Hard to know whether the NWO government will want to cull (1) those with wealth so the government can confiscate it, or (2) the parasitic "eaters".. so that they are no longer an economic drain. (After all, the NWO government won't have any need to pander to nor give financial support to the have-nots for votes..)
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The new rent-free: No mortgage payments, no worries
- Thread starter PocketChange
- Start date
Hard to know whether the NWO government will want to cull (1) those with wealth so the government can confiscate it, or (2) the parasitic "eaters".. so that they are no longer an economic drain. (After all, the NWO government won't have any need to pander to nor give financial support to the have-nots for votes..)
From a pure traders perspective:
$300K house ($250K mortgage) = approx 6 ES contracts when ES was trading at 1000 (Assume 5 to 1 margin: $50K account).
Your ES house is trading today at 666 and worth $200K.
You've blown out your $50K account and your broker/lender sends notice of a margin call but needs 1 to 2 years to go through court to close your account.
Play the options/rental game.
If this property is not your primary home...
Rent it out and pocket the premium.
If you can get $2K in rental premiums each month your back in the black in 24 months. Even if you don't go the full 2 years.. Every $2K is way ahead of the - $100K your ES house is worth and these rental options do not go through any exchange/lender.
If this property is your primary home and you stop paying the mortgage and taxes. Each month you are essentially withdrawing
$3K in equity/cash from your margin account. Every month of non payment is still way ahead of -$100K debt with compounding interest. Every month beyond 10 is essentially $3K a month in post tax savings.
Your $50K property investment($50K down payment/$250K mortgage) generates $5K pretax value each month you don't pay.
If you make it 10 months you've sucked your down payment out.
If you lawyers stall it out 24 months you've realized $70K in pretax savings / value.
These lenders are really fucked when even a small group of borrowers realizes they have the power to recoup their massively leveraged property investments in 10 months or less by simply stop paying.
Lawyers are masterful tie up artists. Continuance, medical emergency, evidential hearing the loan document is fraudulent.
Every new filing is a 90 day extension.
Traders generally are among the best at the cut -n- run. This is no different except there is no counter party insurance, credit check or exchange ... Mandatory arbitration or expedited resolution system.
In fact, you post $50K or less to buy your "ES" house and they not only give you a deed for 6 ES contracts. They give you all of the underlying shares to hold and use.
it's not the poor and broke sub prime borrowers playing this game. It's the affluent and savvy investors who recognize they have blown out there "ES" house account and are cutting and running.
$300K house ($250K mortgage) = approx 6 ES contracts when ES was trading at 1000 (Assume 5 to 1 margin: $50K account).
Your ES house is trading today at 666 and worth $200K.
You've blown out your $50K account and your broker/lender sends notice of a margin call but needs 1 to 2 years to go through court to close your account.
Play the options/rental game.
If this property is not your primary home...
Rent it out and pocket the premium.
If you can get $2K in rental premiums each month your back in the black in 24 months. Even if you don't go the full 2 years.. Every $2K is way ahead of the - $100K your ES house is worth and these rental options do not go through any exchange/lender.
If this property is your primary home and you stop paying the mortgage and taxes. Each month you are essentially withdrawing
$3K in equity/cash from your margin account. Every month of non payment is still way ahead of -$100K debt with compounding interest. Every month beyond 10 is essentially $3K a month in post tax savings.
Your $50K property investment($50K down payment/$250K mortgage) generates $5K pretax value each month you don't pay.
If you make it 10 months you've sucked your down payment out.
If you lawyers stall it out 24 months you've realized $70K in pretax savings / value.
These lenders are really fucked when even a small group of borrowers realizes they have the power to recoup their massively leveraged property investments in 10 months or less by simply stop paying.
Lawyers are masterful tie up artists. Continuance, medical emergency, evidential hearing the loan document is fraudulent.
Every new filing is a 90 day extension.
Traders generally are among the best at the cut -n- run. This is no different except there is no counter party insurance, credit check or exchange ... Mandatory arbitration or expedited resolution system.
In fact, you post $50K or less to buy your "ES" house and they not only give you a deed for 6 ES contracts. They give you all of the underlying shares to hold and use.
it's not the poor and broke sub prime borrowers playing this game. It's the affluent and savvy investors who recognize they have blown out there "ES" house account and are cutting and running.
Quote from SomeYoungGuy:
Before you get behind on your mortgage, finance a couple new cars and max out the credit cards. Hire this lawyer to stall your mortgage payment, BK the credit cards, all you have in the car payments. Pay cash for everything else for those 7-10 years.
Not an honest way to make a buck, but you will probably come out ahead.
Works for the rich and corporations, why not the little guy also.
Quote from PocketChange:
Assuming you bought your home for $300K and have $250K mortgage. Your property is only worth $200K in today's market and your note and taxes are $3K a month.
If you follow this attorneys advise and stop paying and let him tie it up for just 1 year you save and squeeze $36K of equity out while living rent free. If he can stall it out for 2 years, You save $72K effectively making a profit on your property investment while living rent free.
The case load is only increasing and the banks certainly don't want to spend $25k in legal fees foreclosing on a property that is already a big loss. By year 3 the attorneys may be able to make a low ball settlement with the lender for $100K and you get your house mortgage free from what you've saved. If not you saved $36K - $100K to go out and buy a new house for cash.
A neighbor of ours has $900K they borrowed - to buy the house and then do extensive remodeling. They've not made a mortgage payment in 10 months per county records. Foreclosure was filed in mid-March but the process is so slow. Both husband and wife drive Mercedes, likely leased.
Another couple we know of (from public county records) were in foreclosure. When it appeared they'd lose the house they then filed bankruptcy, further delaying the foreclosure process.
People like this IMO are nothing more than 'squatters'.
Banks understandably don't want to take on even more houses so I guess they feel that if the 'squatters' maintain the yard, pay the basic bills (water, electric, ...) it's one less house they need to take to auction in the shorter term.
Quote from Ivanovich:
I disagree. I think that, whenever some dictator-like government is formed to pick up the pieces of the assholes that destroyed us, the credit score will be one of the most important aspects to have.
Excuse me, who destroyed us? Don't you get it yet? Irredeemable fiat currency require a ponzi system to survive. It's over.
The only reason you and I pay our mortgage is because it's in our best interest to keep the ponzi game going. I think those that are critical of defaulters are secretly envious. I applaud them.
So your money is on the Banksters taking over government?
My money is on the red-necked tea-baggers taking over and electrocutin' wall streeters.
Wrong! They are real estate speculators.
They have a mortgage contract typically non recourse secured solely by a first position lien on the property and the speculators down payment.
No one held a gun to either party's head and the original lenders were creative and willing to finance deals typically for 10% - 20% down. Most of the original lenders have long since bundled and sold the mortgages off for profit.
The borrower relied on an independent appraisal to determine the value of the property and either party can claim fraud in the inducement of contract and move to void the mortgage agreement. They can sue the licensed appraiser. I'm sure these claims are being pursued in the stall.
The lucky few borrowers who bought that $500K home for $50k down just to see their investment depreciate to $300K are in a powerful position.
Is your credit rating worth $2M? $200K loss + compounding interest and fees for 25 more years? Your on the hook for $2M or so by the time the contract is completed. You will not have a dime in equity for at least 20 years. Money pit
Would you really hold an ES contract down 300 points and roll it over each quarter waiting for ES to hit 2500?
These 10% down borrowers are lucky and can't lose if they stop paying... Sue the appraiser for fraud and live relatively stress and rent free for 1 - 2 years.
As speculators, they certainly can't win if they continue to pay on a depreciating and deflating asset.
They have a mortgage contract typically non recourse secured solely by a first position lien on the property and the speculators down payment.
No one held a gun to either party's head and the original lenders were creative and willing to finance deals typically for 10% - 20% down. Most of the original lenders have long since bundled and sold the mortgages off for profit.
The borrower relied on an independent appraisal to determine the value of the property and either party can claim fraud in the inducement of contract and move to void the mortgage agreement. They can sue the licensed appraiser. I'm sure these claims are being pursued in the stall.
The lucky few borrowers who bought that $500K home for $50k down just to see their investment depreciate to $300K are in a powerful position.
Is your credit rating worth $2M? $200K loss + compounding interest and fees for 25 more years? Your on the hook for $2M or so by the time the contract is completed. You will not have a dime in equity for at least 20 years. Money pit
Would you really hold an ES contract down 300 points and roll it over each quarter waiting for ES to hit 2500?
These 10% down borrowers are lucky and can't lose if they stop paying... Sue the appraiser for fraud and live relatively stress and rent free for 1 - 2 years.
As speculators, they certainly can't win if they continue to pay on a depreciating and deflating asset.
Quote from DHOHHI:
People like this IMO are nothing more than 'squatters'.
Banks understandably don't want to take on even more houses so I guess they feel that if the 'squatters' maintain the yard, pay the basic bills (water, electric, ...) it's one less house they need to take to auction in the shorter term. [/B]
Quote from Fatassgerbil:
> what? Is this an alex jones accolade or just an economic ignoramus Maybe your teasing or being sarcastic?
> monetary debasement?
> Why are we talking about this. we have had the longest, most long standing
> era of price stability ever in human history since we abandoned monetarism
> and the gold standard. we might have problems, but debasement is not one of
them.
Can you rephrase? You're not making sense.
At some point the lenders are going to catch up on the backlog and go after deficiency judgements against the best cases. They should approach it like the IRS and pick a few high-profile cases and throw the book at them. The poster boy for this would be someone with good credit and substantial assets outside of the real estate who voluntarily defaulted on the loan but could have made the payments anyway.
Or perhaps a cash-out refinancer since that invalidates the no-recourse in most states anyway.
Or perhaps a cash-out refinancer since that invalidates the no-recourse in most states anyway.