If there is anyone dumber than a banker

[merrylander]

. . . I don't know who that could be. First off it was the bankers who wrote the crappy sub prime mortgages.

It seems to be hoped that the home building sector will dig us out of this recession. Frex, every home sale brings on sales in other sectors, appliances, furniture, etc. So you would think that our brilliant bankers would want the home building sector to expand. But no, they are flooding the market with foreclosures.

Now the home owner would like to keep his/her home but their mortgage is underwater and their job is at risk. So the bank will re-negotiate, right? Not bloody likely, they will foreclose and sell the house well below market value. Why? Because all those genius brokers are telling the nation -"We have not hit bottom yet". So who is going to buy a $250,000 home that may only be worth $200,000 six months from now. The bank will be lucky to dump it for $185,000. However had they re-negotiated with the owner they would have had a $250,00 mortgage and payments coming in.

Frankly it is a totally dumb-ass mortgage system in any case, but these brilliant bankers sure are not helping.

BTW ours just increased $9,000 in the last two months.

[noonereal]

Originally Posted by merrylander

. . . I don't know who that could be. First off it was the bankers who wrote the crappy sub prime mortgages.

It seems to be hoped that the home building sector will dig us out of this recession. Frex, every home sale brings on sales in other sectors, appliances, furniture, etc. So you would think that our brilliant bankers would want the home building sector to expand. But no, they are flooding the market with foreclosures.

Now the home owner would like to keep his/her home but their mortgage is underwater and their job is at risk. So the bank will re-negotiate, right? Not bloody likely, they will foreclose and sell the house well below market value. Why? Because all those genius brokers are telling the nation -"We have not hit bottom yet". So who is going to buy a $250,000 home that may only be worth $200,000 six months from now. The bank will be lucky to dump it for $185,000. However had they re-negotiated with the owner they would have had a $250,00 mortgage and payments coming in.

Frankly it is a totally dumb-ass mortgage system in any case, but these brilliant bankers sure are not helping.

BTW ours just increased $9,000 in the last two months.

this is exactly correct

the banks are playing hard ball and in so doing hurting the home owner, themselves and the country

[BlueStreak]

But..............the price of a home was artificially inflated before the crash and still is.
They are not selling because mortgage qualification standards have been tightened (I am told by a friend in the real estate biz.), and few can afford them under todays conditions. This, coupled with the unemployment situation, is why sales are so sluggish.

So, what to do? Liberalize qualification standards again? That's what led to this mess in the first place.

As I see it, homes will not begin to sell again until prices come in line with the ability of potential homeowners to pay under more strict terms that reasonably assure repayment.

Dave

[HatchetJack]

They might be half way through forclosing if things don't get any worse.
Man there are houses everywhere with no one living in them, grass all grown
up around them. I wonder if the banks have even found them all yet? not
to mention all the vacation spots people walked away from.
I know one guy got forclosed on but just keeps living there making no payments
for over a year now and no one has showed up.

[BlueStreak]

Originally Posted by HatchetJack

They might be half way through forclosing if things don't get any worse.
Man there are houses everywhere with no one living in them, grass all grown
up around them. I wonder if the banks have even found them all yet? not
to mention all the vacation spots people walked away from.
I know one guy got forclosed on but just keeps living there making no payments
for over a year now and no one has showed up.

Yep. Crazy times. The homes in my hood are your basic "starter homes". Well, at least what we thought of as starter homes thirty years ago. They used to sell quick, put one up for sale and it's sold in a week. But, now? There's one three doors down that's been vacant for almost three years. Twice, the police have chased squatters out of it, and caught a group of teenagers partying in it once. Actually, there's several of these places in the 'hood.

Dave

[noonereal]

Originally Posted by HatchetJack

They might be half way through forclosing if things don't get any worse.
Man there are houses everywhere with no one living in them, grass all grown
up around them. I wonder if the banks have even found them all yet? not
to mention all the vacation spots people walked away from.
I know one guy got forclosed on but just keeps living there making no payments
for over a year now and no one has showed up.

not here in NY

the bank is required to cut the lawn and keep up the property after they throw the former owners into the street in front of it

[merrylander]

Originally Posted by BlueStreak

But..............the price of a home was artificially inflated before the crash and still is.
They are not selling because mortgage qualification standards have been tightened (I am told by a friend in the real estate biz.), and few can afford them under todays conditions. This, coupled with the unemployment situation, is why sales are so sluggish.

So, what to do? Liberalize qualification standards again? That's what led to this mess in the first place.

As I see it, homes will not begin to sell again until prices come in line with the ability of potential homeowners to pay under more strict terms that reasonably assure repayment.

Dave

The problem is that the bankers absolutely refuse to lower the mortgages to the actual value of the house. So they foreclose (with all the attendant expenses) and end up selling the house at a big loss. Do they expect to make a profit on volume?

[noonereal]

Originally Posted by merrylander

The problem is that the bankers absolutely refuse to lower the mortgages to the actual value of the house. So they foreclose (with all the attendant expenses) and end up selling the house at a big loss. Do they expect to make a profit on volume?

Although I had a standard 15 year mortgage with 20% down when I became ill the bank would do nothing. Nothing.

They foreclosed rather than take a reduced payment. Now, two years later the house is still empty (not even on the market) in disrepair which it was not, they have to maintain the outside and pay the tax and incurred all the foreclosure costs which I understand is tens of thousands of dollars here in NY.

All in all they are out at least $100,000-$150,000 instead of breaking even for 5 years or so.

and BTW all that crap Obie passed to compel the banks to work with the home owner only increased the costs to the banks without compelling them to make any decisions that helped the homeowner.
For example, they were required to have a sit down with the home owner at the home owners request but did not have to negotiate in good faith. So they would send minimum wage representatives to the meeting with no power to negotiate. As long as someone showed up, they were in compliance and the foreclosure could proceed.

[finnbow]

Is anyone dumber than a banker?

A politician.

[HatchetJack]

A voter?