Less than 20% fall in home prices will destroy the banking system?

[volente_00]

Quote from blast19:

You just made my point...haha. The prices have done nothing but settle or go down since THE PEAK! That means everyone who has purchased since the PEAK(Do you know the definition) has a home valued at less than they paid! That means that their equity is probably less than what they paid in the first place!

Refinance? When, where? Refinance on a house you can't afford and that is worth less now than previously? Yes, I'm sure the lenders would be brilliant to do that since they were smart enough to issue millions of "liar loans" for the past few years.

Do you get it now!??!? If you don't get it now I can't carry on...you're going to make me lose my mind and jump out the window.

Hello ???? Go research the builders I listed and see how much sales have been falling since mid 2005. The number shows fewer people have been buying since the peak which means fewer peak are trapped into the bubble. So your "everyone" is not as big as you make it out to be. As far as the refinance, you would be surprised what can be done as far as appraisal to get the loan done.

 

[blast19]

Quote from volente_00:

Hello ???? Go research the builders I listed and see how much sales have been falling since mid 2005. The number shows fewer people have been buying since the peak which means fewer peak are trapped into the bubble. So your "everyone" is not as big as you make it out to be. As far as the refinance, you would be surprised what can be done as far as appraisal to get the loan done.

So 2005 and 2006 home sales being on overpriced, overleveraged, risky loaned, properties in bubble traps doesn't bother you at all. Okay, that's all I need to know...you should be studied.

 

[NasdaqTrader]

Quote from ssternlight:

One thing I haven't seen discussed is the impact of the new bankruptcy law on foreclosures. I'm not sure you can "walk away" any more....you still might be evicted for non-payment though.

How do the new bankruptcy laws impact a foreclosure?

 

[ssternlight]

Quote from NasdaqTrader:

How do the new bankruptcy laws impact a foreclosure?

I think you'll be liable over time for the difference between what you owe and what the bank sells it for.

But don't quote me on that one.

 

[blast19]

Quote from ssternlight:

I think you'll be liable over time for the difference between what you owe and what the bank sells it for.

But don't quote me on that one.

I think this is far far from over. I would guess there will be an attempt on each company to let people off the hook on the grounds that they shouldn't have been approved loans that they couldn't afford.

Most of these companies committed fraud in the sense that they sold something they knew people wouldn't be able to afford in a few years. Then they packaged those unstable loans and sold them to banks and investment firms.

Qualifying people using the teaser rate could probably be shown to be fraud of some sort since it inflated their earnings and revenues artificially and then selling that on to an investor in a package is even more suspicious. Couple all of this with the fact that people like Angelo Mozilo have sold $140 million in stock and you can see that it's probably not the borrowers who will have to be answering hard questions for the time being.

 

[otcstockfund]

well if there is any kind of relief given to defaulters, it should not be given to anyone that lied about their income or assets on their loan application

 

[blast19]

Quote from otcstockfund:

well if there is any kind of relief given to defaulters, it should not be given to anyone that lied about their income or assets on their loan application

Agree totally....but who's to say that it wasn't the loan broker? I'd guess that a lot of loan brokers nudged people into this kind of activity to help push it through. Plus, the majority of burden needs to be on the lender for being stupid enough to give huge loans without verifying income...that's just stupid.

Also, a lot of these lenders are probably holding quite a few big loans...Freddie Mac doesn't buy loans over $417k in value...so they weren't buyers...MBS buyers were no doubt, but some of these companies are surely holding the loans on some $800k palace of shit in Bakersfield.

 

[NasdaqTrader]

Quote from ssternlight:

I think you'll be liable over time for the difference between what you owe and what the bank sells it for.

But don't quote me on that one.

Would they garnish some of your wages?

If so, I think many people in this country are going to be fucked and miserable going forward.

 

[ssternlight]

Quote from NasdaqTrader:

Would they garnish some of your wages?

If so, I think many people in this country are going to be fucked and miserable going forward.

That is indeed my understanding of the new law. If one thing had to be changed that would probably be the best one...although more conservative folks might rightly argue that they should take their lumps.

 

[2ez]

Quote from volente_00:

One last point.



The only ones who will be walking are the ones who bought recently and were late to the party. If you bought a 300k home out west 3 years ago and now it is worth 400k, with a 20% correction it will still bring 320k. Do you think this person is going to walk ?

Depends on the type of mortgage. If it is a ARM....the real question is could they afford the increased pymt.