Rich – You may want to read this…

[SD Realtor]

These actions have one single solitary goal which is to stall and provide time for market conditions to unwind and/or keep hoping for more bailouts.

They will not thwart off price declines in the long run, but rather will simply slow down the process of inventory hitting the markets which will do nothing but to prolong the slowdown, push the bottoming out process further out into the future and continue to hamper the market from returning to one that would be characterized as “healthy”.

In essence they will provide further support for people who have defaulted and are simply living in thier homes for free. They will also allow those who revved up HELOCs to the hilt so that they can buy boats and other toys to continue to live in thier homes without paying a cent because they cannot afford it, and they even get to go water skiing on the weekend!

Don’t worry though, 300 days later they may be foreclosed on. I really don’t see how that promotes a speedier recovery.

Just my opinion of course

[peterb]

All these bail-out tactics are just stalling the inevitable. But that’s the idea. Taking the whole hit all in one year could kill the host. But spreading it out over several years will allow survival. It’s clear to me, we’re in survival mode. And it looks exactly like the Japanese model from the early 1990’s!! The outcome is a long, protracted recession. And it will probably cause the true bottom of the real estate market to take another year or two and then bump along the bottom for at least a couple more years.

[peterb]

All these bail-out tactics are just stalling the inevitable. But that’s the idea. Taking the whole hit all in one year could kill the host. But spreading it out over several years will allow survival. It’s clear to me, we’re in survival mode. And it looks exactly like the Japanese model from the early 1990’s!! The outcome is a long, protracted recession. And it will probably cause the true bottom of the real estate market to take another year or two and then bump along the bottom for at least a couple more years.

[peterb]

All these bail-out tactics are just stalling the inevitable. But that’s the idea. Taking the whole hit all in one year could kill the host. But spreading it out over several years will allow survival. It’s clear to me, we’re in survival mode. And it looks exactly like the Japanese model from the early 1990’s!! The outcome is a long, protracted recession. And it will probably cause the true bottom of the real estate market to take another year or two and then bump along the bottom for at least a couple more years.

[peterb]

All these bail-out tactics are just stalling the inevitable. But that’s the idea. Taking the whole hit all in one year could kill the host. But spreading it out over several years will allow survival. It’s clear to me, we’re in survival mode. And it looks exactly like the Japanese model from the early 1990’s!! The outcome is a long, protracted recession. And it will probably cause the true bottom of the real estate market to take another year or two and then bump along the bottom for at least a couple more years.

[peterb]

All these bail-out tactics are just stalling the inevitable. But that’s the idea. Taking the whole hit all in one year could kill the host. But spreading it out over several years will allow survival. It’s clear to me, we’re in survival mode. And it looks exactly like the Japanese model from the early 1990’s!! The outcome is a long, protracted recession. And it will probably cause the true bottom of the real estate market to take another year or two and then bump along the bottom for at least a couple more years.

[Coronita]

bumping this top to get all the politics OT threads at the bottom.

[Coronita]

bumping this top to get all the politics OT threads at the bottom.

[Coronita]

bumping this top to get all the politics OT threads at the bottom.

[Coronita]

bumping this top to get all the politics OT threads at the bottom.

[Coronita]

bumping this top to get all the politics OT threads at the bottom.

[cr]

This is probably going to prove to be one of the most ineffective and costly wastes of legislation in history. All the more why it’s assinine that it passed, but all I read indicates it’s virtually pointless for CA, where people all along have been planning on selling for massive gains once their loan adjusts.

This is from the doctorhousingbubble.com:

“The new housing bill now fully signed into law by the President will do very little to help California. Why? First, lenders should they wish to participate will need to have the property reappraised at today’s market value… In addition, the lender will be required to cut an additional 10 percent from the current appraised value. Well in places like Los Angeles where the median price is off by 35.65 percent an additional reduction of 10 percent will bring the one year correction to nearly 50 percent!…
…Another reason that this won’t fly in states like California is many borrowers even with the new bailout program will not be able to make their payments on a 30 year fixed…

…the minimum payment is only $2,053 on a $616,230 loan! Simply insane and ridiculous. What should be a $3,626 a month payment is artificially lowered by nearly half. Keep in mind that data on option arm loans tells us that approximately 80 percent of people make the minimum payment and we are not factoring in taxes or insurance above.
So with that said, let us assume the lender decides to participate and that home valued at $616,230 is now appraised at $396,560. How will the numbers work out now? Well first the lender will need to take off 10 percent off the appraised value plus a one time 3 percent fee from the note to participate in the program:
$396,560 x .13 = $345,007 new 30 year fixed mortgage
According to the Freddie Mac website the current 30 year fixed rate is 6.63%.

So let us assume the borrower now goes with this loan. What does his monthly principal and interest payment work out to be?
30 year fixed new principal and interest payment = $2,210.26!!!
So even after the massive haircut the lender will take from the 35.65% market correction, the additional 10% in reduced appraisal terms, and the extra one time payment the borrower actually has a higher payment than the initial Pay Option ARM payment for a loan that was $271,223 larger.”

[cr]

This is probably going to prove to be one of the most ineffective and costly wastes of legislation in history. All the more why it’s assinine that it passed, but all I read indicates it’s virtually pointless for CA, where people all along have been planning on selling for massive gains once their loan adjusts.

This is from the doctorhousingbubble.com:

“The new housing bill now fully signed into law by the President will do very little to help California. Why? First, lenders should they wish to participate will need to have the property reappraised at today’s market value… In addition, the lender will be required to cut an additional 10 percent from the current appraised value. Well in places like Los Angeles where the median price is off by 35.65 percent an additional reduction of 10 percent will bring the one year correction to nearly 50 percent!…
…Another reason that this won’t fly in states like California is many borrowers even with the new bailout program will not be able to make their payments on a 30 year fixed…

…the minimum payment is only $2,053 on a $616,230 loan! Simply insane and ridiculous. What should be a $3,626 a month payment is artificially lowered by nearly half. Keep in mind that data on option arm loans tells us that approximately 80 percent of people make the minimum payment and we are not factoring in taxes or insurance above.
So with that said, let us assume the lender decides to participate and that home valued at $616,230 is now appraised at $396,560. How will the numbers work out now? Well first the lender will need to take off 10 percent off the appraised value plus a one time 3 percent fee from the note to participate in the program:
$396,560 x .13 = $345,007 new 30 year fixed mortgage
According to the Freddie Mac website the current 30 year fixed rate is 6.63%.

So let us assume the borrower now goes with this loan. What does his monthly principal and interest payment work out to be?
30 year fixed new principal and interest payment = $2,210.26!!!
So even after the massive haircut the lender will take from the 35.65% market correction, the additional 10% in reduced appraisal terms, and the extra one time payment the borrower actually has a higher payment than the initial Pay Option ARM payment for a loan that was $271,223 larger.”

[cr]

This is probably going to prove to be one of the most ineffective and costly wastes of legislation in history. All the more why it’s assinine that it passed, but all I read indicates it’s virtually pointless for CA, where people all along have been planning on selling for massive gains once their loan adjusts.

This is from the doctorhousingbubble.com:

“The new housing bill now fully signed into law by the President will do very little to help California. Why? First, lenders should they wish to participate will need to have the property reappraised at today’s market value… In addition, the lender will be required to cut an additional 10 percent from the current appraised value. Well in places like Los Angeles where the median price is off by 35.65 percent an additional reduction of 10 percent will bring the one year correction to nearly 50 percent!…
…Another reason that this won’t fly in states like California is many borrowers even with the new bailout program will not be able to make their payments on a 30 year fixed…

…the minimum payment is only $2,053 on a $616,230 loan! Simply insane and ridiculous. What should be a $3,626 a month payment is artificially lowered by nearly half. Keep in mind that data on option arm loans tells us that approximately 80 percent of people make the minimum payment and we are not factoring in taxes or insurance above.
So with that said, let us assume the lender decides to participate and that home valued at $616,230 is now appraised at $396,560. How will the numbers work out now? Well first the lender will need to take off 10 percent off the appraised value plus a one time 3 percent fee from the note to participate in the program:
$396,560 x .13 = $345,007 new 30 year fixed mortgage
According to the Freddie Mac website the current 30 year fixed rate is 6.63%.

So let us assume the borrower now goes with this loan. What does his monthly principal and interest payment work out to be?
30 year fixed new principal and interest payment = $2,210.26!!!
So even after the massive haircut the lender will take from the 35.65% market correction, the additional 10% in reduced appraisal terms, and the extra one time payment the borrower actually has a higher payment than the initial Pay Option ARM payment for a loan that was $271,223 larger.”

[cr]

This is probably going to prove to be one of the most ineffective and costly wastes of legislation in history. All the more why it’s assinine that it passed, but all I read indicates it’s virtually pointless for CA, where people all along have been planning on selling for massive gains once their loan adjusts.

This is from the doctorhousingbubble.com:

“The new housing bill now fully signed into law by the President will do very little to help California. Why? First, lenders should they wish to participate will need to have the property reappraised at today’s market value… In addition, the lender will be required to cut an additional 10 percent from the current appraised value. Well in places like Los Angeles where the median price is off by 35.65 percent an additional reduction of 10 percent will bring the one year correction to nearly 50 percent!…
…Another reason that this won’t fly in states like California is many borrowers even with the new bailout program will not be able to make their payments on a 30 year fixed…

…the minimum payment is only $2,053 on a $616,230 loan! Simply insane and ridiculous. What should be a $3,626 a month payment is artificially lowered by nearly half. Keep in mind that data on option arm loans tells us that approximately 80 percent of people make the minimum payment and we are not factoring in taxes or insurance above.
So with that said, let us assume the lender decides to participate and that home valued at $616,230 is now appraised at $396,560. How will the numbers work out now? Well first the lender will need to take off 10 percent off the appraised value plus a one time 3 percent fee from the note to participate in the program:
$396,560 x .13 = $345,007 new 30 year fixed mortgage
According to the Freddie Mac website the current 30 year fixed rate is 6.63%.

So let us assume the borrower now goes with this loan. What does his monthly principal and interest payment work out to be?
30 year fixed new principal and interest payment = $2,210.26!!!
So even after the massive haircut the lender will take from the 35.65% market correction, the additional 10% in reduced appraisal terms, and the extra one time payment the borrower actually has a higher payment than the initial Pay Option ARM payment for a loan that was $271,223 larger.”

[Author]

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