patrick.net

Call it Crazy says

Today's underwriting standards are fine... If you pay your bills and have a stable job with verifiable income, (and a down payment) you can get a mortgage....

It's the verifiable income that kills off most entrepreneurs as well as buyers with parents who are willing to help them out (rather than have them living at home). That leaves you with working stiffs. Working stiffs with good credit and a hefty down payment in this economy aren't going to sustain the market.

Stated income, no down payment, interest only loans, etc. performed fine for decades. Things will work fine as long as you don't let them get away with bundling a bunch of high risk loans with a few good loans and fraudulently rate it A+. Of course that's going to make everybody way too cocky.

Cash deals doesn't mean financing is not involved
It means mortgages are not. Investors have access to cash lines at lower rates than mortgages so a lot of the all cash deals are financed but not via mortgages
Or they are financed with public equity offering or other investor money

Phoenix is the market most likely to get hit hard as investors are leaving that market according to recent reports
If private homebuyers can't afford or get mortgages in phoenix that market could see another collapse

Call me crazy says:
Oh, to ease of on "strict guidelines", you want to go back to NINJA loans and people with 400 credit scores making minimum wage to qualifying for 600K mortgages.... Got it!!

LOL. I did not even mention ninjas.
Why do you think easing off on strict guidelines equates to NINJAs?
How about a sensible balance that is a win win for everyone?
Sub prime, stated income have always been around with high down payments. Let's stick to what works.

Call it Crazy says

ELC says

Things will work fine as long as you don't let them get away with bundling a bunch of high risk loans with a few good loans and fraudulently rate it A+.

What's that got to do with someone defaulting on their mortgage??

A lot. It changed who was approved. It changed the way underwriting was done (or not done.)

Call it Crazy says

Sure... No verifiable income and money loaned by family because the home buyer can't save up by themselves... Yep, that's a recipe for success.....

The system is set up now to suck savers dry. There's not enough savers left to only approve savers. Savers are a dying breed.

Call it Crazy says

ELC says

Stated income, no down payment, interest only loans, etc. performed fine for decades.

Ha Ha Ha... Spoken like a true realtor...

Spoken like someone who's been around for decades and has been actually paying attention. BTW, I train Realtors. I'm not a Realtor.

ELC says

Call it Crazy says

Sure... No verifiable income and money loaned by family because the home buyer can't save up by themselves... Yep, that's a recipe for success.....

The system is set up now to suck savers dry. There's not enough savers left to only approve savers. Savers are a dying breed.

Homeownership for purposes of primary residence should be a reward for those who were able to save. Besides, if parents want to buy a house for their children why don't they take out a loan in their own name? I am sure that it will be approved if numbers make sense. However, if all they do is help with downpayment, they can get a notarized note stating that downpayment is a gift and a lender can approve the loan for children if their income is sufficient. You can't really expect for them to be approved otherwise.

smaulgld says

Phoenix is the market most likely to get hit hard as investors are leaving that market according to recent reports

If private homebuyers can't afford or get mortgages in phoenix that market could see another collapse

do you have any sources for this?

Wow, bigmouth has 55 out of 61 posts on his own thread. That's got to be a patnet record. I've got a special right now on top of the line tin foil hat. These babies are the rolls royce of the paranoid set.

So what if the dollar loses value? Has no relevance to the standard of living.
Cell phones, large screens, computers, life saving drugs, internet did not even exist a hundred years ago. How the hell are you gonna make a comparision? Our standard of living is determined by the introduction of new technologies, not maintaining the value of a currency.

bgamall4 says

bob2356 says

Wow, bigmouth has 55 out of 61 posts on his own thread. That's got to be a patnet record. I've got a special right now on top of the line tin foil hat. These babies are the rolls royce of the paranoid set.

So the women are the same person. Can you reason or are you just a mule/ass. If you are incapable of reasoning, Bob, why do you bother to go online?

Because you put two photos up side by side does not make them the same person unless you think these two are one and the same:

Do you see the point? Before you start making extraordinarily offensive claims about individuals such as this woman and Parker, you'd better have more than a couple of blurry photos and a google search of the same name if you think you are going to be taken seriously by anyone other than the other resident loons on here.

economic lesson: inflation is harmful and a way for the gov to rob you of your hard earned dollars only if you keep cash under the mattress or invest in bonds. but who the hell buys bonds anyways? now that Europe has been bailed out.

They can't be the same person. Travolta's got much bigger boobs:

So Homeboy was absolutely spot on. You just totally ignored the obvious and kept on going. Amazing.

bgamall4 says

Bigsby says

So Homeboy was absolutely spot on. You just totally ignored the obvious and kept on going. Amazing.

No, you can't debunk the fake crying. It is an actress and she is the identical twin to an actress. If you didn't watch the video you are a dumb ass. But I already knew that.

So let me get this straight. You think your belief in her 'fake crying' trumps the fact the person you think she is has utterly different teeth (ignoring everything else).

Send a couple bucks to patrick and change your name to RIPPLES ARE THE FUTURE?

The primary falsehood on this is that inflation is organic to the economy. It certainly is NOT.

Could it be the denim jacket is a little big for her, and the part where her arm goes behind the girl's head is where her arm and sleeve is resting on the girl's shoulder. This would cause the empty part of the sleeve to bulge up at this point, making it look like the angle of her arm (if you extrapolate it 2-4X the distance thus multiplying the error 2-4X) is impossible when her actual arm inside the sleeve is at a normal angle, and your eyes were tricked like a bull in the ring. Toro, Toro!

Like the moon conspiracy folks, who obsess on certain aspects of photos yet clearly know next to fuck all about even basic photography.

Homeboy says

bgamall4 says

Teeth can be fixed.

And a cleft chin?

Her ears appear to have moved as well.

Shadows, camera angle, expression... all those things that he would normally argue are irrelevant when others say they're not the same person will no doubt be trotted out.

I have honestly missed these threads, especially Mr Shostakovich's reflections. ⛄

Call it Crazy says

Yep, why go back to the basics that worked decades ago for our parents... Just look how many foreclosures they had back in the 70's...

What worked then won't work now. Those were totally different times. It WAS possible for people to save for a down payment, not to mention the down payment was much smaller because the cost of housing was much smaller. In Florida the same condo on the ocean my parents bought for 50k is now 400k. You're either just trolling or you're totally clueless.

ELC says

Call it Crazy says

Yep, why go back to the basics that worked decades ago for our parents... Just look how many foreclosures they had back in the 70's...

What worked then won't work now. Those were totally different times. It WAS possible for people to save for a down payment, not to mention the down payment was much smaller because the cost of housing was much smaller. In Florida the same condo on the ocean my parents bought for 50k is now 400k. You're either just trolling or you're totally clueless.

At the same time, a house in Detroit that used to cost $50k in the 70's are selling for $20k or less today, while people's average income in this country has gone up from $5k/yr back then to $50k/yr now. There are plenty ocean front building sites in Florida.

Down payment is the key holding down default rate . . . and retained interest is the key holding loan-originators to having skin in the game.

ELC says

It's the verifiable income that kills off most entrepreneurs as well as buyers with parents who are willing to help them out (rather than have them living at home). That leaves you with working stiffs. Working stiffs with good credit and a hefty down payment in this economy aren't going to sustain the market.

Stated income, no down payment, interest only loans, etc. performed fine for decades.

Not in combination in the same loan. Taking out a stated income loan should require 25+% down payment. Likewise, no-down-payment loan should require strong evidence of consistent income. Interest-only should also require massive down payment. Down payment percentage is the key to preventing default. Working stiff is already helped by all sorts of government programs that require very little down payment. All the rest wishing to play in the field should show us the money when they say they have income to carry the loan.

Reality says:
Not in combination in the same loan. Taking out a stated income loan should require 25+% down payment. Likewise, no-down-payment loan should require strong evidence of consistent income. Interest-only should also require massive down payment. Down payment percentage is the key to preventing default. Working stiff is already helped by all sorts of government programs that require very little down payment. All the rest wishing to play in the field should show us the money when they say they have income to carry the loan.

Strategist responds:
First time buyers may not have large down payments, but move ups usually do. There are probably millions of potential buyers with large down payments who have not been able to get stated income loans in the last 6 years because of destructively tight lending standards. With 25 to 35%

With 25 to 35% down payments they are not likely to default. Same goes for sub primes.

Call it says:
How can a condo that once sold for 50K be worth 400K now, considering that it is years older?????????

Have incomes increase by 8x since then???

How many normal people have 80K to put as a down payment on that condo??

Strategist responds:
The rich move to better areas, while the poor move to cheaper areas. How do you think New York sustains high prices, while Detroit mansions are cheaper than cars?
That trend will continue.

Mark D says

smaulgld says

Phoenix is the market most likely to get hit hard as investors are leaving that market according to recent reports

If private homebuyers can't afford or get mortgages in phoenix that market could see another collapse

do you have any sources for this?

Here you go
http://www.cnbc.com/id/101271821

Strategist says

First time buyers may not have large down payments, but move ups usually do. There are probably millions of potential buyers with large down payments who have not been able to get stated income loans in the last 6 years because of destructively tight lending standards. With 25 to 35%

I doubt anyone having 25-35% down payment, whether in cash or from sale of existing home turning equity into cash, has been having much finding financing for primary home, unless they don't have the income to make projected payments or have shoddy income history or credit history or recently got laid off.

Call it Crazy says

Strategist says

There are probably millions of potential buyers with large down payments who have not been able to get stated income loans in the last 6 years because of destructively tight lending standards. With 25 to 35%

If someone is looking to put down 25% to 35%, I doubt they would have any problem getting a mortgage, unless they have a real shaky work or income history or have some really bad black marks on their credit history.

Here is a true scenario.....
4 months ago a close friend with a $1.8 million home, and 6 rentals free and clear got declined for a $400,000 loan because his employer started paying him on a 1099 instead of W2's.
Does anyone in their right minds think he will default? The system needs to start using some common sense.

A simpler alternative is for you to put your picture on the monopoly money and see if you can get some sucker to accept them as the future of currency.

Stuff is worth whatever people agree it's worth. That goes double for currency.

Strategist says

Here is a true scenario.....

4 months ago a close friend with a $1.8 million home, and 6 rentals free and clear got declined for a $400,000 loan because his employer started paying him on a 1099 instead of W2's.

Does anyone in their right minds think he will default? The system needs to start using some common sense.

Can he carry the $400k loan on his Schedule E income from the rental houses alone? If not then the switch from W-2 to 1099 would mean he doesn't have a 2yr income history form that job. The more disconcerting thing is that, switching to 1099 is often prelude to elimination of the job in the corporate world. How much equity does he have in the $1.8mil house? why can't he use a home equity line or 2nd mortgage on that house?

Call it Crazy says

Strategist says

Does anyone in their right minds think he will default?

Apparently the bank does..... and they are the ones loaning him the money...

Yeah, the same banks did not think my gardener would default on a $400,000 loan with no down, no provable income, and no credit.
No wonder we had a crash, and no wonder the recovery is slower than expected.
It's a screwed up system.

Call it :
And now your whining because banks won't loosen their lending standards.... You just proved why...

But, now you're complaining that they won't give out easy money like before??? Which way do you want it???

Strategist:
How about good old fashioned common sense loans?

Strategist says

Yeah, the same banks did not think my gardener would default on a $400,000 loan with no down, no provable income, and no credit.

Even in the most lenient of times you needed to have at least one of those three. If he's like most, he probably had good credit and he defaulted because he was under water with a comparably high interest loan, not because he couldn't pay. Bankers get Government bailouts. Gardeners have to bail themselves out.

smaulgld says

Here you go

http://www.cnbc.com/id/101271821

Roberto will tell us this is BS till he's swimming back home.

""If I was a Phoenix real estate 'investor' sitting on the upside—or in the long process of readying dozens, hundreds, or thousands of houses for rent into a market about to get pounded for years with single-family rental supply—I would push the 'sell button' on everything I could"

Reality says

Strategist says

Here is a true scenario.....

4 months ago a close friend with a $1.8 million home, and 6 rentals free and clear got declined for a $400,000 loan because his employer started paying him on a 1099 instead of W2's.

Does anyone in their right minds think he will default? The system needs to start using some common sense.

Can he carry the $400k loan on his Schedule E income from the rental houses alone? If not then the switch from W-2 to 1099 would mean he doesn't have a 2yr income history form that job. The more disconcerting thing is that, switching to 1099 is often prelude to elimination of the job in the corporate world. How much equity does he have in the $1.8mil house? why can't he use a home equity line or 2nd mortgage on that house?

His job is safe, no question there.
Owes $400k on primary residence. Purpose was to lower rates without pulling any money out. Now rates have increased and there is no benefit.

Strategist says

Strategist responds:

The rich move to better areas, while the poor move to cheaper areas. How do you think New York sustains high prices, while Detroit mansions are cheaper than cars?

That trend will continue.

Yes. That's exactly what happened. The ocean condos in S. Florida are now being bought by yuppies and foreigners. The retirees are moving away from the ocean. Some of the ones that are staying are taking out reverse mortgages.

ELC says

Strategist says

Yeah, the same banks did not think my gardener would default on a $400,000 loan with no down, no provable income, and no credit.

Even in the most lenient of times you needed to have at least one of those three. If he's like most, he probably had good credit and he defaulted because he was under water with a comparably high interest loan, not because he couldn't pay. Bankers get Government bailouts. Gardeners have to bail themselves out.

He didn't have much of anything. Lots of kids and the ability to work like a horse without complaining. Maybe his kids co signed. The poor guy was in tears when he lost his home.