinaced away in the last year. A couple years ago, I expected the problems in upper middle tier to hit between 2010 and 2012 as much of the loans I saw as problematic were 5/1 ARM’s written in between 2010 and 2012. I underestimated the resolve of the Fed to get/keep rates as low as they are and suspect they will stay there for quite some time to come. Will be interesting to see how big the problem actually manifests itself to be.

FWIW, the highlighted text above is a quote from Mark Hanson aka Mr Mortgage who has been wrong all year.

[jpinpb]

I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.

[jpinpb]

I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.

[jpinpb]

I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.

[jpinpb]

I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.

[jpinpb]

I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.

[CA renter]

[quote=jpinpb]I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.[/quote]

Absolutely agree.

If the “shadow inventory” didn’t exist, there would be no reason for all the govt intervention (foreclosure moratoriums, HAMP program, ramped-up GSE and FHA programs, Fed buying Treasuries and mortgages, etc., etc.), right?

IMHO, it’s a fallacy to say the “shadow inventory” doesn’t exist. It DOES, in fact, exist. They are just trying mightily to hide it and prolong the correction.

For clarification: I include all houses that would be foreclosed on if not for external intervention, in addition to those that are already foreclosed but not on the market. It’s just a different stage of the same problem.

[CA renter]

[quote=jpinpb]I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.[/quote]

Absolutely agree.

If the “shadow inventory” didn’t exist, there would be no reason for all the govt intervention (foreclosure moratoriums, HAMP program, ramped-up GSE and FHA programs, Fed buying Treasuries and mortgages, etc., etc.), right?

IMHO, it’s a fallacy to say the “shadow inventory” doesn’t exist. It DOES, in fact, exist. They are just trying mightily to hide it and prolong the correction.

For clarification: I include all houses that would be foreclosed on if not for external intervention, in addition to those that are already foreclosed but not on the market. It’s just a different stage of the same problem.

[CA renter]

[quote=jpinpb]I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.[/quote]

Absolutely agree.

If the “shadow inventory” didn’t exist, there would be no reason for all the govt intervention (foreclosure moratoriums, HAMP program, ramped-up GSE and FHA programs, Fed buying Treasuries and mortgages, etc., etc.), right?

IMHO, it’s a fallacy to say the “shadow inventory” doesn’t exist. It DOES, in fact, exist. They are just trying mightily to hide it and prolong the correction.

For clarification: I include all houses that would be foreclosed on if not for external intervention, in addition to those that are already foreclosed but not on the market. It’s just a different stage of the same problem.

[CA renter]

[quote=jpinpb]I am not following entirely what Hanson is saying lately, but he predicted a tsunami of NODs and they did happen. They’re just not hitting the market as a tsunami. This is, of course, thanks to government intervention. Had that not occurred, I think we would be flooded w/REOs.[/quote]

Absolutely agree.

If the “shadow inventory” didn’t exist, there would be no reason for all the govt intervention (foreclosure moratoriums, HAMP program, ramped-up GSE and FHA programs, Fed buying Treasuries and mortgages, etc., etc.), right?

IMHO, it’s a fallacy to say the “shadow inventory” doesn’t exist. It DOES, in fact, exist. They are just trying mightily to hide it and prolong the correction.

For clarification: I include all houses that would be foreclosed on if not for external intervention, in addition to those that are already foreclosed but not on the market. It’s just a different stage of the same problem.

[Author]

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