Report shows strategic defaults increasing

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Submitted by Arraya on March 27, 2010 - 5:04pm

http://blogs.reuters.com/rolfe-winkler/2...

How widespread are strategic defaults? Laurie Goodman and her team at Amherst Mortgage Insight yesterday released a report that shows they are indeed on the rise and for reasons we might suspect: negative equity and a more borrower-friendly environment.

The second reason should be kept in mind as we consider President Obama’s soon-to-be-announced plan to encourage principal reduction. If the plan is structured so that it gives incentives to default in order to secure principal forgiveness, well, expect defaults to spike.

Strategic default isn’t necessarily synonymous with mailing your keys to the bank and walking away. It may simply mean a borrower choosing to stop payments to the bank when economic incentives would have him do so. Amherst has come up with a novel metric to measure strategic default — the “default transition rate.” DTR looks at the percentage of borrowers who’ve never been more than one payment behind on their mortgage suddenly missing two payments in a row.

Lo and behold, negative equity leads more folks to strategically default, regardless of their credit score and whether they took out a liar loan:

Submitted by briansd1 on April 25, 2010 - 9:57pm.

Arraya wrote:
Being second-order conscousness(aware) beings we can literally create our own environment if we wished. Which in turn, means we could create our own evolution or consciously evolve.

How many do you believe actually consciously evolve?

Isn't that kinda like reaching Bodhisattva then Buddha level?

You may consciously evolve but the problem is then you die. You can't pass on the conscience evolution to the next generation.

Maybe with brain graft and transplant we could evolve consciously in the future.

Submitted by briansd1 on April 25, 2010 - 10:04pm.

CE, I setup a 3GS iPhone for my teenage niece without a data plan.

You just have to call AT&T then tell them to register a new handset (not a PDA) on their network. They'll ask for the IMEI number. Then tell them to block the data service. After you're done, move the SIM card to the iPhone.

If you have an iPhone, AT&T wants you to have the $30 per month data plan.

Without the data plan, when you try to use an app that requires data on the iPhone, a message will pop up saying that you're not subscribed to a data service. Of course, wifi still works just fine.

Submitted by bearishgurl on April 26, 2010 - 1:11pm.

UC Gal, I too, have resisted any add-ons to my cell phone service (cheap, voice only) and have been "out of contract" for more than two years. My "Walkman" phone is still great (for me) cuz it is my "i-pod" and camera too, and is brand new still because it has been in a case since I got it (over 4 yrs. ago). However, some of the new phones do look appealing to me for the wi-fi access so I will probably end up purchasing an UNLOCKED one thru e-bay by the end of the year and just moving my chip to it. Then I will enjoy the wi-fi for e-mail, etc. wherever I can hook up for free, incl. my home. It's not worth it to me to enter into another contract where AT&T blocks the true capabilities of the phone so they can charge you a min. of $720 (for a 2 yr. contract) to get SOME OF them back.

If you already have the phone you want and it is out of warranty, you can buy the software to unlock your phone for a nominal fee and simply "flash" it. This voids your "warranty." Actually, I have never known any who ruined their phone by "flashing" it to strip it of the carrier's proprietary operating system. After flashing, you can load it with any operating system compatible with it.

Submitted by sdrealtor on April 26, 2010 - 2:17pm.

This could be the mother of all threadjacks.

Are Smartphones shark resisitant? zombie resistant? Hitler resisitant?

Submitted by scaredyclassic on April 26, 2010 - 4:09pm.

in the future, all threads will devolve not into rants about hitler but instead about smartphones...

Submitted by flu on April 26, 2010 - 4:18pm.

scaredycat wrote:
in the future, all threads will devolve not into rants about hitler but instead about smartphones...

Everyone of you not paying for rent and living rent/mortgage free courtesy of the government/banks, please go out and exercise your discretionary spending on the new Incredible please. :)

http://phones.verizonwireless.com/htc/in...

There, I somewhat brought this back on topic about not paying for mortgage and have more discretionary spending.

Submitted by bearishgurl on April 26, 2010 - 7:40pm.

Not to continue the "threadjacking," my opinion is that BillS78 seems to be "proud of himself" for "strategic default" when he is busy "putting and calling" his way into oblivion. The truth is, his credit is SHOT. I choose to enjoy my 804 FICO score. BobS78 WILL get his Karma. Thank you and good night!

Submitted by NotCranky on April 27, 2010 - 9:00am.

For the nice Realtor:(as long as we are bullying)

http://rationallyspeaking.blogspot.com/2...

You voted for Bush right?

Note the part about refusing to take human nature into consideration(Bill's). Bill has every right to piss on propertarian idealism. It would take a grand removal of liberties for him to really be in the wrong. If people want to trade houses and paper in a rediculous fasion they are free to do it. All of it is fraudulently tied to government but that is not Bill's fault. I, like you, don't like it, but really, let's not get "religious" about it. I think jealousy, is a part of it. If you really want to be "libertarian" you gotta take the good with the bad.

Submitted by briansd1 on April 27, 2010 - 9:36am.

Russell thanks for the link.

I believe that the following excerpt is very true.

Libertarianism appears to be very popular these days, especially among Republicans who wish to pretend to be anti-big government and yet are ashamed of eight years of huge government deficit and interference in personal life under W.

http://rationallyspeaking.blogspot.com/2...

Submitted by Arraya on April 27, 2010 - 9:46am.

It's part of the financialization of everything. homes are bought and sold like stocks. Debt is sold to foreign entities like slavery. In the corporate world contracts and laws are amoral. And they are broken on a consistent basis with no fanfare all on the basis of a cost benefit analysis. he entered into a contract with an amoral entity and it would be foolish to operate under a different set of rules than the entity that he is doing business with. It would put him at a disadvantage.

As well as living for "free". Every default lives for free, Bills period just happens to be a little longer. his actions are perfectly rational given the situation. For him to act otherwise would be irresponsible and foolish.

Seems we don't like it when humans act like corporate entities.

Submitted by NotCranky on April 27, 2010 - 10:02am.

briansd1 wrote:
Russell thanks for the link.

I believe that the following excerpt is very true.

Libertarianism appears to be very popular these days, especially among Republicans who wish to pretend to be anti-big government and yet are ashamed of eight years of huge government deficit and interference in personal life under W.

http://rationallyspeaking.blogspot.com/2...


What you quoted is one of those comments that just makes you say, "no shit".

Submitted by AN on April 27, 2010 - 10:04am.

briansd1 wrote:
Russell thanks for the link.

I believe that the following excerpt is very true.

Libertarianism appears to be very popular these days, especially among Republicans who wish to pretend to be anti-big government and yet are ashamed of eight years of huge government deficit and interference in personal life under W.

http://rationallyspeaking.blogspot.com/2...


I don't get it, if they're ashamed of Bush, doesn't that mean they don't support him and his big government policy? Is this author trying to say that once you registered with one party, you can't change to a different party when the party you register for no longer do what they say they would do? BTW, here are 2 data points, my coworker and I were both life long democrats until 2008. We both are now registered Libertarians.

Submitted by NotCranky on April 27, 2010 - 10:48am.

AN wrote:
briansd1 wrote:
Russell thanks for the link.

I believe that the following excerpt is very true.

Libertarianism appears to be very popular these days, especially among Republicans who wish to pretend to be anti-big government and yet are ashamed of eight years of huge government deficit and interference in personal life under W.

http://rationallyspeaking.blogspot.com/2...


I don't get it, if they're ashamed of Bush, doesn't that mean they don't support him and his big government policy? Is this author trying to say that once you registered with one party, you can't change to a different party when the party you register for no longer do what they say they would do? BTW, here are 2 data points, my coworker and I were both life long democrats until 2008. We both are now registered Libertarians.

My two cents...The piece is a playfully condescending tutorial about libertarianism. The joke about republicans converting, post Bush, insinuates perhaps the many "libertarians" haven't really embraced the philosophy(which the author does think has serious weaknesses) for reasons other than looking for cover(maybe neutrality?).

For the record,I am a non-registered independent and have been for most of 3 decades. For the near future at least, I am not trading that status for anything. My sympathies do at various times align with each party, depending on the topic and the era, but I consistently like none of them.

Submitted by AN on April 27, 2010 - 11:05am.

Russell wrote:

My two cents...The piece is a playfully condescending tutorial about libertarianism. The joke about republicans converting, post Bush, insinuates perhaps the many "libertarians" haven't really embraced the philosophy(which the author does think has serious weaknesses) for reasons other than looking for cover(maybe neutrality?).

For the record,I am a non-registered independent and have been for most of 3 decades. For the near future at least, I am not trading that status for anything. My sympathies do at various times align with each party, depending on the topic and the era, but I consistently like none of them.


That's really where I see this jest fall apart. No single party have 100% support from its supported voters. If it does, all the democrats should be in full support of all these bailouts that the Democrats in all 3 branches are orchestrating. We all think the other party philosophy has serious weaknesses. So there's nothing new there.

Submitted by jpinpb on April 27, 2010 - 11:22am.

Arraya wrote:

Seems we don't like it when humans act like corporate entities.

I don't have any problem w/Bill and others following his contract. I don't even care if the bank loans money to every unemployed person in the world. I couldn't care less. But when they then turn around and want my tax dollars to pay for it, then I have an issue w/it.

Submitted by NotCranky on April 27, 2010 - 11:52am.

AN wrote:
Russell wrote:

My two cents...The piece is a playfully condescending tutorial about libertarianism. The joke about republicans converting, post Bush, insinuates perhaps the many "libertarians" haven't really embraced the philosophy(which the author does think has serious weaknesses) for reasons other than looking for cover(maybe neutrality?).

For the record,I am a non-registered independent and have been for most of 3 decades. For the near future at least, I am not trading that status for anything. My sympathies do at various times align with each party, depending on the topic and the era, but I consistently like none of them.


That's really where I see this jest fall apart. No single party have 100% support from its supported voters. If it does, all the democrats should be in full support of all these bailouts that the Democrats in all 3 branches are orchestrating. We all think the other party philosophy has serious weaknesses. So there's nothing new there.

I think the joke/teasing of newly minted Libertarians stands O.K. If the shoe fits or not is a different question.
What did the pop song say? "Philosophy is a walk on slippery rocks" I understand that there are a lot of reasons for people to affiliate certain ways...or not.

Submitted by SD Realtor on April 27, 2010 - 12:05pm.

Yes Rus I am libertarian since 88 and did vote for Bush, twice in fact. He was horrendous. As far as what Bill does, I don't care what anyone says, I do not believe it is a victimless crime. As I stated, Bill does what he wants to do but in my opinion it is playing right into the hands of what the govt and the banks want people to do. I think this behavior does help reduce inventory by simply kicking the can down the road and does alleviate the banks of dealing with uninhabited homes. Just my opinion.

As for Bill talking about living the life of a rockstar that is his choice as well. As far as me being judgemental, sure I admit to it freely. I have no problem passing judgement of character. I do it everyday with everyone I meet and everyone I deal with. I judge whether certain clients are worth my time, and I judge whether I think people are trustworthy or not. It doesn't bother me in the least to admit that.

Submitted by NotCranky on April 27, 2010 - 1:18pm.

SD Realtor wrote:
Yes Rus I am libertarian since 88 and did vote for Bush, twice in fact. He was horrendous. As far as what Bill does, I don't care what anyone says, I do not believe it is a victimless crime. As I stated, Bill does what he wants to do but in my opinion it is playing right into the hands of what the govt and the banks want people to do. I think this behavior does help reduce inventory by simply kicking the can down the road and does alleviate the banks of dealing with uninhabited homes. Just my opinion.

As for Bill talking about living the life of a rockstar that is his choice as well. As far as me being judgemental, sure I admit to it freely. I have no problem passing judgement of character. I do it everyday with everyone I meet and everyone I deal with. I judge whether certain clients are worth my time, and I judge whether I think people are trustworthy or not. It doesn't bother me in the least to admit that.


This is the line of thought that provokes a desire to put all kinds of alternate theories on the board especially vis-a-vis "libertarianism", since you brought it up. What are libertarians doing that is better by virtue of their being libertarian? Why was selling houses in 2005 and 2006, and perhaps even now,(since you think it is all a scam) not doing something really rotten to society that the banks and the government wanted and want you to do? Since we are talking about societal damages, it has nothing to do with what you have told or are telling your individual clients. I think Bill is not being unfair to draw the comparison.

Why are shortsellers better than strategic defaulters(other than a commission can be earned)? They also are just doing what the banks and government want them to do and perhaps saving their credit to an extent that they can do what the banks and the government want them to do again, sooner compared to a foreclosure, with the help of a Realtor.Buyers?Everybody who plays in the real estate market is just doing what the banks and the government want them to do. I think the truly free thing is to not get hung up on it or blow it up.

Submitted by briansd1 on April 27, 2010 - 1:24pm.

Russell wrote:
Realtor.Buyers?Everybody who plays in the real estate market is just doing what the banks and the government want them to do. I think the truly free thing is to not get hung up on it or blow it up.

That illustrates another human trait. What we do is always better than what other people do. At least that's how we justify it to ourselves.

People who look in the mirror always believe that they look OK, compared to others (back to scaredycat's theory on our need to compare).

Self examination can bring about depression. So we avoid it.

Submitted by briansd1 on April 27, 2010 - 1:36pm.

What about bankrupt company continuing to operate while having defaulted on debt?

Or a property owner still charging rent while not paying the mortgage?

Are they immoral too?

Submitted by NotCranky on April 27, 2010 - 2:23pm.

briansd1 wrote:
What about bankrupt company continuing to operate while having defaulted on debt?

Or a property owner still charging rent while not paying the mortgage?

Are they immoral too?


Builders "losing" property and buying it back in foreclosure?

Submitted by patientrenter on April 27, 2010 - 4:50pm.

SD Realtor wrote:
.....As far as what Bill does, I don't care what anyone says, I do not believe it is a victimless crime.....

That is correct. It takes a little effort to put the blinders on and ignore this obvious fact. But, you know that saying, "It is difficult to get a man to understand something, when his salary depends on him not understanding it".

Submitted by jpinpb on April 27, 2010 - 5:27pm.

SD Realtor wrote:
As far as what Bill does, I don't care what anyone says, I do not believe it is a victimless crime.

It for sure stops being a victimless crime when the taxpayers have to foot the bill (even indirectly or as a result)

Submitted by Arraya on April 27, 2010 - 6:16pm.

I hope everybody defaults that bought into the fraud and stops buying homes as well. The establishment needs to be taught a lesson.

Submitted by jpinpb on April 27, 2010 - 8:46pm.

Arraya wrote:
I hope everybody defaults that bought into the fraud and stops buying homes as well. The establishment needs to be taught a lesson.

As long as our tax dollars don't have to supplement the banks and anyone else.

Submitted by NotCranky on April 27, 2010 - 8:53pm.

jpinpb wrote:
SD Realtor wrote:
As far as what Bill does, I don't care what anyone says, I do not believe it is a victimless crime.

It for sure stops being a victimless crime when the taxpayers have to foot the bill (even indirectly or as a result)

What does it take for people to stop exaggerating something as "criminal" in this argument, when it is not? It's just interaction with policy and parameters way beyond the layman's influence. That is, unless we do what Arraya is suggesting and team up against the establishment,fat chance.

Is a buyer a criminal because they take a tax credit? Subsidized interest rate? Loan backed by the government? Are you going to do your part and refuse these things JP? Is the Realtor refusing to work, on moral grounds with someone using one of these? How many strategic shortsales are there? I bet there are no Realtors lecturing them. Realtors run from the possibility of offending a short seller of any kind and do some butt kissing in many cases. Everybody is in it for themselves.

Submitted by scaredyclassic on April 27, 2010 - 9:08pm.

agreed. it's all the same..

everyone has their snout at the same communal trough of cash, some is gobbled up by tax credits, some by the rules making it worthwhile for the bank to let you sit there...still I somehow think there's a chance for a guy like me waiting away from the trough with a little bit of cheddar saved up to somehow get a chunk of offal that some giant hog noses out and lets slip away from the giant hogs.

I'm kind of the diseased little mouse looking for that scrap when the hogs have bloated themselves on botulism-tainted feed and are passed out dazed in the sun vomiting up other animal parts they've been force fed at the communal tax trough.

.At that moment, when the giant hogs are paralyzed, and the smaller pigs are running about squirting hog diarrhea on the ducks and chickens who are blinded in the panic, and the farmer is out with ashotgun ready to shoot everyone, I will stealthily steal up a bit closer to the communal feeding trough, careful not to get stepped on by some beastly 1,000 pound hog who kicks or rolls over in a spasm, or to literally be drowned in hog vomit, and try to steal a small chunk away for myself.

Ahh, it's not going to happen. They hogs will keep eating as they continually vomit into the public trough. who am i kidding. i'll stay in my little rodent hole in the dark and never see the light of day. The vomit covered hogs will rule forever...

do i win the award for Most Disgusting Piggington Metaphor Ever?

it's justa more scatalogical way to express the sentiment that it's best to buy when there's blood -- or hog vomit -- in the streets.... blood sort of connotes that there was a healthy creature running around which somehow got senselessly killed. I don't think that's appropriate in this case. I'd say our system is more liek a bunch of hogs about to explode with dysyntery...

hey, why is this site called Piggington's anyway? is it supposed to signify giant hogs?

Submitted by Arraya on April 28, 2010 - 7:51am.

jpinpb wrote:
Arraya wrote:

Seems we don't like it when humans act like corporate entities.

I don't have any problem w/Bill and others following his contract. I don't even care if the bank loans money to every unemployed person in the world. I couldn't care less. But when they then turn around and want my tax dollars to pay for it, then I have an issue w/it.

Western banks have been running hostage-ransom rackets for decades on foreign countries. Most of which America has benefited from. Welcome to the real world of global capitalism, we all have blood on our hands. This is the best it's going to get under this paradigm. The banks are already placing their bets on municipality defaults like jackals circling the sick and dying. Be happy your on top of the global shit pile.

The best thing you can do is completely reject the system or do as Bill suggests and get in the game and quit bitching.

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