"4 weeks and then all hell breaks loose"

NEW -> Contingent Buyer Assistance Program
I agree, Robert, anything and everything is shadow inventory. It's comical.
 
<blockquote>You can joke all you want and you will still be wrong. Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They do not care about your other creditors or your health insurance or if you eat enough. They care about being first in line. You don't know what you're talking about</blockquote>


Humor me for a second because I hate to admit I am wrong. Faced with your overwhelming proof that you talked to someone that said they could I am starting to come around.



No Vas brought up the cure rate.



So I am now on your side and I realize that they will make loan mods to people with 100% DTI.



Can you explain to me how this person can stay current? Again DTI is based off of GROSS income not NET income.



20-30% of the Gross is gone before the person even sees the check.



So right away this person only has the ability to pay 70-80% of their montly payments.



Then there is the whole utilities, food, gas etc tha we all have.



I am having a hard time wrapping my head around that.
 
[quote author="trrenter" date=1252016354]<blockquote>You can joke all you want and you will still be wrong. Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They do not care about your other creditors or your health insurance or if you eat enough. They care about being first in line. You don't know what you're talking about</blockquote>


Humor me for a second because I hate to admit I am wrong. Faced with your overwhelming proof that you talked to someone that said they could I am starting to come around.



No Vas brought up the cure rate.



So I am now on your side and I realize that they will make loan mods to people with 100% DTI.



Can you explain to me how this person can stay current? Again DTI is based off of GROSS income not NET income.



20-30% of the Gross is gone before the person even sees the check.



So right away this person only has the ability to pay 70-80% of their montly payments.



Then there is the whole utilities, food, gas etc tha we all have.



I am having a hard time wrapping my head around that.</blockquote>


I assume they assume you will cut where you need to to save the roof over your head. Especially when they just greatly reduced the cost of that roof. They are kicking the can as far down the road as they can.



Oh, I see where there's some confusion: they have standards for food and utilities that are included. I think it's like $345 or something like that for all utilities. I don't know what they assume for food.



That's not the typical definition of DTI, so I stand corrected.
 
[quote author="trrenter" date=1252016354]<blockquote>You can joke all you want and you will still be wrong. Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They do not care about your other creditors or your health insurance or if you eat enough. They care about being first in line. You don't know what you're talking about</blockquote>


Humor me for a second because I hate to admit I am wrong. Faced with your overwhelming proof that you talked to someone that said they could I am starting to come around.



No Vas brought up the cure rate.



So I am now on your side and I realize that they will make loan mods to people with 100% DTI.



Can you explain to me how this person can stay current? Again DTI is based off of GROSS income not NET income.



20-30% of the Gross is gone before the person even sees the check.



So right away this person only has the ability to pay 70-80% of their montly payments.



Then there is the whole utilities, food, gas etc tha we all have.



I am having a hard time wrapping my head around that.</blockquote>


The proof is in the cure rate!
 
[quote author="NewportSkipper" date=1252016508][quote author="trrenter" date=1252016354]<blockquote>You can joke all you want and you will still be wrong. Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They do not care about your other creditors or your health insurance or if you eat enough. They care about being first in line. You don't know what you're talking about</blockquote>


Humor me for a second because I hate to admit I am wrong. Faced with your overwhelming proof that you talked to someone that said they could I am starting to come around.



No Vas brought up the cure rate.



So I am now on your side and I realize that they will make loan mods to people with 100% DTI.



Can you explain to me how this person can stay current? Again DTI is based off of GROSS income not NET income.



20-30% of the Gross is gone before the person even sees the check.



So right away this person only has the ability to pay 70-80% of their montly payments.



Then there is the whole utilities, food, gas etc tha we all have.



I am having a hard time wrapping my head around that.</blockquote>


I assume they assume you will cut where you need to to save the roof over your head. Especially when they just greatly reduced the cost of that roof. They are kicking the can as far down the road as they can.



Oh, I see where there's some confusion: they have standards for food and utilities that are included. I think it's like $345 or something like that for all utilities. I don't know what they assume for food.



That's not the typical definition of DTI, so I stand corrected.</blockquote>


<strong>I already posted what DTI is. I will post again a shorter version that maybe you will read.</strong>



<blockquote>The arithmetic

In order to make the calculation, add up your fixed monthly expenses such as your car payments, minimum credit card payments and any other regular debt obligations such as monthly child support or student loans (you don?t have to include bills for things such as groceries or utilities). Add your expected housing payments (your mortgage payments plus, for example, private mortgage insurance, homeowner?s insurance and property taxes) and divide the total by your gross monthly income.</blockquote>


NOTICE AGAIN GROSS INCOME. Not NET income.



Net is always lower then Gross.



Admit you are wrong or you have no credibility.
 
<strong></strong>[quote author="graphrix" date=1251993988]This is like the old days. I love it! Someone tell nirvinerealtor to come back for old time sake.



<a href="http://www.housingwire.com/2009/09/02/lps-sees-foreclosure-inventory-rise-896-from-2008/">LPS Sees Foreclosure Inventory Rise 89.6% from 2008</a>



By DIANA GOLOBAY

September 2, 2009 8:10 AM CST



http://www.housingwire.com/wp-content/uploads/2009/09/rolls-to-foreclosure.png



Foreclosure starts increased in July while completed foreclosures eased, funneling more loans into the foreclosure pipeline. Loss mitigation efforts, however, seem to enjoy a greater degree of success.



<strong>Foreclosure inventory rose 4.2% in July from June and is up 89.6% from July 2008</strong>, according to the August mortgage monitor report by Lender Processing Services (LPS: 34.82 0.00%). The total US foreclosure inventory rate sits at 3%.



Foreclosure starts rose 7.1% to their second-highest record. The rate of loans rolling into the final foreclosure stage, however, are narrowing back toward levels seen in mid-2006 and remain below ?07 and ?08 levels as servicers step up loss mitigation efforts, LPS said.



These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



In another bit of positive data, new delinquencies dropped in July to their second-lowest level in the last year.



<strong>The rate of total delinquencies remained unchanged from June at 8.6% but hold 40% above year-ago levels. The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.



?[T]he percentage of 90-day or greater delinquent loans rolling to foreclosure status has decreased from 2007 and 2008 levels; however those loans not referred into foreclosure continue to roll to the next stage of delinquency, showing the volume of at-risk loans worsening,? LPS said. ?Meanwhile, the absolute volume and percentage of foreclosure starts relative to the total number of active loans continues to increase as well.?</strong></blockquote>


Also a good sign:



<strong>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.</strong>
 
[quote author="trrenter" date=1252017073][quote author="NewportSkipper" date=1252016508][quote author="trrenter" date=1252016354]<blockquote>You can joke all you want and you will still be wrong. Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They do not care about your other creditors or your health insurance or if you eat enough. They care about being first in line. You don't know what you're talking about</blockquote>


Humor me for a second because I hate to admit I am wrong. Faced with your overwhelming proof that you talked to someone that said they could I am starting to come around.



No Vas brought up the cure rate.



So I am now on your side and I realize that they will make loan mods to people with 100% DTI.



Can you explain to me how this person can stay current? Again DTI is based off of GROSS income not NET income.



20-30% of the Gross is gone before the person even sees the check.



So right away this person only has the ability to pay 70-80% of their montly payments.



Then there is the whole utilities, food, gas etc tha we all have.



I am having a hard time wrapping my head around that.</blockquote>


I assume they assume you will cut where you need to to save the roof over your head. Especially when they just greatly reduced the cost of that roof. They are kicking the can as far down the road as they can.



Oh, I see where there's some confusion: they have standards for food and utilities that are included. I think it's like $345 or something like that for all utilities. I don't know what they assume for food.



That's not the typical definition of DTI, so I stand corrected.</blockquote>


<strong>I already posted what DTI is. I will post again a shorter version that maybe you will read.</strong>



<blockquote>The arithmetic

In order to make the calculation, add up your fixed monthly expenses such as your car payments, minimum credit card payments and any other regular debt obligations such as monthly child support or student loans (you don?t have to include bills for things such as groceries or utilities). Add your expected housing payments (your mortgage payments plus, for example, private mortgage insurance, homeowner?s insurance and property taxes) and divide the total by your gross monthly income.</blockquote>


NOTICE AGAIN GROSS INCOME. Not NET income.



Net is always lower then Gross.



Admit you are wrong or you have no credibility.</blockquote>


You are 100% right it doesn't work and 100% wrong that they are not doing it anyway. Is this a joke? You think I don't know what DTI is?



You are also fixating on this 100% thing. Most loans aren't anywhere close to half of that. I'm just telling you what the posture is and that even 100% doesn't mean "no".
 
If the lenders and/or servicers can make money modifying loans vs. foreclosures, they will be motivated to modify loans.

And there will be many borrowers/owners who will decline the loan mods, IMO. Put yourself in the shoes of someone who owes $800,000 on a home that would sell for $700,000, and no one is offering to write off any of the principal. Is there really any reasonable payment amount on an $800,000 loan that will make the payment attractive enough that the owners will not find renting more palatable? Maybe, but I doubt it. Especially as the owners see the value of their home continue to decrease.



Now, if the modifications start including principal write down, everything changes.

But, ya gotta wonder, or at least I wonder, if principal is written down, someone still has to pay. Either the lenders or the government, (us), or a combination. As as long as someone is paying for debt, they will not be spending, on real estate or other stuff. and if the gubamint prints money to pay for the debt, which it seems to be doing at a phenomenal rate, we all pay in increased prices for everything. There is no free lunch. Loan mods will only prolong and increase the agony.
 
<blockquote>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.</blockquote>


Based on reading about the housing market, both national and local, for the last 3-4 years and actually having read IR's book, I interpret this as such:



Instead of being able to help a laughable trickle of people stay in their homes, it's now more like a stream. And they are mostly those folks in the flyover states where back in the day you could actually still buy a house for less than $417K. Awesome for those few in the stream who aren't in the 11.6% anymore. We'll see how it continues to work out for you folks.



For those in the areas where you needed a fat-ass loan to buy a house, it is finally your turn and it sucks to be you. I will wait patiently to see what the numbers are in 6 months to see if the foreclosure prevention programs help people who paid [insert ridiculous multiplier here]X income for a house. I haven't seen much sympathy from the government for these folks yet, so I'll just get my popcorn and watch. I might still throw some at the TV, but hopefully not.
 
[quote author="awgee" date=1252017811]If the lenders and/or servicers can make money modifying loans vs. foreclosures, they will be motivated to modify loans.

And there will be many borrowers/owners who will decline the loan mods, IMO. Put yourself in the shoes of someone who owes $800,000 on a home that would sell for $700,000, and no one is offering to write off any of the principal. Is there really any reasonable payment amount on an $800,000 loan that will make the payment attractive enough that the owners will not find renting more palatable? Maybe, but I doubt it. Especially as the owners see the value of their home continue to decrease.



Now, if the modifications start including principal write down, everything changes.

But, ya gotta wonder, or at least I wonder, if principal is written down, someone still has to pay. Either the lenders or the government, (us), or a combination. As as long as someone is paying for debt, they will not be spending, on real estate or other stuff. and if the gubamint prints money to pay for the debt, which it seems to be doing at a phenomenal rate, we all pay in increased prices for everything. There is no free lunch. Loan mods will only prolong and increase the agony.</blockquote>


There are thousands upon thousands of loans being paid today under these exact circumstances. People know value will return in time.
 
[quote author="NewportSkipper" date=1252014338]Someone made the comment about "banks won't give you money...", well that is the first mistake. They gave the money out a long time ago. Now they are trying to get it back. They don't care about your other creditors or your health insurance or if you eat enough. They care about being first in line.</blockquote>


That raises a question for me. Does anyone know if the loan mods change the loan terms from non-recourse to recourse?
 
[quote author="caycifish" date=1252017842]<blockquote>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.</blockquote>


Based on reading about the housing market, both national and local, for the last 3-4 years and actually having read IR's book, I interpret this as such:



Instead of being able to help a laughable trickle of people stay in their homes, it's now more like a stream. And they are mostly those folks in the flyover states where back in the day you could actually still buy a house for less than $417K. Awesome for those few in the stream who aren't in the 11.6% anymore. We'll see how it continues to work out for you folks.



For those in the areas where you needed a fat-ass loan to buy a house, it is finally your turn and it sucks to be you. I will wait patiently to see what the numbers are in 6 months to see if the foreclosure prevention programs help people who paid [insert ridiculous multiplier here]X income for a house. I haven't seen much sympathy from the government for these folks yet, so I'll just get my popcorn and watch. I might still throw some at the TV, but hopefully not.</blockquote>


You will be proven wrong. I know of people with very large loans that have had them modified.
 
[quote author="NewportSkipper" date=1252018148][quote author="caycifish" date=1252017842]<blockquote>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.</blockquote>


Based on reading about the housing market, both national and local, for the last 3-4 years and actually having read IR's book, I interpret this as such:



Instead of being able to help a laughable trickle of people stay in their homes, it's now more like a stream. And they are mostly those folks in the flyover states where back in the day you could actually still buy a house for less than $417K. Awesome for those few in the stream who aren't in the 11.6% anymore. We'll see how it continues to work out for you folks.



For those in the areas where you needed a fat-ass loan to buy a house, it is finally your turn and it sucks to be you. I will wait patiently to see what the numbers are in 6 months to see if the foreclosure prevention programs help people who paid [insert ridiculous multiplier here]X income for a house. I haven't seen much sympathy from the government for these folks yet, so I'll just get my popcorn and watch. I might still throw some at the TV, but hopefully not.</blockquote>


You will be proven wrong. I know of people with very large loans that have had them modified.</blockquote>


Wrong? I didn't make any predictions. I actually said that I might still throw popcorn at the TV.
 
So this is what it must have been like when you guys were arguing the bubble is going to pop.



Quick... someone write the "Great Shadow Inventory Bubble" before IR does.
 
[quote author="caycifish" date=1252018268][quote author="NewportSkipper" date=1252018148][quote author="caycifish" date=1252017842]<blockquote>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.</blockquote>


Based on reading about the housing market, both national and local, for the last 3-4 years and actually having read IR's book, I interpret this as such:



Instead of being able to help a laughable trickle of people stay in their homes, it's now more like a stream. And they are mostly those folks in the flyover states where back in the day you could actually still buy a house for less than $417K. Awesome for those few in the stream who aren't in the 11.6% anymore. We'll see how it continues to work out for you folks.



For those in the areas where you needed a fat-ass loan to buy a house, it is finally your turn and it sucks to be you. I will wait patiently to see what the numbers are in 6 months to see if the foreclosure prevention programs help people who paid [insert ridiculous multiplier here]X income for a house. I haven't seen much sympathy from the government for these folks yet, so I'll just get my popcorn and watch. I might still throw some at the TV, but hopefully not.</blockquote>


You will be proven wrong. I know of people with very large loans that have had them modified.</blockquote>


Wrong? I didn't make any predictions. I actually said that I might still throw popcorn at the TV.</blockquote>


I thought you said OC loans, at least big ones, will not be modified.
 
[quote author="NewportSkipper" date=1252018148]I know of people with very large loans that have had them modified.</blockquote>
Can you give us more details (the non-personal ones)?



For example:



How much was the loan balance and the approximate value of the home?

Was the principle written down or just backloaded?

What type of tems is it now (interest rate, length, etc)?

What kind of loan was the original?



I would like to know what my tax dollar is paying for.



And I still think that your examples are exceptions and not the rule or else we would be Cash for Clunking through the bailout package much faster.
 
[quote author="NewportSkipper" date=1252018051]There are thousands upon thousands of loans being paid today under these exact circumstances. People know value will return in time.</blockquote>


I think you are sweeping with a broad brush there. While some people may be motivated by the future possibility of the Ben Billfolds Five reinflating the bubble, there are others who, among other possibilities, (1) like their house, can afford the mortgage (if any), and will stay, or (2) will beg, borrow, steal, work multiple jobs and/or take on renters because (a) they like the house / neighborhood and don't want to move, (b) they don't want to face the embarrassment of foreclosure, or (c) they don't want to ruin their credit, or (d) believe they need to perform their part of the contract.



I'm just not ready to say I know the thinking of thousands of people, and in part that is because I know people in all of the categories I listed.



I know we have all been talking about AV as a sample, but I would really like to see some numbers for Ladera. The Foreclosure Radar map has shown that place with a bad case of measles for something like two years now, plus with all the people who bought "extra" properties for flipping, I think you would find a fair amount of shadow inventory. <---- I don't have any numbers on this and it is based on observation and anecdotes (the plural of which is, of course, not data), but I think that is one of the where you will find it.
 
[quote author="NewportSkipper" date=1252018148][quote author="caycifish" date=1252017842]<blockquote>These loss mitigation and foreclosure prevention efforts taken in Q109 and Q209 so far outperform the efforts taken in all of last year. Modifications made in the first two quarters of 2009 experienced lower redefault rates in their initial three months than those modifications made in every quarter of 2008.



The national rate for all non-current loans ? both delinquencies and foreclosures ? edged up to 11.6% in July, a 50% year-on-year increase.



The deterioration ratio of loans worsening in status versus improving now sits at 2.2 to 1. Jumbo prime, option adjustable-rate mortgages (ARMs) and non-agency conforming prime loans experienced the highest deterioration rates. Jumbo prime foreclosure rates, for example, are up 634% from January 2008.</blockquote>


Based on reading about the housing market, both national and local, for the last 3-4 years and actually having read IR's book, I interpret this as such:



Instead of being able to help a laughable trickle of people stay in their homes, it's now more like a stream. And they are mostly those folks in the flyover states where back in the day you could actually still buy a house for less than $417K. Awesome for those few in the stream who aren't in the 11.6% anymore. We'll see how it continues to work out for you folks.



For those in the areas where you needed a fat-ass loan to buy a house, it is finally your turn and it sucks to be you. I will wait patiently to see what the numbers are in 6 months to see if the foreclosure prevention programs help people who paid [insert ridiculous multiplier here]X income for a house. I haven't seen much sympathy from the government for these folks yet, so I'll just get my popcorn and watch. I might still throw some at the TV, but hopefully not.</blockquote>


You will be proven wrong. I know of people with very large loans that have had them modified.</blockquote>


I thought you eschewed anecdotal evidence. We are the data?
 
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