This page has been archived and commenting is disabled.
Guest Post: Roll Out The Welcome Mat For A Housing Double-Dip
Submitted by Alexander Cloy of Lighthouse Investment Management
US house prices – Roll out the welcome mat for a double-dip
Let’s take a look at the situation after the October data from the Case-Shiller home price index has come in[1]:
You see all major metropolitan areas peaking between March and May
2010 (the end of the first-time home-buyer tax credit). After only 8
months in positive territory, the overall index comprising 20 cities is
back into the red (-1% in October). 14 out of 20 regions now show
declining house prices.
Prof. Robert Shiller (one of the creators of the index) pointed out
that 6 out of 20 cities in the index have hit new lows (even lower than
in early 2009). He said that the economy would face “serious worries” if
house prices kept falling this fast.[2]
Why did he say “this fast”? To understand, you have to look at the annualized rate of change of the last 3 months[3]. And it is not a pretty picture:
While the 10-city index dropped an annualized 8.8% in the three-month
period from July to October 2010, the 20-city index fell at a rate of
10.4%.
The annualized three-month rate of change gave an early warning sign
went it went into negative territory in June 2006, while both the
10-city and 20-city only showed declining house prices in January of
2007.
Equally, the three-month rate of change signaled a trend reversal in
April, May and June of 2009, while the overall index did not turn
positive until February 2010.
Investors would have been wise to heed these signals – both on the
way down and on the way up. As declining house prices were the trigger[4]
for the biggest financial crisis since the Great Depression it is only a
matter of time until financial markets react to the new realities of
house prices: a double-dip.
[1,3] Source: StandardandPoors.com, own calculations.
[2] Prof. Robert Shiller, in: online interview with Wall Street Journal, December 29, 2010
[4] “Trigger” (not the only reason)
»
- 10301 reads
- Printer-friendly version
- Send to friend
- advertisements -
OT
PMs Take a hell of a Hit here. BTFD
Yea pretty amazing how gold and silver are now the only things on the planet that can open down. If we had nuclear bombs going off in Manhattan it would be reported as 'better than analysts expectations' and stock futures would flush green.
Bought more SIL, AG, UXG cheap on the dip --- some of them over 5% off!
http://www.google.nl/url?sa=t&source=web&cd=1&ved=0CBcQtwIwAA&url=http%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DBru2tVghbqw&ei=WScjTZ6yNMygOtm3lbUJ&usg=AFQjCNEPdmS4JWGR8YxsMZLvJ97q5uI6ew&sig2=P4oKpon-nz7giNQpbvQ5Rw
OK already priced in QE4.5 this morning on Baltic Dry, so now QE5 solid getting priced in on housing collapse ver.2.0, stocks higher of course. This is easy!
Now, plot the CS index against the REITs, the IYR, the RMZ or any of their components.
It must just be residential as CRE is soaring like a condor.
For entertainment, I always look at the NYT real estate section each Sunday, and the ask-sale spread and time on market. The numbers started getting dramatically worse as mortgage rates rose (not too surprising). Another poster showed the reset calendar again on another thread, and it will support downward pressure all year. This will create a huge headwind for the whole economy. It just took two years to play through.
This is good for +300 intra-day /es points.
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=IYR&sid=0&o_symb=IYR
Any Q's?
Crude getting slammed in reaction to the gold pummeling.
Peak Oilers must be scratching their heads, wishing they invested in retail stocks and tech stocks instead.
AAPL up $3.00 to a new, world record high in the pre-market.
So far, my remaining longs in the PM sector are getting killed. Not a good start for me in 2011.
WTF does this have to do with the C-S index?
Aren't you supposed to post a 12 month chart of Piggly-Wiggly or some other bullshit?
Crude over 91 has LA buses filled to capacity with paper traders and paper tigers. LOL...
Just another good opportunity to average down!
You're the only person I know of in the financial world that refers to "world record" highs.
The exact same dynamic that infects housing as seen in the C-S index is infecting crude oil.
When the price of housing reaches a point of unaffordability the customers are gone leaving only those who did not buy a house when the price was rising, presumably because they had no money or no access to credit.
The same credit constraints are effecting the oil markets: when the price of crude reaches the point of unaffordability the customers are gone. Nobody can make a profit by using the expensive crude just as nobody can make a profit with the expensive houses.
The ultimate outcome is identical in housing and crude; users of both fall bankrupt. This is and has been taking place all across the country and rest of the world since 2004 when crude prices increased a mere 300% from the dollar 'peak' of 1998.
High bubble house prices lead to a crash, high bubble oil prices lead to the same crash. The real problem period is 'really cheap oil' of $20 or so per barrel. What this will mean is near- zero disposable income, a totally flat broke USA and rest of the world.
Don't worry, be happy. This is coming and there is nothing anyone seems willing to about it. What to do? Get rid of the carz is step number one. Step 2 is de- industrialize agriculture. Oh, btw ... if step 2 isn't put into practice pretty damned fast there is going to be some very interesting 'difficult times' here in the good- ol' USA!
Happy fucking new year!
Double dip is so 2010. I say bring on the "triple dip" headlines!
Edit: my point being, has it ever recovered? no. The "double dip" is simply a headline which for some reason seemed to be popular.
How about let's all decide to speak the truth and call it bottomless?
Because there is no floor besides worthless.
The great suburban experiment is at end. Folks will flee back to the cities.
Very very interesting to behold. Add the fraudclosure settlement (potential) and people will really be in a bind, cannot pay and deep underwater and somewhere in the "settlement", the banks will be able to go after most of the underwaterees.
ORI
http://aadivaahan.wordpress.com/2010/12/31/a-big-part-of-what-this-here-...
The state, acting through its attorney general, cannot waive the rights of its individual citizens. [this is why legislation is ultimately needed]. The attorney general settles the rights of his/her state to sue/prohibit action of those businesses conducting themselves on the state's soil and with its citizenry.
In short, the way attorney generals work in the equation is they could put pressure on the judiciary and everyone else to wake up and start sticking it to the banks... however, they have decided to capitulate to prolong the pain. That is about the extent of their involvement... they are patently ostriches now. The same courts that have been prohibiting foreclosures and slapping banks in the face will continue doing so regardless of what the AGs decide.
Thanks MachoMan.
Somehow though, I think the banks (bing ones anyways) are a little bit more powerful than states. Maybe another little wrist slap billion here and there to kick the can further.
Unless Texas decides to do something, well, bigger!
ORI
The mechanism for state control is the budget deficits/debt of the states... essentially, they will/are trading sovereignty for bailouts. In this regard, yes, the banks are more powerful than states given states are beholden to the federal government who is beholden to the banks... pretty simple really... and very well played. About the only thing standing in their way is the judiciary... hopefully they will not be so result oriented and stop us from boiling.
I think it's time for price discovery...
Yup. The rest is smoke and mirrors. And, the longer the can gets kicked, the more I am convinced that the next crisis will hit with little (if any) warning. Till then, it's all fun and games.
Move back to the war zones in the city!? No thanks. I'll take my chances tenting in the woods.
There's an interesting post at naked capitalism, saying lenders are incentivized to drag out mortgage defaults to maximize fees and penalties. Then foreclose fast once the penalty phase has been maximized. Bottom line, the severity of the foreclosure crisis is gonna get much worse.
http://www.nakedcapitalism.com/2011/01/amherst-securities-investors-unde...
Finally, a mortgage industry expert, Arthur Herbert Fonzarelli (aka "The Fonz"), is promoting Reverse Mortgages as the way out of this madness. "Whoa".
https://www.onereversemortgage.com/about/henry-winkler
Tenting in the woods sounds like a plan Alex.
Thanks for the links.
inverse compounding, bad for the problem at hand.
ORI
Worked well to keep the consumer sheeple not too worried. Tell them theres no double dip, theyll believe it till the day they find themselves freezing in a tent.
I am getting SOOO confused.. Wasn't there some cartoon character in 2010 telling us to, "buy the dip"?
So I wrote to the Regional Bank which originated my mortgage loan. I am current on all payments and upside down by about 35%. I asked them to show me the note. Their response was that the loan was sold to an investor know as FEDERAL HOME LOAN MORTGAGE and the transfer was not recorded with the County Recorder. Since the originator of the loan has been fully compesated for the loan I was thinking my next step should be to request a satisfaction of mortgage with that lender, along with an accounting of all payments made to the "investor". Correct me if I am wrong, but the idea is to get the originating bank out of lien position on the deed. Since the "investor" never recorded their line position with the county, as required by Ohio Revised Code, they would not be able to record their lien position on my deed? I would then I will have clear title? Any suggestions from this point?
A quick phone call to a lawyer may answer some questions. I found a lawyer via a reference from a short sale realator (rather than looking for one randomly). A 20 minute phone call clarified a lot of details. I spoke to one in minnesota so unfortunatly, his contact details are not bennefit to you.
I did speak to one, a dear friend of mine and the family, and this was the basic direction he was suggesting. He actually has been following the stopforeclosurefraud website, as access to these cases tends to be masked through the normal channels I guess.
Quite frankly, the ZH community has been instrumental in getting me to this point of the race, so I figure a query to the community might help me reach that finish line. Thanks for your insight Dr.
Hope to see you at the next doctor's convention. HAHA
Yes, get out of your manly responsibilities any way you can. It's the American way.
I am not tryingto GET OUT of anything. If 5/3 has been paid, then why the hell should they be collecting the payments. Shouldn't that go to the investor according to the servicer agreement that was part of the original loan? Keep sucking the bankers' cock out of morality and pay no attention to the obvious indentured servitude for banks who never had financial consideration to begin with.
Quick question, do banker shoot loads of fiat semen as well?
Yes you are. No. Scientifically unlikely.
The banks may sell notes reflecting your debt but are retained to process your payments. The receiving party to your debt is still owed the money and has contractual rights it can enforce. I bet nothing in your loan documents prohibits reselling of your mortgage.
The mere fact that the current holder of your mortgage may have failed to record the transfer does not wipe the debt. Theoretically, if you could get a title company to recognize the document you received from the originating bank as a release of the mortgage than maybe you could sell the property to a third party. But we all know the title company will only recognize a formal pay off letter from the mortgage holder, the mortgage was not paid off, the paper was transfered legally.
Failure to properly record the transfer may impede certain collection rights and theoretically allow a transfer of the property to an innocent third party who might then be able to record a defensible title. However, you good doctor would remain personally liable for the mortgage debt. The current holder of the mortgage could lose a secured interest in property but would retain the unsecured claim to sue you for recovery of the full value of the note.
Sell to your brother or a buddy and the courts would unwind the deal as a shame and you both would potentially exposing yourself to a criminal prosecutions.
The failure to properly record title transfers does not eliminate the debt, it may make certain types of collection procedures such as foreclosure impossible until the true title holder properly files the mortgage so that a court will recognize the property rights.
Ultimately title holder to the mortgage should be able to fie the proper paperwork and foreclose, the question is at what cost. Bottom line, if you have other tangible assets, you may ultimately lose 100%. Fighting properly will cost a bundle. The folks in the best position to fight can afford to pay a lawyer something less than their current mortgage but otherwise are relatively judgement proof and ultimately don't care about going BK or realize that sooner or later the smart move will be make a deal.
The only winners in this will be a few lawyers.
FYI - the quick way to find out if you are right is likely to file a Chancery action to clear title. Good luck, the likely result will be to force the bank and current mortgage holder to get their paper work in order. Tell me how it all works out in three to five years.
I appreciate the insight.
you also have "constructive notice" in Florida it is 7 years. Give notice, publically, openly of an action, possession, intent, etc., and the other party must respond or loose status.
There is also the "Commercial Credit" interstate laws, the banks don't want you to get into those...it is quick sand to them.
Remembe the good ol' days of Lincoln S&L, go to jail, pay a fine, loose respect. How the times have changed.
Why would you open an action to quiet title based upon an adverse possession that hasn't happened? This is going in the trash bin aka dismissal by the court. Why would you file a lawsuit hoping default of the other party is your only chance? That's patently ridiculous and any good attorney would NOT file the lawsuit for fear of sanctions by the court... (aside from looking like an idiot where you practice every day).
Generally, adverse possession can never begin accruing from permissive use except for EXTRAORDINARY measures to overcome the presumption.
I agree with you MachoMan, I never said it was smart and I think the good Dr. is going nowhere. But if he thinks he is right, better to bring a lawsuit than to stop paying on the note on the misguided belief that he owes nothing.
just because the particular person you spoke to at your bank can't find the records, that does not mean that your mortgage payments do not get forwarded to the new owner of your loan, whether it be freddie or another bank. believe it or not, the entity that bought your mortgage is very likely to check to make sure it is receiving cash flows due to it. even if that's not happening, bashing the evil "bankers" does not make an immoral action righteous.
if successful, you are not going to stiff bankers but instead the collective american taxpayer. we taxpayers are the ones who will eventually bear the cost of the default and legal actions you are pursuing either via bank or agency bailout. if successful, your theft will add to the cost of the bailout of whatever entity that is, because the payments you owe will be missing from that entity.
using the legal system to claim what is not rightfully one's own... hooray for the american way.
So, what bank do you work for?
You obviously don't understand the massive fraud that has been perpetrated on us proles. The chain of title has been destroyed due to the slicing and dicing of mortgages for MBSs, etc. and the failure of the banksters to properly record title transfers and lien releases as required by law.
Do you know what happens when you try to sell a home with a clouded title or unreleased lien? Sheesh, the good doc is just trying to protect himself.
you damn right... and all those smug folks out there who think this is a problem for the behind-in-payments or "under water" are truly blind and simple minded.
Trust what I write here....ANYONE who has any kind of mortage on any USA property, anywhere, is sitting on a clouded title. If you don't understand what that means, then you, I mean YOU, need to do some serious homework folks. This mess touches anyone whose home has not been free and clear for the last TEN YEARS> Period.
seems there are fewer and fewer reasonable members of this community. thank you for calling it like it is.
No one is going to get a free and clear mortgage in these situations, including you. It would bankrupt the whole system. The bank are going to pay a huge find and the states are going to change the laws.
No one is going to get a free and clear mortgage in these situations, including you. It would bankrupt the whole system. The bank are going to pay a huge find and the states are going to change the laws.
I guess we will see. I hope your wrong, but suspect you are right. In either case, I will still request a satisfaction of mortgage from the lender since they were fully compensated for the loan. Pipe dream? Perhaps. Worth a shot though.
It's not called a satisfaction, it's called an assignment...
I'd certainly demand to see YOUR note! The bank telling you 'Oh sorry, we sold that to someone else but keep paying us on your underwater home'...thats BS, produce the documents!
They did send me the note which indicates the "investor" was never indicated as a transfer on the deed. This lack of transfer was also confirmed with the county, by me, prior to my request to see the note and after the note was sent to me. In fact, the letter explaining the transfer and the party of the transfer explicitly states that the transfer was never recorded for their flexibility. So I anticipate a paid in full transfer to the investor should satisfy the mortgage as it relates to the originating bank. Perhaps a request for a satisfaction of mortgage outlined in the RESPA rights would be a simple move.
Shirk your responsibilities at all cost! It's the American way.
My responsibility is to the owner of the property. The originating bank was compensated for the loan were they not? My responsibilities are to know the rules of the agreements that were set forth.
Should I not follows the rules of the agreement, they would kick my ass out would they not? Why shouldn't the banks be held responsible for those same agreements.
Am I missing something goldmiddlefinger?
Uncertain. Yes. Yes, your contractual obligation.
So I have a contractual obligation to the bank who no longer owns my note and a bank that has already been fully compensated for my mortgage? They are contractually bound to receive double payments on the loan?
That is not how the mortgage is written as I read it.
I bet there wasn't anything in that contract about bailouts and 20% unemployment either. The giant banks were betting against mortgages they were writing. Ask yourself, did they ever disclose this before the system took a crap and we all had to find out the hard way? No sir, that would have been bad for business.
"An oath to a liar is no oath at all."-Braveheart
Go read your contract. 99%+ chance it says something to the effect that you have no right to contest an assignment and/or the originating bank is entitled to assign the note at any time. What this means is that you're on the hook to the assignee (probably a TBTF and then a GSE). You should have received notices of all the assignments in the mail... and should have also received notice of what company would be servicing your note...
If you have a question about whether the assignments are valid and you are getting credit for your payments, then you need to ask the servicing agent (probably a TBTF) to show you the document of transfer to the present holder as well as the servicing agreement. Presuming of course that you have not already waived contesting the matter through multiple payments to the servicing entity.
The fact is that you need to keep records of your payments and in all likelihood are getting credit for your payments... just keep chugging away at the 35% underwater property and maybe it'll be worth 20% of the sales price by the time you get done paying for it ~3 times.
I don't think you're missing anything.
Your responsibility is to the owner of the property/holder of the note. How do you know the servicer is transferring your payments to the note holder? Not to mention all the title issues that could arise from all the improper transfers.
Yes, the banks should be held responsible! But they won't. Us proles will be held responsible for every little thing though.
I think if people really understood what all this means, there would be a lot more anger. However, my anecdotal experience: nearly everyone to whom I've tried to explain it just changes the subject.
Do you also think your checking account balance is sitting in the vault in an envelope with your name on it?
There are digits in the computer that supposedly belong to me. Add fractional reserve banking to the mix and there is no money in the bank with my name on it. Currency perhaps a bit, but no money.
No worries though, I don't keep much currency in the bank beyond the needs of my check writing. Looks like my check writing needs will get a bit smaller.
I am not sure what your agenda is goldmiddlefinger, but I like to bat down your ideas. Tits fun.
Correct me if I am wrong, but the idea is to get the originating bank out of lien position on the deed.
The originating bank can't give you a satisfaction of mortgage for a loan (mortgage) they sold. Only the new, current, actual note holder (assignee) can provide that. Since they never recorded the lien you could get a new mortgage or sell the house and hold the cash or continue paying the note (unsecured) for as long as you like. Depending on what state you are in liens are acknowledged in priority of filing, also known as a "race state" - such as NY. This means that if you get a new mortgage (or friendly confession of judgment) filed on your RE before FHLM files their mtg they sit in second position even though the date of the loan predates the confession of judgment or new loan.
You are upside down by 35% theoretically, but technically, you are up 100% if your house is Free and Clear.
contact www.nationalfraudconstable.net for more sophisticated and legal solutions.
you are 100% correct sir.
It would be wonderful if "new" ZH readers would add meaningful information instead of this fussy, bitchie, childlike waste of space I see more and more of.
In Florida, if the note was not recorded in a chain ownership, it is subject to question and possible non collection. The "quality" of the note is impared if the chain of recording is broken or delayed.
Why would the note need to be recorded? Do you mean the lien on the real property? The priority of the lien may be impaired if assignments are required to be recorded, they are not, and other liens are recorded on the property in the meantime...
Do you live in a recourse state? My question is what are you planning to do with the property, given you're 35% underwater and will still owe on the note, regardless of what happens with the underlying mortgage? Can you simply turn the keys in and smile as you walk out the door?
Also, are you certain that assignments are required to be recorded in your state?
If you get a satisfaction from the only lienholder(s), then there should be clear title... but, as the poster above stated, the original creditor should be required to show you an assignment, but cannot write a satisfaction for debt that has already been assigned...
Again, what are you planning on doing even if you have clear title?
I plan on living in the home for some time still. According to Ohio Revised Code all transfers must be recorded. Ohio is a recourse state to my understanding. http://realestate.uslegal.com/mortgage-satisfaction/ohio-assignment-and-satisfaction-of-mortgage-law/
If they can come after you for a deficiency judgment, you have few, if any, business reasons for paying people to screw around with this issue. It's one thing to get a lien removed from your property, it's another to be absolved of the debt... If you were trying to get rid of the property or were trying to interject a lien, then I could understand... otherwise, I'm having a real hard time justifying it for someone who wants to stay there.
Hello Dr Richard
1) First, I would like to suggest that you go to the county recorder's office and do a careful search for a recorded satisfaction document. Depending on the state, this document could be called "satisfaction" , "release" or "discharge" of mortgage/ deed of trust, in some west coast states, it's called "deed of reconveyance", in Virginia, it's called "certificate of satisfaction of mortgage"
Search can be performed with your name or with the legal description of your property (i.e., section, block, lot number or tax-id number which you can get from your city/township tax assessor or from your original mortgage paper or warranty deed. You may also locate the original recorded mortgage/deed of trust first, and then see if any other recorded document references the mortgage/deed of trust. Generally speaking, satisfaction/release/discharge/reconveyance should reference the recorded mortgage.
If the task seems to daunting, you can hire a title search company to do it for you for $75.
If you are able to find a recorded release/satisfaction doc, you have proof you have a clear title to your property. The next thing is to figure out how to get back the extra money you have paid.
2) If you can't locate the satisfaction document, it means they have screwed you big time. You need to hire a lawyer IMMEDIATELY
Mortgagor/mortgagee relationship is more complicated than the unsecured creditor/debtor relationship (as seen in credit cards). Basically, when you and the bank signed the mortgage, you entered a trustor/trustee relationship. You used your house as a collateral to a loan, and entrusted your house to the bank. The bank then became the "trustee" of your property until you paid them the whole amount of your loan.
Let's say you owe a credit card company some money, that credit card company can sell that debt to another company without much hassle. However, if you owed your bank some money through a mortgage, and if your bank sell that debt to another bank, does that alter/terminate/transfer the trusteeship? That's why you need a lawyer
What your lawyer needs to figure out is that:
1) Did you pay off the mortgage before or after your bank sold the debt? If before, why didn't your bank record a satisfaction of mortgage with the county? The bank is committing a fraud if they failed to release the title back to you after you paid it off
If after, then
2) Did your bank have the right to alter, transfer or terminate your trustor/trustee relationship without your knowledge or consent? If they don't have the right to do that but did it nonetheless, they have breached a contract, (possibly) resulting in your financial losses. They should compensate you for that.
3) Even if your bank had the right to do that, did they make sure that the party they sold the mortgage to ("the "Investor") would take all the responsibility of the trusteeship? If your bank didn't do that, then their unilateral actions has caused you financial damages. They should compensate you for that
4) If your bank did its homework and made sure that "The Investor" assumed the obligation of the trustee, then "The Investor" should have cleared your title once you paid off the mortgage. Failure to do so is fraudulent on the part of "The Investor"
5) If your bank sliced or diced your mortgage and sold it to multiple "Investors", or if "The Investor" sold it to multiple "Investors", with the end result being that you can't get a clear title (because non of them would be qualified to clear your title). Then the unilateral action of your bank (or "the Investor") without your knowledge and consent have caused you financial damage, and they should compensate you for that.
6) Even though your mortgage can be owned by a thousand different entities now, you have always paid your money to one account which is your bank. If your bank continued to take your monthly payment, knowing full well that they had changed/tranferred/terminated the trustor/trustee relationship without your knowledge and consent, that you might not be able to get a clear title even after you have paid the mortgage in full, they are clearly committing a fraud.
You need to hire a lawyer and sue them NOW, because if your bank goes bust and belly up, there's no place you can go to get a clear title, or to obtain damage for the failure to get a clear title.
Wonderful. Thank you.
Um not exactly. If you are serious, hire a good local real estate lawyer.
The above points are all half true at best. Take point 1, failure by the bank to record a release and satisfaction is not a fraud. If you paid off the mortgage you were entitled to receive a release and satisfaction, which you should have filed. There is no requirement that the bank file one for you. If you did not get a release, ask for one. If the bank refuses than suit to clear title is proper, but unless you can show willful and wanton action you are unlikely to get anything more than a court declaring title.
Lastly, it would be a pain if a mortgage holding bank goes BK but some one will wind up with the note ultimately, a local chancery court can always clear title, its just a question of $$ and time.
Bingo. Aside from the fact that anyone purchasing the property would have a closing agent/seek title insurance... who would help ensure a release is obtained. The buyer would have just as much incentive for clear title as the seller...
Aside from the fact that his entire premise was wrong... the guy still has a note payable...
Thank you.
This is a finance, not a legal site and it shows with respect to much of the mortgage "fraud" comments. And yes I am a lawyer but not a real estate guy, but as a "real" trial lawyer I have run circles around collection lawyers. Most good trial lawyers can make life miserable for the average collection attorney. Of course most debtors can't afford a good attorney.
Putting aside pure screw up's ie. foreclosing on the wrong property. It all a question of documentation. At the end of the day people received money and signed a legally binding note. The issue is what needs to be done to enforce the note. What is now clear is that that the collection lawyers for the banks were acting like, well ...collection lawyers.
A good lawyer can often make it too costly for a collection attorney pursue a legitimate debt, which is why they will usually settle for a serious discount on the debt or just go away. With mortgages and priority lien status, there should be enough incentive to properly process the paper work. It is just time and money. It will happen, the only questions are how long and how much of a haircut banks will take.
The AG's suits may be the best thing for the banks if they can workout a deal for modified payments over a longer term. The banks get their money, they can still claim full value, the effective interest rate's will just drop for those that can afford to make payments. The AG's will not be able to protect folks who lost their jobs and can't pay.
delete
The bank essentially performed a "refinance" for Richard without his knowledge/approval and without the proper paperworks. A refinance consists of 2 parts:
1) Reconveyance. The bank declares that the mortgagor doesn't owe them any money any more, and releases the title back to the mortgagor, and terminates the trusteeship
2) Substitution of Trustees. A new bank pays the old bank the balance of the loan, and signs a new mortgage (deed of trusteeship) with the mortgagor, and becomes the new trustee of the property.
Richard's bank didn't perform step #2 because it required Richard's approval and signature. For some reason they didn't want to ask Richard for consent/signature.
As a result the bank didn't perform step #1 either because if they had done it, neither the old nor the new bank ("the investor") would be able to collect any more money from Richard.
Currently, Richard's house is still under the trusteeship of the original bank and he has no document to prove otherwise. His authority over the house is quite limited. There is no way he can sell the house (warranty deed) or give the house to his family member (quit claim deed) without involving the bank.
The new bank ("the investor") could declare the loan paid in full, but it can not terminate the trusteeship on the house because Richard has never legally enter into a trustor/trustee relationship with them
The old bank has the authority to terminate the trusteeship, but it is currently unwilling to do so because it doesn't know whether Richard has paid off the mortgage. If the bank has sold 1,000 mortgages, it needs to verify 1,000 cases with "the investor", moreover, if each mortgage is sliced and diced into pieces and sold to 1,000 different "investors", the old bank needs to verify 1,000 x 1,000 = 1,000,000 cases. The cost of research/paperwork is worth more than the bank itself and they'd be better off declare chapter 11 bankruptcy outright.
Furthermore, most of the mortgages were toxic so in order to sell them, they had to slice, dice, scramble and repackage. Hence the mess today. Bring the bank to the court right away to get some money out of them before everyone else wakes up and does the same thing
No. I have no idea what you're talking about...
Hello. Your mortgage was not satisfied, the note was sold along with the rights to enforce the note. The current holder may have failed to filed title documents to fully protect itself but the originating lender would never sign a release of mortgage over to you since it know you did not pay off the debt. If the originating bank did sign such a release it would open itself up to being sued by the current holder of the note for assisting you in fraudulently trying to clear title. Your debt is still valid, what rights the current note holder has to enforce the debt collection depends. Ultimately, the current holder should be able to file the proper paper work and foreclose. Should you sell your house the originating bank and title holder to the mortgage would transfer the funds, likely direct from the Title company's trust account, to the current holder of the note. The Title company insures that this process.
The banks may sell notes reflecting your debt but are retained to process your payments. The receiving party to your debt is still owed the money and has contractual rights it can enforce. I bet nothing in your loan documents prohibits reselling of your mortgage.
The mere fact that the current holder of your mortgage may have failed to record the transfer does not wipe the debt. Theoretically, if you could get a title company to recognize the document you received from the originating bank as a release of the mortgage than maybe you could sell the property to a third party. But we all know the title company will only recognize a formal pay off letter from the mortgage holder, the mortgage was not paid off, the paper was transfered legally.
Failure to properly record the transfer may impede certain collection rights and theoretically allow a transfer of the property to an innocent third party who might then be able to record a defensible title. However, you good doctor would remain personally liable for the mortgage debt. The current holder of the mortgage could lose a secured interest in property but would retain the unsecured claim to sue you for recovery of the full value of the note.
Sell to your brother or a buddy and the courts would unwind the deal as a shame and you both would potentially exposing yourself to a criminal prosecutions.
The failure to properly record title transfers does not eliminate the debt, it may make certain types of collection procedures such as foreclosure impossible until the true title holder properly files the mortgage so that a court will recognize the property rights.
Ultimately title holder to the mortgage should be able to fie the proper paperwork and foreclose, the question is at what cost. Bottom line, if you have other tangible assets, you may ultimately lose 100%. Fighting properly will cost a bundle. The folks in the best position to fight can afford to pay a lawyer something less than their current mortgage but otherwise are relatively judgement proof and ultimately don't care about going BK or realize that sooner or later the smart move will be make a deal.
The only winners in this will be a few lawyers.
FYI - the quick way to find out if you are right is likely to file a Chancery action to clear title. Good luck, the likely result will be to force the bank and current mortgage holder to get their paper work in order. Tell me how it all works out in three to five years.
You might want to look into the possibility of filing a quiet title motion. I have no idea if it would be useful in your situation, but it would certainly force their hands to the point where you can challenge it. This depends on your local state laws.
In any case, I thought that I'd mention it.
Maybe some auctions will happen where you can pick up some houses for 1000 a pop. IOr a few coins of silver.
As each day passes you'll be needing more coins of silver for your trade
Dude, have you even looked at the 6mo chart on SLV? You sound like robo with his dismissing of peak oil due to a one day decline.
What does the 6 month chart of silver tell you?
That your stament is false. From the chart, it is obvious every day that goes buy, a person need less and less silver coins for a trade.
You must correct the verbs in your statement to past tense.
I wouldn't get overconfident in this. Runs like this have a history of ending badly. Charts would have also told you that everything was depreciating compared to tech stocks a decade ago or that oil was going to defy gravity in H1 2008. Particularly precious metals had their own little fiasco back in the early 80s when suddenly...for seemingly no reason, people weren't all that hot to buy them anymore. I'm not going to tell you how it ends but merely that just because the market seems to confirm something at a point in time, does not make it ultimately true.
I agree. My point was to highlight goldmiddlefingers false statment. Someone who bought silver coins 6 months ago -hell 6 days ago- can now buy more stuff since they are valued higher. Where will they be tomorrow? who knows, but most likely higher than it was 6 months ago.
Hello Dr. NO...you just gave a great piece of logic for all to ponder. Silver goes up, great so does your food, gas, taxes, etc. You are, at best, equal to where you were when you bought your silver or gold.
This idea that somehow you are way ahead of the pack because you have PM might have meaning if you bought when Bill Fleckenstien said to buy, but not now.
What does the 6 month chart of silver tell you?
The 6 month charts tells me to BTFD. We have a pullback and people come out of the woods to tell us PMs are doomed. Just BTFD. Bernanke is printing dollars to oblivion, states and municipals grossly underwater, govt can't stop it's spending binge, PIIGS still screwed, unemployment rates still horrendous, more bailouts are coming and it won't end, and the list goes on and on. Just BTFD.
I like the idea of breaking up the TBTFs, then flooding the market with their inventory which would decimate the price of housing. Then we could see your $1000 home sales. Such a situation would probably cause a buying frenzy in housing, potentially jump starting that market again. No debt and full ownership would allow us to save our wages instead of paying rent to the banks, which in turn, would create an environment where productive investment would flourish. Jubilee* baby!
*Of course, this plan totally sucks if you are already a homeowner. I admit it wouldn't be that simple, but I like the general idea.
GM All, we talk about it all the time, pumps and dumps in PMs, the bernank does not like gold at 1,400. So, be patient and lets give him 1,500. Nothing goes straight up, except of course the spoos.
Have a great trading day all.
This is the ugly, oozing herpes blister on the lips of the banks that they keep trying to hide with pancake makeup and lipstick. I honestly wonder if Bernanke's ultimate goal isn't simply to print so much money that home prices return to their 2005 levels via the devalued currency. This would save the banks alot of trouble on their MBS's.
Surely this will drive gold higher.
Things aren't looking good in Housingville.. Where most Americans 'wealth' is stored away like a trunk on the Titanic.
I though all Americans stored their vast wealth at Goldline.Com
Most americans 'wealth' is now in extended to infinity unemployment check and food stamps or else damn near half the country wouldnt be eating today.
Only thing lookin all Leave it to Beaver is the BS manipulated 100+ P/E suicide stocks as their pump up continues daily, no matter what due to daily $8 billion POMO fraud. I want off this ride, this is bullshit and somethin bad is comin up next.
If gold is not a sucide ride then what is it's P/E?
Well of course gold has no P/E, it is a commodity. And the nice thing about it is its future price does not depend on some BS CEO or BOD who are in cahoots with the FED to help buy their so-called bid/ask stocks to price in the next 100 years of stellar earnings today.
What is the P/E of your next meal? Not all assets can be viewed in P/E terms.
P/E allows for the biggest scam on earth...anyone buying a paper stock today which has built into the price the next 100 years of earnings is a lunatic. Same behaviour was seen in the Dot.Com mania craze as today and will end the same.
Wanna see a Redback Networks stock certificate?
At the end of all this, I see prices on houses with a CLEAR title increasing. With all the mess in paperwork, foreclosure, short sale, etc., a house with a title free and clear will be worth a premium.
for the second time today, a man with logic to ponder.
100% agree, what I have also been writting for weeks.
How can house prices be down when no one has clear title to actually sell?
Kinda like signing a long term sublet without the landlord's knowledge I suppose...
There is movement in some areas, and since these housing numbers are national (and they never provide a standard deviation), may be misleading to some people in other parts of the country. For example, in Houston, I see lots of relo's from around the country (out of state plates). They are buying houses ( a few here and there). In August there was a 4 bed 3k sqft listed at $209k. A month ago, some new folks were moving in (from out of state). They paid less that $175k (since the last flyer I pulled listed at $175). The market is slow but due to relo's in texas, there is movement.
Simple. Buyer and Homeowner enter into a contract of sale. Seller provides a title commitment and the title company performs a title search for all outstanding liens. The liens would generally entail any taxes owed on the property and would require a mortgage release from the record lienholder. After closing, title company pays record lienholder the proceeds of the sale and lienholder files a release... title company issues title insurance.
In other words, banks issue credit and title companies issue policies based upon the title company's title search... that search will not reveal all the latent transfers... so, "clear" title is not really necessary to make the transfers in this case.
For the once middle class and wealthy housing still makes a large portion of their perceived wealth. 1.7 Trillion gone in 2010 alone and sinking. The whole banking system is built now on a declining asset.
Amazingly, like the bloated stock market, lumber futures (yes, they exist) have been skyrocketing for the past few months along with most other commodities. They are also ignoring the reality of the housing double dip that has been manifesting itself for the past 4 months!
there is nothing like a Saturday shoe sale to make you think you need to buy one too.
Nothing has changed in 15 years, everyone floks into whatever the 'hot ticket' is today. The trouble is...the smart money has moved on, 'traders" just haven't spotted it.
NumberNone,
+1. I agree that is BB's strategy. If true, it shows what a simpleton Bernank really is. Very few people will qualify for an inflation adjusted home. TU, EQ, EX quietly stopped releasing their "trends report" that now indicate credit scores are dropping like a rock. They also stopped the retail purchases of data that include 1st month mortgage missed payments to 90 days late (at least to refi vendors). This indicates Q4 lates are surging. Where is the new credit going to come from (and the income to qualify)?
Thats what QE money printing does.. distorts everything and makes a bigger mess. (more voiltility, more bankruptcy, & fraud, More of everything the Fed does best) Bigger and better in the New yr.
Case-Shiller has its problems. It is a wildly over interpreted URBAN (central city) index. The inventory never began to clear at anything close to 2006 prices. Wait for the dead cat bounce.
Not a double dip, a double trip?
This is not a porn site
??????
You have really lost me.
I doubt that it will be over until 1999 prices are reached. 2002 minimum.
Only one thing would change my mind; much higher wages.
Just closed a deal for a residential property in MD owned by Deutsche Bank who was in for over $350k, DB cut it loose for 90K net. I must say i enjoyed that. Smoke if you got'em.
see if you get 90 k off 350k debt, really, why bother...they probably netted 20-40k of 350k debt after paying the lawyers for foreclousure process and paying the realtors cut to sell etc....they could have gone to existing homeowner and said we will sell it to you for 110k if you can get loan from someone else to pay us, and they would have netted 90-100k.
The servicers vs the actual owners of the debt vs. the HELOC debt owners create so many mis-incentives....when really, everyone should just be splitting the differences in lost equity with any substanitially underwater homeowner and only foreclosing when current owner can't pay at all (unemployed, sick etc). Better yet, let bankrupcty judge cram down...you willing to take a bankruptcy because you are underwater, then so be it.
My understanding is regional banks are over-exposed to CRE, while big banks exposed to res real estate...BofA is so toast, toast on fire, all charcoal like
Here is something new about JPM. They just told a client of mine that they are "releasing" a brand new program whereby JPM WILL NOT pursue deficiency judgments. In other words, deals like yours will become much more frequent, even perhaps jingle mail velocity will pick up? I too, am hearing about 25-30% JPM deals, aside from the fact they are much slower than BAC to foreclose (by almost 6 months). Will house prices fall further than the bricks and sticks cost? I'm starting to offer JPM 30% on houses, which is average about 55% percent of the b/s costs. I'm in the GoM Spill area, and many people got a BP check and walked on their mortgage, so this means no deficiency to pay back. Sweet deal. Try to get those returns out of the market.