CW REO's

NEW -> Contingent Buyer Assistance Program
<em>"I will tell you - workouts are coming."</em>





The workouts will help a few people, but the vast majority are seriously "effed" and beyond help. How many people do you think can make the fully amortized payment on a $750,000 loan? And how many will be willing to when the value of that house drops to $450,000?
 
<p>IR,</p>

<p>Those people will not be helped.</p>

<p>However, I would assume the chart is based on national statistics.</p>

<p> </p>
 
IMB already services the loan. There is no origination cost, since they are not underwriting a new loan. They repurchase your existing note from the investor and immediately re-sell it as a lower risk loan for a profit while retaining the servicing rights. The original note is amended and restated. Your default risk and your refinance risk is also lowered. It is as close to a perfect deal for the borrower as it gets. Sometimes the same investment house repurchases the loan.
 
<p>I wonder what the average loan size of the loans in the chart is?</p>

<p>I know lots of people bought expensive properties with little or no down, but I don't subscribe to the idea that it's an overwhelming majority.</p>

<p>I have always made large downpayments. As have most of the people I know.</p>

<p>If I had a home bought at $750,000 that became $450,000, I would wait it out. However long it takes.</p>

<p> </p>
 
<p>Maestro,</p>

<p>Thanks. </p>

<p>Hmmmm - can't figure out if that's brilliant, evil or brilliantly-evil!</p>
 
<p>I know they do care about refinance risk.</p>

<p>When payoffs get pulled, they are on it like white on rice!</p>
 
<p>Maestro,</p>

<p>Wouldn't that royally P/O the MBS holders?</p>
 
<p>If information is power and that's why we don't get any, how come that chart from Credit Suisse was ever released?</p>



<p>That little chart is the only publicly available evidence that clearly shows the worst is yet to come.</p>



<p> </p>
 
No. When a MBS isi priced out, it is priced out with the assumption that its lifespan will be relatively short. Less than three years. At the point in time you qualify for a note modification, the investor has realized a good portion of their required ROI. The bank can now repurchase the loan at a good discount. The bank the packages the loan back up and resells it.
 
<p>I see.</p>

<p>It still hurts the MBS holders, or residual holder though.</p>

<p>They could have gotten lots more.</p>

<p> </p>
 
<p>Who is in the postion to agree to sell the loan at a discount?</p>

<p>The Trustee can't do it, so I would think it's the residual holder?</p>
 
<p>My experience (mentioned above) and the hearing today.</p>

<p>My experience indicates willingness. The hearing indicates government's desires/plans.</p>

<p>I will concede several persons testifying did mention rate reductions are dependent on being current.</p>

<p>I'm not saying this impacts foreclosures (even though I think it may), I'm saying it will affect the population of resetting loans.</p>

<p> </p>
 
<p>I'm not sure it that hearing was live or from earlier in the week - I just saw it today.</p>

<p>(It looks like it was Tuesday).</p>
 
It also depends on the MBS pool as it may only have the ability to modify 5% of the ORIGINAL pool amount. If 5% is already paid off good luck going back to the underwriter of the pool to renegotiate that. Plus if we are going to be discussing loan mods it is required to read <a href="http://calculatedrisk.blogspot.com/2007/08/not-all-modifications-are-created-equal.html">Tanta's latest</a> on it.
 
<p>I suspect many of you may think I'm just trying to be difficult.</p>

<p>I will say: </p>

<p>I do not want to see a total collapse of our economy. I do not want to lose my hard-earned life savings.</p>

<p>I think I'm as fair and balanced as anyone.</p>

<p>I believe some people behaved very, very recklessly. I believe, even more so, that some lenders behaved very, very recklessly.</p>

<p>Isn't there a sort of poetic justice to losses being shared by the industry and its investors?</p>

<p> </p>
 
<p>I'm am sorry if common people lost value, because their funds invested in CDOs that are underwater.</p>

<p>When will these guys (managers) learn that derivitives can be dangerous?</p>

<p>Funny how we were ground zero for a similar problem when OC went bankrupt. </p>

<p>Does no one learn anything?</p>

<p>How can someone (the supposed professionals) invest in something they cannot understand?</p>
 
<p>Janet,</p>

<p>I don't think that you are being difficult and in fact I encourage you to ask questions or bring up topics. We are all here to discuss and learn from this debacle and the only way that we will learn is if we ask questions. </p>

<p>That being said I still think it is required reading of Tanta's post. If we are going to discuss a topic in which many of us are totally unfamilar with it is best to become familar with it by reading something from someone who is.</p>
 
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