Foreclosure, for Closure

The problems with the Bush and Clinton plans to suspend foreclosures.

By Daniel Gross | Newsweek Web Exclusive
Feb 15, 2008 | Updated: 1:07  p.m. ET Feb 15, 2008

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  • Posted By: James Thompson @ 03/11/2009 10:31:05 AM

    Daniel,
    I am a professional real estate appraiser for 25 years. How right you are. Nothing can keep these house prices to falling to a sustainable level, without any speculator/flipover guys in the market, to a price level based on the incocme levels in the area. Historically the average house should cost about 3 times the average salary in the area. In the end, house prices are based on the income of the local people. The only way to raise house prices without speculators is to raise the general income in an area. James Thompson Appraisal Concepts Rhode Island
    ,

  • Posted By: wiseowl2 @ 11/17/2008 8:08:23 PM

    Well, everyone that is regular homerowners I for one was looking for a loan, not away to steal my equity. Many people that work in good jobs will feel the pinch as the working poor has for years. Will the auto financiers will stop reporcession of autos while they get a handout on the other hand? Well they can go bankrupt as others had to do, sometime because bad things happen to good people.

  • Posted By: phiomalibumalibu @ 02/16/2008 4:25:30 AM

    Those with money will buy up all the foreclosures and sell them when the market is high. Middle class people will struggle. If you are struggling to find a loan there are a couple of places you can try. CreditLoanApproved.com is one, and if you need to fix your credit and consolidate debt try CreditBumper.com Works for me!

    • Posted By: FirstZebra @ 05/13/2008 2:36:39 PM

      I've already seen it in this little town in NV. The big frogs are already gobbling up the remains and crowing about it!

  • Posted By: theshark58 @ 03/05/2008 3:25:44 PM

    second try,pardon if duplicated.

    First, nice ad Steve... first you said you "were told" about a company and then you said "we".
    These companies ONLY HELP THEMSELVES WHILE YOU GET SCREWED.

    Back to my comment

    Individuals were not being coerced into these loans. People knew what they were doing and were betting the property values were going to go up. They thought that they could refinance and everything would work out. Now the politicians want to bail them out...because they can buy votes.

    Sorry, but i BIT THE BULLET AND DID NOT BUY. Each year I file my taxes and have to pay alot of taxes.
    I could not buy a house for a tax break because it was just too risky, too much pressure. A 4300 mortgage is just plain crazy ( I live in San Jose).

    where are the breaks for the millions who rent? Buyers get the best of both worlds in this scenario... tax breaks, buyouts, while their neighbors who are renting are footing the bill.

    First they borrowed, then they bragged, now they beg.

  • Posted By: theshark58 @ 03/05/2008 3:11:53 PM

    A bailout is just plain wrong.

    the people who bought these homes signed papers knowing full well what THEY WERE DOING.
    I made the choic not to buy in california even though I am getting killed with taxes.
    These individuals gambled that their home values would go up and they would be able to refinance at a lower rate if they had to. Sorry, Vegas does not return your losses.

    what government should really look at is the tax breaks homeowners get when they buy, yet renters don't receive any. where is all the outrage for the millions of people who can't buy but are getting raped by their government; where is their tax break.

    I can see in 2 months one neighbor who rents, pays his 10k more in income taxes when he files while the neighbor who bought, bragged, and begged gets bailed out.



  • Posted By: Holly Garfield @ 02/17/2008 2:50:16 PM

    This article gives even more information on the fallout of the mortgage/housing problems. The foreclosure situaiton will hurt housing prices until they get burned off, lowering neighborhood prices below normal price points. Many of the foreclosed mortgages are new, so the banks will have a high loss rate. The bigger problem is how to keep the global economy running in the meantime. The world is still heavily US dependent. The US has 5% of the global population and produces about 30% of the global GDP. Hong Kong's Hang Seng index has fallen 2 1/2 times the Dow industrial fall in the last 3 months. The world cannot afford the author's scenario for recovery. Somehow a solution has to be found to the lending and investment industries that does not require house pricing adjustments. The mortgage problem is the detonator, and the lender's liquidity problem is the explosive. Any ideas on how to resolve the problem?

    • Posted By: elcaminobootery @ 02/18/2008 7:32:04 PM

      Excellent response. Your readers are informed obviously. You will not bring prices into a stable environment or see true valuations until EVERY American is either removed from homes they cannot afford or brought in line with the income needed to service the debt secured by the home ithey live in. Its put up or get pushed out! However a negotiated settlement with a lender is a fast rising alternative - deed your home back to the lender and repruchase it at a reduced "affordable amount. Companies like borrowerhotline.com do this type of work. But whats important here is that the Stated income and Stated assets programs of the last two years were highly predatory for one specific reason. Look at the neighborhood you reside in. More times than not you will live in an area with people of the same economic earnings capacity as you. Yes, middle income tends to live with similar economic profiles as do upper high end income earners who are more often than not self employed. So when a borrower who lives in a predominantly middle income area reports $20,000 a month needed to qualify for a loan and who was induced to overstate income and the borrower really works as a W2 wage earner - get the message? What the "majority" of borrowers can afford is really what the homes in the area are worth! As a risk comliance specialist for the institutional secondary markets, I never have auditied so many housekeepers and blue collar wage earners living in million dollar homes! Foreclosures loom and create absolute instability to each and every neighborhood. Website www.borrowerhotline.com or go to
      www.360blog@yahoo.com M Soliman, Managing Director

  • Posted By: elcaminobootery @ 02/18/2008 6:58:44 PM

    Comments: This is a sincere question. I was told about a workout company who offers borrowers the support of qualifed compliance officers and underwriters trained in reviewing and determing unfair lending criteria used to approve your file. According to thier web site (www.borrowerhotline.com) predatory lending is illegal and some of us maybe a victim of a predatory loan. Technically, your loan is therefore considered a classified asset and can we ask the lender to stop collections and seek a resolution to our situation. Are there other companies that seek to provide a borrower with technical alternatives designed to potentially reimburse you out of pocket losses caused by this hardship. Steve Shafer

  • Posted By: JayMM @ 02/16/2008 10:20:18 AM

    Pretty well thought out article. However, it doesnt seem to describe the end result, except that prices will fall. However, prices cannot fall indefinatly. Market forces will prevail. Lots of lenders, borrowers and other stakeholders will experience pain. New production will slow or stop and prices will drop until excess inventory clears the market. When will this be??? The market will clear quickly when the price of an existing home falls below the cost to replace the home. Commodity prices could fall as demand for materials falls, but this is as temporary as the inventory glut. Once existing home prices are equivalent or below the cost to build an equivalent new house, the existing inventory will clear quickly, because, in reality, the vast majority of potential home buyers are in decent credit shape and can obtain a loan. When will all of this happen? Its happening now. Many foreclosed properties are listed for basically what you can build them. We are almost done (relatively speaking).

  • Posted By: phiomalibumalibu @ 02/16/2008 4:34:04 AM

    One other thing, you may have to repair your credit if you were late, see .bestcreditrepairtips.com

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