patrick.net

Call it Crazy says

Depends on your definition of "looser"....

Indeed... nowadays you have to discern whether the writer actually means "loser" when they type "looser" on the internet.

Call it Crazy says

If you have a pulse, you get a loan!!

Under QM mandate by the federal government those loans won't come back

The

2/28
3/27
80/20 S.S.

Stated income was here in CA last year and this year but it's old school version of it and hence not popular

Those crazy exotic loans are done RIP and burn in hell!

Mark Zandi still doesn't get the wage factor in the article, this is why he couldn't mention one standard change on CNBC this morning

Automan Empire says

Indeed... nowadays you have to discern whether the writer actually means "loser" when they type "looser" on the internet.

Looser credit...
Loser credit... What's the difference?

Automan Empire says

Call it Crazy says

Depends on your definition of "looser"....

Indeed... nowadays you have to discern whether the writer actually means "loser" when they type "looser" on the internet.

You took the words straight out of my fingers

bgamall4 says

will they still bite

Only if they like FROST BITE

http://theeconomiccollapseblog.com/archives/if-economic-cycle-theorists-are-correct-2015-to-2020-will-be-pure-hell-for-the-united-states

Logan

How do you see Frank Dodd effecting home sales?

indigenous says

How do you see Frank Dodd effecting home sales?

At this stage not much, it really comes down to incomes and assets because the standards to entry to buy a home has been low since the financial crisis started.

Even QM that came in this year hasn't really changed anything either. I have done 4 non QM loans this year.

So it comes down to incomes and assets.

Now in terms of compliance and paperwork, all the regulations has created that type of drama. However in terms of demand destruction not so much.

Case in point, Last year California took on a 20% down Stated Income loan from one lender. It wasn't very popular because it was an old school stated income loan that had old school metrics.

It's a bad idea.

clambo says

t's a bad idea.

Its a bad idea and it won't happen, so I am not worried about because they are just talking about over lays restriction being taken off. They have no idea what core standards are today.

In a nut shell you are talking about demographics and the FED trying to stave off an inevitable decline and making a mess?

Call it Crazy says

Depends on your definition of "looser"....

There are so many people not working or working part time or lower wages, that I think they will have to bring back NINJA loans if they want to ramp up sales...

If you have a pulse, you get a loan!!

Looser and healthy loan market would be the pre NINJA era.
It would jump start a softening real estate market.
We need that.

indigenous says

In a nut shell you are talking about demographics and the FED trying to stave off an inevitable decline and making a mess?

The main point I have been trying to make is this

2010 #1 thesis is that we don't have enough qualified home buyers

Being in the business and knowing what the true capacity of Americans where, I knew for a fact that unless you had some 3rd financial bubble creating fake demand for fake good paying jobs ... that there was going to be a limit of growth for housing

We never had the goods in the first place. We are consumption based economy on debt in a time where median real income growth has been going no where.

So a debt structure like a home mortgage would get impacted greatly

So, rates have come from 18% to all the way 3.25% in 2012 and we are seeing so much stress on mortgage buyers at 3.25%-4.25%

There is a reason for that and this economic cycle shows that more than any other I have ever seen since I have been in the business

Call it Crazy says

That's the part that surprised me... with rates falling into the 3's, it was a great time to buy... But, when they rose into the 4's, the brakes came on Big Time... You would think a 1% rise would be no big issue, but it was

Even at 3.25% the actually percent of mortgage buyers didn't increase. In volume from a depressed level it did. So, there wasn't even strong demand even at 3.25% considering we have had over 34 million Americans since 2000.

This was never about would or should... it was always about could

Logan Mohtashami says

2010 #1 thesis is that we don't have enough qualified home buyers

My point is that this is caused by demographics.

indigenous says

My point is that this is caused by demographics.

Yes demographics is a reason for this for sure. Demographics are one of the 4 horsemen I have for the American economy that will limit capacity growth.

We have seen in this cycle a lot of older workers taking jobs away from young. Young meaning 25-54 age group

It's very simple.

The recession around 2007 popped the housing bubble.
The pop was magnified many times by the CDOs and other derivatives of MBS.
After Lehman collapsed, the USA entered a mild depression.
NO ONE in the public eye would say such a word for various reasons, some should be obvious.
Today there are 10 million on disability (not really desabled), 9 million unemployed (officially) and 92 million out of the workforce. 47 million are on food stamps.
The FAKE economy collapsed. Politicians won't allow those who produce wealth and jobs to thrive.

Nobody "took away" a job from the young except a foreign worker.

The older workers refuse to QUIT their jobs because they know the actual condition of the USA economy.

The older workers also know that they will pay higher TAXES in the future to support the welfare class. Older workers also remember the 70's so they've seen a weak president and a bad economy before and aren't dumb enough to quit working.

Logan Mohtashami says

Demographics are one of the 4 horsemen

Not to beat a dead horsemen but the demographics eclipses the rest. I mean Abenomics has demonstrated that you cannot fix this with debt. The central banks would be admitting their own redundancy, whih they won't do to the expense of the citizens.

clambo says

It's very simple.

The recession around 2007 popped the housing bubble.

The pop was magnified many times by the CDOs and other derivatives of MBS.

After Lehman collapsed, the USA entered a mild depression.

NO ONE in the public eye would say such a word for various reasons, some should be obvious.

Today there are 10 million on disability (not really desabled), 9 million unemployed (officially) and 92 million out of the workforce. 47 million are on food stamps.

The FAKE economy collapsed. Politicians won't allow those who produce wealth and jobs to thrive.

Excellent and concise summary.

Analyzer says

The recession around 2007 popped the housing bubble.

Decreased affordability popped the bubble when "owners" could no longer make payments for a variety of reasons, only one of which was increased unemployment. Now that interest rates are back to the same level as ARM rates in 2003-5, we are pushing housing up to its peak level yet again. Its only hope to be sustained is if interest rates remain low...for a very long time. Oh, that and this minor detail:

bgamall4 says

But if they know it will crash, will they still bite?

Many are now convinced (again) that housing ONLY gains value. The crash of 2007 was not a crash, but a minor blip on a long-term, historically sustainable march to wealth and prosperity for all.