[ucodegen]

@SD Realtor

My belief is not that eradicating non recourse will solve the problem and my apologies for not conveying it properly.
I would have to disagree with you on this (eradicating non-recourse part of the statement). We got into this problem with the banks/loan originators feeling that the increasing property value would cover any loss even with the fact that the loans were non-recourse. The property would give them back their money on foreclosure. The lenders made the bad assumption that the current rate of property appreciation would continue unabated. Making loans recourse means that all loans have the potential to return the money to the lender, continuing the problem.
For responsible lending to exist, the lenders have to realize that they can loose their skin in the game, not just the borrower. This way, the lender will be forced to do their due diligence.

No doubt adding curbs, regulation to the lending and institutional side of the equation will be most helpful.
I think this would be the most useful, and on more than just the lending side of the equation. I want to see legal regulations along the lines of series 3 and 7 SEC licenses for real estate agents, brokers and mortgage brokers (same with the disciplinary portion) I would also like to see LTV restrictions on loans much like the margin restrictions for stocks (Though not necessarily at the same %LTV weighting. Houses and stocks are both assets)

[ucodegen]

@SD Realtor

My belief is not that eradicating non recourse will solve the problem and my apologies for not conveying it properly.
I would have to disagree with you on this (eradicating non-recourse part of the statement). We got into this problem with the banks/loan originators feeling that the increasing property value would cover any loss even with the fact that the loans were non-recourse. The property would give them back their money on foreclosure. The lenders made the bad assumption that the current rate of property appreciation would continue unabated. Making loans recourse means that all loans have the potential to return the money to the lender, continuing the problem.
For responsible lending to exist, the lenders have to realize that they can loose their skin in the game, not just the borrower. This way, the lender will be forced to do their due diligence.

No doubt adding curbs, regulation to the lending and institutional side of the equation will be most helpful.
I think this would be the most useful, and on more than just the lending side of the equation. I want to see legal regulations along the lines of series 3 and 7 SEC licenses for real estate agents, brokers and mortgage brokers (same with the disciplinary portion) I would also like to see LTV restrictions on loans much like the margin restrictions for stocks (Though not necessarily at the same %LTV weighting. Houses and stocks are both assets)

[ucodegen]

@SD Realtor

My belief is not that eradicating non recourse will solve the problem and my apologies for not conveying it properly.
I would have to disagree with you on this (eradicating non-recourse part of the statement). We got into this problem with the banks/loan originators feeling that the increasing property value would cover any loss even with the fact that the loans were non-recourse. The property would give them back their money on foreclosure. The lenders made the bad assumption that the current rate of property appreciation would continue unabated. Making loans recourse means that all loans have the potential to return the money to the lender, continuing the problem.
For responsible lending to exist, the lenders have to realize that they can loose their skin in the game, not just the borrower. This way, the lender will be forced to do their due diligence.

No doubt adding curbs, regulation to the lending and institutional side of the equation will be most helpful.
I think this would be the most useful, and on more than just the lending side of the equation. I want to see legal regulations along the lines of series 3 and 7 SEC licenses for real estate agents, brokers and mortgage brokers (same with the disciplinary portion) I would also like to see LTV restrictions on loans much like the margin restrictions for stocks (Though not necessarily at the same %LTV weighting. Houses and stocks are both assets)

[ucodegen]

@Multipleproperty

Boy are you out to lunch on your info. Ok.. starting from some where in the middle…

I know most of you are bitter because you don’t own homes. Thus, the tenor of this forum, which is generally caustic. Watching others suffer makes you feel a bit better about your situation as a renter

Dude, wake up. Most of the people on this site are up to their neck in debt. I heard about this site from a handful of people, and all of them are bitter cash poor renters.

Silly boy. There are several long term posters that have been here since the wild real-estate days, who have the ability to buy but did not.. because the rent-buy weighting did not work out and we do not want to risk financial suicide and expect Uncle Sam to bail use out of our stupidity. The cash poor renters were continually thinking of how to get in on the RE Ponzi Scheme, the Piggs were yelling at the top of our voice “Stop the madness”. Some of the newer posters/viewers may be in the category of ‘bitter renter’, but most of us old timers either own or are quite happy renting right now. Myself, I am saving(and investing) at a rate greater than 30% of gross income, or greater than 50% of net income (net of taxes, 401K contribs(maxed)).

Here is why I am upset on the bailouts:
1) It rewards bad behavior in Mortgage lenders(honesty in lending), CDO structures(misrepresenting risks in securitized loans), RE agents(acting as investment advisors, inserting themselves into the middle of the transaction instead of being a broker.. stuff that would get you jailed by the SEC and your series 7 yanked for life), home owners(the home ATM) and new home buyers(Not making sure they can afford what they purchase) while at the same time punishing those that act with prudence and live under their means. If the players in the RE Ponzi Scheme don’t have a penalty, the next time will be worse (more RE Ponzi Scheme players).
2) It really does not bail out the homebuyers, but it does bail out the lenders. Purchase money loans are non-recourse in California. This means that the buyers can walk away from the 1st mortgage on the overpriced asset if they have to, and the bank has to eat the deficiency. Once homeowners avail themselves of the “bail out”, they are no longer dealing with a purchase money loan. The loan has now become recourse, which means the lender can pursue the homeowner should the loan eventually result in foreclosure. This last part is what makes it bad for homeowners. I would recommend that any homeowner having financial problems on a purchase money loan, not use the bail-out. They will be able to walk away from the property if they have to.
3) The bailout supports the present overpriced housing (for the time being), which causes problems for any new buyers trying to enter the market. Eventually things will correct.. the question becomes who is the last fool buying.

The underlying issue is that all things have to return to a norm. The overpriced assets can get devalued, or the all other assets can get inflated up to the price of the overpriced asset.
1) In the example of the overpriced assets getting devalued, the RE speculators and unwise purchases are the ones getting hit, but it will largely be isolated to them. 100% of the current housing did not change hands this time. Less than 20% of total housing did.
2) In the case of everything else getting inflated, this is the ‘bailout’ case. Your wages buy less, gas prices are higher, price of money for business development is higher, Fed can’t get their deficit spending funded through treasuries so they print money.. spurring even greater inflation.. etc

All that changes in these outcomes is: who gets stuck with the bill. The cost of the correction can not be avoided, all that can be done is adjust who takes the cost. I don’t think a 1930’s depression can occur. The 30’s depression was caused by speculating on businesses with no income(not like a house whose ‘income’ is the amount of rent it shields you from) with margin overhang above 100%(similar to 100%morgages). The key difference is the speculation on a tangible asset verses a paper asset. The former provides the floor.

[ucodegen]

@Multipleproperty

Boy are you out to lunch on your info. Ok.. starting from some where in the middle…

I know most of you are bitter because you don’t own homes. Thus, the tenor of this forum, which is generally caustic. Watching others suffer makes you feel a bit better about your situation as a renter

Dude, wake up. Most of the people on this site are up to their neck in debt. I heard about this site from a handful of people, and all of them are bitter cash poor renters.

Silly boy. There are several long term posters that have been here since the wild real-estate days, who have the ability to buy but did not.. because the rent-buy weighting did not work out and we do not want to risk financial suicide and expect Uncle Sam to bail use out of our stupidity. The cash poor renters were continually thinking of how to get in on the RE Ponzi Scheme, the Piggs were yelling at the top of our voice “Stop the madness”. Some of the newer posters/viewers may be in the category of ‘bitter renter’, but most of us old timers either own or are quite happy renting right now. Myself, I am saving(and investing) at a rate greater than 30% of gross income, or greater than 50% of net income (net of taxes, 401K contribs(maxed)).

Here is why I am upset on the bailouts:
1) It rewards bad behavior in Mortgage lenders(honesty in lending), CDO structures(misrepresenting risks in securitized loans), RE agents(acting as investment advisors, inserting themselves into the middle of the transaction instead of being a broker.. stuff that would get you jailed by the SEC and your series 7 yanked for life), home owners(the home ATM) and new home buyers(Not making sure they can afford what they purchase) while at the same time punishing those that act with prudence and live under their means. If the players in the RE Ponzi Scheme don’t have a penalty, the next time will be worse (more RE Ponzi Scheme players).
2) It really does not bail out the homebuyers, but it does bail out the lenders. Purchase money loans are non-recourse in California. This means that the buyers can walk away from the 1st mortgage on the overpriced asset if they have to, and the bank has to eat the deficiency. Once homeowners avail themselves of the “bail out”, they are no longer dealing with a purchase money loan. The loan has now become recourse, which means the lender can pursue the homeowner should the loan eventually result in foreclosure. This last part is what makes it bad for homeowners. I would recommend that any homeowner having financial problems on a purchase money loan, not use the bail-out. They will be able to walk away from the property if they have to.
3) The bailout supports the present overpriced housing (for the time being), which causes problems for any new buyers trying to enter the market. Eventually things will correct.. the question becomes who is the last fool buying.

The underlying issue is that all things have to return to a norm. The overpriced assets can get devalued, or the all other assets can get inflated up to the price of the overpriced asset.
1) In the example of the overpriced assets getting devalued, the RE speculators and unwise purchases are the ones getting hit, but it will largely be isolated to them. 100% of the current housing did not change hands this time. Less than 20% of total housing did.
2) In the case of everything else getting inflated, this is the ‘bailout’ case. Your wages buy less, gas prices are higher, price of money for business development is higher, Fed can’t get their deficit spending funded through treasuries so they print money.. spurring even greater inflation.. etc

All that changes in these outcomes is: who gets stuck with the bill. The cost of the correction can not be avoided, all that can be done is adjust who takes the cost. I don’t think a 1930’s depression can occur. The 30’s depression was caused by speculating on businesses with no income(not like a house whose ‘income’ is the amount of rent it shields you from) with margin overhang above 100%(similar to 100%morgages). The key difference is the speculation on a tangible asset verses a paper asset. The former provides the floor.

[ucodegen]

@Multipleproperty

Boy are you out to lunch on your info. Ok.. starting from some where in the middle…

I know most of you are bitter because you don’t own homes. Thus, the tenor of this forum, which is generally caustic. Watching others suffer makes you feel a bit better about your situation as a renter

Dude, wake up. Most of the people on this site are up to their neck in debt. I heard about this site from a handful of people, and all of them are bitter cash poor renters.

Silly boy. There are several long term posters that have been here since the wild real-estate days, who have the ability to buy but did not.. because the rent-buy weighting did not work out and we do not want to risk financial suicide and expect Uncle Sam to bail use out of our stupidity. The cash poor renters were continually thinking of how to get in on the RE Ponzi Scheme, the Piggs were yelling at the top of our voice “Stop the madness”. Some of the newer posters/viewers may be in the category of ‘bitter renter’, but most of us old timers either own or are quite happy renting right now. Myself, I am saving(and investing) at a rate greater than 30% of gross income, or greater than 50% of net income (net of taxes, 401K contribs(maxed)).

Here is why I am upset on the bailouts:
1) It rewards bad behavior in Mortgage lenders(honesty in lending), CDO structures(misrepresenting risks in securitized loans), RE agents(acting as investment advisors, inserting themselves into the middle of the transaction instead of being a broker.. stuff that would get you jailed by the SEC and your series 7 yanked for life), home owners(the home ATM) and new home buyers(Not making sure they can afford what they purchase) while at the same time punishing those that act with prudence and live under their means. If the players in the RE Ponzi Scheme don’t have a penalty, the next time will be worse (more RE Ponzi Scheme players).
2) It really does not bail out the homebuyers, but it does bail out the lenders. Purchase money loans are non-recourse in California. This means that the buyers can walk away from the 1st mortgage on the overpriced asset if they have to, and the bank has to eat the deficiency. Once homeowners avail themselves of the “bail out”, they are no longer dealing with a purchase money loan. The loan has now become recourse, which means the lender can pursue the homeowner should the loan eventually result in foreclosure. This last part is what makes it bad for homeowners. I would recommend that any homeowner having financial problems on a purchase money loan, not use the bail-out. They will be able to walk away from the property if they have to.
3) The bailout supports the present overpriced housing (for the time being), which causes problems for any new buyers trying to enter the market. Eventually things will correct.. the question becomes who is the last fool buying.

The underlying issue is that all things have to return to a norm. The overpriced assets can get devalued, or the all other assets can get inflated up to the price of the overpriced asset.
1) In the example of the overpriced assets getting devalued, the RE speculators and unwise purchases are the ones getting hit, but it will largely be isolated to them. 100% of the current housing did not change hands this time. Less than 20% of total housing did.
2) In the case of everything else getting inflated, this is the ‘bailout’ case. Your wages buy less, gas prices are higher, price of money for business development is higher, Fed can’t get their deficit spending funded through treasuries so they print money.. spurring even greater inflation.. etc

All that changes in these outcomes is: who gets stuck with the bill. The cost of the correction can not be avoided, all that can be done is adjust who takes the cost. I don’t think a 1930’s depression can occur. The 30’s depression was caused by speculating on businesses with no income(not like a house whose ‘income’ is the amount of rent it shields you from) with margin overhang above 100%(similar to 100%morgages). The key difference is the speculation on a tangible asset verses a paper asset. The former provides the floor.

[ucodegen]

@Multipleproperty

Boy are you out to lunch on your info. Ok.. starting from some where in the middle…

I know most of you are bitter because you don’t own homes. Thus, the tenor of this forum, which is generally caustic. Watching others suffer makes you feel a bit better about your situation as a renter

Dude, wake up. Most of the people on this site are up to their neck in debt. I heard about this site from a handful of people, and all of them are bitter cash poor renters.

Silly boy. There are several long term posters that have been here since the wild real-estate days, who have the ability to buy but did not.. because the rent-buy weighting did not work out and we do not want to risk financial suicide and expect Uncle Sam to bail use out of our stupidity. The cash poor renters were continually thinking of how to get in on the RE Ponzi Scheme, the Piggs were yelling at the top of our voice “Stop the madness”. Some of the newer posters/viewers may be in the category of ‘bitter renter’, but most of us old timers either own or are quite happy renting right now. Myself, I am saving(and investing) at a rate greater than 30% of gross income, or greater than 50% of net income (net of taxes, 401K contribs(maxed)).

Here is why I am upset on the bailouts:
1) It rewards bad behavior in Mortgage lenders(honesty in lending), CDO structures(misrepresenting risks in securitized loans), RE agents(acting as investment advisors, inserting themselves into the middle of the transaction instead of being a broker.. stuff that would get you jailed by the SEC and your series 7 yanked for life), home owners(the home ATM) and new home buyers(Not making sure they can afford what they purchase) while at the same time punishing those that act with prudence and live under their means. If the players in the RE Ponzi Scheme don’t have a penalty, the next time will be worse (more RE Ponzi Scheme players).
2) It really does not bail out the homebuyers, but it does bail out the lenders. Purchase money loans are non-recourse in California. This means that the buyers can walk away from the 1st mortgage on the overpriced asset if they have to, and the bank has to eat the deficiency. Once homeowners avail themselves of the “bail out”, they are no longer dealing with a purchase money loan. The loan has now become recourse, which means the lender can pursue the homeowner should the loan eventually result in foreclosure. This last part is what makes it bad for homeowners. I would recommend that any homeowner having financial problems on a purchase money loan, not use the bail-out. They will be able to walk away from the property if they have to.
3) The bailout supports the present overpriced housing (for the time being), which causes problems for any new buyers trying to enter the market. Eventually things will correct.. the question becomes who is the last fool buying.

The underlying issue is that all things have to return to a norm. The overpriced assets can get devalued, or the all other assets can get inflated up to the price of the overpriced asset.
1) In the example of the overpriced assets getting devalued, the RE speculators and unwise purchases are the ones getting hit, but it will largely be isolated to them. 100% of the current housing did not change hands this time. Less than 20% of total housing did.
2) In the case of everything else getting inflated, this is the ‘bailout’ case. Your wages buy less, gas prices are higher, price of money for business development is higher, Fed can’t get their deficit spending funded through treasuries so they print money.. spurring even greater inflation.. etc

All that changes in these outcomes is: who gets stuck with the bill. The cost of the correction can not be avoided, all that can be done is adjust who takes the cost. I don’t think a 1930’s depression can occur. The 30’s depression was caused by speculating on businesses with no income(not like a house whose ‘income’ is the amount of rent it shields you from) with margin overhang above 100%(similar to 100%morgages). The key difference is the speculation on a tangible asset verses a paper asset. The former provides the floor.

[ucodegen]

@Multipleproperty

Boy are you out to lunch on your info. Ok.. starting from some where in the middle…

I know most of you are bitter because you don’t own homes. Thus, the tenor of this forum, which is generally caustic. Watching others suffer makes you feel a bit better about your situation as a renter

Dude, wake up. Most of the people on this site are up to their neck in debt. I heard about this site from a handful of people, and all of them are bitter cash poor renters.

Silly boy. There are several long term posters that have been here since the wild real-estate days, who have the ability to buy but did not.. because the rent-buy weighting did not work out and we do not want to risk financial suicide and expect Uncle Sam to bail use out of our stupidity. The cash poor renters were continually thinking of how to get in on the RE Ponzi Scheme, the Piggs were yelling at the top of our voice “Stop the madness”. Some of the newer posters/viewers may be in the category of ‘bitter renter’, but most of us old timers either own or are quite happy renting right now. Myself, I am saving(and investing) at a rate greater than 30% of gross income, or greater than 50% of net income (net of taxes, 401K contribs(maxed)).

Here is why I am upset on the bailouts:
1) It rewards bad behavior in Mortgage lenders(honesty in lending), CDO structures(misrepresenting risks in securitized loans), RE agents(acting as investment advisors, inserting themselves into the middle of the transaction instead of being a broker.. stuff that would get you jailed by the SEC and your series 7 yanked for life), home owners(the home ATM) and new home buyers(Not making sure they can afford what they purchase) while at the same time punishing those that act with prudence and live under their means. If the players in the RE Ponzi Scheme don’t have a penalty, the next time will be worse (more RE Ponzi Scheme players).
2) It really does not bail out the homebuyers, but it does bail out the lenders. Purchase money loans are non-recourse in California. This means that the buyers can walk away from the 1st mortgage on the overpriced asset if they have to, and the bank has to eat the deficiency. Once homeowners avail themselves of the “bail out”, they are no longer dealing with a purchase money loan. The loan has now become recourse, which means the lender can pursue the homeowner should the loan eventually result in foreclosure. This last part is what makes it bad for homeowners. I would recommend that any homeowner having financial problems on a purchase money loan, not use the bail-out. They will be able to walk away from the property if they have to.
3) The bailout supports the present overpriced housing (for the time being), which causes problems for any new buyers trying to enter the market. Eventually things will correct.. the question becomes who is the last fool buying.

The underlying issue is that all things have to return to a norm. The overpriced assets can get devalued, or the all other assets can get inflated up to the price of the overpriced asset.
1) In the example of the overpriced assets getting devalued, the RE speculators and unwise purchases are the ones getting hit, but it will largely be isolated to them. 100% of the current housing did not change hands this time. Less than 20% of total housing did.
2) In the case of everything else getting inflated, this is the ‘bailout’ case. Your wages buy less, gas prices are higher, price of money for business development is higher, Fed can’t get their deficit spending funded through treasuries so they print money.. spurring even greater inflation.. etc

All that changes in these outcomes is: who gets stuck with the bill. The cost of the correction can not be avoided, all that can be done is adjust who takes the cost. I don’t think a 1930’s depression can occur. The 30’s depression was caused by speculating on businesses with no income(not like a house whose ‘income’ is the amount of rent it shields you from) with margin overhang above 100%(similar to 100%morgages). The key difference is the speculation on a tangible asset verses a paper asset. The former provides the floor.

[ucodegen]

@Bugs

The raised foundation is a killer when it comes to buyer appeal.

I would have to disagree with you on this (with caveats). I have lived in both raised floor and slab foundations. I prefer a properly built raised floor foundation. Plumbing repairs in a slab foundation can be a nightmare. When you buy a house built on a slab foundation, the state of the plumbing is an un-inspectable potential black hole.

I think what does turn off people on raised foundations is floor flex and noise. This has much to do with how the floor was constructed. I don’t know what the specs on the modulars are. The spacing on stick built depends upon span and spacing between joists. Unfortunately most construction tends to push the spacing to the limit. Closer spacing and larger joists (in the vertical dimension) make a tighter raised floor.

There are also issues with large tile/marble floors on a raised floor foundation.

[ucodegen]

@Bugs

The raised foundation is a killer when it comes to buyer appeal.

I would have to disagree with you on this (with caveats). I have lived in both raised floor and slab foundations. I prefer a properly built raised floor foundation. Plumbing repairs in a slab foundation can be a nightmare. When you buy a house built on a slab foundation, the state of the plumbing is an un-inspectable potential black hole.

I think what does turn off people on raised foundations is floor flex and noise. This has much to do with how the floor was constructed. I don’t know what the specs on the modulars are. The spacing on stick built depends upon span and spacing between joists. Unfortunately most construction tends to push the spacing to the limit. Closer spacing and larger joists (in the vertical dimension) make a tighter raised floor.

There are also issues with large tile/marble floors on a raised floor foundation.

[ucodegen]

@Bugs

The raised foundation is a killer when it comes to buyer appeal.

I would have to disagree with you on this (with caveats). I have lived in both raised floor and slab foundations. I prefer a properly built raised floor foundation. Plumbing repairs in a slab foundation can be a nightmare. When you buy a house built on a slab foundation, the state of the plumbing is an un-inspectable potential black hole.

I think what does turn off people on raised foundations is floor flex and noise. This has much to do with how the floor was constructed. I don’t know what the specs on the modulars are. The spacing on stick built depends upon span and spacing between joists. Unfortunately most construction tends to push the spacing to the limit. Closer spacing and larger joists (in the vertical dimension) make a tighter raised floor.

There are also issues with large tile/marble floors on a raised floor foundation.

[ucodegen]

@Bugs

The raised foundation is a killer when it comes to buyer appeal.

I would have to disagree with you on this (with caveats). I have lived in both raised floor and slab foundations. I prefer a properly built raised floor foundation. Plumbing repairs in a slab foundation can be a nightmare. When you buy a house built on a slab foundation, the state of the plumbing is an un-inspectable potential black hole.

I think what does turn off people on raised foundations is floor flex and noise. This has much to do with how the floor was constructed. I don’t know what the specs on the modulars are. The spacing on stick built depends upon span and spacing between joists. Unfortunately most construction tends to push the spacing to the limit. Closer spacing and larger joists (in the vertical dimension) make a tighter raised floor.

There are also issues with large tile/marble floors on a raised floor foundation.

[ucodegen]

@Bugs

The raised foundation is a killer when it comes to buyer appeal.

I would have to disagree with you on this (with caveats). I have lived in both raised floor and slab foundations. I prefer a properly built raised floor foundation. Plumbing repairs in a slab foundation can be a nightmare. When you buy a house built on a slab foundation, the state of the plumbing is an un-inspectable potential black hole.

I think what does turn off people on raised foundations is floor flex and noise. This has much to do with how the floor was constructed. I don’t know what the specs on the modulars are. The spacing on stick built depends upon span and spacing between joists. Unfortunately most construction tends to push the spacing to the limit. Closer spacing and larger joists (in the vertical dimension) make a tighter raised floor.

There are also issues with large tile/marble floors on a raised floor foundation.

[ucodegen]

If this information has not been released to the general public, you can do jack shit. Any action done on stock trades under this condition is illegal.

Morality anyone?

[ucodegen]

If this information has not been released to the general public, you can do jack shit. Any action done on stock trades under this condition is illegal.

Morality anyone?

[Author]

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