Tri-City Home Values Fall 20% In 1st Quarter 2011

[BriansPerspective]

Blame can be spread everywhere. Let's just hope that we can learn from our mistakes:
* Politicians - lowered the federal requirements for lending, which started the ball rolling
* Banks - gave loans to unqualified buyers
* Lenders - originated loans to unqualified buyers
* REALTORs - helped unqualified buyers purchase houses
* Appraisers - inflated appraised values so that the loans could go through
* Buyers - obtained loans that they knew they could not afford
* Homeowners - refinanced and took cash out to buy cars, toys, vacations, investments etc.

No single group is at fault and not everyone in each group is at fault. Some percentage of each group made poor choices and we are reaping the results of those poor choices.

[wretched wrench]

Originally Posted by BriansPerspective

Blame can be spread everywhere.
* Buyers - obtained loans that they knew they could not afford
* Homeowners - refinanced and took cash out to buy cars, toys, vacations, investments etc.

These last two groups you mention believed, for the most part, that they could, in a coupla years , borrow against the ever-increasing value of their house.

It didn't happen.

[keninaz]

In one case I knew a realtor somewhat personally that I went to school with.
That guy was crafty. He would have you sign a high interest personal loan note and lend you the money for the down and closing costs to put in your bank account.
He would sell you the house and arrange for "his favorite appraisers" to do that work.
His wife ran a small mortgage company under her maiden name and guess where the loans all went to?
When you moved in, you signed a second mortgage right back to him/her with high interest rates.
Almost all of the homes he sold that way he had bought himself, done some minor improvements via a sub company he owned and then put them on the market for people to buy through his agency.
I don't know for sure, but I have to think that some of that stuff he was doing was illegal.
I know when I left the area some years ago he was still doing all of that and making a lot of money at it.
Again this type of activity left the owners with no equity and he got a lot of the properties back and resold them again..

[Kimballette]

This is the Prescott forum. Please note the title of this thread --> Tri-City Home Values Fall 20% In 1st Quarter 2011. This debate has meandered pretty far afield. Thread closed.