Armageddon for Home-Owners?

No worries. It's just oscillation of values of the S&P/Case-Shiller Home Price Index. Meaning home values were above the index value of 100 for so long to average out at the 100 index prices have to 'over-correct' before they oscillate above and then below the index line again. There will be buying opportunities. Look for houses you can rent out for more than the mortgage payment, and buy lots of them.

reply to post by brokedown


you are sooo spot on, but you know that already.. i have the exact plan you described in the works..tried to do it 2 yrs ago, wife shot me down.. now selling house to live the dream wife ready to pioneer.. new problem is finding nice land. any insight as to where? more importantly where not?

reply to post by havok


Either way, we just need to get over our indulgent lifestyle and back to necessity.

I agree with you on this one hundred percent. I bought modest and what I could afford. No, it wasn't as nice and as big as what my friend's houses were but guess what? I still live in mine and they don't.

I do believe that fraud took place in the mortgage industry, however and remember the last time my house appraised for a refinance, it was just an outrageous amount. It was obvious to me that the price was overinflated. I would love to be able to sell in the next five years but have a feeling we'll be sitting on it for a few more years to come. And that's fine, at least we have a roof over our heads.

its only a matter of time before we are all homeless, as Jefferson i believe warned us that a private bank would cause Americans "to wake up homeless on the continent their forefathers conquered" or something like that...Vegas is turning into a ghost city, i was going door to door recently for a cause and the amount of empty homes was staggering...there were whole neighborhoods where only a few people still lived, it was really depressing...foreclosure notices on door after door, etc...Americans are slaves to the private banks that their founders tried to outlaw, and should fight back...neighborhoods should band together, everybody declare where they live as their house, and sound an alarm when the bankers come a-knockin'...if they try to take what is yours, you and your neighbors should protect your homes by any means necessary, its that simple...its time to take the power back...people need to start organizing into clans and villages like the old days, for defense of the little we have left against the fascists who have taken over...if people everywhere start standing up, the man will have no choice but to stand down...

reply to post by ~Lucidity

12 Facts That Show We're in the Midst of the Worst Housing Collapse in US History

Do you have a link or should we just take your word on this report?
Even at that you didn't list all 12 of the facts.

Edit, OH, never mind. I see it now, it's almost the same color as your EX background.

reply to post by Devino

Sorry about that! I didn't even notice it had done that.

Originally posted by ~Lucidity
reply to post by dawnstar

 

Ah...that explains a few things. It's complicated, isn't it? I hear in some cases it takes years from them to evict a homeowner (like that woman in Florida) and in other cases it seems to happen virtually overnight.

All this makes me wonder about the whole squatters' rights issue. Wonder if we'll ever get to the point where homes are entirely abandoned and people just move right in and take over. What a mess.

One of the bank asset managers I do business with says that some of the properties have been on hold for two years. They also tell me that the foreclosures will get worse each year for the next 3-4 years.

Originally posted by havok
reply to post by ~Lucidity

 

You know, I have to wonder about all this...
Who deserves the blame more, the banks or the people?
The banks because they made enormous amounts of $$ selling loans?
Or the people for buying into homes beyond their budget?

First off, I believe we live in a country filled with over-indulgence.
Buying things we don't need, or buying things that are 'better' than yours...(keepin up with the jones)
So when I see someone getting a $450k loan for a house that:
A. Isn't worth the value
B. Is entirely too large for the owners needs.
C. Takes up 60% of their income.
I see problems.

Sure I can blame banks for all eternity, but when you boil it down...
It's the people who make the decisions to go into debt over it.

It's not like the banks hold guns to their heads and forces them to buy homes they can't afford.


Either way, we just need to get over our indulgent lifestyle and back to necessity.
Buy what you need and what you can afford.

Not what you lust over or go eye-ball deep in debt for.

There's more to life than impressing others.

Agreed 1000%

I think me and you have had some talks about this before on here.

reply to post by ~Lucidity

Yeah, it didn't help that the Sun was shining on my monitor.

Speaking of Sunshine, from where I am the foreclosures are not that bad. Most people I know are doing fine with their mortgages, including myself, and we don't foresee any approaching doom. There are problems around here on the west coast, just not as bad as I have been reading about in the rest of the country. I just wanted to post this, for what it's worth, in the hopes that it will show that all is not lost.

Originally posted by rusethorcain
reply to post by ~Lucidity

 

They (actions of both Clinton and GWB) enabled a lot of poor people to buy their own homes.
Unfortunately when the housing market readjusted to reflect actual rather than inflated values - all hell broke loose.
I say unfortunately as if this were some kind of accident. Financiers who instigated this inequity made a fortune bundling and selling this bad debt to China.
China and the American homeowner took the entire hit.
American capitalist took the entire profits.
Yeah Capitalism!!! This is how we do it.

Meanwhile, many folks had the rug yanked out from underneath them.
I am one of those who would not have qualified for a loan otherwise but by some miracle I got one in 2002. I saw my home value triple and I sold. If I had kept that money and walked away I might have been fine.

In 2006 I bought another house. I paid $218. I could not get $95G for the home today but that is because Florida is one of the hardest hit areas. Eventually the value will raise. Just as the home prices were artificially inflated I think now they are artificially deflated. Eventually some equilibrium will take hold. At that time I plan to dump this home and move to Costa Rica where we have already purchased property.

The housing market has at least stabilized but you are right that there is no building going on.
This is wonderful because where I am at here in Florida

The state localities take money from contractors hand over fist.
They allow forests and marshland to be taken and developed into housing communities
without any forethought or planning.
High rise condos going up on every square inch of Florida land with absolutely no consideration (actually they know and do not care)

HOW ARE ALL THESE PEOPLE GOING TO GET WATER AND ELECTRICITY?

2007-2008 we already were threatened with power and water shortages and sewer problems not to mention the one exit road and 2 lane highways that bottlenecked traffic everywhere and this is when the new places were not even half sold.

Another problem here in Florida that leaves new developments standing empty looking like ghost villages is one more additional example of American greed and why we should not rely on Capitalism to sustain us is the killer substance many people have already been exposed to..... Chinese drywall.

Since suits are still pending they can't tear them down.

I believe in Capitalism but think we should first map out...What do we need?
How much and where?

At least get the basics covered without killing unsuspecting Americans in their own homes.
Without the threat of NO INFRASTRUCTURE TO SUPPORT THE DEVELOPMENT you have (and really without that your development is nothing more than a facade at Disney)

I am HAPPY they have quit building in this area.
Now maybe the street will handle the traffic, sewers will be able to handle the sewer, the water will be enough to go around and we won't have power shortages for a few years.

I have bought many properties in FL from Naples up to Tampa and I had to educate my self real quick about that Chinese drywall. That should have never happened.

Originally posted by dbriefed
No worries. It's just oscillation of values of the S&P/Case-Shiller Home Price Index. Meaning home values were above the index value of 100 for so long to average out at the 100 index prices have to 'over-correct' before they oscillate above and then below the index line again. There will be buying opportunities. Look for houses you can rent out for more than the mortgage payment, and buy lots of them.

I use the 50% rule on my rentals. I suggest others use the same.

Originally posted by HenryPatrick
its only a matter of time before we are all homeless, as Jefferson i believe warned us that a private bank would cause Americans "to wake up homeless on the continent their forefathers conquered" or something like that...Vegas is turning into a ghost city, i was going door to door recently for a cause and the amount of empty homes was staggering...there were whole neighborhoods where only a few people still lived, it was really depressing...foreclosure notices on door after door, etc...Americans are slaves to the private banks that their founders tried to outlaw, and should fight back...neighborhoods should band together, everybody declare where they live as their house, and sound an alarm when the bankers come a-knockin'...if they try to take what is yours, you and your neighbors should protect your homes by any means necessary, its that simple...its time to take the power back...people need to start organizing into clans and villages like the old days, for defense of the little we have left against the fascists who have taken over...if people everywhere start standing up, the man will have no choice but to stand down...

How are they a slave to the banks? They went to the banks for the loan right?

If you don't like the banks then don't take money from them.

That plan you have is only going to get people hurt or killed, not good.

reply to post by havok

it was also people who inflated the assessed values of the houses, it was also people who wrote false numbers into the loan applications for their perspective buyers, it was also people who over rated the bogus cdos...
it was all done by PEOPLE!! and it was also people who were robosigning crap!
Those few who had the moral fiber to not overstate the homes values were blacklisted. those who weren't showing any moral fiber lost out, those who didn't give a hoots arse about morality, well, they made out like bandits....
maybe that is where we should lay the blame, on a society that places the dollar above any moral standing that they might have!

reply to post by dawnstar

Absolutely...the real estate agents and brokers, the appraisers, the mortgage companies, and the lawyers all pushed to sell this. You know...the people who are supposed to be representing YOU in the transaction, who are supposed to be professionals whose advice you take, who are supposed to help you wade through all the gobblydegook. And they pushed HARD. When we bought our home the push was so hard, we went what's going on here?

Some would just love to blame this ALL on the consumer. They would be being very dishonest.

reply to post by ISRAELdid911

so a double dip is less likely

IN YOUR DREAMS

It is much worse that people realize and the SHTF in 2012 when the economy tanks as a result of these two new laws.

First the Government is fudging the numbers on unemployment. Once you fall of the "unemployment rolls" you are "unemployable" so you do not count... even though you want a job.

Our real unemployment is somewhere around 22% CHART and has not shown any real signs of decreasing over the last two years.

Second Congress enacted laws that will only make matters much much worse.

FIRST LAW: Food Safety Law:
The Fake Food Safety Law will wipe out many of the 2.1 million American farmers. This older article explains how the addition of the "Commerce Clause can include in state farms and home gardens. The law contains large fines and jail terms.

Losing a million to 2 million farmers is not the end but the beginning. A Pew report states family farm dollars have a multiplier effect of seven because unlike corporate farms the dollars are spent within the communities. When direct and indirect spending are included it is estimated that the horse industry creates approximately 1.43 million FTE jobs andcontribute nearly $40 billion annually to the Gross Domestic Product of the economy. When indirect spending is included this number jumps to approximately $63 billion. That is just for horses I don't have the other stats handy but think of all the feed mills, feed stores, farmers markets, health food stores, tack shops, tractor supply, John Deere.... All will be hit as well as we lose another industry.

SECOND LAW: Obamacare's tax change on 1099 filing.

50% of US jobs come from small business. This law will wipe out many small businesses, keep them from growing or prevent them from starting. 80% of small business fail in the first few years Only 10% fail because of bankruptcy the rest fail because there is too much hassle for the amount of money the owners make. This bill increases the hassle. Just reading it make me think that perhaps it is time to take an early retirement and go collect Social Security like all the good little socialists want me to.....

Health-reform’s new 1099 requirement says small businesses, charities, even government entities must issue 1099 forms to all vendors from whom they purchased more than $600 worth of goods and services a year. Plus they must report to the IRS these transactions as well. The new law takes effect January 1, 2012....

...health reform's new onerous 1099 requirement because it requires small businesses to file even more, separate tax forms to be compliant; can trigger erroneous penalties from the IRS if the forms are missing information or are incorrect: can expose taxpayers’ personal identification information; and it can require expensive new computerized systems to comport with the letter of the tax law.

...Olson says she is worried about taxpayer mistakes, IRS mismatches and erroneous penalties. Olson also says that “the IRS has authority to impose monetary penalties against businesses that fail to file information reports

...Olson says she is worried about taxpayer mistakes, IRS mismatches and erroneous penalties. Olson also says that “the IRS has authority to impose monetary penalties against businesses that fail to file information reports

....What if a vendor fails to furnish a correct TIN? The small business is required by law to calculate and then impose back-up withholding at the rate of 28% of the purchase price.

It gets worse. In that event, under the law, “the small business must prepare and file Form 945, Annual Return of Withheld Federal Income Tax, and make federal tax deposits at an authorized institution on a prescribed schedule,” to comply with the 1099 law, Olson says.

If the small business doesn’t do that? It gets slapped with a penalty.

...this TIN fight could hurt the economy, especially in this scenario. “A vendor may simply refuse to sell goods to any purchaser that refuses to pay the full purchase price,” Olson says. “Such an outcome could significantly impair the normal course of commerce. No business should have to choose between compliance with back-up withholding and losing access to vendors on the one hand, and noncompliance while keeping vendor access on the other hand.”

...if a small business makes individual purchases of $600 or more from at least 250 vendors during a calendar year, it must also by law file forms 1099 electronically to the IRS. That’s even more costly, because the small business would have “to pay a per-report fee charged by an e-file service provider,” Olson says.

And what happens if you want to return the item?

And what if someone erroneously pumps out a 1099 form that says you sold them a laptop, when you didn’t, and the IRS matches that form to find out you did not report income on your tax return?

The IRS then issues a so-called “CP 2000 “notice of underreported income. That’s basically an IRS form letter explaining to you that the 1099 income information in IRS files does not match entries on your tax return and advises you to respond. At this point, you’re stuck, you’ll “have to prove a negative,”

slumz.boxden.com...

reply to post by dawnstar

the only ones I will thank for any glimmer of hope that shows itself would be the american people who keep on trudging along, even after those in office, be they republicans or democrats...quickly run to extinguish that small glimmer!! Both parties have lost my favor....

Isn't that the TRUTH.

BOTH PARTIES are responsible and should be hung, drawn and quartered. Time to vote third party if we can ever find anything to vote FOR. I am about to vote my cat into office, he has more sense.


Here are the critical moves by each president that will lead to the coming Great Depression: In my other post I addressed the last two laws designed to crush America. Here is what happen in the last few decades.

#1. Reagan - facilitate Leveraged buyouts/Hostile takeovers

....Both economic and regulatory factors combined to spur the explosion in large takeovers and, in turn, large LBOs. The three regulatory factors were the Reagan administration's relatively laissez-faire policies on antitrust and securities laws, which allowed mergers the government would have challenged in earlier years; the 1982 Supreme Court decision striking down state antitakeover laws (which were resurrected with great effectiveness in the late eighties); and deregulation of many industries, which prompted restructurings and mergers. The main economic factor was the development of the original-issue high-yield debt instrument. The so-called "junk bond" innovation, pioneered by Michael Milken of Drexel Burnham, provided many hostile bidders and LBO firms with the enormous amounts of capital needed to finance multi-billion-dollar deals.... www.econlib.org...

#2. Clinton - World Trade Organization, NAFTA, Formation of Mega Banks, "Most favored Nation Status" - China

1995 World Trade Organization Agreement on Ag and 1996 Freedom to Farm Act, both written by VP of Cargill Dan Amstutz. Amstutz later joined Sachs Goldman who with others manipulated the food commodities market creating the 2008 food riots. Monsanto and Cargill post record earnings.

Today's global food crisis shows "we all blew it, including me when I was president," by treating food crops as commodities instead of as a vital right of the world's poor, Bill Clinton told a U.N. gathering on Thursday. UNITED NATIONS, Oct. 23, 2008

President Bill Clinton, now the UN Special Envoy to Haiti, publicly apologized last month for forcing Haiti to drop tariffs on imported, subsidized US rice during his time in office. The policy wiped out Haitian rice farming and seriously damaged Haiti’s ability to be self-sufficient. www.democracynow.org...

Consolidation of Mega Banks, AIG Bailout and Foreclosuregate: Quick list of Banking laws


After the Great Depression, several laws were put in place to prevent another depression. The 1933 and 1934 Security and Exchange laws, The McFadden Act of 1927, The Glass-Steagall Act or Banking Act of 1933. Also Bank Holding Company Act of 1956.

Clinton's laws Negating above: Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 and Gramm-Leach-Bliley Act of 1999

More pro-banking Clinton laws:
Federal Deposit Insurance Corporation Improvement Act of 1991:Allowed big banks to gobble up smaller banks more easily.

Housing and Community Development Act of 1992 and RTC Completion Act - Housing and business loans to minorities.

Commodity Futures Modernization Act of 200 - left CDSs unregulated and set up AIG bailout and Foreclosuregate.

#3 Bush - Wars, Patriot Act, John Warner Defense Authorization Act of 2007

Wars are costly to those fighting them and profitable to those financing them. If the "winning" country does not gain appreciable amounts of land and resources to offset the cost of war, the war make absolutely no sense---- UNLESS of course you are a banker. Bankrolling the Bolshevik Revolution and Bankers and WAR

Patriot Act:
It is very interesting to read the Patriot Act. It addresses border security at the Canadian border but now where in the document does it address the Mexican border despite Radical Islam makes inroads among Latin America's Native peoples

Of course Bush and the bankers see nothing to fear from the Muslims given their "intimate" connections. Therefore the only real reason for the Patriot Act is to oppress "Homegrown Terrorists" On February 14 2008 U.S. Northern Command, Canada Command established new bilateral Civil Assistance Plan allowing Canadian troops to be used to "respond quickly to the other nation's requests for military support of civil authorities,” and the John Warner Defense Authorization Act of 2007 repealed Posse Comitatus.

The Military Commissions Act, allows the president to station military troops anywhere in the United States and take control of state-based National Guard units without the consent of the governor or local authorities, in order to “suppress public disorder.”

Clinton was not to be out done by Bush in preparing for insurrection.

So Where Do Anti-Hoarding Laws Come In?

These ideas of anti-hoarding legislation may have stemmed from two areas of confusion:

First is from Executive Orders in place dating back to 1939 which Clinton has grouped together under one order, EO #12919 released on June 6, 1994. The following EOs all fall under EO#12919:

10995--Federal seizure of all communications media in the US;
10997--Federal seizure of all electric power, fuels, minerals, public and private;
10998--Federal seizure of all food supplies and resources, public and private and all farms and equipment;
10999--Federal seizure of all means of transportation, including cars, trucks, or vehicles of any kind and total control over all highways, seaports and water ways;
11000--Federal seizure of American people for work forces under federal supervision, including the splitting up of families if the government so desires;
11001--Federal seizure of all health, education and welfare facilities, both public and private;
11002--Empowers the Postmaster General to register every single person in the US
11003--Federal seizure of all airports and aircraft;
11004--Federal seizure of all housing and finances and authority to establish forced relocation. Authority to designate areas to be abandoned as "unsafe," establish new locations for populations, relocate communities, build new housing with public funds;
11005--Seizure of all railroads, inland waterways and storage facilities, both public and private;
11051--Provides FEMA complete authorization to put above orders into effect in times of increased international tension of economic or financial crisis (FEMA will be in control incase of "National Emergency").

These EOs are not aimed at anti-hoarding but rather at seizure or confiscation of items... www.millennium-ark.net...

#5 Obama - Bankrupt the American people and push them towards revolt.

Obama-Dodd financial bill would further enrich Goldman Sachs The "bill would reward the firm with potentially billions of dollars by instituting a so-called “resolution authority” that would, in practice, be a permanent bailout fund."

Obama loan modification program actually forces foreclosures:

Even though many homeowners are put into trial Making Home Affordable Programs, thousands of homeowners complain that a few months after making reduced monthly mortgage payments their banks avoid permanent loan modifications. By now, it's no secret that home loan servicers are making money on foreclosures rather than approving home loan modifications. www.suite101.com...

Although the article admits "Homeowners are tired of sending the same paperwork again and again and getting the runaround from their banks.." It neglects to say that after many months of drag the process out, the banks then hand the cash strapped homeowner a colossal bill for back payments, penalties, added interest AND LAWYERS FEES! You are given one month to make the payment or the bank forecloses. IF by some miracle you manage to scrap up the payment you get ANOTHER run around with the bank refusing to name the exact amount need to avoid foreclosure.

It took SIX MONTHS for my lawyer to pin the S.O.B.s down! Here is the reason why

“To ensure that the mortgage servicer pushes default instead of workout, the servicer is paid double (50 basis points versus 25 basis points) by the MBS to service a loan in default. Why do you think your servicer tells you that you must be in default before it will consider a mortgage modification, a practice known as invited default?

“Simply put,” says Parker, “the government bailout of AIG has actually encouraged foreclosures because the taxpayers continue to fill AIG’s coffers with enough cash to pay out insurance on defaulted home loans.”

...CDS premium revenue is not restricted to those who might have actual losses or real assets to protect. You can bet as much as you want and create as many CDS as you want....
www.realtytrac.com...

reply to post by crimvelvet

the whole healthcare laws should be deemed unconstitutional, just on the basis that some are being given waivers, while others are being denied waivers...
if it's gonna be that bad for a few companies, then it doesn't take a rocket scientist to figure out it's gonna be just as bad for alot more, they just won't be getting the waivers...for whatever reason, mainly, lack of political cloat!

This article has some very interesting statistics about foreclosures. For example, five states (California, Florida, Arizona, Illinois and Michigan) account for half of national total. The other states in the top 10 Georgia, Texas, Ohio, Nevada, and New Jersey. Georgia being in the top 10 might explain what I'm seeing locally.

There's also a map. I suppose all sorts of additional research and conclusion could be undertaken and then extrapolated from there, such as what are the laws governing mortgages, was there a big subprime marketing push in those areas, and what other economic conditions may have contributed to this...high unemployment rates, companies leaving the area, and so on.

Anyway, in case you're interested, here it is.

reply to post by ~Lucidity


Tell me about it...

... my home's been for sell for the better part of a year

Anyone want to buy a house in Lexington KY?

Something happened between my last post and yesterday. The Treasury brings you a larger longer term housing correction.

Fannie Mae and Freddie Mac provided the majority of home mortgages. Although loans are called FHA loans, these loans are insured by FHA but bought by Fannie Mae and Freddie Mac from banks as soon as they are funded. Most loans today are owned by FNM or FMCC.

To sum up the points they offered:

• Reduce the $729,750 loan limit to $625,000
  
• Increase the 3% minimum down payment to 10%
  
• Increase mortgage insurance
  
• Increase mortgage fees
  
• Increase mortgage rates
  
• Reduce the number of loans issued by Freddie Mac and Fannie Mae by 10% a year
  
• Shutdown Fannie Mae and Freddie Mac over time

www.treasury.gov...'s%20Housing%20Finance%20Market.pdf

Plan is to completely wind down Fannie Mae and Freddie Mac over the next few years

Increasing guarantee fees to bring in more private capital. - …ending the unfair capital advantages that Fannie Mae and Freddie Mac previously enjoyed … to the same capital 13 standards as private banks or financial institutions. This will mean that the price of the guarantee offered by Fannie Mae and Freddie Mac explicitly reflects its risk, and will help the private market compete on a level playing field, reducing Fannie Mae and Freddie Mac’s market share over time….

Increasing private capital ahead of Fannie Mae and Freddie Mac guarantees. - …Going forward, we support gradually increasing the level of required down payment so that any mortgages insured by Fannie Mae or Freddie Mac eventually have at least a ten percent down payment.

Reducing conforming loan limits - … the Administration recommends that Congress allow the temporary increase in limits that was approved in 2008 to expire as scheduled on October 1, 2011 and revert to the limits established under HERA

Winding down Fannie Mae and Freddie Mac’s investment portfolio. - … winding down their investment portfolios at an annual pace of no less than 10 percent.

FHA should return to its pre-crisis role as a targeted provider of mortgage credit access for low- and moderate-income Americans …increase the price of FHA mortgage insurance"

Fewer owners and more renters. Lower home values.

Let's take a house valued today at $750,000. Dropping the $729,750 loan limit to $625K reduces the number of qualified buyers and reduces the value of the home. A 10% minimum down payment reduces the number of qualified buyers yet again. The value of the house would drop to about $643K, just due to the loan limit. An increase in fees and mortgage rates drops the value again. Banks will be picky because the only two entities that were willing to buy mortgages were FNM and FMCC, they'll have to sell their loans to private lenders who are more savvy than GSEs and know which direction the market is heading. This reduces the number of qualified buyers yet again.

Today a house of $750K would have a 3% down payment of $22,500 and $729K - 5% mortgage payment of $3,917.

Tomorrow, a 8% mortgage payment of $3,917 would get a mortgage of $540K but require at $60K downpayment to buy a $600K house.

It's reasonable that today's $750K homes will drop to $600K. This looks like a looming 20% drop in value.