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Six Month + Delinquent Mortgages Amount To More Than Half Of Bank of America's Market Cap

Tyler Durden's picture


For those curious why many people are scratching their heads how the market cap of Bank of America has nearly doubled in the past year, here it is: "Bank of America Corp. has amassed $64 billion of mortgages that are at least six months delinquent and have yet to enter foreclosure, more than twice the amount held by its four largest competitors combined." $64 billion is more than half the market cap of Bank of America as of this moment. 

This number in the context of the BAC market cap:

In other words, by keeping tens of billions of mortgages off the market, Bank of America is hoping to limit the supply of houses in the market, creating an artificial shortage, in the process pushing up the prices of all other house higher, and only then to start dumping its pre-foreclosure inventory to a witless housing market.

And of course, this number excludes any of the tens of billions of mortgages that are in process of discharge and full write off, as well as the tens of billions in associated Reps and Warranties legal fees, which will go from accrued to paid out status as soon as Bank of America loses the MBIA litigation.

Also, recall "Foreclosure Stuffing" aka the most obvious housing subsidy in the past 4 years? There you have it. And there are those who wonder why we are experiencing merely the fourth dead cat bounce in the housing market.


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Wed, 12/19/2012 - 09:05 | 3078018 GetZeeGold
GetZeeGold's picture's on like donkey kong.

Wed, 12/19/2012 - 09:11 | 3078034 Harrison
Harrison's picture

Or the donkey show. Washington Mutual anyone?

Wed, 12/19/2012 - 09:32 | 3078098 trav777
trav777's picture

how can they call those mortgages worth $64B??  Fantasy marks?  They're probably worth closer to 0.

Wed, 12/19/2012 - 09:43 | 3078122 Pegasus Muse
Pegasus Muse's picture

No wonder BAC Censors banned ZH.  The truth hurts employee morale.

Wed, 12/19/2012 - 10:04 | 3078179 fourchan
fourchan's picture

just imagine how tall that bar would be if mark to market wasnt just a memory.

Wed, 12/19/2012 - 10:09 | 3078216 Life of Illusion
Wed, 12/19/2012 - 11:36 | 3078670 Manthong
Manthong's picture

How do you spell "Bank Fraud"?

Wed, 12/19/2012 - 13:08 | 3079103 strannick
strannick's picture

BAC Employees cant handle the truth

Wed, 12/19/2012 - 10:17 | 3078253 Chief KnocAHoma
Chief KnocAHoma's picture

Well fuck me running!!! I am in the process of trying to handle several short sales for owners with BOA mortgages. The asset managers insist the the properties are worth about 95% of top of the market value.

This ass whelp manager that lives in another area of the country says he has an appraisal that justifies this price. Of course I have recent sales that justify a valuation of around 60% of peak value which he choses to ignore.

I was never one of those bank hating, blame the fed and money changer types until I noticed that these slime balls refuse to accept any blame, refuse to grace the home owner any discount, and will ultimate win by foreclosing, collecting on their CDS, then reselling the home for the value I propose.

Oh and by the way, they are using our fucking money to stay afloat long enough to clear the last scraps from the table.

Bastards all!

Wed, 12/19/2012 - 11:59 | 3078782 Piranhanoia
Piranhanoia's picture

You are being too kind Chief.  Tell us what it is really going down.   Do any of the clients have proof from BoA that the loan exists?  wasn't paid off?,  couldn't be delinquent ever?

Wed, 12/19/2012 - 12:08 | 3078809 Almost Solvent
Almost Solvent's picture

these slime balls refuse to accept any blame, refuse to grace the home owner any discount, and will ultimate win by foreclosing, collecting on their CDS, then reselling the home for the value I propose.

Not that I ever would advise it, but it's hard to resell for much when the interior walls are ripped out along with all the copper. Also, in northern states, this time of year really is not good for pipes with the heat turned off. Finally, no one wants to live in a mold infested home, which tends to happen if the water is left running in every room that has a faucet.

Wed, 12/19/2012 - 12:11 | 3078835 Freddie
Freddie's picture

I talked to a guy in the business the other day.  He said the banks are creating valuations on homes owned that are much higher than comparables.   They are selling homes/mortgages like they sell cars.  Find out what the sucker can pay each month and price the house higher.   So if the real value is $150,000 but they can bundle it so the suckers can pay $1,500 a month and they can sell it for $190,000 then it's a "good" deal.

Wed, 12/19/2012 - 10:13 | 3078237 GMadScientist
GMadScientist's picture

Fantasy Assessment Standards Body


Wed, 12/19/2012 - 10:28 | 3078331 CPL
CPL's picture

Trav777, There's no mark to market anymore remember?  It's been gone for four years on the FAS ruling.


They can do car loans and keep the original retail value as the value now no matter the age of the matter the condition of the matter the condition of real finances.


Even the loss on an equity doesn't need to be shown anymore as long as you have a finance component to your business. It's why all the auto makers are "banks" now.

Wed, 12/19/2012 - 10:29 | 3078333 Chief KnocAHoma
Chief KnocAHoma's picture

But they are backed by CDS and the underlying asset of the home, which is worth maybe 50% of the outstanding loan. 

A true mark to market might push the value of those loans UP in value because these evil fuckers, made loans - secured loans, then bet against them.

Wed, 12/19/2012 - 10:54 | 3078487 The trend is yo...
The trend is your friend's picture

Doesn't even a 20-30% defualt on that size technically make the bank insolvent?  anyone have the numbers?

Wed, 12/19/2012 - 11:47 | 3078717 CPL
CPL's picture

I'll say it again.










SO their losses don't count, that was passed into law four years ago to save the banks.  So not only are the banks holding assets that they'll never sell, they are holding trillions in credit they can never offer, or assets that they can never write down.  until Mark to Market is consider that the deck is already loaded and all prices urrently in the housing market are complete fiction.  Without the govt stepping in you wouldn't be able to give away a picture of a house, let alone a real one right now.


Catch 22 situation.  There is no reality in any housing figures.  What you should be asking is what the real housing inventory is because currently you could put every American family in a mcmansion right now and still have alot of inventory left over even with the bulldozing.

Wed, 12/19/2012 - 09:08 | 3078025 Harrison
Harrison's picture

No wonder they blocked their employees from accessing ZH. :-)

Wed, 12/19/2012 - 09:08 | 3078026 Roandavid
Roandavid's picture

They'd be on to this over there at BoA if only they'd unblock Zero Hedge.

Wed, 12/19/2012 - 09:08 | 3078027 Roandavid
Roandavid's picture

Blast ... second

Wed, 12/19/2012 - 09:10 | 3078031 zilverreiger
zilverreiger's picture

Is your government sleeping? How can they allow this?

Wed, 12/19/2012 - 09:13 | 3078042 EmmittFitzhume
EmmittFitzhume's picture

They are not sleeping, they are complicit

Wed, 12/19/2012 - 10:14 | 3078241 mick_richfield
mick_richfield's picture

Well, the government is doing its job.

It's just not the job that you thought it should be doing.

They aren't working for us anymore.

Democracy and fiat currency cannot long coexist.

If some men are empowered to create money in any amount, they will shortly own 'your' government regardless of its design.

Either that, or they are angels.  And if they are angels they will shortly be replaced by men who are not angels.

Such power, by its mere existence, corrupts all who know of it.

Wed, 12/19/2012 - 09:15 | 3078048 wonderatitall
wonderatitall's picture

obama is the bankers dick tater...question what?

Wed, 12/19/2012 - 09:16 | 3078051 Sheeple Shepard
Sheeple Shepard's picture

DUDE! They're running market.

Wed, 12/19/2012 - 09:58 | 3078166 sessinpo
sessinpo's picture

Agreed, up arrow for you. If zilverzinger had a clue, he would know that the government allowed this with full knowledge. Oh no zilverzinger, another TBTF, we need another bailout. We need more stimulus and more printing.

I can only HOPE zilverzinger was being sarcastic (which he should have noted in his post). Otherwise I have to wonder what it will take to wake some people up. You slap them in the face and they still don't get it.

At some point you have to give up and let them suffer the consequences. What do you tell a person with 2 black eyes? Nothing, you already told them twice.

Wed, 12/19/2012 - 10:35 | 3078349 Sheeple Shepard
Sheeple Shepard's picture

When the student is ready the teacher will appear.

Wed, 12/19/2012 - 11:55 | 3078759 Nobody For President
Nobody For President's picture

Dude! They're ruining the market.


There, fixed it for yah.

Wed, 12/19/2012 - 09:28 | 3078090 unrulian
unrulian's picture

Because they have the drones and Hollow-points

Wed, 12/19/2012 - 09:10 | 3078032 Sheeple Shepard
Sheeple Shepard's picture

That cats definitely going to be a closed casket.

Wed, 12/19/2012 - 09:11 | 3078033 Al Gorerhythm
Al Gorerhythm's picture

Hammer them, Tyler.

Wed, 12/19/2012 - 09:11 | 3078035 pepperspray
pepperspray's picture

I fucking hate Bank of America

Wed, 12/19/2012 - 09:14 | 3078046 HowardBeale
HowardBeale's picture

I Bank-of-America fucking hate.

Wed, 12/19/2012 - 09:26 | 3078078 unrulian
unrulian's picture

Hate Bank of America more i could not

Wed, 12/19/2012 - 09:46 | 3078127 flattrader
flattrader's picture

It will be a pleasure watching them choke to death on these delinquent mortgages as a principal in the whole mortgage origination fraud.

Wed, 12/19/2012 - 10:01 | 3078172 Karlus
Karlus's picture

Gubmint wont let them choke, they need someone to help the voters.

In case you dont know how this story ends, the .gov is going to pay BAC for the service of helping voters. The marketcap is not meaningful

Wed, 12/19/2012 - 09:27 | 3078083 flacon
flacon's picture

That's ok. They fucking hate you (all of us) too. 

Wed, 12/19/2012 - 10:25 | 3078317 1eyedman
1eyedman's picture

i wanna be a money wrencher....   

Wed, 12/19/2012 - 09:12 | 3078041 Nostradamus
Nostradamus's picture

How is this a good business decision by BOA?  They are losing money every month on these homes from borrowers not making their mortgage payments.  Furthermore, there is certainly no shortage of homes on the market in America, and won't be anytime in the next decade or more.  All the big homebuilders are still in business and are building new communities all the time.  BOA stays above water only because of FED intervention in the mortgage market.

Wed, 12/19/2012 - 09:25 | 3078075 Cursive
Cursive's picture


I agree with everything you said, but kinda chuckled when I read, "How is this a good business decision by BOA?"  I mean, in a rational, non-keynesian, non-centrally planned world your question makes sense.  But we are living in non of that.

Wed, 12/19/2012 - 09:27 | 3078076 edb5s
edb5s's picture

A TBTF bank having to worry about making "good" business decisions?  Ha!

Wed, 12/19/2012 - 09:26 | 3078080 edb5s
edb5s's picture

Cursive beat me to it...

Wed, 12/19/2012 - 10:42 | 3078401 Shell Game
Shell Game's picture

Cute, wasn't it?


In many BOA toilet stalls, there eminates the glow of smart phone screens (yes,a stench eminates too), 


and the murmur:



'fuck me.....'

Wed, 12/19/2012 - 10:00 | 3078167 Diplodicus Rex
Diplodicus Rex's picture

"They are losing money every month on these homes from borrowers not making their mortgage payments."


That's not how I understand it. First of all we don't know how much BoA paid for them. It likely paid pennies in the pound for them. Secondly, the loan servicers are currently taking the hit for the non-payment of mortgage premiums. They are chosing to do this because admitting to the food chain higher up that they are delinquent would set off a chain of events which would end very badly for them. Therefore, the servicers are still providing the originators or the MBS holders with monthly income even although the house owners have stopped paying. This may not be as bad a deal for BoA as it first looks. That is, until the tsunami hits. Then they will attain their true value. Zero. Until then they are picking up pennies in front of the steam roller as the saying goes.

Wed, 12/19/2012 - 09:13 | 3078043 mckee
mckee's picture

You couldn't make this shit up!

Wed, 12/19/2012 - 10:03 | 3078176 sessinpo
sessinpo's picture

Yes you could.

You have to graduate from an Ivy League school and get an MBA (Making Bullshit Allowed) in finance.

Wed, 12/19/2012 - 09:13 | 3078044 LongSoupLine
LongSoupLine's picture

Fuck Bank of America.

Break it the fuck up and burn it, crush it and send that crooked fucking piece of shit wealth stealing company through the fucking wood chipper.

Fuck you BOA.

Wed, 12/19/2012 - 09:23 | 3078070 cossack55
cossack55's picture

Can't. when the bitch Blythe invented/marketed derivitives all the big boyz signed on and overflowed to use as extortion tool to block any rule of law shit from hitting them.  "Don't prosecute or else we collapse the economy"

Paging Mr. Hitler.

Wed, 12/19/2012 - 09:13 | 3078045 earnulf
earnulf's picture

BofA recently sold all it's area operations to Arvest Bank (Sw Missouri).   Guess the Walton Clan has more money than BofA.   Wonder if all those homes in this area will now foreclose?

Wed, 12/19/2012 - 09:15 | 3078049 EmmittFitzhume
EmmittFitzhume's picture

Can't Bernanke just send a month's worth of QE their way and wipe it all out?

Wed, 12/19/2012 - 09:16 | 3078050 Fantasy Planet
Fantasy Planet's picture

Dead cats do bounce.  Try it at home. 

Wed, 12/19/2012 - 09:16 | 3078052 Misean
Misean's picture

Didn't they hear that the Feral Reserve is buying that shite at par?

Or mebe they did...

Wed, 12/19/2012 - 09:32 | 3078096 Winston Churchill
Winston Churchill's picture

The other reason for the fraudclosure slowdown may be the servicer banks

needing the time to re organise the shambles that is the RMBS trusts.

90 % of the trust assets are fiction.How do you foreclose on a property where ten trusts

hold thesame Notes on their books ?

As expected the banks are ignoring the OCC ban on robosigning.

Wed, 12/19/2012 - 09:52 | 3078151 flattrader
flattrader's picture

Santelli says it's all the fault of the "loosers" who took out the mortgages.

He conveniently ignored the years of fraud at the origination level and securitization level.

Hell, it was so rampant and blatant that the FBI even put out a warning in 2004 that was then ignored.

Yep, Rick you asshole, it's all the fault of the homeowner that the economy crashed.

Wed, 12/19/2012 - 09:16 | 3078056 booboo
booboo's picture

Don't know if anyone else has noticed but their employees exude a palpaple fear that can only be described as sitting on death row. A recognition of defeat, despair and general hopelessness. Really sad. They know they are sailing a one way ticket  garbage scow. 

Wed, 12/19/2012 - 09:44 | 3078123 CrimsonAvenger
CrimsonAvenger's picture

LOTS of layoffs happening, done cleverly so as to avoid notice by the press.

Wed, 12/19/2012 - 11:59 | 3078780 Omen IV
Omen IV's picture

whats also interesting about the employees is that they cant find anything - files are missing???

at some level the docs are being lost to preserve jobs and avoid fraud charges i think - everything is so fucked up its amazing going to court with BoA

Wed, 12/19/2012 - 09:16 | 3078058 knowless
knowless's picture

they can just sell them to the fed though right? like zero risk,,

Wed, 12/19/2012 - 09:18 | 3078059 ivana
ivana's picture

fuckin zombies kept artificially alive to fulfil strategic evil agenda .... at same time bastards can trigger collapse of any zombie any time and just reset criminal fiat system again ... to have it running for another few years ... to blackmail each of us and suck our blood at same time ... via totally corrupt and broken "democracy"

Wed, 12/19/2012 - 09:24 | 3078072 fonzannoon
fonzannoon's picture

they hold my note. i may stop paying just to see if i can be the straw to break their back

Wed, 12/19/2012 - 10:22 | 3078296 1eyedman
1eyedman's picture

their uncle prints money....does yours?

Wed, 12/19/2012 - 09:27 | 3078077 williambanzai7
williambanzai7's picture

Zombie Dance Party Girls? Where have I heard that?

Wed, 12/19/2012 - 09:28 | 3078086 put_peter
put_peter's picture

Underwater mortgages for dividend? And the world is saved!!!

Wed, 12/19/2012 - 09:28 | 3078088 chunga
chunga's picture


"If I could file 60 million lawsuits I would."

Wed, 12/19/2012 - 09:30 | 3078093 FubarNation
FubarNation's picture

As Misean pointed out above why not?  They will get a free pass. 


Probably bought up those shitty Morts on the cheap and will cash out for par (or even a premium if they get to do a gov't supported refi on them).


Brilliant BOFA strategy - unfortunately to be paid by you and me.

Wed, 12/19/2012 - 11:54 | 3078752 Winston Churchill
Winston Churchill's picture

You misunderstand the dynamics here.

BofA is the servicer of the Note/mortgages held by REMIC trusts.

They must pay the contractual  income stream to the trust regardless of whether

the borrower is paying them.

Therefore no Note is in default at anytime, and can not be foreclosed on anyway.

No default=No foreclosure.

Now multiply that problem tenfold,each Note was sold on average to ten different trusts.

The puchase money from those 'sales' to the trusts is sitting offshore(Caymans etc).

Ten times the income stream is going out to those trusts.

The servicers are slowly bleeding to death.,

Wed, 12/19/2012 - 09:43 | 3078119 Payne
Payne's picture

it is also Chase bank.

Wed, 12/19/2012 - 09:57 | 3078159 pazmaker
pazmaker's picture

My wife's ex-husband hasn't paid his mortgage for 26 months and his mortgage is with BOFA, they haven't foreclosed on him yet and he isn't in the modification process....go figure!

Wed, 12/19/2012 - 10:06 | 3078187 gwar5
gwar5's picture


Wed, 12/19/2012 - 11:38 | 3078680 flattrader
flattrader's picture

Which state is he in?

Wed, 12/19/2012 - 11:50 | 3078742 pazmaker
pazmaker's picture


Wed, 12/19/2012 - 09:57 | 3078162 ThisIsBob
ThisIsBob's picture

If BOA can't read Zero Hedge, how are they ever going to find out about this?

Wed, 12/19/2012 - 10:05 | 3078180 gwar5
gwar5's picture

Day don't.

Wed, 12/19/2012 - 10:00 | 3078168 lordbyroniv
lordbyroniv's picture

My cunt sister in law hasnt made a payment on her 3 bedroom house which she obtained with 106% financing and $5000 5 years.  


Mortgage is held by BOA.


Anyone buying real estate is a fool.


There is no integrity in the market....


and it appears people like me are suckers because I have to pay to rent each month.



Wed, 12/19/2012 - 11:40 | 3078690 flattrader
flattrader's picture

Which state is your sister-in-law in?

BOA's handling of foreclousres varies from state to state so I hear.

Wed, 12/19/2012 - 10:02 | 3078173 pauhana
pauhana's picture

I have been waiting for the banks to fess up on this issue.  In every town in America, you can find lots of derelict houses but when you put the address in Zillow, they are "not for sale."  Many have been in this state of neglect for 3 to 5 years!   If the bank never start the foreclosure proceedings, they can continue with the fiction of a performing loan, even if there have been no payments for years.  How we can say our banks are "fixed" is beyond me.

Wed, 12/19/2012 - 10:08 | 3078211 flattrader
flattrader's picture

I've had that experience myself looking at property.  You have to contact a realtor to get the story.  Some of the small local guys and gals know the details and the backstory on local properties and what the bank may accept.

Just low-ball the fuckers and you might get lucky and hit the jackpot.  Pay cash.  Make sure you get good paper on it.

Wed, 12/19/2012 - 10:20 | 3078282 1eyedman
1eyedman's picture

laws need to be changed on a county level.   like if a property is in disrepair or vacant for X time, or delinquent in taxes or hoa dues for X time, the county seizes it, sells is and pays off taxes/hoa then the current mortgage holder as paid in full".    same idea on foreclosure 'sales'....change county law so that the sale must be arms length.  the buyer cannot be the one foreclosed upon, an auction is an auction.   if they foreclose and just take title fine...but this 'auction' charade  smells like tax/fdic loopholes to me

Wed, 12/19/2012 - 10:04 | 3078178 monopoly
monopoly's picture

Truly beyond words. How can markets be so stupid to think this is all going to work out OK> And they sell gold, silver. Well, let them ramp up AMZN to 260 on 0 earnings and a stated loss for this quarter. I will not go there. 

Recovery, what recovery, not in my state. And how many employees is BAC laying off? Thousands. Great bank. What a piece of shit.

Wed, 12/19/2012 - 10:34 | 3078350 Village Smithy
Village Smithy's picture

Just like the Titanic the markets have 2 classes of passengers. The ones who have ridden this thing from the day they got the nod and who will have instant access to the lifeboats. The other class...well you know the story.

Wed, 12/19/2012 - 10:06 | 3078185 ISEEIT
ISEEIT's picture

Wow...Just wait till Lizzahauntus Warren finds out about this...She'll teach 'em!

Wed, 12/19/2012 - 10:11 | 3078232 Smuckers
Smuckers's picture

Maybe BAC should be blocking public website access to their mortgage applications.

Wed, 12/19/2012 - 10:12 | 3078233 1eyedman
1eyedman's picture

sounds like a good time to do a stock buy back, like MS.     C and MS rocket up....smells like a new valuation approach to their 'joint venture'.  

also sounds like fan and fred should make eligible for their purchase, all the currently 'private' paper out there, thereby guanunteeing it with your tax dollars, and making it all eligible for purchase by the fed....problem solved.

Wed, 12/19/2012 - 10:20 | 3078242 gwar5
gwar5's picture

Good thing FDIC is solvent enough to cover all $64 Billion without breaking a sweat or there could be media censorship and a run on a big bank.  It's purely coincidence there is talk of banning assault rifles going on right now.

Wed, 12/19/2012 - 10:14 | 3078243 vote_libertaria...
vote_libertarian_party's picture

$64B in loans.  Amount written down already???   Probably 0.


Probability we...China...Ben will bail them out again...100%

Wed, 12/19/2012 - 10:16 | 3078248 GMadScientist
GMadScientist's picture

The Bank of Lynching America...spread em CountryWide!

Wed, 12/19/2012 - 10:19 | 3078266 shovelhead
shovelhead's picture

45 Billion a month and no free toasters.

BoA sucks. Hard.

If I didn't know better, I'd think this might be a criminal act.

Good thing the Govt. wouldn't allow that to happen.

Wed, 12/19/2012 - 10:21 | 3078280 americanspirit
americanspirit's picture

There you go again ZH - being dangerous to B of A's business. When will you guys ever learn - this is the Bank of America fer chrissakes! America - get it? Anything they do, they for the good of America. No wonder their employees are banned from reading ZH. Wouldn't want to distract them from doing their patriotic job.

Wed, 12/19/2012 - 10:25 | 3078316 Bay of Pigs
Bay of Pigs's picture

This is the question I asked yesterday when Whitney went long. Has she lost her marbles or did she just say "fuck it" and realized shorting anyting in this Ponzi bullshit market doesn't work anymore?

Thx again ZH.

Wed, 12/19/2012 - 10:39 | 3078381 surf0766
surf0766's picture

She missing being able to talk and watch markets move. So she got in line and now has no street cred.

Wed, 12/19/2012 - 10:27 | 3078326 1eyedman
1eyedman's picture

time for everyone to do thier part:

Wed, 12/19/2012 - 10:27 | 3078327 game theory
game theory's picture

No way is this going to play out with a hit to any bank. No way.  Just watch the gov't introduce a mortgage forgiveness plan in be followed by a cleansing of all student debt.  Once the politicians and fed started rewriting the rules of the game, there is no need for them to stop with just free money for banker bonuses, AIG execs, and GM managers.  Our gov't is going to go "all in" with their free money until they magically break the inflation/unemployment conundrum. But they are piling the dynamite higher and higher. I pray Volcker outlives Dimon because the US is really in for something truly epic...perhaps even Zimbabwean. 

Wed, 12/19/2012 - 10:32 | 3078342 SillySalesmanQu...
SillySalesmanQuestion's picture

Bank of rehypothecating assets...those mortgages are really worth 640 billion or even 6.4  trillion on a good day! <sarc on>

Wed, 12/19/2012 - 10:43 | 3078344 Jumbotron
Jumbotron's picture

Watch out Tyler.....BAC blocks your site now from its employees......tomorrow....they hire off shore "contractors" to pay you a little visit.


Only semi-joking........(cough...cough..."The International"....cough cough...)


And this scene from the Miami Vice episode"Prodigal Son"....



Wed, 12/19/2012 - 10:37 | 3078365 mendolover
mendolover's picture

It would all be so delicious if it weren't so scary.

Wed, 12/19/2012 - 10:59 | 3078375 forwardho
forwardho's picture

Oh, very well done.

Now we see causus belli for ZH being banned on BOA servers.

The "TRUTH" is a very, very dangerous proposition for those who's life depends on the perpetuation of a lie.

Wed, 12/19/2012 - 10:39 | 3078387 Withdrawn Sanction
Withdrawn Sanction's picture

Just to put it in perspective, at $64B, that's roughly 1/3 of BofA's capital ($180B, 2Q12).  Yes, yes, not all the loans will sour, and even those that do will not incur losses = 100 cents on the dollar.  Still it is nice to know, esp since the market (or what's left of it) evidently sees through BofA's "bookkeeping" ledgerdermain by trading them at a discount to book (i.e., $120B mkt cap vs $180B book capital...captial inflated by mark to whatever) .  The difference most likely attributable to losses yet to be recognized.

Wed, 12/19/2012 - 11:10 | 3078580 AynRandFan
AynRandFan's picture

Makes you wonder how BAC can show profitability and support a P/E over 30 when 1/3 of its book value is tied up in illiquid, money-losing assets. That's got to be some creative accounting.

Wed, 12/19/2012 - 15:57 | 3079935 batterycharged
batterycharged's picture

You have to realize that a property without tax paying residents actually COSTS MONEY to BoA.

All those foreclosures need to be paying property taxes or they will indeed lose 100 cents on the dollar when the city takes the property.

It's not like money sitting in a money market at 0%.



Wed, 12/19/2012 - 10:42 | 3078398 orangegeek
orangegeek's picture

Actually this story isn't real.   It doesn't exist.


BOA has blocked ZH's website from access by their staff.  Stupid fkrs.

Wed, 12/19/2012 - 10:57 | 3078424 Payne
Payne's picture


Wed, 12/19/2012 - 10:52 | 3078463 rockraider3
rockraider3's picture

Next website to be blocked at BofA: Bloomberg.

Wed, 12/19/2012 - 10:56 | 3078498 Payne
Payne's picture

Midwest Bank has a 50% default rate on 1-4 Family units with $2 Billion in default

Wells Fargo $35 Billion in default

Chase $28 Billion

B of A is the winner at $58 Billion


the total number in default has not changed by much since 2009 $178 Billion in default with banks that report to the FDIC.

Wed, 12/19/2012 - 11:04 | 3078548 Payne
Payne's picture

What is the deal with Metlife Bank out of New Jersey  they have had an increase in defaults in the last 2 quarters from 10% to 83%.  Cannot blame it on Sandy, yet.

Wed, 12/19/2012 - 11:06 | 3078554 AynRandFan
AynRandFan's picture

I am always looking to buy real estate through short sales, but I won't look at another BAC property after sitting for over a year waiting for a decision.  They should change the ticker symbol to FUBAR.

Wed, 12/19/2012 - 11:06 | 3078562 Atlantis Consigliore
Atlantis Consigliore's picture

$ 58 B? Pee nuts;  flip em all the DA FED hedge fund, theiry printing $ 85 Billion counterfeit a month

  hold 1 million homes all foreclosed and performing, LOL

along with the $ 1 Trillion in studen loans 15% defaulted.


along with 1 million unsold cars by guvie em out as Obamaphones....

Wed, 12/19/2012 - 11:39 | 3078684 GittyUP
GittyUP's picture

$64B in mortgages is only about 450,000 houses nationwide using $150,000 avg house price.    Considering they prob picked these mortgages up at huge discounts and will end up making money when letting the mortgages go through short sale.  not much to see here.

Wed, 12/19/2012 - 12:00 | 3078743 Seasmoke
Seasmoke's picture


Fraud by BOA, at almost every page i turn with these criminals......Starting with the very first documents signed at closing

Wed, 12/19/2012 - 11:57 | 3078770 Herkimer Jerkimer
Herkimer Jerkimer's picture





Isn't the FED going to be buying up bad mortgages from the banks with that 40 billion every month and giving them to FM and FM? What does BoA care? The risk/reward chain is broken when you're TBTF.




Wed, 12/19/2012 - 12:05 | 3078805 Element
Element's picture

sssscchhhhh!!  you aren't supposed to know about that!

Wed, 12/19/2012 - 14:05 | 3079415 Logiclee03
Logiclee03's picture

are you aware that BAC has 39 billion in reserves already set aside that has already been written down.  Next I would ask what is the loss assuming the real estate is worth 40% less?  That would be a 26 billion dollar loss……That would be about 20% of current book value.  So if we assume that loss occurred, that would put BAC book around 11.20$.  Exactly where the stock is trading…hmmmmmmmmmmm…

Wed, 12/19/2012 - 15:24 | 3079781 batterycharged
batterycharged's picture

"tens of billions of mortgages"

I think u mis-typed a letter there haus.


This makes total sense. You try to find a cheap home thinking the market is flush with despereate home owners needing to sell and NADA.

My street alone has 5 of 12 houses in foreclosure or owned by the city. And only one is for sale.

BofA is the definition of Walking Dead.

Wed, 12/19/2012 - 16:43 | 3080083 Catflappo
Catflappo's picture

Another non-existent 'exit strategy'

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