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July 23, 2017 at 9:10 AM in reply to: New construction at record low, nominal prices hit new high #807269December 12, 2011 at 6:15 PM in reply to: Refinanced 4 months ago at 4.2%, now same broker said I could refiance again? #734523
lifeizfunhuh
ParticipantThanks for the clarification sdr, but it was not a “faulty” post.
You are correct IF the lender seeks non-judicial foreclosure. This doesn’t mean the lender cannot seek a judicial foreclosure. Here is the scenario… a high net-worth individual makes a bad purchase on his home, and decides to save some money via a refi. The value of the house subsequently tanks and he decides to make a “strategic default” thinking there is nothing the bank can do about it because he has received advice on the internet that the bank cannot go after their assets.
The reason that 99.9 percent of foreclosures are non-judicial is because the deficiency is less than the expected litigation and other costs. I don’t know where that number is because I don’t litigate in this space. However, there is a number where judicial foreclosure is worthwhile, and personal assets are in jeopardy.
People should make their own choice based on their own situation, but it is better to have complete information about your rights before you do.
December 12, 2011 at 5:18 PM in reply to: Refinanced 4 months ago at 4.2%, now same broker said I could refiance again? #734520ParticipantI’m an attorney so I thought I would interject something about the perils of refinancing.
In California, there is an “anti-deficiency” law on your primary residence, with your ORIGINAL LOAN. This means that if you suffer hard times and cannot pay your mortgage, you can walk, and the only recourse the lender has is to take the home. They cannot come after you for the difference between what your house is worth and the balance on the note.
If you refi however, you lose this protection. So for example, if your original note was for 500k, you refi, then default, your house is sold at auction for 300k, the bank can come after you for the “deficiency” or 200k. Is that worth a few hundred a month? What is the piece of mind worth that they can only take the house and nothing more? Lots for me thanks.
Participant[quote=jstoesz][quote=AN][quote=jstoesz]read up on how Argentina’s home prices fared through their last serious bout with hyper-inflation.
Things are far from a sure bet.[/quote]
Thanks for pointing me to Argentina’s experience w/ hyper-inflation. According to Wikipedia:[quote=wiki]Argentina
Argentina went through steady inflation from 1975 to 1991. At the beginning of 1975, the highest denomination was 1,000 pesos. In late 1976, the highest denomination was 5,000 pesos. In early 1979, the highest denomination was 10,000 pesos. By the end of 1981, the highest denomination was 1,000,000 pesos. In the 1983 currency reform, 1 Peso argentino was exchanged for 10,000 pesos. In the 1985 currency reform, 1 austral was exchanged for 1,000 pesos argentinos. In the 1992 currency reform, 1 new peso was exchanged for 10,000 australes. The overall impact of hyperinflation: 1 (1992) peso = 100,000,000,000 pre-1983 pesos.[/quote]
Even if housing price dip nominally, if the currency weaken at a much faster rate due to inflation, then you still come out ahead. Which, I think is what lifeizfunhuh is trying to say. A 1000 peso in 1975 is equivalent to 1M peso in 1983. If we see this kind of inflation, everything that have fixed rate interest will look dirt cheap in the future. Even if we don’t see hyper inflation like Argentina, if we see inflation like we experienced in the US in the 70s, it will still be dirt cheap to pay back with much weaker currency.[/quote]That was exactly the article I was referring to. I saw it on the Gonzolo Lira blog
My point was that it is not so simple. Lifeisfunhuh, was making the point that A leads to B. Except, it is far from that simple. There are many times when inflation has crushed peoples buying power, and ability to borrow. They now have less to spend on housing and interest so that they can keep eating.
This is economics we are talking here. If you are predicting the future, you are either stupid, delusional, or a combination of the two.
.[/quote]I respectfully disagree on the “predicting the future” remark. I agree that in free markets predicting the future is folly. However, markets for almost all things in finance are no longer free-flowing. To the contrary, it is a rigged casino. Case in point: nearly all major bank trading desks have near perfect trading records.
As someone famously said “I don’t care IF the markets are rigged, as long as I know HOW they are rigged so I can play along.” The House Rules of monetary policy REQUIRE significant inflation. It is both the only mathematical outcome, and also the only historical one as well.
The question is not IF, but when, and how much. While I’m not stupid or delusional enough to think I can predict the future of a particular stock, bond, or other asset class, I CAN be certain that the value of the cash I keep in the bank is, and will continue deteriorating at an unacceptable rate. From this premise I can make appropriate decisions on what assets to purchase with that cash. Whether those assets go “up” or “down” is not the issue, and is not something I am trying to predict.
ParticipantYour analysis must be something like this:
Assuming it is true empirically (I’ll take it at face value), the situation discussed is falling prices because there is no lending in periods of high inflation. I admit the argument is intuitive. However, that does not negate the fact that if a person can hold the asset, the medium of exchange will be worth less. Whether buyers dry up is irrelevant to whether a person ends up with an essentially free home.
Participant[quote=barnaby33]FSD, I posted because I disagree. Housing is only cheap because of unrealistic financing. Housing will be fairly priced when we return to historic norms for ALL the important aspects of how housing is priced, including incomes AND interest rates. Its only cheap if you ignore risk. Risk is NOT intangible. Unemployment is high and probably going higher. Interest rates are driven to lows only because our govt is buying all the mortgages and subsidizing risk at a huge level. Costs for everything basic are surging MUCH faster than increases in income. Its nuts to say housing is affordable.
I’ve had this argument with Rich several times over dinner. I suppose the way I view it is that in order for housing to recover it has to be fairly priced. In order for fairly priced to occur, employment must be on the rebound or at least stable. Lenders must also be accurately compensated for the risk of lending money. One other often overlooked issue is rising taxation. Too many of the unspoken assumptions in this and many other threads are that none of the fundamentals have changed radically. If nothing else this period of instability should point out that many of those either no longer are true, or are due to be changed in the near future.
If you just look at the statistics of rent to own in aggregate I’d agree that things aren’t awful. Of course, again you are making assumptions that the rest of the “market” is functioning normally as well. One of those assumptions is that rent to own ratios encompass a very broad swath of society. In the US where unemployment hovers near 10% I don’t think that’s a valid claim. If unemployment were close to average sure. So now there are two problems I have with that metric. One it covers a much smaller group of people than it used to. Second there is no compensatory stat for those who aren’t covered and probably aren’t working. That’s just one of the traditional metrics that people use. There are of course others.[/quote]
Right now I think people are missing one of the most historic opportunities to protect personal security and assets by not purchasing real estate. There is too much focus on traditional considerations such as job growth and the real economy, which scares people away. The focus should be the government subsidized financing that provides a FIXED, historically low interest rate on a real asset (a home). Governments around the world are expanding the money supply at an exponential rate, and it is a mathematical inevitability that inflation will rise SIGNIFICANTLY in the (near?) future.
Who will win? People owning claims to physical assets, with lots of fixed interest rate debt.
Who will lose? People with lots of cash and the holders of the low-interest rate debt.
Trade the funny money for something real, whether it is a house, a classic car, precious metals, art, whatever.
Think of it this way… it doesn’t matter what the house is worth in the future, because you get to pay that loan back with increasingly less valuable dollars. At some point, those dollars will be worth sufficiently less that the nominal value of the real estate will increase as well. This is always true, but for the past 25 years or so, inflation has been so low that you couldn’t see the process working. Give it 5-10 years, and your monthly payment will be truly insignificant.
So what is a “fair price”? How do you determine a fair price when the medium of exchange (money) is so unstable. By focusing on the market for the house, you are missing the other half of the exchange, the market for money. At this point in history, it is the latter part of the exchange that truly matters.
ParticipantI think the question is not, “how high can gold go?” but “how low can the dollar go?” The answer is theoretically to zero, so the nominal $ value attached to gold is meaningless.
Bernanke announced in early August that he was going to keep interest rates at a very low rate for two years. You can’t just say the words. The only way the central bank can do that is to intervene in the market and force interest rates down. Just look at the Fed’s unadjusted numbers since the beginning of August and you will see they shot up at the same time.
Its all about relative supply curves – the supply curve for bullion is far more inelastic than is the case for paper currency. Its really that simple.
ParticipantI recently bought an Inteliflo VS 3050 and had it installed on the old timer. It now runs about 14 hours a day. I can monitor my electricity usage hour-by-hour with something called “google power meter” which links to my SDGE account and my smart meter. The difference in consumption between the old pump and new is absolutely remarkable. The pump was down for a few days while the caulk on the new pump cured. When I turned it back on, google power meter basically shows that it has no discernible effect on the power used. Its as if it is not running at all.
Definitely get one. I got mine for about $900 online, had it installed for $50, and get a $200 rebate from SDGE. Its totally a no-brainer.
ParticipantI recently bought an Inteliflo VS 3050 and had it installed on the old timer. It now runs about 14 hours a day. I can monitor my electricity usage hour-by-hour with something called “google power meter” which links to my SDGE account and my smart meter. The difference in consumption between the old pump and new is absolutely remarkable. The pump was down for a few days while the caulk on the new pump cured. When I turned it back on, google power meter basically shows that it has no discernible effect on the power used. Its as if it is not running at all.
Definitely get one. I got mine for about $900 online, had it installed for $50, and get a $200 rebate from SDGE. Its totally a no-brainer.
ParticipantI recently bought an Inteliflo VS 3050 and had it installed on the old timer. It now runs about 14 hours a day. I can monitor my electricity usage hour-by-hour with something called “google power meter” which links to my SDGE account and my smart meter. The difference in consumption between the old pump and new is absolutely remarkable. The pump was down for a few days while the caulk on the new pump cured. When I turned it back on, google power meter basically shows that it has no discernible effect on the power used. Its as if it is not running at all.
Definitely get one. I got mine for about $900 online, had it installed for $50, and get a $200 rebate from SDGE. Its totally a no-brainer.
ParticipantI recently bought an Inteliflo VS 3050 and had it installed on the old timer. It now runs about 14 hours a day. I can monitor my electricity usage hour-by-hour with something called “google power meter” which links to my SDGE account and my smart meter. The difference in consumption between the old pump and new is absolutely remarkable. The pump was down for a few days while the caulk on the new pump cured. When I turned it back on, google power meter basically shows that it has no discernible effect on the power used. Its as if it is not running at all.
Definitely get one. I got mine for about $900 online, had it installed for $50, and get a $200 rebate from SDGE. Its totally a no-brainer.
ParticipantI recently bought an Inteliflo VS 3050 and had it installed on the old timer. It now runs about 14 hours a day. I can monitor my electricity usage hour-by-hour with something called “google power meter” which links to my SDGE account and my smart meter. The difference in consumption between the old pump and new is absolutely remarkable. The pump was down for a few days while the caulk on the new pump cured. When I turned it back on, google power meter basically shows that it has no discernible effect on the power used. Its as if it is not running at all.
Definitely get one. I got mine for about $900 online, had it installed for $50, and get a $200 rebate from SDGE. Its totally a no-brainer.
March 31, 2011 at 12:14 PM in reply to: OT: Anybody had any success in getting rid of cigarrette smell from a home? #683368ParticipantThe machine you are thinking of is an “ozinator.” They are commonly used to remove smoke odors caused by fire damage. Costs about $600. ServPro has them.
March 31, 2011 at 12:14 PM in reply to: OT: Anybody had any success in getting rid of cigarrette smell from a home? #683014ParticipantThe machine you are thinking of is an “ozinator.” They are commonly used to remove smoke odors caused by fire damage. Costs about $600. ServPro has them.
March 31, 2011 at 12:14 PM in reply to: OT: Anybody had any success in getting rid of cigarrette smell from a home? #682874ParticipantThe machine you are thinking of is an “ozinator.” They are commonly used to remove smoke odors caused by fire damage. Costs about $600. ServPro has them.
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