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propertylender.c
1551 Posts |
 Posted - 11/16/2007 : 11:26:20 PM
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Bank of America: It’s Not Over Until 2011
http://www.housingwire.com/2007/11/16/bank-of-america-its-not-over-until-2011/ |
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peter
5816 Posts |
Posted - 11/16/2007 : 11:39:08 PM
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It could even be longer than 2011 as this time we will
have a series of Perfect Storms beginning with subprime
implosion, to follow by Option Arm implosion, and Alt-A
implosion, exarcerbated by the weakness of the dollar and
the absence of investors' interest in buying mortgage-back
securities and CDOs from the U.S.
Wells Fargo just said that this is the great real estate
downturn since the Great Depression, and I think with the
coming series of Perfect Storms we might even see the Second
Depression by 2009 thru 2010.
Peter |
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propertylender.c
1551 Posts |
Posted - 11/17/2007 : 12:06:56 AM
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quote:
Originally posted by peter
It could even be longer than 2011 as this time we will
have a series of Perfect Storms beginning with subprime
implosion, to follow by Option Arm implosion, and Alt-A
implosion, exarcerbated by the weakness of the dollar and
the absence of investors' interest in buying mortgage-back
securities and CDOs from the U.S.
Wells Fargo just said that this is the great real estate
downturn since the Great Depression, and I think with the
coming series of Perfect Storms we might even see the Second
Depression by 2009 thru 2010.
Peter
Scary. |
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BrokerCA
2447 Posts |
Posted - 11/17/2007 : 01:21:19 AM
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| 2011 sounds about right. 5 years up, 5 years down. |
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propertylender.c
1551 Posts |
Posted - 11/17/2007 : 10:25:41 AM
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quote:
Originally posted by BrokerCA
2011 sounds about right. 5 years up, 5 years down.
The question is are these people able to qualify for the higher payments? |
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MALIZNA
444 Posts |
Posted - 11/17/2007 : 11:03:36 AM
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| The next group of foreclosures will be the 700 and up scores, people who cant refi, people who can't sell, and people who just can't make the payments, yet banks REFUSE to work with people and even take a modified payment for 6 months.... |
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propertylender.c
1551 Posts |
Posted - 11/17/2007 : 12:50:29 PM
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quote:
Originally posted by MALIZNA
The next group of foreclosures will be the 700 and up scores, people who cant refi, people who can't sell, and people who just can't make the payments, yet banks REFUSE to work with people and even take a modified payment for 6 months....
I think these are the people who up-graded to a more expensive home because of a higher equity amount and but the cars, boats, t.v.'s, etc. |
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nw@8brook
291 Posts |
Posted - 11/18/2007 : 3:42:36 PM
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| don't forget all the helocs with principal payment due (usually at yr 10). You're looking at around 2013 or 14. Let's hope the market has rebound and people can either refi or sold their house if the heloc resets are eating them up. |
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CoralSnake
12216 Posts |
Posted - 11/18/2007 : 9:39:59 PM
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| I would not be surprised if they are right-on. |
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austinmp
311 Posts |
Posted - 11/18/2007 : 10:13:09 PM
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Sure housing won't likely recover in some areas for 3-4 years.....
Not that bad IMHO. Employment is still good in most areas, and people need to live somewhere. US Productivity remains strong, and there are many people that can afford their homes and many people that will need a home. Certain areas that saw huge gains will revert to the mean, and this will mean BIG problems for those areas, but nationwide things arent quite as bad as some people are sensationalizing. We have always been resilient and innovative and will find a way out of this with less pain then the worst case scenario. It is a good thing that people are now paying attention, this means we will react in time to avert catastrophe.
Plus think of all the refinances that will need to be completed.....
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propertylender.c
1551 Posts |
Posted - 11/18/2007 : 10:54:33 PM
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quote:
Originally posted by austinmp
Sure housing won't likely recover in some areas for 3-4 years.....
Not that bad IMHO. Employment is still good in most areas, and people need to live somewhere. US Productivity remains strong, and there are many people that can afford their homes and many people that will need a home. Certain areas that saw huge gains will revert to the mean, and this will mean BIG problems for those areas, but nationwide things arent quite as bad as some people are sensationalizing. We have always been resilient and innovative and will find a way out of this with less pain then the worst case scenario. It is a good thing that people are now paying attention, this means we will react in time to avert catastrophe.
Plus think of all the refinances that will need to be completed.....
The problem is that the employment numbers do not account for most people in the real estate industry that were making major money.
I know a real estate agent who was driving a thousand dollar a month BMW and now cannot go out and spend $50.00 for a dinner with a group of friends.
Banks are tightening with no end in sight.
Many of those in the luxary business (jewelry expecially) are hurting big time (I know many jewelers). I am willing to bet that the no cash out refi. boom has stopped a lot of these types of purchaes. |
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propertylender.c
1551 Posts |
Posted - 11/18/2007 : 11:06:47 PM
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quote:
Originally posted by nw@8brook
don't forget all the helocs with principal payment due (usually at yr 10). You're looking at around 2013 or 14. Let's hope the market has rebound and people can either refi or sold their house if the heloc resets are eating them up.
Sooooooooooooooooooooooo True. |
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cjnohl@federated
559 Posts |
Posted - 11/19/2007 : 03:09:24 AM
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I remember the first day an LO of mine handed me a flyer for the 540 mid 100% ltv loan and my verbatum quote was, "These guys are fuc4in' crazy." Welcome home.
Peter, your projection of depression starting in the 2009 time frame is way too optimistic. Don't you see it happening now? Can you really imagine the equity market plugging along like this for another 6 months? WHat happens when the babyboomers realize the crosshairs of this entire situation lie on their retirement funds (401ks, pensions, SEPPs, ROTHs, what-have-you)? With the depreciating dollar at the hands of skyrocketting inflation, well, there goes the chance of foreign investment being a life-raft.
Here is what you will see. Exodus. Exodus of every type, but most noticably for us will be the exodus of those age 50-75 taking their retirement proceeds, leaving their mortgages and taxes to the wind and moving abroad. I'm seeing it already. As the tax tills run dry the tax rates will increase and the exodus will accelerate. After all, our most notable export has been our culture and at this point there are so many options for an aspiring ex-pat. The lipstick is coming off the pig.
We have two alternatives to this certainty: 1.) return to fundamentals as a People, ie. removing the Federal Reserve System and all unapportioned tax, or 2.) double-down on the FIAT myth of infinite Ponzi finance. The resultant is of course either meltdown/rebirth or boom/ka-boom.
PS. We'll offer Canada and Mexico as additional collateral shortly. [Wry grin] |
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equityPrivate Entertainer
106 Posts |
Posted - 11/19/2007 : 05:15:45 AM
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quote:
Originally posted by propertylender.com
Bank of America: It’s Not Over Until 2011
http://www.housingwire.com/2007/11/16/bank-of-america-its-not-over-until-2011/
Thats good stuff, or bad stuff really, I had no idea my state was so pink! |
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msancheznj
2244 Posts |
Posted - 11/19/2007 : 06:17:30 AM
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I believe if goverment goverment keeps sticking their nose in with new legislation and other crap then this maybe go even further.
We need goverment to work on strengthening the dollar, boost the economy and let the market handle the real estate mess itself, without more legislation crap, if not then cjnohl has predicted correctly. |
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mganovsky
2123 Posts |
Posted - 11/19/2007 : 11:43:09 AM
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| Very good stuf here guy's. But you can not leave out the upcomming Reverse Mortgage perfect storm. For those folks who got a reverse mtg when property value's were at thier peak. The lenders will be stuck with a loss when the owner's die and the lenders try to re-sell. |
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1003s.com
3808 Posts |
Posted - 11/19/2007 : 1:23:42 PM
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The BOA map looks about right, we are starting to see inventory
move a bit in the Chicago burbs.
I am seeing a number of divorce sales, where they are just going to
sell at a lower price than they want, because they are done with
the marriage and the big house, and they just want to move on with
their lives in their new condo or apartment. |
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rescaplender
640 Posts |
Posted - 11/19/2007 : 1:39:14 PM
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I've been talking to my girlfriend about this a lot lately as her office specializes in reverse mortgages. All of these lenders are counting on a 4% price appreciation to help offset the increasing debt. That's all fine and dandy except when you don't figure in a 10-30% decline in value the year or 2 after you gave someone the loan. That's going to seriously put some of the reverse mtg lenders under water.
The weird thing is that I don't understand is why people think home prices will continue up at 4% or more... noone can afford their house as it is right now. The only way people are going to be able to pay more for a home in 10 years is if they are making more then than they do now but all of the statistics show there has been no wage growth for most of the country over the last 10 years or so. I don't see any reason this will change in the future....
quote:
Originally posted by mganovsky
Very good stuf here guy's. But you can not leave out the upcomming Reverse Mortgage perfect storm. For those folks who got a reverse mtg when property value's were at thier peak. The lenders will be stuck with a loss when the owner's die and the lenders try to re-sell.
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propertylender.c
1551 Posts |
Posted - 11/19/2007 : 7:19:18 PM
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quote:
Originally posted by rescaplender
I've been talking to my girlfriend about this a lot lately as her office specializes in reverse mortgages. All of these lenders are counting on a 4% price appreciation to help offset the increasing debt. That's all fine and dandy except when you don't figure in a 10-30% decline in value the year or 2 after you gave someone the loan. That's going to seriously put some of the reverse mtg lenders under water.
The weird thing is that I don't understand is why people think home prices will continue up at 4% or more... noone can afford their house as it is right now. The only way people are going to be able to pay more for a home in 10 years is if they are making more then than they do now but all of the statistics show there has been no wage growth for most of the country over the last 10 years or so. I don't see any reason this will change in the future....
quote:
Originally posted by mganovsky
Very good stuf here guy's. But you can not leave out the upcomming Reverse Mortgage perfect storm. For those folks who got a reverse mtg when property value's were at thier peak. The lenders will be stuck with a loss when the owner's die and the lenders try to re-sell.
I don't know how prices will increase in the short term either. |
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cpruitt
1754 Posts |
Posted - 11/19/2007 : 8:02:20 PM
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I've already got buyers coming out the woodwork to buy a HUD foreclosure as their first home. Getting so much new business I barely have time to come on BO the last couple of days. So I'm going to do as many of them as I can to try to help the economy.  |
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Donald1955
6067 Posts |
Posted - 11/19/2007 : 8:06:38 PM
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| Scary indeed! |
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propertylender.c
1551 Posts |
Posted - 11/19/2007 : 8:34:34 PM
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quote:
Originally posted by cpruitt
I've already got buyers coming out the woodwork to buy a HUD foreclosure as their first home. Getting so much new business I barely have time to come on BO the last couple of days. So I'm going to do as many of them as I can to try to help the economy.
Wish we had that in our area. |
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darkstar
23609 Posts |
Posted - 11/19/2007 : 8:40:43 PM
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It's time, considering the possibilities in the future, to align yourself with a shop that gives you the opportunity to originate in as many states as possible, with as many lenders as possible, to increase the odds for yourself...
There are plenty of areas of the country doing very well, even places many say aren't, I differ with...Overall they may have a higher rate of default and foreclosure, but there isn't any lack of doable loans out there...
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1003s.com
3808 Posts |
Posted - 11/19/2007 : 8:51:17 PM
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quote:
Originally posted by rescaplender
I've been talking to my girlfriend about this a lot lately as her office specializes in reverse mortgages. All of these lenders are counting on a 4% price appreciation to help offset the increasing debt. That's all fine and dandy except when you don't figure in a 10-30% decline in value the year or 2 after you gave someone the loan. That's going to seriously put some of the reverse mtg lenders under water.
The weird thing is that I don't understand is why people think home prices will continue up at 4% or more... noone can afford their house as it is right now. The only way people are going to be able to pay more for a home in 10 years is if they are making more then than they do now but all of the statistics show there has been no wage growth for most of the country over the last 10 years or so. I don't see any reason this will change in the future....
quote:
Originally posted by mganovsky
Very good stuf here guy's. But you can not leave out the upcomming Reverse Mortgage perfect storm. For those folks who got a reverse mtg when property value's were at thier peak. The lenders will be stuck with a loss when the owner's die and the lenders try to re-sell.
I expect some reverse loans will result in losses in FL,CA,NV,AZ while many
reverse loans in the midwest and some other areas will do just fine. |
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darkstar
23609 Posts |
Posted - 11/19/2007 : 9:15:25 PM
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| I'm totally unfamiliar with the reverses, but aren't they capped at a certain LTV which means they had to start at a very low LTV, so the lenders may not be in bad shape on those, no?... |
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propertylender.c
1551 Posts |
Posted - 11/20/2007 : 12:29:31 AM
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quote:
Originally posted by darkstar
I'm totally unfamiliar with the reverses, but aren't they capped at a certain LTV which means they had to start at a very low LTV, so the lenders may not be in bad shape on those, no?...
I think it depends on the zipcode. |
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