[DaCounselor]

That plan would have to essentially be a lender write-down to the current market value of the property and a new loan based upon the new lower balance, as a homeowner who is in foreclosure would probably have a tough time finding outside financing to purchase the property.

The plan sounds like it could be a win-win. The lender may avoid some of the costs associated with an REO/sale and they get their price. The buyer lives for free for a number of months, then gets a nice chunk of their loan written off and lower payments.

There are a few potential impediments to such a deal, including securitized loan issues and lender unwillingness to reward delinquency. But it seems to make sense to do the deal, doesn’t it? Which is probably why it won’t get done…

A twist on this scenario is the potential manuevering on 80/20 purchase money loan packages that were very common here in CA during the boom. Once the value of the home drops down about 20%, the 2nd is toast, at which time the buyer simply stops paying on it. The 2nd then has three options – foreclose (and incur expenses with zero recovery – not likely), do nothing and hope values go back up, or negotiate a settlement for pennies on the dollar. I would imagine that if the 2nd is not inclined to settle and decides to sit tight, the homeowner could go into default on the 1st mtg and thus threaten the 2nd with a complete wipe-out. That may provide the necessary incentive to settle, after which the borrower could bring the 1st current and stay in the home, now minus the 2nd.

[DaCounselor]

That plan would have to essentially be a lender write-down to the current market value of the property and a new loan based upon the new lower balance, as a homeowner who is in foreclosure would probably have a tough time finding outside financing to purchase the property.

The plan sounds like it could be a win-win. The lender may avoid some of the costs associated with an REO/sale and they get their price. The buyer lives for free for a number of months, then gets a nice chunk of their loan written off and lower payments.

There are a few potential impediments to such a deal, including securitized loan issues and lender unwillingness to reward delinquency. But it seems to make sense to do the deal, doesn’t it? Which is probably why it won’t get done…

A twist on this scenario is the potential manuevering on 80/20 purchase money loan packages that were very common here in CA during the boom. Once the value of the home drops down about 20%, the 2nd is toast, at which time the buyer simply stops paying on it. The 2nd then has three options – foreclose (and incur expenses with zero recovery – not likely), do nothing and hope values go back up, or negotiate a settlement for pennies on the dollar. I would imagine that if the 2nd is not inclined to settle and decides to sit tight, the homeowner could go into default on the 1st mtg and thus threaten the 2nd with a complete wipe-out. That may provide the necessary incentive to settle, after which the borrower could bring the 1st current and stay in the home, now minus the 2nd.

[DaCounselor]

That plan would have to essentially be a lender write-down to the current market value of the property and a new loan based upon the new lower balance, as a homeowner who is in foreclosure would probably have a tough time finding outside financing to purchase the property.

The plan sounds like it could be a win-win. The lender may avoid some of the costs associated with an REO/sale and they get their price. The buyer lives for free for a number of months, then gets a nice chunk of their loan written off and lower payments.

There are a few potential impediments to such a deal, including securitized loan issues and lender unwillingness to reward delinquency. But it seems to make sense to do the deal, doesn’t it? Which is probably why it won’t get done…

A twist on this scenario is the potential manuevering on 80/20 purchase money loan packages that were very common here in CA during the boom. Once the value of the home drops down about 20%, the 2nd is toast, at which time the buyer simply stops paying on it. The 2nd then has three options – foreclose (and incur expenses with zero recovery – not likely), do nothing and hope values go back up, or negotiate a settlement for pennies on the dollar. I would imagine that if the 2nd is not inclined to settle and decides to sit tight, the homeowner could go into default on the 1st mtg and thus threaten the 2nd with a complete wipe-out. That may provide the necessary incentive to settle, after which the borrower could bring the 1st current and stay in the home, now minus the 2nd.

[DaCounselor]

That plan would have to essentially be a lender write-down to the current market value of the property and a new loan based upon the new lower balance, as a homeowner who is in foreclosure would probably have a tough time finding outside financing to purchase the property.

The plan sounds like it could be a win-win. The lender may avoid some of the costs associated with an REO/sale and they get their price. The buyer lives for free for a number of months, then gets a nice chunk of their loan written off and lower payments.

There are a few potential impediments to such a deal, including securitized loan issues and lender unwillingness to reward delinquency. But it seems to make sense to do the deal, doesn’t it? Which is probably why it won’t get done…

A twist on this scenario is the potential manuevering on 80/20 purchase money loan packages that were very common here in CA during the boom. Once the value of the home drops down about 20%, the 2nd is toast, at which time the buyer simply stops paying on it. The 2nd then has three options – foreclose (and incur expenses with zero recovery – not likely), do nothing and hope values go back up, or negotiate a settlement for pennies on the dollar. I would imagine that if the 2nd is not inclined to settle and decides to sit tight, the homeowner could go into default on the 1st mtg and thus threaten the 2nd with a complete wipe-out. That may provide the necessary incentive to settle, after which the borrower could bring the 1st current and stay in the home, now minus the 2nd.

[DaCounselor]

well now, that’s what i get for taking a break from piggington over the holidays. thanks for the link…

[DaCounselor]

well now, that’s what i get for taking a break from piggington over the holidays. thanks for the link…

[DaCounselor]

well now, that’s what i get for taking a break from piggington over the holidays. thanks for the link…

[DaCounselor]

well now, that’s what i get for taking a break from piggington over the holidays. thanks for the link…

[DaCounselor]

well now, that’s what i get for taking a break from piggington over the holidays. thanks for the link…

[DaCounselor]

I haven’t had time to fully evaluate this bill, but my very preliminary thoughts are as follows:

The bill appears to specifically encompass “acquisition indebtedness” only; therefore, it appears that loans taken to purchase the oft-cited Hummer, European vacation, yacht, etc, may not be excluded from cancellation of debt taxation.

The bill does not provide for a free-pass from recourse debt as it does not appear to restrict a lender from pursuing a deficiency judgment. It appears to be a tax bill only. And it’s not a free-pass re taxation, as described above.

At first blush this bill appears to be most favorable to those with considerable assets – ie, those who would not be found insolvent at the time of foreclosure/short sale. Those who are insolvent are already protected from cancellation of debt taxation, so this bill appears to have no relation to them.

I look forward to actually digging into this bill (after much Christmas shopping) and seeing all the fine print.

[DaCounselor]

I haven’t had time to fully evaluate this bill, but my very preliminary thoughts are as follows:

The bill appears to specifically encompass “acquisition indebtedness” only; therefore, it appears that loans taken to purchase the oft-cited Hummer, European vacation, yacht, etc, may not be excluded from cancellation of debt taxation.

The bill does not provide for a free-pass from recourse debt as it does not appear to restrict a lender from pursuing a deficiency judgment. It appears to be a tax bill only. And it’s not a free-pass re taxation, as described above.

At first blush this bill appears to be most favorable to those with considerable assets – ie, those who would not be found insolvent at the time of foreclosure/short sale. Those who are insolvent are already protected from cancellation of debt taxation, so this bill appears to have no relation to them.

I look forward to actually digging into this bill (after much Christmas shopping) and seeing all the fine print.

[DaCounselor]

I haven’t had time to fully evaluate this bill, but my very preliminary thoughts are as follows:

The bill appears to specifically encompass “acquisition indebtedness” only; therefore, it appears that loans taken to purchase the oft-cited Hummer, European vacation, yacht, etc, may not be excluded from cancellation of debt taxation.

The bill does not provide for a free-pass from recourse debt as it does not appear to restrict a lender from pursuing a deficiency judgment. It appears to be a tax bill only. And it’s not a free-pass re taxation, as described above.

At first blush this bill appears to be most favorable to those with considerable assets – ie, those who would not be found insolvent at the time of foreclosure/short sale. Those who are insolvent are already protected from cancellation of debt taxation, so this bill appears to have no relation to them.

I look forward to actually digging into this bill (after much Christmas shopping) and seeing all the fine print.

[DaCounselor]

I haven’t had time to fully evaluate this bill, but my very preliminary thoughts are as follows:

The bill appears to specifically encompass “acquisition indebtedness” only; therefore, it appears that loans taken to purchase the oft-cited Hummer, European vacation, yacht, etc, may not be excluded from cancellation of debt taxation.

The bill does not provide for a free-pass from recourse debt as it does not appear to restrict a lender from pursuing a deficiency judgment. It appears to be a tax bill only. And it’s not a free-pass re taxation, as described above.

At first blush this bill appears to be most favorable to those with considerable assets – ie, those who would not be found insolvent at the time of foreclosure/short sale. Those who are insolvent are already protected from cancellation of debt taxation, so this bill appears to have no relation to them.

I look forward to actually digging into this bill (after much Christmas shopping) and seeing all the fine print.

[DaCounselor]

I haven’t had time to fully evaluate this bill, but my very preliminary thoughts are as follows:

The bill appears to specifically encompass “acquisition indebtedness” only; therefore, it appears that loans taken to purchase the oft-cited Hummer, European vacation, yacht, etc, may not be excluded from cancellation of debt taxation.

The bill does not provide for a free-pass from recourse debt as it does not appear to restrict a lender from pursuing a deficiency judgment. It appears to be a tax bill only. And it’s not a free-pass re taxation, as described above.

At first blush this bill appears to be most favorable to those with considerable assets – ie, those who would not be found insolvent at the time of foreclosure/short sale. Those who are insolvent are already protected from cancellation of debt taxation, so this bill appears to have no relation to them.

I look forward to actually digging into this bill (after much Christmas shopping) and seeing all the fine print.

[DaCounselor]

Be sure to investigate and compare insurance costs for a leased car versus a used car. Leases often require substantial amounts of coverage that go beyond what you may normally select, and any extra costs should be factored in your analysis.

I will say, for whatever it’s worth, that I have been lured to at least consider leasing by the thought of driving a new luxury car every few years. However, after crunching the numbers I always come back down to earth and end up purchasing a late model used (uh, excuse me, I mean “pre-owned”) car. I can say that over the past 12 years I have saved a large sum of money by going used while still driving excellent cars.

[Author]

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