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As Foreclosure Activity Drops To 40 Month Low, Delinquent New Yorkers Have Lived Mortgage-Free For Nearly 3 Years

Tyler Durden's picture




 

Today's foreclosure update from RealtyTrac is chock full of interesting data, although none of it is surprising. Those who have been following the complete debacle that is the fraudclosure crisis know that over the past 6 months the foreclosure activity has plunged. Indeed in April, total foreclosures, split between default notices, foreclosure auctions, and bank repossessions affected 219,258 properties: a 9% decline from April, a 34% plunge from a year earlier, and the lowest in 40 months! And while REO events (or disposals once a bank has the keys to the property in its possession) took an average of 400 days, up from 340 days a year earlier, and compared to 169 in Q1 2007, it is the length of the foreclosure process that explains not only the persistent surge in retail stocks, but why US GDP is artificially inflated by at least 0.5-1.0% (and likely has a major impact on inflation): from the release: "The average timeframe from initial default notice to REO in New Jersey and New York was more than 900 days in the first quarter of 2011, more than three times the average timeline in the first quarter of 2007 for both states." In other words, once a deadbeat stops paying their mortgage in NY or NJ, it takes nearly 3 years to get them to vacate. It also means that those who stopped paying their mortgages around time Lehman filed are still living mortgage free in the Empire and Garden States!  And there are those who wonder why the "squatters rent" amounts to at least $50 billion...

Full monthly breakdown of foreclosure activity:

And from the release:

“Foreclosure activity decreased on an annual basis for the seventh straight month in April, bringing foreclosure activity to a 40-month low,” said James J. Saccacio, chief executive officer of RealtyTrac. “This slowdown continues to be largely the result of massive delays in processing foreclosures rather than the result of a housing recovery that is lifting people out of foreclosure.

“The first delay occurs between delinquency and foreclosure, when lenders and services are no longer automatically pushing loans that are more than 90 days delinquent into foreclosure but are waiting longer to allow for loan modifications, short sales and possibly other disposition alternatives,” Saccacio continued. “Data from the Mortgage Bankers Association shows that about 3.7 million properties are in this seriously delinquent stage. The second delay occurs after foreclosure has started, when lenders are taking much longer than they were just a few years ago to complete the foreclosure process.”

On why banks no longer care to evict anyone, no matter how long they are living rent free:

Foreclosure timelines lengthening

Nationwide, foreclosures completed (REOs) in the first quarter of 2011 took an average of 400 days from the initial default notice to the REO, up from 340 days in the first quarter of 2010 and more than double the average 151 days it took to foreclose in the first quarter of 2007.

The foreclosure process took much longer in some states. The average timeframe from initial default notice to REO in New Jersey and New York was more than 900 days in the first quarter of 2011, more than three times the average timeline in the first quarter of 2007 for both states.

The average foreclosure process in Florida took 619 days for foreclosures completed in the first quarter, up from 470 days in the first quarter of 2010 and nearly four times the average of 169 days it took in the first quarter of 2007.

The average foreclosure process in California took 330 days for foreclosures completed in the first quarter, up from 262 days in the first quarter of 2010 and more than double the average of 134 days in took in the first quarter of 2007.

And why evicit: after all, all that does is to accelerate a mark to market event on a bank's books. And with banks making money (inversely) fair and square by merely gaming POMO and other monetization events, and trading with 100% perfection each quarter, who cares that there is no incoming cash flow from trillions of loans.

 

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Thu, 05/12/2011 - 15:33 | 1269100 FOC 1183
FOC 1183's picture

And we wonder what replaced MEW as a source of consumption

Thu, 05/12/2011 - 15:36 | 1269101 Manthong
Manthong's picture

How does 3 years and no house payments work?

Likely no response to mailings about the house from freeloaders as well.

Doesn't the tax man sell the property off for taxes owed before that?

Thu, 05/12/2011 - 17:43 | 1269708 MachoMan
MachoMan's picture

No.  It typically takes many years for a county to certify a property to the state and for the state to auction it or make it available for negotiated sale.  For example, right now, there is an auction in another month in my state for 2006 vintage tax delinquent properties... 

In other words, the typhoon from tax delinquencies hasn't hit yet...  and, frankly, there is dick the federal government can do about it.  The only way they can weasel out of anything is if they proclaim TBTF, et al, are federal institutions precluded from state taxation...  but, that won't change the fact that you've got a watershed event for accounting purposes and, further, won't change the fact taxes are delinquent for the next year...

Fri, 05/13/2011 - 11:25 | 1271840 glenlloyd
glenlloyd's picture

Yes, it can take a very long time for tax sales to get to auction although there have been some changes here on the part of the counties to bring those more quickly. The big issue though is the rate charged on delinquent taxes, in Iowa it's 24%, and that's why buying tax certs in the past has been lucrative, the return was very good as long as they were eventually redeemed.

Thu, 05/12/2011 - 20:37 | 1270232 blunderdog
blunderdog's picture

If you don't pay your mortgage, it's much easier to make the tax payments, anyway.

Fri, 05/13/2011 - 00:14 | 1270794 zerozulu
zerozulu's picture

My bank Wellsfargo/chase is paying my taxes and I am getting receipt in the mail. I am late 33 months so far. ( LI, NY )

Fri, 05/13/2011 - 09:15 | 1271302 MachoMan
MachoMan's picture

my guess is this will become more widespread practice as the banks get bitten by tax sales of their secured properties...  sounds like wells has already been bitten ;)

Thu, 05/12/2011 - 15:37 | 1269103 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

Land of the live free, home of the bravely not paying.

 

Thu, 05/12/2011 - 15:54 | 1269210 Clowns on Acid
Clowns on Acid's picture

+1...hehe

Thu, 05/12/2011 - 21:24 | 1270382 downwiththebanks
downwiththebanks's picture

Land of the fraudulent banker-gangsters getting off scott free for their crimes.

Thu, 05/12/2011 - 15:37 | 1269106 doomandbloom
doomandbloom's picture

OT but....Five tons of confiscated gold and silver jewelry go on auction next week in Texas. 

http://www.cnbc.com/id/42988581/

 

what is this all about?

Thu, 05/12/2011 - 19:03 | 1269952 Hephasteus
Hephasteus's picture

Allow drug dealers to be tax collectors. When they have plenty of taxes collected. Seize it. Keep it in vaults and when state gets into money trouble auction it off.

Thu, 05/12/2011 - 15:34 | 1269107 km4
km4's picture

And why evicit....Sickening but true !

 

Thu, 05/12/2011 - 21:28 | 1270388 downwiththebanks
downwiththebanks's picture

You can't evict, banker-gangster, because you don't own the house.

Thu, 05/12/2011 - 15:35 | 1269109 LawsofPhysics
LawsofPhysics's picture

How are those securities/mortgages valued on the books of those banks?  he he

Thu, 05/12/2011 - 15:44 | 1269152 MrPike
MrPike's picture

And how are they valued on the books at the Fed?

Fri, 05/13/2011 - 08:27 | 1271190 fajensen
fajensen's picture

Up 110% since the recovery - Risk ON baby!

Thu, 05/12/2011 - 15:44 | 1269153 Dick Darlington
Dick Darlington's picture

This is one of those "only in America" moments.

Thu, 05/12/2011 - 15:46 | 1269165 Village Smithy
Village Smithy's picture

I think $50 billion is just the beginning. Add in no property tax because the bank owns the house now, no building insurance because the bank owns the house now, no maintenance costs cause the bank owns the house now, etc. It adds up to a lot of free cash flow for the weekend trip to the outlet mall. Go ANF!

Thu, 05/12/2011 - 15:47 | 1269169 Clowns on Acid
Clowns on Acid's picture

'Tis funny...just when the SEC and Treasury are screaming about price discovery and transparency in the equity markets, they are ensuring that the price discovery mechanisms in the RE market stays opaque.

All the RE brokers are now trying to convince potential buyers to "get pre-approval" for a X value mortgage, from bank mortgage lenders before coming to brokers. Y'know..."give me a firm bid, and I will go get you an offer". And of course RE brokers tell buyers that this helps them in negociation. 

Now watch ili Timmy and his band of soft, faux intellectuals bang the ES close.

 

Thu, 05/12/2011 - 15:48 | 1269173 johngaltfla
johngaltfla's picture

Of course since RMBS doesn't have to be accurately priced and the U.S. has deviated from honest accounting to C.R.A.A.P. accounting the banksters can declare these foreclosures on the books at 2006 price levels if they please. It's a joke and it's about cash flow.

Eventually the music stops and when the A.G.'s do not settle with the banksters they will take those states down hard and ram hundreds of thousands of foreclosures through the system in a very, very short time period. The banksters are already making those preps now and testing the "new new systems and procedures" in various jurisdictions. When they are ready they will punish those politicians and states who did not play ball.

I figure that will push Florida to up over 700,000 in the judicial backlog when they file them some time in 2012; just in time for election season.

Thu, 05/12/2011 - 15:50 | 1269193 buzzsaw99
buzzsaw99's picture

yeah but they still have to live there. lulz

Thu, 05/12/2011 - 15:49 | 1269198 aaronb17
aaronb17's picture

My house is in foreclosure right now.  We stopped paying in March, 2010. We will live in it until we're ordered to leave.  Right now I'm actively defending the foreclosure to make sure it doesn't happen quickly.  

It's our way of recouping some of the losses we've suffered from buying at the tip-top of the market (June, 2006 was when I bought, with encouragement from everyone -- realtors, bankers, the government, they all were cheering me on). 

One thing I've discovered: It's a lot easier to get by in life once you stop playing the debt game.  I used to spend a third of my net income on interest payments (car, house, credit card, student loan).  When we stepped off that merry-go-round, we were amazed to see that the world didn't end, and life was a lot less stressful. 

We haven't even filed for bankruptcy.  Ultimately I expect to settle our debt for about 50 cents on the dollar (principal only of course -- no more interest).  The only negative consequence is (horrors) we can't get loans anymore.  Oh noooooo!   And we get to live a couple years rent-free. 

Thu, 05/12/2011 - 16:12 | 1269298 d00daa
d00daa's picture

How many iPads have you purchased?

Thu, 05/12/2011 - 16:18 | 1269334 buzzsaw99
buzzsaw99's picture

thank you for sharing but a note of caution for others, you may wish to consult legal counsel before adopting any plan of action along these lines.

Thu, 05/12/2011 - 17:46 | 1269725 MachoMan
MachoMan's picture

Accounting help too on the tax from gains on debt settlement :)

Thu, 05/12/2011 - 18:26 | 1269858 FreeNewEnergy
FreeNewEnergy's picture

Ah, macho, you're such a card. Gains? Taxes? Get real.

The apparatus of the federal government is so irretrievably broken that they're lucky anybody pays any taxes at all. The boyz down in the bowls of the IRS high-five each other over the fact that payroll tax deductions still happen weekly, bi-weekly or monthly.

The poop has already hit the fan and it's blowing back feces in the faces of politicians and bankers across the country. This is still nothing, what we're seeing now. Prepare for complete systemic breakdown in every aspect of civilized existence.

Those who have any faith that the ponzi can continue on without interruption are simply clueless. One gets ahead of the game by whatever means available, be it not paying a mortgage, defaulting on credit cards, hijacking a tractor-trailer full of Panpers ( an associate once did this after he found out he knocked up a girl and she was having twins - saved him a pantload - to borrow an e-trade line).

There's no fucking rule of law, so why should anyone bother treating banks or government with any respect whatsoever? Tax laws? What? Will they round up everyone and imprison them?

Don't answer that.

Thu, 05/12/2011 - 20:30 | 1270208 Almost Solvent
Almost Solvent's picture

Imprison? No, but the lender will issue the dreaded 1099-C "Cancellation of Debt" which the IRS of course tracks.

 

Once the system implodes, then jubilee. Until then, debt settlement has tax repercussions in the form of involuntary 1099-C for debt cancellation of more than $600.

 

The IRS (and state departments of taxation & finance) consider that "income" you are "required" to report. 

 

Unless, you file the magical IRS FORM 982 to exclude the 1099-C as "income"

Fri, 05/13/2011 - 09:17 | 1271313 MachoMan
MachoMan's picture

Apparently someone hasn't been prodded by the long dick of the law yet...  and it has an itchy trigger finger until jubilee... 

Thu, 05/12/2011 - 16:20 | 1269341 JoeSexPack
JoeSexPack's picture

Challenge the lender's documented links to your house.

The loan & deed to your house two different things, check that link.

Many loans were made & transferred without new lenders registering these mortgages at local courthouses, which is needed to collateralize the notes.

Meaning they might have your name & credit rating, but no house as collateral.

Play this game, & pay taxes for 7 years, & it's yours. After a credit rating hit.

State laws will vary.

Thu, 05/12/2011 - 17:49 | 1269734 MachoMan
MachoMan's picture

It's a very difficult standard for permissive use of a property to rise into adverse possession...  I would suggest reading up a lot on the subject, tailoring an approach to your jurisdiction, and making for sure to let there be no doubt, objectively, as to your desire to hold against the interest of all others...

But the charade won't last 7 years...  the state will boot you out before then, unless you pay property taxes...

Thu, 05/12/2011 - 18:41 | 1269902 FreeNewEnergy
FreeNewEnergy's picture

You got that right. Here in NY it's ten years and the operative term is adverse possession. My day of enlightenment was, sadly, the day my father died and left me and my two siblings the house and a mountain of debt in July 2009.

The CC debt is history. The house has been occupied by me since August, 2009. Lots of discrepancies in the original loan docs, BAC filed foreclosure over a year ago, and "crickets" since.

I maintain, pay taxes, etc., etc. Other sibs have no interest, though eventually they are each entitled to a third. Were it my own house, that I had bought with my own DP, the situation might be different, but the original CW loan is a sham and the banks knows it, also filed a bogus robo-signed assignment.

Being as the criminal elite (and I am taking credit for coining that term) has screwed everybody and his/her uncle over in the past 10 years and continue the raping and pillaging of the US economy even today, I feel not one iota of shame or moral turpitude in taking the banks for as much as I can. If I could find a way to default on 100 more residential mortgages, I would do so in a heartbeat. They want to play night baseball with metal bats, let's get it on, brothers!

The days of playing nice and within the parameters of law are over. Now it's bricks and bats and balls to the wall with these fuckers. They'll get exactly what they deserve from me, in honor of my father (a good guy, WWII vet and all that) a shit sandwich with an exploding penis inside.

It's truly us vs. them. Rock on, and enlighten the sheeple around you.

Fri, 05/13/2011 - 00:06 | 1270777 zerozulu
zerozulu's picture

God bless you "MAN"

Fri, 05/13/2011 - 09:29 | 1271350 MachoMan
MachoMan's picture

The way to fight them is to not burden yourself with their debt...  or, alternatively, to do more homework before taking on debt. 

When I see rants like this, I always wonder where the other side of the coin was...  are you suggesting that because your father was a good guy and all that he should have gotten a free house and toaster out of the deal?  If so, do you propose that I pay for it?  If so, what is your moral basis for doing so?

The fact of the matter is that you see a free lunch and know the other side is impotent to deal with it.  That's fine, the banks would definitely do the same...  but don't make it sound like you're doing god's work blankfein.

Thu, 05/12/2011 - 16:20 | 1269353 LFMayor
LFMayor's picture

Averaged 35 cents on the dollar, still paying the house.  Free and clear of all the cards this past month.  My 401k plan won't allow me to withdraw and take the hit, can only be for medical or foreclosure, else I'd take the hit before it gets looted.

Go for the gold man, stick it to those pricks!

Thu, 05/12/2011 - 17:25 | 1269650 smlbizman
smlbizman's picture

aaron...you should at least preface your comment and identify yourself as to fucking stupid to navigate my way thru...

 so you present yourself as stopping payment on your credit cards, your house and other items all in the name of what? i actually don't find you any different from the "bad" guys....pawning your loses off on others....you may want to provide more detail in your post, or others may assume the same things...are their circumstances that made you adopt your current policy?....

Thu, 05/12/2011 - 18:54 | 1269936 FreeNewEnergy
FreeNewEnergy's picture

Read my comment above and get off the moral high ground for a moment. Come down to earth with the rest of the serfs and take a look up at Lloyd Blankfien and his buddies who would take money directly from your pocket, your clothes, your shoes, your women and kids if they could (and they might still).

I pay CC bills monthly and the morons keep increasing my credit limits. Seriously, I live like the Tyler Durden of movie fame, in a foreclosed-upon property, albeit in a much better neighborhood. I AM JACK'S UNPAID MORTGAGE DEBT.

The bankers themselves would default on these "shitty" loans, gladly, so why should you be any different? So as to not become like them? Give me a break. You can never become like them. They control billions and trillions of dollars; you are lucky to have reign over a couple hundred thousand, maybe a million. Stiffing them is the most patriotic thing you can do, because they are the cause of all of our country's pain. They are the traitors, the liars, the thieves, the tricksters, manipulators and deceivers.

Am I getting my point across?

I'll be back. Need to fix another drink. Started early today when I discovered I'm only half way through the average foreclosure time span, because I'm WAY ABOVE AVERAGE.

Fri, 05/13/2011 - 09:37 | 1271397 MachoMan
MachoMan's picture

What good are drug dealers without end user demand?  This nonsense about banks being the root of all evil is incredibly convenient and self serving in your case.  The fact is, people make bad decisions all the time...  banks and serfs...  and the real cause is much deeper than a superficial entity...

Thu, 05/12/2011 - 17:56 | 1269762 Bam_Man
Bam_Man's picture

Good for you.

But don't forget that Uncle Gorilla is going to send you a 1099 for every payment you have missed. Keep some cash handy to pay that bill when it comes. The IRS can be a real bitch.

Thu, 05/12/2011 - 18:06 | 1269799 bigdawg
bigdawg's picture

FYI.

The Mortgage Forgiveness Debt Relief Act (know as H.R. 3648) was introduced in Congress on September 25, 2007, and became law on December 20, 2007. This act offered relief to homeowners who would formerly owe taxes on forgiven mortgage debt after facing foreclosure. The act extends such relief for three years, applying to debts discharged in calendar year 2007 through 2009. (With the Emergency Economic Stabilization Act of 2008, this tax relief was extended another three years, covering debts discharged through calendar year 2012.) Normally in US law when a lender decides to forgive all or a portion of a borrower's debt and accept less, the forgiven amount is considered as income for the borrower and is liable to be taxed. However, The Mortgage Forgiveness Debt Relief Act of 2007 amends the Internal Revenue Code to exclude from gross income amounts attributable to a discharge of indebtedness incurred on a principal residence. H.R. 3648 would ensure that any amount forgiven on mortgage debt secured by a principal residence would not be taxed. This bill will apply whether it is a short sale, foreclosure, deed in lieu of foreclosure or any other similar arrangement that relieves the borrower of the obligation to pay some portion of their debt on their primary residence. The amount of forgiven mortgage debt allowed to be excluded from income tax is limited to $2 million per year.
Thu, 05/12/2011 - 19:12 | 1269993 Calculated_Risk
Calculated_Risk's picture

BS. I lost my home. Didn't pay jack shit. Only concern is if it's not a primary residence, and it's over a million.

Thu, 05/12/2011 - 21:01 | 1270305 blunderdog
blunderdog's picture

I see this comment so many times here on ZH...it seems so strange that it'd be so common here, where almost everyone is a toughguy.

For the most part, the IRS is a paper tiger.  Once you've come to terms with a life that doesn't completely depend on access to near-unlimited leverage, there's very little to worry about from the IRS.

They're not going to put you in prison unless you really work at it, and quite frankly, chances are you've never once had access to enough money for them to care much about.  You get a letter, you tell them what you can afford, they give you a schedule.  You fall off the schedule, you call 'em up and tell them you need to work out a new schedule.

Most people's fears are as rational as kids cryin' about monsters under the bed.

Fri, 05/13/2011 - 09:42 | 1271423 MachoMan
MachoMan's picture

This.  The IRS also hates attorneys and hates court oversight.  I recommend hiring an attorney that can pay for his own way by knocking more off the negotiated settlement than you could get on your own.

Their settlement or offer in compromise is completely based upon your net assets and present income stream...  if you have dick for net assets, then you'll likely be able to settle for pennies on the dollar...  the IRS WILL cut its losses, take the money, and run.  They can (and will) sink their teeth into any real property you might have though...  and after the lien is filed, you won't be getting rid of it until you dump the property or settle. 

Thu, 05/12/2011 - 19:13 | 1269984 Calculated_Risk
Calculated_Risk's picture

Convert all assets to pm's or non-traceable paper (i.e. cash) long before you file bankruptcy.  Keep the absolute MINIMUM in you're savings account. Look at the IRS means test for your area, and try to get your "income" at or below that level. This way it will be easier to file chapter 7. If you can, go for chapter 7 bk. Wipe it all out! If your gonna go, may as well go nuclear!!!

Thu, 05/12/2011 - 15:59 | 1269238 Clowns on Acid
Clowns on Acid's picture

"It's our way of recouping some of the losses we've suffered from buying at the tip-top of the market (June, 2006 was when I bought, with encouragement from everyone -- realtors, bankers, the government, they all were cheering me on)."

I bet a lot of people wish they could do that with their Lehamn and Bear Stearns stock.  

Thu, 05/12/2011 - 15:59 | 1269255 sabra1
sabra1's picture

so, you're saying that if i live near the Mississippi, my home gets flooded out and ruined, i can no longer live there for free, and, and, i will have to PAY to rent to live in a sub basement apartment? that's not fair!

Thu, 05/12/2011 - 16:13 | 1269318 Fíréan
Fíréan's picture

The "dead bests" are in the banks and mortgage servicers.

It deminishes the blog when the writers here perpetuate the stereotyping of all persons who are in arrears, foreclosed on or below water with their mortgage as dead beats.

Thu, 05/12/2011 - 16:20 | 1269352 JLee2027
JLee2027's picture

Yeah, the author didn't get the real reason for the foreclosure slowdown.

Fucking fraud, people are fighting back.

Thu, 05/12/2011 - 16:18 | 1269345 JLee2027
JLee2027's picture

aaronb17: Same here. 

They are trying to Robo-Sign me out right now. My lender (Equifirst) was shut down in 2009, so things are pretty unclear if anyone actually holds a valid note.  

Thu, 05/12/2011 - 16:50 | 1269467 the not so migh...
the not so mighty maximiza's picture

Typical NY with the BS double standard.   If my tenants have not paid buy the second month, my server goes out and the court date is within a few weeks, ether they pay, work out a deal or sherriff comes a knocking.   I rent myself waiting for this stupid NYC housing market to go down but they keep it up with this shoestring and dental floss crappola.  As a renter myself when i see people living free in a house it IS ill gotten gains just as bad as a Goldman girly boy with a bailout.

Thu, 05/12/2011 - 21:02 | 1270314 blunderdog
blunderdog's picture

Don't be a hater.  Even if those folks are thrown out on the streets, the banks aren't going to immediately start selling the properties to "deserving" people like you because they can't afford the losses.

And if everyone's out on the streets and the houses aren't available, that's going to increase your competition and let the badguys jack rents. 

Consider yourself lucky.

Thu, 05/12/2011 - 17:46 | 1269585 PulauHantu29
PulauHantu29's picture

Taxpayers should feel warm and cuddly paying for these folks to live for free.

BOOOYAAH!

Actually, I see that all over even in Arizona and all over Texas....renters are not paying and it takes forever to evict...so much for thos ewho say you should buy rentals and make a ton of money...LMAO!

Thu, 05/12/2011 - 21:51 | 1270464 downwiththebanks
downwiththebanks's picture

Regular, working people are the ones being foreclosed upon by your beloved banker-gangsters.

And to think:  you think they should be able to keep foreclosing despite their criminal deceit.

Fri, 05/13/2011 - 09:59 | 1271483 MachoMan
MachoMan's picture

I'm certainly waiting to buy some rental property (if it will ever fucking find some price discovery).  The eviction process is not very hard at all...  and if renters want to stay, they get to pony up the monthly rent into the registry of the court...  needless to say, that's not going to happen (I've never seen it anyway).  The Sheriff's Dept. is courteous and only charges $50/pop...  get a solid lease agreement and use the deposit to pay the eviction fees...  make sure your insurance is paid up for the damage they leave and rock and roll.

For whatever reason, everyone is apprehensive about the legal process...  It's a little procedurally demanding and requires strict attention, but the process itself is very simple...

Thu, 05/12/2011 - 17:55 | 1269752 jomama
jomama's picture

fuck man, i wish i was living rent free. 

who gives a shit about credit anyway when the game is rigged...?

i mean, it's not like it's a student loan.

Thu, 05/12/2011 - 18:14 | 1269812 MarcusAurelius
MarcusAurelius's picture

Amen....."the heads I win, tails I still win trade". I often wonder why the rest of the country doesn't simply quit paying with all the BS staring them in the face. I mean why seriously why is it OK for deadbeats (assuming they were not caught in the layoff debacle) and crooked bankers to get their loans covered but not the guy who really needs nhelp right now. The guy/gal that goes to work everyday, makes some hard earned cash in productivity, pays his bills and raises his/her family. Our whole system is set up to reward the incompetant person. From the welfare case to the financial terrorist. Where the hell is the reward for the guy who in essence does it right? What sort of dumb ass message are these policitcal and legal morons sending???? Hey don't worry its alright to be unethical and immoral but hey if you are an honest hard working Schmuck well you know that is the way the ball bounces. I simply wonder when people are finally going to say, "ENOUGH!".  

Thu, 05/12/2011 - 19:07 | 1269975 FreeNewEnergy
FreeNewEnergy's picture

When people say, "enough" is up to each to decide on his/her own. You may not have come to terms with the fraud, the corruption, the unwillingness of government to prosecute offenders, the non-paying neighbors, the crime, the stupidity, the media, etc., etc., but you will, everyone will, eventually.

Those who hold out the longest will likely lose the most. History has set precedents. Germany, 1938-1945. Those who fled in '38 were able to re-establish some sort of life. You know what happened to those who "stuck it out."

Open thine eyes and see the world as it really is. Nobody protects you.

Thu, 05/12/2011 - 21:50 | 1270476 downwiththebanks
downwiththebanks's picture

What a sad view of people you have.  Working people - i.e., people who have a conscience - generally don't walk away unless they've been gang raped repeatedly from banker-gangsters already.

Thu, 05/12/2011 - 18:19 | 1269828 tedstr
tedstr's picture

We will next hear from Mr. B about QE3 but it will be called the Floating Term Asset Umbrella Liability Acceptance Notes or "FLATULANCE".

Thu, 05/12/2011 - 18:31 | 1269877 bigdawg
bigdawg's picture

As a preface, I believe that those who don't pay should be foreclosed on.  I have purchased a couple of notes for income, and I also have a mortgage so I see both sides.

I wouldn't allow someone to live in a property, where I owned the debt, without foreclosing as quickly as the law allows.  Of course, the chain of title that I have is crystal clear.  My notes are 50% LTV maximum...banks are fucking idiots for lending at 100%, 97%, or even 80% LTV.  (No, I didn't make people put down 50%, as if anybody puts down 50%, I just bought the notes at steep discount from private holders who seller financed their properties and wanted the cash).

Not sure why there are those people that are angry at people for living "rent-free".  If the bank has the proper docs, then foreclose.  They either don't have the proper docs or they're unwilling to take the accounting hit to their books.  I'd rather have someone living in the houses than a bunch of vacant properties.  Actually, if you are waiting for foreclosure, you should stay until the property is taken over by the bank...otherwise you'll (usually) be liable for any damage to the property from the time you move and the new owner takes over.  This usually applies to non-deficiency states too.  Be mad at the bank for not foreclosing soon enough...we'll get to the market bottom much quicker if they do.

As far as the taxpayers footing the bill...yes, true...but I distinctly remember everyone calling their Reps to tell them not to bail out the banks.  If you're going to be pissed at someone, Congress is where it's at...both Dems and Repubs are guilty of this.

Fri, 05/13/2011 - 01:31 | 1270882 MisterMousePotato
MisterMousePotato's picture

You are comparing apples to oranges. In your case, you took real money that was yours, and purchased an asset that you thought would provide cash flow/income. The operative difference is that you used REAL MONEY. Your stack of hundreds. Or Eagles. Something real.

With the bankers, however, it is different, and thinking about one's credit card debt, etc., in the same terms they might if they were talking about borrowing, oh, say, ten thousand bucks from their father in law. Or the It's a Wonderful Life kinda banking we all grew up with. (Or you, for that matter.)

But we are talking about something else here.

A TRUE lending relationship is when I lend YOU something I HAVE, meaning I lack it until it is repaid.  If you don't repay, I lose.  Where the fuck is the LACK on ANY banker's part after having "lent" $50T of Z1 credit into the FRN zone????  Have they been living as paupers all these years after lending all these FRNs out?  I mean, surely they lent SOMETHING real, right?  And when someone defaults, do these bankers end up LOSING permanently the value lent?

The whole fucking system is an OUTRIGHT fraud.  The money powers belong to the people and must be run as a public utility.  We have granted seigniorage and ultimate power to a bunch of crooks.  Bankers are legalized parasites.  They add NOTHING of value to this societal equation.  EVERY function they perform could be performed by public utilities.

In fact, the reason true fiat currencies haven't worked is because BANKS through speculative attacks, have destroyed every one of them.  The BOE used the Sterling Bill to destroy bimetallism and rape nations.  There is NO reason whatsoever that fictitious money could not be "lent" by the US Treasury, or as Friedman maintained, printed by a fucking computer.

(Disclaimer: I stole the foregoing rant from some outraged ZeroHedger some months back. Wish I was as articulate.)

Thu, 05/12/2011 - 20:20 | 1270188 uniman
uniman's picture

You are correct.  One of the dominoes that will eventually fall is that people realize they don't have to pay income tax any more.  Just stop filing and stop paying.  Yes, I know about the potential legal consequences.  But the reality is that, just like foreclosures, there are too many people to actually lock up.  They can make examples of a small number in order to frighten the rest, but you may calculate the odds of that happening to you, on your own.

Yes, you won't be able to have "investment" accounts and play in the casino anymore, and you'll have to divest yourself of your paper PM first :-)  But perhaps it's best to have physical after all ? 

Many readers here believe that the financial meltdown is not going to have an easy landing.  Assuming so (hard landing) what are the actual mechanisms and sequences of failure and what specific harm will come to each of us individually?  What can we do to take proactive defensive action and stay out of harm's way? This is dangerous and scary, but not intractable.  Think.

Thu, 05/12/2011 - 23:14 | 1270661 rambo1028
rambo1028's picture

Wait a minute.... are these numbers referring to only single family dwellings or do they include apartment buildings as well? If they include bulidings as well.... its not hard to figure out what they are doing. Think about how many people live in apartments in NYC. If they foreclosed on all those properties and all of those people lost the roof over their heads, how long would it be before people started rioting and actually protesting instead of watching dancing with the stars? They are afraid of revolt. Plain and simple.

Fri, 05/13/2011 - 03:46 | 1270989 fellatio is not...
fellatio is not fattening's picture

OK lets assume it does include multi-family bldgs.  I own a 4 plex all my tenants pay their rent, so I collect ~$7500 a month and I STOP paying my mtg.  in 12 months I have collected $90k free and clear (minus normal expenses) and in 2 years $180k my tenants are happy, it doesn't effect them yet, and I will just give the bank the keys after I have over $250k CASH!!  Now there's a good deal and there's no min. mgn. requirement to be raised on me.

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