[jfkIII]

Originally Posted by desertsun41

In Vegas its easy to live without them with all the casinos begging for you to cash your checks with them.

...and then re-deposit your money.

[MomMom]

Originally Posted by Daddys///M3

Let's not lump FHA loans with down payment assistance in with non-owner occupied, stated income, 100% financing at 580 FICO's. There is a world of difference between an FHA 30 year fixed loan that one must actually qualify for with full documentation and strict DTI ratios and NOO SIVA subprime 2/28's. Regardless of what the media, HUD, and politicians would have you believe FHA loans even with DPA's are very stable loans and very few default, relatively speaking.



The fact that you would not place the blame on buyers, even though many of them commited loan fraud by lying about their income and occupancy fraud by structuring investment properties as owner occupied speaks volumes.

As far as banks wanting to hold these homes on their balance sheets, it does not make economic sense. It ties up liquidity, which is a banks most powerful tool and what truly makes a bank it's money. Now keep in mind that I am only speculating as I have zero experience with loan mods, but it seems to me that to modify a loan may actually be more expensive than foreclosing and selling it. There are many hands in the pot when it comes to a mortgage, which are never dealt with individually except on the level of LO and borrower. Loans are sold in bundles called pools, usually containing many hundreds or thousands of loans. Everyone from insurance companies to mutual funds to pension funds invest in these pools. Not only that but FNMA has it's hand in the pot as well, and of course the investors that hold FNMA bonds. All of these hands are expecting a certain rate of return. The fact is that simply sorting through these pools can be very time consuming and complicated, and whether you like it or not the bank's primary responsibility is to it's shareholders. Taking the immense amount of time it may take to find these loans, modify the notes, and possibly negotiate with all of the entities involved it may not be in the bank's or the shareholder's best interest. Couple all of that with the fact that banks are absolutely overrun with paperwork due to shortsales, foreclosures, and loan mods. I'm sure you get the picture.

As far as lenders making huge profits and raping everyone, where have mortgage rates been at for the last few years? Let's say they have averaged 6.25% (random number) over the last 5 years or so. Of that 6.25%, how much do you think the bank receives after FNMA and Wall Street take their cut? I would wager less than 1%. Now throw in the overhead that it takes to service a loan as well as offer the other products that most banks offer. But let's just say for arguments sake that they do receive the whole 6.25% and have zero cost associated with that rate of return. Do you have a 401K or a IRA? Pension? What has the rate of return been on that for the last few years? In case you don't have one, I believe the average rate of return, post tax, has been between 7% and 10%. Are the pension funds and mutual funds raping folks to get that kind of rate of return, one that handily whoops the banks rate of return? If you do, how much of that return do you think has come from the so called "bank rape" that you rant about now?

The fact is that in a free market society there are winners and there are losers. You know how you can tell who the winners are? They're the ones that keep moving forward, even when they lose. They're the ones that do it without asking for handouts and whining about how life is not fair. And I will tell you what, the winners are the ones that look around and see opportunity, while others only see despair.

You know Daddy, I've been saying this ever since this home loan crisis began..I don't feel sorry for ONE homeowner who bought a house they couldn't afford. Or took a mortgage on their home and spent the cash for the Hummer and trip to Hawaii.

I blame the greedy buyers out there, who wanted more than they could afford and who decided to NOT live within their means...and now they're all crying foul...

[desertsun41]

Originally Posted by jfkIII

...and then re-deposit your money.

That is the hope of the casinos. And they lure you with a free lunch to cash that check too. Sorry to say many blow their pay checks because the money just burns a hole in their pocket.

[desertsun41]

Originally Posted by MomMom

You know Daddy, I've been saying this ever since this home loan crisis began..I don't feel sorry for ONE homeowner who bought a house they couldn't afford. Or took a mortgage on their home and spent the cash for the Hummer and trip to Hawaii.

I blame the greedy buyers out there, who wanted more than they could afford and who decided to NOT live within their means...and now they're all crying foul...

You and I both know there were people who bought things they could not afford.

Those who took equity to buy even more goodies thought homes can continue to go up 10% a month forever.

But never ever blame the turn of the economy from a steam roller to the current depression on those less then financial savy buyers who really only wanted to be a homeowner and nothing more. But instead were preyed upon by those who reeped big commissions for selling them even more debt.

[MomMom]

Originally Posted by desertsun41

You and I both know there were people who bought things they could not afford.

Those who took equity to buy even more goodies thought homes can continue to go up 10% a month forever.

But never ever blame the turn of the economy from a steam roller to the current depression on those less then financial savy buyers who really only wanted to be a homeowner and nothing more. But instead were preyed upon by those who reeped big commissions for selling them even more debt.

And the buyers accepted even more debt, knowing fully that they were getting into something they couldn't really afford. They signed away on the dotted line....

Maybe you know DS or Daddy...any lawsuits that have been won by anyone sucked into the mortgage crisis? I mean, the "honest" folks who only wanted to buy the American Dream of home ownership, who got "lied" to by shady mortgage brokers, and now these homeowners are in foreclosure?

I haven't heard much about any of the lawsuits that were sure to come.

[MomMom]

Originally Posted by bradly

Wow big deal our PF Changs you have to make reservations for the next day other wise you just wont able to eat there, dont feel bad..i love PF Changs tho same with tucanos, i effin love that place but once we had to wait 3 hours to eat there it sucked!..any city you go to there will be an area crowded as hell, nob hill here and occasonally downtown will be very crowded..uptown here is very crowded too... i was mostly talking about foreclosures tho, tourists go to the strip mostly not the locals...have you not been watching CNN lately your citys "economy" isnt doing so well so dont go off on me tell CNN that...and not to bad?, but then again look at all the projects being delayed or cancled there.

Bradley, my love, chill out. I'm simply stating that despite what you're seeing on the news and what you're hearing about Las Vegas...is not as bad for a lot of us.

Oh sure, if you are in construction, and were slated to work on any of the projects that have been put on hold...then yes, the circumstances are not good for you. But we lived for a long time without those proposed projects...and something tells me we'll do just fine without them for a while

The point I am trying to make, my opinion and what I observe...is that for a lot of people here in LV, the economy doesn't seem to be destroying them. They are still shopping in the stores, going out to eat, going to nightclubs, enjoying the amenities of the city..it's not all doom and gloom as you are trying to tell us...from Albuquerque

While some folks are hurting right now, there are a lot of us where nothing has changed, despite all those projects being put on hold. Oh sure, we're paying more for things now, and new hires in the casinos might face layoff, so that hurts some of us, but not to the point where there is despair all over. People are still enjoying themselves and the city...out in the burbs, and I'm not talking about anywhere near the tourist corridors. It's just what I am observing every week, every weekend, off Strip...

Also, please don't buy into the "locals don't go to the Strip" thing...because most of us do, even though we have everything we want out in the burbs. The Strip is there for us to enjoy anytime we want. Granted there are a few of us who don't visit it that often or at all for that matter, but the majority of us do on a regular basis.

That's why most people moved here and are continuing to do so, foreclosures are sellling......and you my love, are exhibiting all the signs of wanting to move here...now might be the right time for you

[airics]

nahh, if he' move here, he'd be a whiner!

[desertsun41]

Originally Posted by MomMom

And the buyers accepted even more debt, knowing fully that they were getting into something they couldn't really afford. They signed away on the dotted line....

Maybe you know DS or Daddy...any lawsuits that have been won by anyone sucked into the mortgage crisis? I mean, the "honest" folks who only wanted to buy the American Dream of home ownership, who got "lied" to by shady mortgage brokers, and now these homeowners are in foreclosure?

I haven't heard much about any of the lawsuits that were sure to come.

I have been reading up on it. It seems some states, Nevada excluded as usual, have been adopting legislation to slow predatory lending. But it is no comfort to all those many many thousands who are already in foreclosure or at least in deep trouble due to high cost loans that lenders refuse to help out on (modify the loan). The new legislation are to help those who have adjustable rate loans that skyrocket without regard to market conditions. Almost as if the lenders WANT the borrower to lose.

The biggest problem seems to be that borrowers are denied injunctive relief by mandated arbitration which all lenders sneak into the aggrement.

CBS news did a report on an 80 YO woman who was facing foreclosure as a result of deceptive tactics of an unethicial sub prime lender. Her lawyer filed a counter claim challenging the mandatory arbitration clause in the loan contract. She lost. So now they filed another claim in Federal Dist Court and also fighting the foreclosure in Superior Court.

I think this mandatory arbitration is something of a Kangaroo Court simular to the Coroners Inquest Court that Clark County has to keep cops out of jail where they belong. A court that is instructed which way to vote or else face consequenses. In other words you are guilty even if proven innocent.

Mandatory arbitration is a way that lenders can deny a borrower legal defense against themselves. It's sickening. Something like the old Soviet Union with Josef Stalin ruling the verdict in his favor all the time. Lenders know that the average Joe does not have the financial savy or the financial resources to put up a fight against the big bad lenders. So they just continue to put people into bad loans knowing full well they will foreclose in short order.

[MomMom]

Originally Posted by desertsun41

I have been reading up on it. It seems some states, Nevada excluded as usual, have been adopting legislation to slow predatory lending. But it is no comfort to all those many many thousands who are already in foreclosure or at least in deep trouble due to high cost loans that lenders refuse to help out on (modify the loan). The new legislation are to help those who have adjustable rate loans that skyrocket without regard to market conditions. Almost as if the lenders WANT the borrower to lose.

The biggest problem seems to be that borrowers are denied injunctive relief by mandated arbitration which all lenders sneak into the aggrement.

CBS news did a report on an 80 YO woman who was facing foreclosure as a result of deceptive tactics of an unethicial sub prime lender. Her lawyer filed a counter claim challenging the mandatory arbitration clause in the loan contract. She lost. So now they filed another claim in Federal Dist Court and also fighting the foreclosure in Superior Court.

I think this mandatory arbitration is something of a Kangaroo Court simular to the Coroners Inquest Court that Clark County has to keep cops out of jail where they belong. A court that is instructed which way to vote or else face consequenses. In other words you are guilty even if proven innocent.

Mandatory arbitration is a way that lenders can deny a borrower legal defense against themselves. It's sickening. Something like the old Soviet Union with Josef Stalin ruling the verdict in his favor all the time. Lenders know that the average Joe does not have the financial savy or the financial resources to put up a fight against the big bad lenders. So they just continue to put people into bad loans knowing full well they will foreclose in short order.

Well, then you could say it's all about the commission, which we know played a significant role in this whole mess. So many people here in LV went for their Real Estate license or their mortgage broker license to hop on the gravy train.

I heard some distressing news last week. You know the show with Ty Pennington, Extreme Home Makeover?

Remember a few years ago, they renovated the home in North Las Vegas for that down and out family and the producers of the show worked with the mortgage company and paid off the mortgage on the house?

Well, that home is in foreclosure apparently. The news report stated that the homeowner re-financed the home and is $450,000 (+/-) in debt and currently in foreclosure.

Typical story of what caused the housing crisis, here in LV and around the country...

[Daddys///M3]

Originally Posted by desertsun41

It may have been fraud on the buyers part but who talked them into it? Im not pointing at you. But you know what went on. It was a free for all out there. You make the whole thing seem so complicated, maybe it is. I see our end and what we feel is just as easy as pulling the file and rewriting it. Surely that has to be cheaper and easier then foreclosing. And what avenue they take surely benifits the investors too.

I wish I understood better how the whole thing worked. You probably explained it well but its hard getting a handle on the whole thing.

Dont defend lenders. I know its their business but I dont feel sorry for them on a 6% loan. The garbage fees alone they collect account for 70% of their profits. No one likes banks. Kinda like ya cant live with them or without them. In Vegas its easy to live without them with all the casinos begging for you to cash your checks with them.

I will readily admit that lenders and LO's pulled alot of shady stuff. My point is that the blame lies everywhere, from borrowes using their homes as ATM machines by cashing out with stated income Pay-Option ARMS so they could barely afford it to the rating agencies that sold these MBS as AAA, knowing full well that they were much riskier than that to the pension funds and private investors that bought into these MBS pools looking for that quick return. Of course some of these execs running these banks, investment banks, and mortgage companies are starting to get indicted and that says alot about where alot of the blame lies. However, you will NEVER see any of the homeowners indicted on wire fraud charges. Why? For one reason, it is an election year. Everyone perceives the borrowers as "victims". Our politicians would be hung from the nearest tree if they went after the victims. Two, they don't have the money to pay the fines that the execs do. And I will admit that, lastly, the little bit of fraud that some may have pulled pales in comparison to the level of what went on over on Wall Street.

Unfortunately without a degree in finance and experience in MBS and the secondary market it is very difficult to understand exactly how that whole scenario works. I do try and educate myself everyday but my analysis may not be entirely correct.

As far as defending lenders, I'm certainly not. Everyone that played with fire is getting burnt, and I am all for that. I am not for bank bailouts or borrower bailouts. I believe in a true free market economy and as I mentioned previously, for a free market economy to work you have to have winners and losers. This would definitely include many of the lenders that have and will go under. So be it.

For the record, I did not get into this business until October of 2006. I have never written an Option ARM, a subprime loan, and I've only written one stated income loan in my career. The borrowers actually made the money and I verified that, they just could not document it in a satisfactory way to the underwriter. I know that you were not calling me out, but in this day and age I always feel it necessary to defend myself from that fast talking used car salesman image.

Originally Posted by MomMom

You know Daddy, I've been saying this ever since this home loan crisis began..I don't feel sorry for ONE homeowner who bought a house they couldn't afford. Or took a mortgage on their home and spent the cash for the Hummer and trip to Hawaii.

I blame the greedy buyers out there, who wanted more than they could afford and who decided to NOT live within their means...and now they're all crying foul...

Exactly. I do feel for some borrowers though. The folks that did not know about FHA or were steered into a subprime ARM, or the folks that really had no other option but to use a subprime ARM and were promised that if they fixed the credit they could refi. If values would have kept going up than that would be true. Subprime loans surely had their place and were an excellent tool when used correctly. Guidelines got much too lax and the lack of educational requirements for loan officers in the state of Nevada (at the time) did not help at all. Or the folks that bought what they could afford but then had to relocate, and cannot sell (or must short sell) due to the falling home values. I certainly feel for them as well. But for those that knowingly bit off more than they could chew to try and keep up with the Jones', for those that risked their family's well being for a way of life only attainable through irresponsibility, you reap what you sow.