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You would think that oversight over home loans would be a bit tighter after the publicized problems of the past few years. But that doesn't seem to be the case:
In the past year alone, the number of borrowers who failed to make more than a singlepayment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency's overall growth in new loans, according to a Washington Post analysis of federal data.
Many industry experts attribute the jump in these instant defaults to factors that include the weak economy, lax scrutiny of prospective borrowers and most notably, foul play among unscrupulous lenders looking to make a quick buck.
If a loan "is going into default immediately, it clearly suggests impropriety and fraudulent activity,"
That's why it would be foolish to buy property at this time if you are looking to buy in bubbleland. What goes up, must come down. What's tragic is that the Admin and Congress are driving the economy into the ground trying to keep the bubble propped up.
What is the minimum requirement now proposed in "The New Plan", 31% of income only to make the payment or qualify for refinance? That will break the system
The whole thing is stupid. Let them ALL fail. Take the hit, regroup and start over. Just like GM should file bankruptcy
Yes, there will be chaos and mass employment, but if your never allowed to fail you'll never learn.
That's why it would be foolish to buy property at this time if you are looking to buy in bubbleland. What goes up, must come down. What's tragic is that the Admin and Congress are driving the economy into the ground trying to keep the bubble propped up.
You would think that oversight over home loans would be a bit tighter after the publicized problems of the past few years. But that doesn't seem to be the case:
In the past year alone, the number of borrowers who failed to make more than a singlepayment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency's overall growth in new loans, according to a Washington Post analysis of federal data.
Many industry experts attribute the jump in these instant defaults to factors that include the weak economy, lax scrutiny of prospective borrowers and most notably, foul play among unscrupulous lenders looking to make a quick buck.
If a loan "is going into default immediately, it clearly suggests impropriety and fraudulent activity,"
MSNBC recently aired a documentary called, House of Cards that discussed a variety of reasons for the housing crisis. The one thing that stuck out in my mind was for the longest time, most all lenders required extensive back ground verification, income verification, job history, credit rating, down payment, etc... and even then the loan could take up to 2-3 months to get processed.
Then the midnight mortgage broker showed up who was willing to take a bit more risk with not quite so credit worthy people. As all these mortgage were being complied into packages with sound loans, they recieved a AAA rating and Wall Street turned around and sold the heck out of them. Then things started going even further down hill as Wall Streets appetite for these mortgage back securities was immense and shady lenders were more than happy to try and fill the demand.
It seemed to be almost a conspiracy between Wall Street, ratings agencies, and shady lenders writing garbage. The conspiracy of shared greed.
This is slightly off topic, but I read somewhere (not sure where) that ~40% of homes are owned free and clear. I have heard repeatedly here of late that 92% of mortgage holders are paying as scheduled. That means that only 8% of 60% of home owners are in trouble. Not trying to minimize the pain of those who are suffering, but I wonder why when so many have acted responsibly the taxpayer needs to bail them out. Just looking for someone's response to this, Also as seen on CNN this afternoon the foreclosure problem is concentrated in S FL, CA, NV, & Ariz., so those of us in fly over country will have to pay the bill.
You would think that oversight over home loans would be a bit tighter after the publicized problems of the past few years. But that doesn't seem to be the case:
In the past year alone, the number of borrowers who failed to make more than a singlepayment before defaulting on FHA-backed mortgages has nearly tripled, far outpacing the agency's overall growth in new loans, according to a Washington Post analysis of federal data.
Many industry experts attribute the jump in these instant defaults to factors that include the weak economy, lax scrutiny of prospective borrowers and most notably, foul play among unscrupulous lenders looking to make a quick buck.
If a loan "is going into default immediately, it clearly suggests impropriety and fraudulent activity,"
...the agency's efforts at pursuing abusive lenders have been hamstrung. Once, about 130 HUD investigators teamed with FBI agents in an FHA fraud unit, but this office was dismantled in 2003 after the FHA's business dwindled in the housing boom.
At the same time, the FHA office responsible for approving and policing new lenders has not expanded even as the number of active lenders doing business with the FHA more than doubled to 2,300 in the past two years.
Although the FHA insures mortgages issued by lenders, it leaves these companies to conduct their own business. If a lender writes a lot of bad loans, that's when the agency can eject it from the program. Experts in housing finance warn, however, that the FHA has inadequate staffing and technology to keep up.
OK Obama, I really really really want to help my country. My house is paid for free and clear, no special interest or lenders involved. I'll volunteer to review each and every one of these lenders FREE OF CHARGE right NOW while congress and senate figure out the language of regulation that appeases obstructionists.
Anyone of the 'ask not what your country can do for you' generation care to volunteer with me?
I don't belong to that generation, but sure why not,after running my own business. I might need some training, but sure, I'd be more than happy to help out.
I think it's pretty evident 80% should be lending and 30% shouldn't be borrowing.
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