Phoenix tops nation in home value declines (for sale, credit)

[ladysovereign]

Originally Posted by MN-Born-n-Raised

Saying that, if you get paid to service a loan even if the buyer doesn't pay you, you can still deduct that from the proceeds. So what is the banks hurry other than it's their job to represent their client?? It's other peoples money.

I think it's a combo of reasons for how they behave. All my initial point was the "stick it to the bank" attitude doesn't matter in many case. In some circumstances, they just don't care as the admin fees add up while they charge the owner (Freddie and Fannie).

An analogy: If the mortgage holder / homeowner doesn't pay the city taxes, do they lose out?? Nope! It comes out of the proceeds.

I don't believe the Loan Servicing Companies get paid if the loan isn't collected. Same as a collection agency. The winner in all this seems to be the Banks that originated the loans, not whom they sell it off to.

As for proceeds, I am assuming you mean at the time of the sale of the home. If the Bank doesn't get the full loan value at the time of sale but still is responsible for paying city taxes, etc., then those who benefit are the city and the new purchaser. Not seeing how the Bank profits from this.

Until you can show me actual data where the Banks are able to collect additional fees for holding up finalization of a Foreclosure, then I guess we'll have to agree to disagree.

[khuntrevor]

The banks benefit, because they delay putting it on their books and finally taking the huge right down, when it sells. The accounting methods they are allowed to use makes us no better than Greece.

[paladinking]

it is a good news for me today..

[MN-Born-n-Raised]

Phoenix home sales drop for fifth-straight month in September: DataQuick « HousingWire

[MN-Born-n-Raised]

Originally Posted by ladysovereign

The winner in all this seems to be the Banks that originated the loans, not whom they sell it off to.

That is what I have been saying. If BoA originated the loan and Fannie is on the hook by guaranteeing it (or later because BoA sold it when it was under performing to Fannie or Freddie) then the servicer BoA in this example), not the company now holding the note, wins.

Originally Posted by ladysovereign

I don't believe the Loan Servicing Companies get paid if the loan isn't collected.
.

I never said they get paid if the loan isn't collected. I think you are viewing service fees as late fees. I'm speaking of administration fees. Fees the "investor" pays to a company like BoA or Wells or GMAC.

Originally Posted by ladysovereign

As for proceeds, I am assuming you mean at the time of the sale of the home. If the Bank doesn't get the full loan value at the time of sale but still is responsible for paying city taxes, etc., then those who benefit are the city and the new purchaser. Not seeing how the Bank profits from this.

It was an analogy (per my post). The bank would not profit for city taxes. It was an example on how the city is 1st in line. The company servicing is 1st in line for the servicing. It doesn't matter if the borrower doesn't pay.

Saying all of that, BoA is BLEEDING on loans that they could not push back to the government. They are at their tipping point. Two big to fail part II?? We shall see now that the political climate has changed.

[EnicAZ]

khuntrevor,

"The banks benefit, because they delay putting it on their books and finally taking the huge right down, when it sells. The accounting methods they are allowed to use makes us no better than Greece."

You are right. It's also one of those things where most people know it, and there's a lot of frustration over the mirages put up by banks. The banks know most people know how they have manipulated the system at taxpayer's expense, but they continue to operate the way they do anyways.

[sheena]

Originally Posted by EnicAZ

Thank you for the comments,

Forbes released that Phoenix is America's 6th emptiest city, with rental vacancty rates at 19%.

The US Census Bureau ranks Phoenix as having the 5th highest vacancy rate in the country.

I'm sure many of you know that the office vacancy rate has been increasing and is now at 25.9% (Q2).

How can such an empty city have so much traffic during rush hour? I wish it were more empty.

[EnicAZ]

sheena,

Response of:


Originally Posted by EnicAZ
Thank you for the comments,

Forbes released that Phoenix is America's 6th emptiest city, with rental vacancty rates at 19%.

The US Census Bureau ranks Phoenix as having the 5th highest vacancy rate in the country.

I'm sure many of you know that the office vacancy rate has been increasing and is now at 25.9% (Q2).

Fortunately, traffic has declined heavily since 2006 in the Phoenix area.

[ladysovereign]

Originally Posted by khuntrevor

The banks benefit, because they delay putting it on their books and finally taking the huge right down, when it sells. The accounting methods they are allowed to use makes us no better than Greece.

That is opinion and not fact. Either prove it to me in actual data or I guess we will also have to agree to disagree.

I know from where I speak because I am a lot closer to the Banking/Finance Industry then I believe some of the posters here who are stating opinions as facts.

[MN-Born-n-Raised]

Originally Posted by ladysovereign

That is opinion and not fact. Either prove it to me in actual data or I guess we will also have to agree to disagree.

I know from where I speak because I am a lot closer to the Banking/Finance Industry then I believe some of the posters here who are stating opinions as facts.

The recent accounting modifications have been talked in 500 + articles. It is a fact.

From Watchdog: Accounting Tied to Lack of Loan Modification - BusinessWeek (http://www.businessweek.com/blogs/money_politics/archives/2009/08/watchdog_accoun.html - broken link)

"Still, given the chance to value the loans higher, banks won't want to sell their toxic assets. Doing so would mean recognizing potentially big losses. That, in turn, would mean having to raise new capital -- thus lowering the value of shares held by existing stockholders (including management, in all likelihood); some banks, unable to raise cash, would go under. Better, banks figure, to hold on to the loans and hope for the best, or earn their way out of the hole over time.
That helps explain the long delays ..."

If you want a link to a couple dozen more related statements from major news institutions like the WSJ, just ask. The laws were changed for a reason. I'm not saying that is the only reason for the delays. But it has to be the case for some examples. No one can prove which ones were the result of the changes while others are a simple fact that the banks are backed up.

to your other point while I am no expert on banking, there are many banking experts that don't work in a bank. I'd consider the Elizabeth Warren a banking (watch dog) expert.