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The Housing Recovery Myth In New York And New Jersey Ends With A Bang As Foreclosures Surge

Tyler Durden's picture




 

It was about a year ago when we noted a core component of the US housing non-recovery: the time to sell foreclosed homes had just hit a record of 400 days across the nation. We showed the following chart from RealtyTrac confirming just this:

 

We also proceeded to highlight some thoughts from a real housing expert, not a made for financial comedy TV "housing guru", in this case Marc Hanson, who pointed out the Bottom line on the Zombie housing market:

Of the 54 million homeowners with mortgages -- the primary repeat buyer cohort and a primary builder demand cohort -- over 22 million are dead to the housing market. Of the 70 million homeowners -- mortgage'd and free and clear -- 33 million are Zombies. Thus, we can't expect housing to act like it has in the past. With so many Zombies it will be impossible for repeat and new home sales to perform as expected. The past 18 month bounce -- especially on prices -- has been on cheap and easy money from investors looking for a dividend stock and/or Treasury replacement trade. some foreigners following their lead, and finally the 'dumb money' (retail) chasing into this summer.

 

But we are running out of greater fools very quickly, especially with first-timers sidelined and new-era "investors" who are quickly pricing themselves out of markets nationwide.

(More can be read in the original article).

Fast forward to today when even the last traces of the lie that sustained the housing recovery myth are being swept away, and we get the following article from Bloomberg titled "Foreclosures Surging in New York-New Jersey Market." The punchline is quite clear but below, for those who are new to this story, are the key supporting points:

The epicenter of the U.S. foreclosure crisis is shifting to New Jersey and New York, threatening a housing rebound in one of the country’s most densely populated areas.

 

New Jersey has surpassed Florida in having the highest share of residential mortgages that are seriously delinquent or in foreclosure, with New York third, a Mortgage Bankers Association report showed last week. By contrast, hard-hit areas such as Arizona and California have some of the lowest levels of soured loans after allowing banks to quickly foreclose after the 2007 property crash.

 

The number of New York and New Jersey homeowners losing their houses reached a three-year high in 2013. Banks in these states have been slowly working through a backlog of delinquent loans that enabled borrowers to skip mortgage payments for years. Now these properties are poised to empty onto a market where affluent Manhattan suburbs neighbor blighted towns that are struggling most with surging defaults.

The good news (according to some): thousands of people could live mortgage free for years until the bank delays obtaining the keys to the foreclosed property. This was money which instead of going to the mortgage owner, would instead go to buy Made in China trinkets and gizmos and otherwise keep the US retail party humming. Specifically, as we observed long ago in March of 2011, the benefit to the US economy from "deadbeat squatters" was about $50 billion per year. Which brings us to the bad news: the party - retail and otherwise - is ending, as courts and banks finally catch up with inventory levels on both sides of the foreclosure pipeline, and those who lived for years without spending a dollar for the roof above their head are suddenly forced to move out and allocated the major portion of their disposable income toward rent.

Lenders in New Jersey are pushing cases through more quickly and it now takes about two months to process final judgments against delinquent homeowners, compared with a backup of nine months a few years ago, said Kevin Wolfe, assistant director of the Civil Practice Division in the Administrative Office of the Courts.

 

The Office of Foreclosure, which reviews case files before they can move to the final step of sheriff sale, has added four permanent staff members, six law clerks and 10 case analysts since 2012. It previously had seven employees.

 

“We are staffed up to move these cases faster,” Wolfe said. “But the other reason cases are moving more quickly is that lenders have improved their foreclosure practices and worked out logistics with their law firms and, as a result, they’re geared up to handle foreclosures more efficiently.”

Which means that as the inventory bottleneck suddenly unclogs and thousands of new properties hit the market with an urgency to sell before anyone else does, things in New York and especially New Jersey are about to go from bad to worse.

“It is really a delayed reaction in New Jersey and New York,” said Michael Fratantoni, chief economist for the Mortgage Bankers Association in Washington. “Loans that were made pre-crisis have been in this state of suspended animation for a number of years. And now, we are beginning to see the pace of resolution pick up.”

 

In January, the number of New York foreclosure auctions reached 527, the highest monthly level since October 2010, according to data firm RealtyTrac. Foreclosure filings in New York City increased 30 percent to 15,993 in 2013, a three-year high, according to RealtyTrac.

 

Almost 10,000 cases in New Jersey headed to a sheriff sale in 2013, 47 percent more than the year before and the highest level since 2009, according to the New Jersey Administrative Office of the courts. Across the country, repossessions fell 31 percent in 2013 to the lowest since 2007, according to RealtyTrac.

The implication is that prices - already suffering in these two core states - are about to go far, far lower:

The real estate markets in New York and New Jersey are trailing the rest of the country as a result. Prices in New Jersey, the most densely populated state, climbed 2.9 percent in the fourth quarter from a year earlier, compared with a 7.7 percent jump for the U.S, the Federal Housing Finance Agency said yesterday. New York values rose 3.7 percent.

 

“Price increases that are occurring in the rest of the country are not likely to happen in the New York-New Jersey area, with the potential inventory that can come at any time,” said Lawrence Yun, chief economist of the National Association of Realtors.

 

“When one sees a price increase in Phoenix or many other parts of the country, one can assume it’s a genuine increase from falling inventory,” he said. “If it happens in Edison, New Jersey, or Long Island, New York, one has to ask, ’Is this for real or just temporary?”

Actually, Larry, when one sees price increase in Phoenix i) one will be wrong as prices in Phoenix just posted their first monthly decline since 2011, and ii) nobody can assume anything is genuine in a housing market in which mortgage origination just dropped to a 19 year low, meaning only those with abundant cash and no regard for cost can continue buying.

Everyone else is about to get a very harsh lesson in what it means to have been lied to by the propaganda machine for years, and suddenly have nothing to show for it but some vastly overpriced real estate.

 

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Wed, 02/26/2014 - 15:31 | 4481310 RafterManFMJ
RafterManFMJ's picture

Any article that has New Jersey in it automatically pegs the guaranteed fraud meter at 11.

Wed, 02/26/2014 - 15:51 | 4481369 BKbroiler
BKbroiler's picture

Manhattan home prices are up a third since last year.  Below 14th street its almost 50%.  NYC is booming.  See for yourself, big infographic at the bottom of the page at streeteasy.com. 

Inventory in all of nyc is so low it's ridiculous.  Brooklyn is exploding. I found a fixer upper for 100K cash in sunset park a year ago and now there's nothing there below 280K, and only 3 below 400K.  Total.  In Greenpoint there's nothing below 600k.  Madness

Wed, 02/26/2014 - 15:57 | 4481450 cynicalskeptic
cynicalskeptic's picture

A LOT of foreign capital is looking for 'safe havens' and finding it in US (esp NYC) real estate.......

 this does not apply to just the top end - you've got foreign money looking to invest in NYC rental properties too - lots of buying in gentrified Brooklyn

Wed, 02/26/2014 - 16:14 | 4481482 TruthInSunshine
TruthInSunshine's picture

More foreign money will get blowtorched in the current bubble (and there is a massive price bubble, regardless of whatever artificially manipulated inventory levels are) than during the last one (2000 to 2007), which was mainly domestic fiat getting torched (except in truly international cities such as Miami, New York, Boston, San Francisco, etc., all on or near the coasts).

Retirees with cash are one of the few classes of people that are genuine buy & hold groups right now, and they're overpaying dramatically due to artificially suppressed inventories of housing stock (shadow inventory is massive and still rotting on TBTFs and GSEs books).

Take away the 3.5% FHA down payment program (look it up - 87% of homebuyers are tapping this right now) and see what happens to the housing "boom."  If buyers had to come up with even 10% down, housing sales would be cut by 1/2 (there was a time when it was NORMAL to have 20% down mortgages, bitchez).

The debt serfs living paycheck to paycheck are about to be sold into abject slavery.

Wed, 02/26/2014 - 18:40 | 4482316 ChanceIs
ChanceIs's picture

Hey!!!!  Remember the late '80s when the world thought that the Japanese had (re)invented capitalism!?!?!  They owned half of Manhattan and 3/4 of Hawaii.  (I can't recall whether they paid cash or got (junk) financing from Mike Milken.)  They don't own Manhattan anymore.  Somehow I think the new owners of NYC are going to be in place for a while.  But then there is the Bolshevek de Blassio factor.  I think in the end that Comrade de Blasio will take orders from the 100% cash owners and they will play as if they are put out because their streets aren't shoveled as the masses will be satisfied.

Wed, 02/26/2014 - 18:47 | 4482350 BKbroiler
BKbroiler's picture

Somehow I think the new owners of NYC are going to be in place for a while

Meet the new boss, same as the old boss.  Here's a hint: It's not you but it rhymes with it.

Wed, 02/26/2014 - 22:39 | 4483175 ChanceIs
ChanceIs's picture

Hmmmmmmm........

>>>Meet the new boss, same as the old boss.<<<

Hillary doesn't rhyme with "you."

Jeb doesn't rhyme with "you."

Egon Spengler (RIP) doesn't rhyme with "you."  Nor does Sta Puft

Just what are you on about????

Oh.  Roger Daltrey doesn't rhyme with "you."  But (The) Who rhymes with "you."

Wed, 02/26/2014 - 16:01 | 4481461 ParkAveFlasher
ParkAveFlasher's picture

Fixer upper for $100k in cash, in Sunset PArk?  Are you SATAN?  $600k in Greenpoint does NOT buy you a lot, although MAYBE a 1 bedroom condo...

Wed, 02/26/2014 - 16:22 | 4481527 BKbroiler
BKbroiler's picture

Are you SATAN?  

A lot of ZH'rs think so, but no, I just suffered through the rigourous co-op approval process to get it, which is similar to an enema of your financial and personal life.  Old co-ops still occasionally yield a gem.

There are still some neighborhoods less than an hour from midtown where you can find 1br's in the 100-150K range like Briarwood.  Only 3 stops before Jamaica ave but much less gunfire.

Wed, 02/26/2014 - 17:41 | 4482068 ParkAveFlasher
ParkAveFlasher's picture

Ah I see now, BKB.  My next question would be, how do you fix up a co-op?  Seriously ... I feel like it defeats its own purpose.  And when I said "a lot", I meant an actual lot, with boundaries and so forth.  Which means I am reinforcing your comment ... one wonders how long this thing can go on in the "inner outers".

Wed, 02/26/2014 - 18:41 | 4482317 BKbroiler
BKbroiler's picture

I just sanded and polyurethane'd the original floors, scraped everything else down to the cement.  The original floors and moldings are all keepers.  These old buildings are a hundred years old and rock solid, my walls are 2 feet thick.

Greenpoint has gone crazy, I think it was that "gilrs" show that did it.  My parents bought a place in Greenpoint for 450K in '06 that is now worth around 750K.  These are apartments that were selling for 100-200K a decade before.  The old polish folks that bought in the 60s and 70's for around 40K cashed out pretty well and moved to Forest Hills.  Good for them.

Wed, 02/26/2014 - 16:04 | 4481486 johnQpublic
johnQpublic's picture

in process of selling my home in northern DE

bought it out of foreclosure dec 007, 20k under market value

put in 75k+

to sell, i had to sell 20k under market value, losing about a 100k

inspection was today

went well

get me the fuck outa here

house at the end of the street is vacant 9-10 months now

it last sold for 455k

it has been in forecosure process since we bought this house

it appeared to me that before she left she took everything, from the cabines to the toilets, and smashed them up and filled a 30 yd dumpster

Wed, 02/26/2014 - 16:13 | 4481533 DavrosoftheDaleks
DavrosoftheDaleks's picture

DE sure misses the ol' MBNA.

Wed, 02/26/2014 - 15:31 | 4481313 ArkansasAngie
ArkansasAngie's picture

Economic value.

Liquidity doesn't solve insolvency.

I am tired of paying the price for other people's fraud and stupidity

Wed, 02/26/2014 - 15:39 | 4481344 DoChenRollingBearing
DoChenRollingBearing's picture

Well, I too am tired of paying for other people's fraud and stupidity.  But, that is a trend that will continue, bet on it.

Real estate is risky and non-liquid, and a big yes to your comment re liquidity & insolvency.

Wed, 02/26/2014 - 16:13 | 4481415 livid levity
livid levity's picture

ceramics ftw...

Wed, 02/26/2014 - 15:38 | 4481338 nantucket
nantucket's picture

tell me about it, my parents bought a 15 year old house in barnegat NJ back in 2005 for $229k, improved it quite a bit (interior, landscaping, etc), can't sell it for $179k.  It's in a very nice neighborhood just 5 miles from the shore.  It was on market for 6 months without a single offer at $179.  They got in a renter last October.  The renter paid the first three months than stopped paying.  The renter basically said eff you, try to evict me, it'll take months.

 

that's just one anecdote.  but it's their reality.

Wed, 02/26/2014 - 15:41 | 4481355 failure to perform
failure to perform's picture

my heart goes out to your folks.

Wed, 02/26/2014 - 16:07 | 4481504 game theory
game theory's picture

NJ...it is the east coast epicenter of public employee fraud...with inflated pensions and overtime pay breaking budgets everywhere. To go live there now is to be signing up to pay ever-increasing taxes to pay those public employees. I hope your parents can evict the freeloader and sell. 

Wed, 02/26/2014 - 16:20 | 4481577 ArkansasAngie
ArkansasAngie's picture

Take the exterior doors off.  They are in obvious need of repairs.  Let'em sue you.

Wed, 02/26/2014 - 16:53 | 4481773 Frostfan1
Frostfan1's picture

A lot of people in Jersey don't rent out their places because they know all the laws are rigged against them.

Wed, 02/26/2014 - 15:39 | 4481340 youngman
youngman's picture

On CNBC all they have been saying all day is the inventory shortage is to blame ....so this should open up some new inventory...but it will all go to Blackrock in some backroom deal...

Wed, 02/26/2014 - 15:41 | 4481347 Ness.
Ness.'s picture

My neighbor, while going thru a divorce, decided to stop paying his mortgage just to save some money and see how long it would take for him to get escorted out of the house.

After two full years, and saving nearly $60,000, he contacted the bank and said he was going to move.

They offered him a deal. Just start making the payments and they would forgive him the past two years without penalty.  All he had to do was send the next month's payment and they would consider him up-to-date on the mortgage.

He removed all of the cabinets, copper, appliances, countertops - sold it to a contruction crew, and told bank to fuck off.

 

 

Wed, 02/26/2014 - 15:46 | 4481392 replaceme
replaceme's picture

I read those stories, and I end up thinking "Oh, so he was a thief and or a scumbag".  The banks will get theirs one way or the other, he said fuck off to everyone else.  Fuck him,  Maybe he can buy steal a sawz all and go cut copper out of other houses, too.  

Wed, 02/26/2014 - 15:58 | 4481453 Seasmoke
Seasmoke's picture

Wrong. Wrong and wrong. You should pay attention at ZH a little more. 

Wed, 02/26/2014 - 16:06 | 4481494 replaceme
replaceme's picture

He stopped paying because he wanted to, and then to be more of a prick, he stole whatever he could?  Yea, he's a real Robin Hood.  A dozen of his neighbors that bought houses they maybe like, at a reasonable price, they're probably stuck with, get to live by his mess, watch their property value drop a little more.  Yay him.  

Just because bankers are scumbags doesn't let him off the hook - honestly, why doesn't he go up and down the block and steal copper?  The meth crowd does it all the time, he'd fit right in. 

Wed, 02/26/2014 - 16:14 | 4481540 Ness.
Ness.'s picture

I didn't say he wasn't a prick.  Hey, I still had to make my payments every month.  If I didn't live next to this fucker I wouldn't have believed it myself.  He was flying all over the country meeting women he'd met on match.com with the "extra" money he saved.  My point was that the housing situation is much worse than we're being told and banks are sitting on ALOT of houses. They're allowing people to stay for free to maintain the homes or they would simply start falling apart. 

Wed, 02/26/2014 - 16:26 | 4481592 TruthInSunshine
TruthInSunshine's picture

Few will believe me, and that's okay, but I PERSONALLY know (i.e. know that what I'm writing is true) an individual who defaulted on a 1.8 million dollar mortgage bearing house from BankOfMerrill in 2006, made no payments for 5 years, disregarded every notice of delinquency, etc. they sent him, and then was allowed out of the house with no deficiency when his good friend agreed to buy the house on a short sale for 580k in March of 2011, who sold him his house back for that amount.

So, he lived mortgage free in a 1.8 million marked house from 2006 to 2011 (he paid the utilities & I think the taxes), then bought it for 70% off in 2011.

Bitchez.

Wed, 02/26/2014 - 16:36 | 4481673 replaceme
replaceme's picture

Sorry, I didn't mean to imply anything about you - I just saw that happen a lot in the historical district we used to live in, really got under my skin.   All the neighbors that took care of their places, paid their bills, etc had to watch those empty houses decay (and in some cases, burn).  It really crushes the spirit of a neighborhood.

Wed, 02/26/2014 - 16:44 | 4481720 TruthInSunshine
TruthInSunshine's picture

No, I prefaced my comment like that because I've had experiences where people just don't believe it to be possible, not because of anything you wrote.

I think honest people, generally speaking, become morally outraged when they hear anectdotes like that (that are actually more common than many are willing to believe), both at BankOfMerrill AND the guy who defaulted without paying his mortgage for 5 years only to buy his house back from a straw buyer for 70% off.

Wed, 02/26/2014 - 16:00 | 4481466 cynicalskeptic
cynicalskeptic's picture

and fuck all your neighbors stuck living next to the mess you've left behind.....   if your philosophy is 'Every man for himself' you're going to find it VERY lonely when you NEED help from others.......

Wed, 02/26/2014 - 15:50 | 4481410 Seasmoke
Seasmoke's picture

Nice. I often wonder why anyone would leave their house to the bank with anything standing except 4 walls and a roof. STRIP THAT OVERPRICED BOX TO THE BONES !!!......Fuck you Jamie. Fuck You John. Fuck You Brian..AND FUCK YOU LLOYD. 

Wed, 02/26/2014 - 16:17 | 4481556 InflammatoryResponse
InflammatoryResponse's picture

better not let your neighbors know where you moved to.  you might end up with some difficulties of your own.

 

Wed, 02/26/2014 - 18:58 | 4482390 Au Shucks
Au Shucks's picture

I often wonder why anyone would leave their house to the bank with anything standing except 4 walls and a roof.

 

Simple, they offer the soon-to-be-foreclosed person a fat check... upwards of $4k to clean the place out and give them the keys.  For most people, an easy 4 grand is a better alternative to stripping and selling the individual components of value.  So they comply, bank takes a small hit to get the house in good shape, and more than makes up for it on the resale in most cases.

All good until the 1099-A hits their mailbox the following January and they realize they have to pay back over 25% of it as if it were income!  Whereas they wouldn't have paid a penny to the war machine on whatever they kept and/or sold direct.

 

Wed, 02/26/2014 - 15:54 | 4481430 JLee2027
JLee2027's picture

LOL. Shows what a scam the whole thing is. Please be our debt slave.

Wed, 02/26/2014 - 17:14 | 4481931 new game
new game's picture

yep, and the hoops people will jump thru to get that loan. the home thingy has become brainwashed bend over no vasoline for a roof... even with the average income know itemizing is iffy.  if we get back to the bottom or near, i will emerge from the woodwork and become a decisive buyer...

Wed, 02/26/2014 - 21:59 | 4483049 lotsoffun
lotsoffun's picture

++

Wed, 02/26/2014 - 15:44 | 4481350 Mercury
Mercury's picture

Which means that as the inventory bottleneck suddenly unclogs and thousands of new properties hit the market with an urgency to sell before anyone else does, things in New York and especially New Jersey are about to go from bad to worse.

 

And the market finally clears as it should have years ago.

Come on guys, you can't have it both ways.

This is a net Good Thing.

Wed, 02/26/2014 - 15:46 | 4481393 halfawake
halfawake's picture

Not so fast.. our environment has long past any vestige of free market.. later in the article:  "Newark, the state’s most populous city, and nearby Irvington are considering plans to use government power to seize underwater mortgages to help homeowners reduce debt and avoid foreclosure. The cities are researching a program that would offer fair-market value for the loans and reissue them to homeowners who can afford to keep making payments at the lowered amount."

 

It's for the people/kids/economy!

 

I deny consent.

Wed, 02/26/2014 - 15:54 | 4481431 Mercury
Mercury's picture

Indeed.

Well then, to the extent that haoppens, not much will have changed and we're back in Zombie land.

Wed, 02/26/2014 - 16:20 | 4481576 halfawake
halfawake's picture

Yup. I think the worst part of most of us ZHers is the cognitive dissonance that resolves around a black swan, market collapse, societal collapse, all of a sudden... but fail to realize that tptb are boiling frogs already in the water. Fabian animal is a turtle. It's drips, here and there, or else the populace will wake up. Maybe a big war, but that'll just reflate everything, including sheepishness. But I still love us. /endrant

Wed, 02/26/2014 - 15:51 | 4481411 Tyler Durden
Tyler Durden's picture

It is a good thing for those who are waiting to buy at lower prices (as you said, to "clear"). It is a very bad thing for those hoping for housing appreciation (mostly Wall Street institutional flippers these days), and an economy which requires inflationary expectations to force consumers to spend.

Wed, 02/26/2014 - 16:11 | 4481479 Mercury
Mercury's picture

I get it but in the bigger picture this is the kind of thing we want to see more of.

If you have any faith in the individual’s ability to deploy capital more effectively than central planners then the macro-economic benefit of incoming homebuyers, who can now finally find a place to buy at their price point (and without as much competition from the likes of Blackstone) should outstrip the economic drag associated with the foreclosed-on (now former) homeowners.

 

Wed, 02/26/2014 - 16:15 | 4481548 Tyler Durden
Tyler Durden's picture

Of course. The problem is that in this artificially propped up economy and market, if it were left to "price discovery" on its own without external support, everything would crash and burn, literally, overnight.

Wed, 02/26/2014 - 16:29 | 4481588 Mercury
Mercury's picture

Ahh. The "great reset” that is both eagerly anticipated and feared (and denied).

 Well, hopefully (I can't believe I'm playing the optimist here) some incremental steps such as this can be taken here and there so as to lower that baby closer to the ground before the cables snap...

 

Wed, 02/26/2014 - 16:24 | 4481599 ArkansasAngie
ArkansasAngie's picture

Economic value 

Screw The Fed and their bubbles

Wed, 02/26/2014 - 16:33 | 4481662 Hippocratic Oaf
Hippocratic Oaf's picture

Mark to market mother fuckers

Wed, 02/26/2014 - 16:50 | 4481755 TruthInSunshine
TruthInSunshine's picture

That's what's going to bring it to popular attention that we've entered a 2nd Economic Depression.

This is in no way a defense of CB monetary policy, but if they didn't do what they did, the debt serfs wouldn't keep borrowing and spending borrowed fiat (how could they?), and it would all crash and burn quickly.

So, they're merely stretching the process out, and in that process, creating MASSIVE NEW FIAT ISSUANCE, much of which will be burned on balance sheets anyways.

Their hope, some say, and arguably, was to try to induce real GDP and economic growth based on growth in productivity in sectors that create real wealth.

Others would argue that they were merely taking the easy way out and reflating bubbles because it worked to delay the reckoning for a while during the last meltdown episodes (I'm in this camp).

Blowing, Reflating & Chasing Bubbles. A Central Banker's Story.

Wed, 02/26/2014 - 15:41 | 4481359 NOZZLE
NOZZLE's picture

When Teresa Guidice and her Gomba husband get tossed from their mansion into the street and prefe4ably prison,  then I'll think this is real.  And I want her fake tits repoed on live Tv.

Wed, 02/26/2014 - 15:42 | 4481363 youngman
youngman's picture

Here is a funny....I have a President of a Community College looking at my condo...has seen it three times now....to me its offer time....but I bet he is reading the news and is waiting.....so he does not believe the liberal stuff he teaches his students at his college....it is a very liberal college....

Wed, 02/26/2014 - 15:56 | 4481439 Seasmoke
Seasmoke's picture

No of course not....that's for you and the students to follow..But not him.  

Wed, 02/26/2014 - 19:48 | 4482571 Pure Evil
Pure Evil's picture

He's like any snake oil salesman. As long as the people keep buying it he's more than willing to travel from town to town to sell it to them.

Wed, 02/26/2014 - 21:08 | 4482573 Accounting101
Accounting101's picture

Right, it's just liberals who overstate the housing market and coddle the big banks. Pure tribal bullshit. Stop being part of the problem.

Wed, 02/26/2014 - 15:43 | 4481371 Darksky
Darksky's picture

Had a Contingent Contract on a vacation house in Fla Panhandle. Been waiting for bank to approve short sale for last two months. Today watched with a grin as the house was auctioned at the county courthouse. Final bid came in at $225k and our offer was in the $300k range. Auction failed because the mortgage debt was $453k and bank will now get to go through foreclosure process. Wondering if they will get flood insurance and wind insurance as Hurricane Season is Coming and the house is on a barrier island. Also wondering if Mr Yellen will just print some funny currency and funnel it thru Blackrock/Blackstone to the bank so they can buy the house on the down low at full price.

B(l)anking idiots, hope they all rot in hell.

Wed, 02/26/2014 - 15:58 | 4481457 Freddie
Freddie's picture

Nice area if it is like Destin.  The only problem is in a hot summer when El Nino or La Nina is going and it whips up the hurricanes.   You get a big ***ker sitting in the Gulf of Mexico with 85 degree waters.   You do not want to be anywhere near the panhandle then.,

Wed, 02/26/2014 - 17:53 | 4482130 Darksky
Darksky's picture

House in Crystal Beach, so yes Destin. Grew up in area and dealt with many hurricanes over last 40 years. Also dealt with Katrina destroying olde house in Nola. Hurricanes for locals are just a good excuse to drink and drink then dry out and repair. Grew up on Gulf Coast will die of Corexit on Gulf Coast.

Wed, 02/26/2014 - 15:43 | 4481373 Triple A
Triple A's picture

Can housing hurry up and fall another 40 to 60% like it should. I will be sweeping one up when that happens.

Wed, 02/26/2014 - 15:44 | 4481382 curbyourrisk
curbyourrisk's picture

My neighbor is going on 4 fucking years of not paying his mortgage on Long Island.  He has during that time, continued to work, gone through a divorce and bpught himself a boat.

3 times he has sent a little bit of money, as requested by his bank, but nothing near a mortgage payment - to "restart" the clock as the bank puts it.

Living the good life if you ask me.

Wed, 02/26/2014 - 15:50 | 4481409 Obama_4_Dictator
Obama_4_Dictator's picture

Those types of people will get thiers in the end, trust me.

Wed, 02/26/2014 - 15:53 | 4481419 Seasmoke
Seasmoke's picture

I Don't think so....nor do I think that they should. (I have seen the fraud 1st hand !!!)

Wed, 02/26/2014 - 16:03 | 4481481 JLee2027
JLee2027's picture

If the bank doesn't have clear title why pay them? They cannot give you clean title even for resale even if you pay it off. Most banks would not be around except for 2008 bailout. And forget what the corrupt courts do, they are handing out titles to banks to "clear the market and start the recovery". That's not what the courts are supposed to do, but that's another conversation.

 

Wed, 02/26/2014 - 16:41 | 4481706 flacorps
flacorps's picture

I had a friend who sold his home and the bank was having trouble putting together a mortgage satisfaction that would hold water with the title insurer because the chain of sales was murky. When deals are happening in the ordinary course of business these things tend to get papered over quickly ... but in foreclosure, it can be a real mess.

Wed, 02/26/2014 - 15:52 | 4481418 Dr. Destructo
Dr. Destructo's picture

ARM, default, foreclose, bailout, buy.

Rinse and repeat.

More jobs you kill, the more property you gain through foreclosures, rent out those properties and farm the proles for everything they're worth, and you then see the death of the middle class property owner and greater power for the kleptocrats.

I'll leave it at that.

Wed, 02/26/2014 - 15:54 | 4481426 Seasmoke
Seasmoke's picture

+333 million. 

Wed, 02/26/2014 - 15:53 | 4481423 lordylord
lordylord's picture

I'm laughing at that group of people who voted for Obama 99% (you know the group and there are a lot of them in NYC and NJ) and thought that the government was going to pay their mortgage (http://www.youtube.com/watch?v=P36x8rTb3jI).  The only thing government can do is steal and murder. You would think that these people and the other 100,000,000 who voted for Obama or Romney would learn by now. 

Wed, 02/26/2014 - 16:00 | 4481464 nantucket
nantucket's picture

The only thing government can do is steal and murder.

 

you forgot "fuck things up".  they do that really well, even when they aren't stealing and killing, they can eff anything up, at any time, better than you could ever dream.  so,...they have that going for them.

Wed, 02/26/2014 - 17:45 | 4482090 lordylord
lordylord's picture

True, but I subscribe to the notion that they intentionally fuck things up.  Nobody can be that proficient at fucking things up.

Wed, 02/26/2014 - 15:54 | 4481432 Rising Sun
Rising Sun's picture

But the market is up 10% month over month.  wtf??

 

This bullshit is going to end soon - crash and burn everyone.  Get your helmets on!!!!

Wed, 02/26/2014 - 15:57 | 4481448 NOZZLE
NOZZLE's picture

And congress could have solved this problem by modifying the bankruptcy code to allow cramdowns on residential mortgages and abolishing the absolute priority rule.

Wed, 02/26/2014 - 16:11 | 4481525 flacorps
flacorps's picture

I can only vote your comment up once. Otherwise I would be mouseclicking that green arrow like a cocaine addicted monkey hammering on the bar in his cage for his next fix.

I wrote this piece for the now-moribund Patch two years ago, and in it I note the irony that you can get a cramdown on a VACATION home but not a primary residence. The 1% is always taken care of.

http://landolakes.patch.com/groups/mark-s-hankinss-blog/p/bp--foreclosur...

Wed, 02/26/2014 - 18:07 | 4482190 waterhorse
waterhorse's picture

Why would congress do that?  Their masters certainly don't want cramdown, except for the wealthy.   No cramdowns on primary residences make it that much easier for the bankster parasites to enrich themselves. 

Wed, 02/26/2014 - 15:57 | 4481452 drinkin koolaid
drinkin koolaid's picture

The other option is that they can "live in a van down by the river!"

Wed, 02/26/2014 - 15:59 | 4481460 flacorps
flacorps's picture

Here just north of Tampa, Florida I'm just back from a hearing where I got a foreclosure case against my client dismissed on a very technical point of law, the requirement that a complaint be served on the homeowners within 120 days of its filing. Although the judge has ruled that they may refile the case, it is possible their refiling will not meet Florida's 5 year statute of limitations. That does not mean the client gets a free house, the bank lien remains--however, two different owners of the loan have denied modifications even though my clients have been willing to go along with almost anything, so you can ask yourself who is being unreasonable here?

One lender took seven months of HAMP payments and then denied a modification (which is what happened to almost all of those who entered the program ... and documents indeed came out a couple of years ago indicating that HAMP was never intended to help homeowners, it was to "foam the runway" for the banks). Lately my clients were again denied a modification.

The lawyers for the other side e-mailed me in increasing desperation six times seeking our "intent" prior to the hearing. I didn't answer them. Our intent was to go to the hearing and get the judge to rule on the motion to dismiss. And being a very experienced retired judge who saw that they filed the case in early 2010, screwed around for two years, finally served the suit after we appeared specially and moved to dismiss, then screwed around for two more years ... he dismissed.

My clients have a deteriorating house with a green pool on their hands. As much as they would like to work with a lender that would work with them, they would also like the whole thing resolved. I've hooked them up with a broker very experienced in short sales to see if perhaps it is worth it to do that rather than the husband be locked out of getting a mortgage for seven years post-foreclosure. It may or may not be worth it to them, she's the one who is working now.

I am by no means superlawyer, but I do know where many of the pressure points are, and while I don't always achieve a result like this I can generally give people another couple of years in their homes, during which time they can ready themselves for the next phase of their lives.

Wed, 02/26/2014 - 16:30 | 4481617 ArkansasAngie
ArkansasAngie's picture

Market to market would have fixed the banks unwillingness to settle/sell.

As to your client.  He can buy a different house.  That one doesn't belong to him

Wed, 02/26/2014 - 16:33 | 4481640 ArkansasAngie
ArkansasAngie's picture

Two wrong don't make a friggin right.

Borrowers shouldn't have borrowed.

Lenders shouldn't have lent.

AND ... I should not be picking up the bill for either one of these yahoos.

Screw'em ... all of them.

Wed, 02/26/2014 - 21:07 | 4482323 Accounting101
Accounting101's picture

Bullshit! Many of these homeowners are hard working, middle class Americans who have played by the rules all their lives. These people lost their jobs because of the financialization of our economy over the last 40 years and the complete gutting of our economy by the Oligarchs.

Don't you dare make a false equivalence between the big banks/financial services industry and middle class Americans. These people didnt think up CDS's, CDO's and other derivative type, exotic investments that nearly brought down the world economy. Come on man! Pay attention and understand what happened in 2008.

Wed, 02/26/2014 - 21:18 | 4482904 FredFlintstone
FredFlintstone's picture

There is plenty of blame to go around, banks, consumers, regulators. However, no one HAS to take out a loan for ANYTHING. Whoever does not understand that concept may be part of the problem as well.

Thu, 02/27/2014 - 12:49 | 4484955 waterhorse
waterhorse's picture

The FBI apportions 95% blame for the housing crash to "industry insiders", not to joe-blow homeowner.  Ruminate on THAT.

Wed, 02/26/2014 - 18:09 | 4482198 waterhorse
waterhorse's picture

Good for you!  I'm so tired of the "free house" bankster-initiated spin.  The only "free houses" I have seen are going to banksters who do not own them!

Wed, 02/26/2014 - 16:07 | 4481505 Atlantis Consigliore
Atlantis Consigliore's picture

zoobie doobie, rooskie real estateski  in Miami...

cash only   double money  sell in trust, no taxes,..

 

zoobie doobi doo. 

Wed, 02/26/2014 - 16:14 | 4481542 drinkin koolaid
drinkin koolaid's picture

And remember no more tax exemption for mortgage debt cancellation. Another huge weight above RE market going forward.

Wed, 02/26/2014 - 18:12 | 4482213 waterhorse
waterhorse's picture

There's always BK.

Wed, 02/26/2014 - 16:16 | 4481551 the not so migh...
the not so mighty maximiza's picture

i have a feeling they will foreclose/evict but won't put them on the market

Wed, 02/26/2014 - 16:28 | 4481613 kchrisc
kchrisc's picture

Headline should be, "Banksters steal more real property on foreclosed counterfeit currency loans."

 

"Wife didn't understand the term, 'Gun and badge thug.' She got pulled over today. Now she understands."

Wed, 02/26/2014 - 16:48 | 4481746 ReligiousAtheist1
ReligiousAtheist1's picture

Excellent read

Wed, 02/26/2014 - 17:05 | 4481875 Frostfan1
Frostfan1's picture

On my street are two houses, one went into short sale late last year and sold for 1/3 less than what I bought it and for $200k less than what the short sellers paid and the other has the owners not paying the banks for years.  As far as I'm concerned, the short sale price is the current price.

Wed, 02/26/2014 - 17:48 | 4482111 Frank N. Beans
Frank N. Beans's picture

we are nearly done paying off our house.  Guess what, the bank called to see if we would like to refinance.

 

 

 

we said no.

 

 

Wed, 02/26/2014 - 18:22 | 4482251 waterhorse
waterhorse's picture

Eight years to go on mine.  Can't wait to be done, but at least I have a portfolio loan owned by my local CU and not one of the pretender-lender Too Big To Fail servicers.  No MERS crap on my deed.

Wed, 02/26/2014 - 20:29 | 4482693 JLee2027
JLee2027's picture

My brother has less than four, he bought in 1987. I told him the currency won't live that long...

It's going to be real interesting.

Wed, 02/26/2014 - 20:12 | 4482643 hangemhigh77
hangemhigh77's picture

Gee it's so great that they've streamlined this activity so they can throw record numbers of women and children out on the street.  Maybe since these criminal banks got bailed out and made whole,  what should have happened is the banks go bust and Americans get their home free and clear.  But no we have armies of people "working a job" throwing people out of their homes for criminal banks who write the laws.  SCREW THESE PEOPLE!!! They're traitors.  They're like cops who will throw your 18 year old kid in jail for pot and ruin their life so he can get a bonus and put a pool in his backyard.  SCUM.

Wed, 02/26/2014 - 21:40 | 4482990 lotsoffun
lotsoffun's picture

what i think is an ironically said thought - how many of these people will end up renting the same house that they previously 'owned'.

blackstone - doing god's work as wall street should.

 

Thu, 02/27/2014 - 14:18 | 4483051 evernewecon
evernewecon's picture

 

 

 

 

Once the Fed overpays on MBS's,

particularly to wind them down, 

that should free up a lot of 

collateral.

 

 

The banks would still have an 

incentive to control the pace of

release, so it might be the surge

in foreclosures only foreshadows

what's still forthcoming.

 

 

It's been repeatedly reported that

a high percentage of mods re-default.

 

https://duckduckgo.com/?q=mortgage+release+program+keith+jurow+mod+redef...

 

Besides millions still underwater,

millions who're not underwater 

are not above water enough to 

cover closing costs.

 

Controlled inventory logically 

(I can't "know" that it has)

should've supported prices 

against those who've bought

recently, while depriving 

entry buyers of supply, especially

at lower prices, implying living

with Mom and Dad and/or homelessness.

 

As I noticed first here at ZH,

South Carolina leaders now seem to 

see homelessness as a sign of

a virtuous society, as feeding

the homeless will cost a lot.

 

http://thinkprogress.org/economy/2014/02/13/3288211/columbia-feeding-hom...

 

The homeless hungry person gets

the choice of unbearable hunger

or leave.

 

So if South Carolina were a nation

oriented toward pyramidal privatization

then long term survival would 

depend on acquiescence in joining

the army for food and/or 

having a hawkish remaining population

with a mechanized military, or both.

 

None would happen if S.C.'ns saw 

each other as ultimately dependent

on each other, all really rather

vulnerable from birth.

 

I suggest the where-squeamish test.

If someone else's really bad boo boo not, but

one's own yes, then maybe that's a

sign of being not realistic, at least

till they recognize that.

 

I'd bet on someone unqualified 

to begin with being unqualified 

still, especially in an economy 

that saw so much get invested in

the mortgage bubble to begin with,

with that bubble now substantially

repurchased by those who sold it,

through Treasury and the Fed, not

by choice.  The original sellers 

are still getting nothing on their

proceeds.  The banks are investing

overseas. 

 

Should be non-recourse:

 

http://online.wsj.com/news/articles/SB123336541474235541

 

(had been Free Pass Article, now 

looks left open to the public,

particularly)

 

Should be skin in the game for the 

credit seller.

 

 

National Homelessness 

Coalition

 

http://nationalhomeless.org/about-us/who-we-are/

 

 

National Alliance To

End Homelessness

 

http://www.endhomelessness.org/pages/aboutus

 

Somewhere There's 

Surely An Unscrupulous

Ultra Rich Privatizer Who

Enjoys Seeing People 

Enslave Each Other By 

Taking Dim Views Of 

Each Other.

 

 

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