patrick.net

hrhjuliet says

How is this managed? I don't understand how this is allowed?

A lot depends on how much equity is left in the property. If the average person understood how many bad loans are on the books of the banking industry there would be a revolution by tomorrow.

The new banking regulations, passed as Dodd-Frank, allow banks to ignore the lost value of foreclosed property and report some mild loss, (which I like to call 'mark-to-make-believe') on their books until they take ownership of the property. But once they take ownership they must write down the "real" loss, called mark-to-market. Now, whatever that real loss is must be added as cash to their reserves to make up for the lost equity.

So, it's easy to see why banks would drag their feet taking ownership of all their bad loans since the capital reserves required to square the mark-to-market losses would be impossible to accumulate.

Thus, if a bank takes ownership of a foreclosed property right away after foreclosure, you can bet the property had a great deal of equity left. Pity the poor saps who lost control of something they had built so much equity into.

If you are foreclosed on, my advice is just live there, save your pennies and wait for the bank to come and take it from you (assuming you are not fighting to save it from foreclosure). In states like mine, Florida, so many properties are in foreclosure you can live rent free for years. Banks actually like people to remain in the houses they have foreclosed on because the original owners will usually continue to keep up the property, thus maintaining the value of the home until the bank can afford to write it off through a short sale or some other means of avoiding adding a large deposit to their cash reserves.

The solution is wage increases, of course.

Long overdue given the massive increase in Wealth and Productivity.

thunderlips11 says

The solution is wage increases, of course.

Long overdue given the massive increase in Wealth and Productivity.

Middle class is not seeing that. Rich drives this economy now. :)

Call it Crazy says

thunderlips11 says

The solution is wage increases, of course.

Long overdue given the massive increase in Wealth and Productivity.

Question, if many people received a 5% wage increase, do you think they would save any of it or just spend it??

LOL
They will spend it all even before they earn it, by taking a well deserved vacation in Hawaii.
Then they will complain how hard it is to make ends meet.
Next they will blame the rich and the government because they are broke.
After that whine whine and whine until I get a headache.

Strategist says

Call it Crazy says

thunderlips11 says

The solution is wage increases, of course.

Long overdue given the massive increase in Wealth and Productivity.

Question, if many people received a 5% wage increase, do you think they would save any of it or just spend it??

LOL
They will spend it all even before they earn it, by taking a well deserved vacation in Hawaii.
Then they will complain how hard it is to make ends meet.
Next they will blame the rich and the government because they are broke.
After that whine whine and whine until I get a headache.

If they are renters, half of it will be gone before they even see it via rent increases. Most of the rest will get baked in other necessities. If they are a homeowner with fixed rate mortgage, they will have more leeway - they may very well choose to spend the raise on vacations/discretionary spending but even taking that course of action is superior to not having a chance to make the choice in the first place.

$100K is the new "Middle to Middle lower" middle class.
That used to be CEO, Doctor and Lawyer money just a decade and half ago.
Today that's just the bare minimum for a family of 4 has to make. To be able to save a few hundred a month if they are lucky. And that's assuming they didn't do something stupid, like buy a luxury car, or a McMansion because they were so foolishly under the impression that 100K in 2014 is the same as even 60K in 1999.

250K is the "Middle to Middle Upper" middle class.
90K is definitely squarely in the lower middle class.
less than 60K is abject poverty.

The problem with our economy there's too damn many full time bills for people making part time wages.

CaptainShuddup says

250K is the "Middle to Middle Upper" middle class.
90K is definitely
squarely in the lower middle class.
less than 60K is abject poverty.

Median american household income is $50,054. Are you saying that a median american lives in "abject poverty" regardless of location?

Call it Crazy says

Online home shopping hit new records in March, with Zillow traffic rising by almost 7 million since the start of the year, an article from GeekWire reported.

That would explain their week over week optimism of my neighborhood since the first of the year.
I guess the Zestimates is based on neighborhood hits on their site, and not actual sales data.

Yup! That is especially if they are married with children.
A single person living alone isn't really a household at all.
So that median income really means nothing on the face of it.
If you're single you'll do with out a lot things, or find those resources in your day to day routine when you're away. Like eat at parents house, or be a part of other social activities where you're often fed or other needs that you would normally have to buy at home if you weren't single.

I mean a single guy can time his nightly dinner to coincide with the local bar's happy hour buffet. You can't really show up with wife and kids in tow, especially if you're only making 50K a year.

If you're single you can always manage rides with friends or family, you can't call friends and ask them to pick up your kids from school or give your wife a ride to the store.

Single person household live an entirely different reality than a 4 member family household in America. So much so, you could consider that single person making $50K a year, will have more disposable income, and a higher living standard(in a materialistic way) than a family of 4 making $75K.

No. No. No. You are all wet. This article on 'Main St.' (So you know it is authentic.) says:

http://www.mainstreet.com/article/real-estate/how-healthy-housing-market-one-stat-tells-all?puc=yahoo&cm_ven=YAHOO

1.) Price are up.
2.) Foreclosures are down.
3.) Shadow inventory is reduced.

All in all, 'Pretty Nice Recovery'.

CaptainShuddup says

I mean a single guy can time his nightly dinner to coincide with the local bar's happy hour buffet. You can't really show up with wife and kids in tow, especially if you're only making 50K a year.

A single guy can also live out of a van, if he wanted to.

Plus, he could spend some $250/month for a paid garage parking spot, so that he wouldn't be facing the cops on the streets.

Thus, $50K for a single guy can even translate into $120K for a family of 4.

You're probably right, I was never that disciplined with my finances, and my wife is the one the toils over the setting up bill pays, and account balances. But when I was single, I was always impressed with guys that made the same money as I did, but managed to save up money of noteworthy significance.
It's not that that I was poor when I was single, as much as I seemed to have had a lot of money to piss away.

Which is really all people seem to want money for. If you have enough money make things in life you would like to do possible. Whether it's be single and sit at a bar and drink and piss your paycheck away, or if it's raise kids and have money to cover your bills.

I've always respected those who could live like a homeless monk and save up tens of thousands of dollars while making $9 to $15 an hour.

Back then our income was spent on frivolous drinking, eating out, and other entertainment.
We didn't have much, but we lived a well entertained life. WE weren't as bored as people of all ages are today. Today, disposable income seems to be spent on more ways to keep your self introverted, and your attention off the sheer hopelessness of ever getting ahead.

Also it's not really fair to consider cell phone, cable and internet access as items being paid for with disposable income. These are things you must have, or at least all but cable.
Back then, those were all things we would do with out, in lieu of being able to catch a touring band on a week end, or have a bash with your friends.

Families are still well firmly based in tangible as well as virtual distractions, they must have all of the digital communication and entertainment outlets, as well as there is also still pressure for them to participate in real world entertainment. Like an amusement park or taking the family out to a themed over priced restaurant to mark a family members birthday. Which Single people don't have to give a crap about anyone's birthday in the world. A working head of a household has to consider at least 3 birthdays, and two Christmas gifts.

Call it Crazy says

Question, if many people received a 5% wage increase, do you think they would save any of it or just spend it??

They would spend it, which means more hiring and longer hours for the current hires, and upward wage pressure.

We don't have a huge emergency savings.. But i've been very careful with credit and have an 800+ credit score and have a massive credit line. I'm talking access to about $100K in credit card limits.

The problem with that is in 2009 a bunch of my cards starting getting cancelled. I looked into it.. and found a small charge off in the amount of $35 sent my credit score tumbling over 100 pts. This was during the credit crisis and stock market crash too.. So Credit Card companies were skiddish to begin with.

I had it corrected and my credit score restored after a few months... But those cards were already cancelled. I learned those huge credit limits can be taken away swiftly.. so while I still like have lots of available credit... I know when it's most needed, it could easily be taken away.... and plan accordingly.

Call it Crazy says

Question, if many people received a 5% wage increase, do you think they would save any of it or just spend it??

If I made 5% more I'd invest it. But if an average person would spend the 5%, that would jolt the economy at least for a while until the money runs out. And we'll be back at square 1.

FortWayne says

Call it Crazy says

Question, if many people received a 5% wage increase, do you think they would save any of it or just spend it??

If I made 5% more I'd invest it. But if an average person would spend the 5%, that would jolt the economy at least for a while until the money runs out. And we'll be back at square 1.

Prices on all goods across the board would rise by the next quarter, and Yellen would declare that there is no inflation and we should all panic about deflation. So therefore, She proposes, She lowers rate at which banks can borrow money from the government, and she is creating a bond buyback program. ...Well this time it's different.

CaptainShuddup says

Prices on all goods across the board would rise by the next quarter, and Yellen would declare that there is no inflation and we should all panic about deflation. So therefore, She proposes, She lowers rate at which banks can borrow money from the government, and she is creating a bond buyback program. ...Well this time it's different.

That too. All while I'm paying almost $5/gallon at the pump!

CaptainShuddup says

So much so, you could consider that single person making $50K a year, will have more disposable income, and a higher living standard(in a materialistic way) than a family of 4 making $75K.

Not so sure about that... I'd have to crunch the numbers... But with a stay at home wife... I save a crap load on state and federal taxes being married. When I was single, i was taxed a hell of a lot more. With all my deductions this year... I paid less in taxes than I did as a single person making $40K less.

But then again, I definitely spend every last bit of those savings on the wife and kids needs... rather than fun toys for myself.

thunderlips11 says

The solution is wage increases, of course.

Right! Then we can pump the median new house square footage up from 2010's pathetic 2169 square feet to something which will make more profits for real-estate agents and bankers.

Oh wait... people spending everything wage increase was what got us to the current situation

David9 says

All in all, 'Pretty Nice Recovery'.

Good luck.

darlag says

Good luck.

The range of accurate 'status' on the housing market is amazing isn't it?

Thankfully, some of the comments include:

"The housing market is doing good as far as cash investors who are renting them out, but typical middle class families can't afford the rising prices due to ridiculous housing recovery speculation by the government"

"People are living in their houses for free and have done so for years."

"BS story! If anything, shadow inventory is increasing. Foreclosure and short sale inventory on the market dried up in mid-2012 because the Banks\Freddie\Fannie made it that way. Manipulation began around this time. We have seen 10-30% increases in values in certain parts of the country because of this."

I was being sarcastic. Thanks for biting!

BoomAndBustCycle says

But with a stay at home wife... I save a crap load on state and federal taxes being married.

Not so anymore, I just realized yesterday, that in spite of the fact that I bitched last year about my taxes going up compared to last year. Which I was told that was not the case, my Taxes did actually go up. And MY tax bracket particularly. Hence why all those quick to call me a Foxbot assumed they knew what they were talking about when they called me a liar. I know find out, because I did my taxes, that in fact married people making between 62K to 96K pay more taxes than singles making the same, or married people making more. In the form of a marriage penalty.

BoomAndBustCycle says

But then again, I definitely spend every last bit of those savings on the wife and kids needs... rather than fun toys for myself.

Well that's just it, you pay for three heath insurances with three deductibles (of course subtotaled under one plan), along with three times the food, and then, 2.5 times the living space.

CaptainShuddup says

in fact married people making between 62K to 96K pay more taxes than singles making the same

Are you talking about the standard deduction or an itemized one?

What a horrible country when one is forced to spend all the money they make & then forced to take on debt so they can buy more crap. lmao

BoomAndBustCycle says

CaptainShuddup says

So much so, you could consider that single person making $50K a year, will have more disposable income, and a higher living standard(in a materialistic way) than a family of 4 making $75K.

Not so sure about that... I'd have to crunch the numbers... But with a stay at home wife... I save a crap load on state and federal taxes being married. When I was single, i was taxed a hell of a lot more. With all my deductions this year... I paid less in taxes than I did as a single person making $40K less.

But then again, I definitely spend every last bit of those savings on the wife and kids needs... rather than fun toys for myself.

When you are married with dependents, sure you pay less in taxes, but life will tax you much more in other ways.

Housing never goes down! Buy now or be priced out forever!

David9 says

Thankfully, some of the comments include:

TR • 4 hours ago

Can't edit out "amp;"

Sounds like a PatNeter

You take what I offer for your smelly crap shack or enjoy eating cat food and rotting in the decaying hell hole, cottontop. It's your call......

If you can't stand the heat, you get out of the kitchen. Do any of you really believe that someone called in gun threats about double R at his double senior school? Not a chance, he is burned out and flaked, plain and simple. He busted his ass and built an empire, but paid a physical and mental price. Happy for him, glad he moved on and found his happy place. The music's over, turn out the lights.

I'm sorry if people don't know that sub-prime mortgages are still outstanding but the figure is about 50% of them.
I know this figure from a source that is not public I was helping someone study who wants to be in the Nationwide Mortgage Licensing System (NMLS). This is a new requirement for mortgage originators. She paid for a course and so I can't provide a link here.
The subject was boring to me but I'm always curious. I was actually shocked to read the figure that about 1/2 of the mortgages in the U.S.A are sub-prime.
The other factoid was Fannnie&Freddie stock losing 90% of their value in 2008.
Other things surprised me, such as how absurd the house of cards was but I saw the reason behind it.

Clambo - the misunderstanding arises from the definition.

Bank of America, QBE to Settle Insurance Lawsuit for $228 Million
Reuters, Apr. 7, 2014--Aubin, Dena
Bank of America and QBE Insurance Corp have agreed to pay $228 million to settle claims that they engaged in a kickback scheme inflating the cost of insurance that homeowners were forced to buy, according to a court filing.
(More)

Citigroup Reaches $1.13 Billion Pact over Mortgage Bonds
Bloomberg, Apr. 8, 2014--Campbell, Dakin
Citigroup Inc. agreed to pay $1.13 billion to settle claims from mortgage-bond investors as it seeks to curb liabilities tied to the financial crisis. It took a $100 million first-quarter charge.
(More)

I just thought I'd sneak in.

Pricewise, RE in SFBA has been fairly stable between Aug 13 to Dec 13. Price has started to creep upwards since early 2014. My WAG is the creep up would stop in Jun and then sideways for many months because of increasing inventory, increasing mortgage rate, higher pays and higher employment rate.

The market is pretty flat ... except for that whole rising prices thing.

Y-o-Y : 5.6% nationwide, and about 18% for California. The trend looks like it will continue into Summer.

Pnet, wake me if the "apoc-a-crash" comes.

Hey rew, I am happy you are happy. Enjoy your place and your family. If your job allows you to make enough money to pay craftsmen to do the upkeep your home or your boss allows you time to put in the work, your golden. Some of us look at the fact we are over burdened by long work hours, supporting the boomers, both parents working, there's only so much time/money to go around. I will rent, enjoy the benefits it allows me and wait for the bloated boomers to die off.

I found a reference if interested.
The document was from 2008.
copy/pasting portions that may interest some:

"The number of outstanding first mortgages is estimated at 55 million and was derived from the National Delinquency Survey (NDS) of the Mortgage Bankers Association (MBA). The NDS contains 45.4 million first mortgages, covering about 80%-85% of outstanding first-lien mortgages.
This yields a total of 55 million first lien loans.
The Federal Reserve reports that the dollar amount of outstanding first lien mortgages at 6.30.08 was $9.42 trillion."

"By number: Forty-nine percent of the 55 million first mortgages are Subprime or Alt-A (26.7 million of 55 million).
By dollars: Forty-nine percent of the $9.42 trillion in outstanding first lien mortgages are subprime or Alt-A ($4.622 trillion/$9.42 trillion)."

clambo says

I found a reference if interested.

The document was from 2008.

copy/pasting portions that may interest some:

"The number of outstanding first mortgages is estimated at 55 million and was derived from the National Delinquency Survey (NDS) of the Mortgage Bankers Association (MBA). The NDS contains 45.4 million first mortgages, covering about 80%-85% of outstanding first-lien mortgages.

This yields a total of 55 million first lien loans.

The Federal Reserve reports that the dollar amount of outstanding first lien mortgages at 6.30.08 was $9.42 trillion."

"By number: Forty-nine percent of the 55 million first mortgages are Subprime or Alt-A (26.7 million of 55 million).

By dollars: Forty-nine percent of the $9.42 trillion in outstanding first lien mortgages are subprime or Alt-A ($4.622 trillion/$9.42 trillion)."

Link the article.

This is another site that shows the percentage of sub-prime loans to total mortgages:

http://www.frbsf.org/education/publications/doctor-econ/2009/december/subprime-mortgage-statistics

You can see the ratio in the graph, though it is lower than the figures quoted elsewhere.

clambo says

I know this figure from a source that is not public I was helping someone study
who wants to be in the Nationwide Mortgage Licensing System (NMLS). This is a
new requirement for mortgage originators. She paid for a course and so I can't
provide a link here.

lol--you sound like that old rootvg guy that guaranteed that Romney would beat Obama. He also has secret sources that were in the know....

The data is clear and the percentage of mortgages that are subprime is MUCH, MUCH less than 50%. You are way off.

clambo says

The subject was boring to me but I'm always curious. I was actually shocked to
read the figure that about 1/2 of the mortgages in the U.S.A are sub-prime.

You should be shocked--it's complete BS.

clambo says

I found a reference if interested.

The document was from 2008.

copy/pasting portions that may interest some:

If you can copy and paste then you can link to this mysterious secret document. Like tatapua said complete bs.

This is starting to concern me a little bit. Still early in the spring buying season, so let's hope it's just a pause. I do know they will have to ease off on tight loan requirements, and when that happens all the pent up demand that has been accumulating over the last 6 years will release its energy like a tsunami.
Qualified buyers who postpone their home buying plans will look back after a few years and kick themselves for missing yet another opportunity to buy at bargain prices.
Potential buyers.......you have been warned.