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DaCounselor
Participant“I read the other day that the size of the average US home in 1960 was 1200 square feet. By 1980 it was up to almost 1800 square feet and today it’s over 2200 square feet.”
__________________More space to cram more stuff that Madison Avenue says we need while we chase the Joneses. Forget about a useless yard, build it out to the lot line, we need more floorspace for the kids to play video games.
Watching the lifestyle of the middle class evolve over the decades has been an amazing experience.
Participant“I read the other day that the size of the average US home in 1960 was 1200 square feet. By 1980 it was up to almost 1800 square feet and today it’s over 2200 square feet.”
__________________More space to cram more stuff that Madison Avenue says we need while we chase the Joneses. Forget about a useless yard, build it out to the lot line, we need more floorspace for the kids to play video games.
Watching the lifestyle of the middle class evolve over the decades has been an amazing experience.
Participant“I read the other day that the size of the average US home in 1960 was 1200 square feet. By 1980 it was up to almost 1800 square feet and today it’s over 2200 square feet.”
__________________More space to cram more stuff that Madison Avenue says we need while we chase the Joneses. Forget about a useless yard, build it out to the lot line, we need more floorspace for the kids to play video games.
Watching the lifestyle of the middle class evolve over the decades has been an amazing experience.
ParticipantGood point xbox about the high end sellers with inflated list prices who are just fishing for that one big offer. They’re definitely out there. But if, as you state, we don’t know how many fall in this category – can’t tell, don’t know – then we really can’t come to the conclusion that such a class of seller makes the inventory numbers meaningless. So all I can do is evaluate the data I have, which is in almost all areas mentioned an inventory level of over one year and in numerous cases in the two year range. There is alot of high end inventory out there and it is not moving fast.
ParticipantGood point xbox about the high end sellers with inflated list prices who are just fishing for that one big offer. They’re definitely out there. But if, as you state, we don’t know how many fall in this category – can’t tell, don’t know – then we really can’t come to the conclusion that such a class of seller makes the inventory numbers meaningless. So all I can do is evaluate the data I have, which is in almost all areas mentioned an inventory level of over one year and in numerous cases in the two year range. There is alot of high end inventory out there and it is not moving fast.
ParticipantGood point xbox about the high end sellers with inflated list prices who are just fishing for that one big offer. They’re definitely out there. But if, as you state, we don’t know how many fall in this category – can’t tell, don’t know – then we really can’t come to the conclusion that such a class of seller makes the inventory numbers meaningless. So all I can do is evaluate the data I have, which is in almost all areas mentioned an inventory level of over one year and in numerous cases in the two year range. There is alot of high end inventory out there and it is not moving fast.
ParticipantGood point xbox about the high end sellers with inflated list prices who are just fishing for that one big offer. They’re definitely out there. But if, as you state, we don’t know how many fall in this category – can’t tell, don’t know – then we really can’t come to the conclusion that such a class of seller makes the inventory numbers meaningless. So all I can do is evaluate the data I have, which is in almost all areas mentioned an inventory level of over one year and in numerous cases in the two year range. There is alot of high end inventory out there and it is not moving fast.
ParticipantGood point xbox about the high end sellers with inflated list prices who are just fishing for that one big offer. They’re definitely out there. But if, as you state, we don’t know how many fall in this category – can’t tell, don’t know – then we really can’t come to the conclusion that such a class of seller makes the inventory numbers meaningless. So all I can do is evaluate the data I have, which is in almost all areas mentioned an inventory level of over one year and in numerous cases in the two year range. There is alot of high end inventory out there and it is not moving fast.
ParticipantIt’s all about the index rate. If the indices had not been driven down toward historical lows, we would already be seeing a mass exodus of those in the 3/1 ARM products and we would be on the front edge of the second massive wave, those in the 5/1 products.
I don’t think the initial article misses the recast issue – I think he indicates that even at recast the payment spike will be not be devastating due to lower interest rates based on lower indices and a loan balance that has not grown massively.
As for what to expect with indices moving forward – my own yardstick is to look at the FFR as a benchmark as its easy to track and LIBOR typically follows fairly closely. My opinion is that 3% or lower is low. After the tech meltdown, the FFR was 3% or lower for 4 years. In this current debacle, the FFR has been 3% or lower for only 20 months. I think the table is set for low rates for longer than after the tech meltdown, so we have quite a bit of time to go in a low rate environment. FWIW.
ParticipantIt’s all about the index rate. If the indices had not been driven down toward historical lows, we would already be seeing a mass exodus of those in the 3/1 ARM products and we would be on the front edge of the second massive wave, those in the 5/1 products.
I don’t think the initial article misses the recast issue – I think he indicates that even at recast the payment spike will be not be devastating due to lower interest rates based on lower indices and a loan balance that has not grown massively.
As for what to expect with indices moving forward – my own yardstick is to look at the FFR as a benchmark as its easy to track and LIBOR typically follows fairly closely. My opinion is that 3% or lower is low. After the tech meltdown, the FFR was 3% or lower for 4 years. In this current debacle, the FFR has been 3% or lower for only 20 months. I think the table is set for low rates for longer than after the tech meltdown, so we have quite a bit of time to go in a low rate environment. FWIW.
ParticipantIt’s all about the index rate. If the indices had not been driven down toward historical lows, we would already be seeing a mass exodus of those in the 3/1 ARM products and we would be on the front edge of the second massive wave, those in the 5/1 products.
I don’t think the initial article misses the recast issue – I think he indicates that even at recast the payment spike will be not be devastating due to lower interest rates based on lower indices and a loan balance that has not grown massively.
As for what to expect with indices moving forward – my own yardstick is to look at the FFR as a benchmark as its easy to track and LIBOR typically follows fairly closely. My opinion is that 3% or lower is low. After the tech meltdown, the FFR was 3% or lower for 4 years. In this current debacle, the FFR has been 3% or lower for only 20 months. I think the table is set for low rates for longer than after the tech meltdown, so we have quite a bit of time to go in a low rate environment. FWIW.
ParticipantIt’s all about the index rate. If the indices had not been driven down toward historical lows, we would already be seeing a mass exodus of those in the 3/1 ARM products and we would be on the front edge of the second massive wave, those in the 5/1 products.
I don’t think the initial article misses the recast issue – I think he indicates that even at recast the payment spike will be not be devastating due to lower interest rates based on lower indices and a loan balance that has not grown massively.
As for what to expect with indices moving forward – my own yardstick is to look at the FFR as a benchmark as its easy to track and LIBOR typically follows fairly closely. My opinion is that 3% or lower is low. After the tech meltdown, the FFR was 3% or lower for 4 years. In this current debacle, the FFR has been 3% or lower for only 20 months. I think the table is set for low rates for longer than after the tech meltdown, so we have quite a bit of time to go in a low rate environment. FWIW.
ParticipantIt’s all about the index rate. If the indices had not been driven down toward historical lows, we would already be seeing a mass exodus of those in the 3/1 ARM products and we would be on the front edge of the second massive wave, those in the 5/1 products.
I don’t think the initial article misses the recast issue – I think he indicates that even at recast the payment spike will be not be devastating due to lower interest rates based on lower indices and a loan balance that has not grown massively.
As for what to expect with indices moving forward – my own yardstick is to look at the FFR as a benchmark as its easy to track and LIBOR typically follows fairly closely. My opinion is that 3% or lower is low. After the tech meltdown, the FFR was 3% or lower for 4 years. In this current debacle, the FFR has been 3% or lower for only 20 months. I think the table is set for low rates for longer than after the tech meltdown, so we have quite a bit of time to go in a low rate environment. FWIW.
Participant“Are you suggesting that the Alt-As won’t “recast” like the Option ARMs? Because when the reset hits, it’s not just the interest rate. Nearly all of these borrorers are now well under water (See WSJ front page today). This means due to their decreasing LTV, monthly payment will still go up regardless of interest rate.”
____________________I think FSD’s general point on this issue is that lower LIBOR = lower reset payments = no payment shock = no forced default. Maybe an oversimplification but that’s the gist. I agree as I have for the past year.
Alot of the 3/1 and 5/1 ARMS in SD have 10 yr IO periods, so anyone in these loan products is probably paying less now than they were originally. If LIBOR had not fallen off a cliff but was still in the 5.5% range, we would probably have had a ton more defaults after reset than we have seen.
I believe a huge percentage of people underwater are not in default because their payments are so low right now. I think the mentality is to ride things out for awhile and see what happens down the road. This environment was created by LIBOR tanking – otherwise I thnk most of these people would have had their hand forced by a big payment spike on reset and many would have just defaulted.
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