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  mita : Awake-catalyst

Mortagage Foreclosures Skyrocketting: Up 42% in 2006

mita said May 24, 2007, 7:19 PM:
 
Jon Goldin-Dubois Jon Goldin-Dubois
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05.17.2007

Why Mortgage Foreclosure Rates are Skyrocketing (33 comments )

READ MORE: Washington, U.S. Congress

You have to wonder what's going on when mortgage foreclosure rates are skyrocketing nationwide: up 42 percent in 2006, compared to 2005, leaving up to two million families in danger of losing their homes.

It's probably not a shock to learn the mortgage lending industry has been spending money frantically in Washington, and has successfully blocked Congress for the last seven years from taking action to restrict lending abuses that have saddled the economically vulnerable with home mortgages they can not afford, according to The Washington Post.

This week put the number of homes that have been foreclosed or are in danger of being foreclosed on at two million.

Consider this: the industry spent nearly $220 million in Washington between 1999 and 2006. About $22 million of that was in the way of campaign contributions to federal candidates, while the rest was on lobbying expenses.

And what did the industry get for its money? Hands off from Congress, despite warnings from housing advocates dating back to 2000 about new mortgage products and their dangers to borrowers.

source: Huffingtonpost.com

Subprime loans and irresponsible lending and buying are blamed.

Bankers don't lose even if they sell properties at 50-60% discount, because under fractional reserve system they can issue 10-20 times of the net gain in new credit!

  GDW : GDW

Re: Mortagage Foreclosures Skyrocketting: Up 42% in 2006

GDW said May 24, 2007, 11:00 PM:
 

I've thought about this last point a bit actually.

They created the money for the loan, and then the mortgage defaults, after a long time they get the property; pretty nice set up.

But I think they would rather the re-payments. Repayments go on and on for 25 years or so, and then there's re-financing after that. A lifetime of repayments; all good stuff for the banks.

But when they get the house, I think it becomes a liability more than anything; they're not in the business of leasing and they soon have to start paying for the up keep if it can't be sold.

Somebody explained this issue very clearly, but I can't remember where I saw it. I also saw an article where the lenders are doing everything they can to save the mortgage, even decreasing the principle.

I know it sounds drastic but when people start losing their homes, they'll start to question the current set up; financial and government; I don't think it's a bad thing.

I gave my house back to the bank recently, and it was like a huge weight being lifted off my shoulders…my wife and I got our lives back; we can now choose where we work and live. The Great Australian Dream wasn't for us. We then declared bankrupt. We live day by day and we've never felt better.

  mita : Awake-catalyst

Re: Mortagage Meltdown: The real story is fraud 9/12/2007

mita said Dec 17, 2007, 7:46 PM:
 

Mortgage meltdown
Interest rate 'freeze' - the real story is fraud

SAN FRANCISCO CHRONICLE  DEC 9, 2007

New proposals to ease our great mortgage meltdown keep rolling in. First the Treasury Department urged the creation of a new fund that would buy risky mortgage bonds as a tactic to hide what those bonds were really worth. (Not much.) Then the idea was to use Fannie Mae and Freddie Mac to buy the risky loans, even if it was clear that U.S. taxpayers would eventually be stuck with the bill. But that plan went south after Fannie suffered a new accounting scandal, and Freddie's existing loan losses shot up more than expected.

Now, just unveiled Thursday, comes the “freeze,” the brainchild of Treasury Secretary Henry Paulson. It sounds good: For five years, mortgage lenders will freeze interest rates on a limited number of “teaser” subprime loans. Other homeowners facing foreclosure will be offered assistance from the Federal Housing Administration.

But unfortunately, the “freeze” is just another fraud - and like the other bailout proposals, it has nothing to do with U.S. house prices, with “working families,” keeping people in their homes or any of that nonsense.

The sole goal of the freeze is to prevent owners of mortgage-backed securities, many of them foreigners, from suing U.S. banks and forcing them to buy back worthless mortgage securities at face value - right now almost 10 times their market worth.

The ticking time bomb in the U.S. banking system is not resetting subprime mortgage rates. The real problem is the contractual ability of investors in mortgage bonds to require banks to buy back the loans at face value if there was fraud in the origination process.

And, to be sure, fraud is everywhere. It's in the loan application documents, and it's in the appraisals. There are e-mails and memos floating around showing that many people in banks, investment banks and appraisal companies - all the way up to senior management - knew about it.

Read the rest here.

Any thoughts or insights? BTW Grant i hope things are going well and unburdened for you.
I can't imagine what many families facing foreclosures are going through.
  GDW : GDW

Re: Mortagage Meltdown: The real story is fraud 9/12/2007

GDW said Dec 17, 2007, 8:08 PM:
 

I read this article a few days ago. It was a bit of a surprise, I hadn’t worked out the freeze myself. This could be getting close.

My family and I are experiencing true freedom. No credit, no insurance, no car…no worries.

  mita : Awake-catalyst

Re: Mortagage Foreclosures HELP

mita said Dec 18, 2007, 6:43 AM:
 

Good for you. Wish many people can do what you did. I got the following email in my box. Posting it here for whoever needs help. Please pass it to friends in need.

——————
From: Allen Media Strategies <aaron@allenmediastrategies.com>
Date: Dec 18, 2007 8:16 AM
Subject: Mortgage Crisis of 2007/2008: Interview the Mortgage Survival Guide Authors



 
 
Mortgage Crisis Interview Opportunity:  available through 12/14-12/22
 
 

The Bush administration has introduced a plan to freeze interest rates for some subprime mortgages.  Their plan is to combat  an avalanche of feared foreclosures, as an estimated two million subprime mortgages reset from lower introductory rates to higher rates. In many cases, the higher rates will boost homeowner's monthly payments by as much as 30 percent, making it impossible for many people to keep current with their loans and force them into foreclosure.
 
UNFORTUNATELY, THE WHITE HOUSE PLAN WON'T HELP MILLIONS OF HOMEOWNERS WHO ARE ALREADY BEHIND IN THEIR PAYMENTS AND ARE ABOUT TO SPEND THEIR LAST CHRISTMAS AT HOME, BEFORE LOSING IT TO FORECLOSURE.  HOW CAN THOSE PEOPLE, INCLUDING MANY OF YOUR LISTENERS, GET THE HELP THEY NEED?
 
Book an interview today with Jeff Wynn and Frank Curtin, the authors of “THE MORTGAGE SURVIVAL GUIDE” and the driving force behind the 5000 Families Initiative (http://www.5000families.org/) . 
 
The U.S. housing crisis has reached such epidemic proportions, that Wynn and Curtin are giving away their MORTGAGE SURVIVAL GUIDE program online, with no strings attached!  The home-saving plan has proved so helpful that faith-based organizations in their home market of Dallas-Ft. Worth are already incorporating THE MORTGAGE SURVIVAL GUIDE into their community outreach offerings! 

The 5000Families.org Mission is to help families resolve their mortgage problem and reach a higher quality of life through education, tools, and professional support specifically designed to have a  measurable impact on families and their communities.

To book a telephone interview with Jeff Wynn or Frank Curtin regarding the mortgage foreclosure crisis, contact:

Aaron Leistner                                                                                         

Director of Client Services                                                                            

Allen Media Strategies                                                                         
 
Washington,DC                                                                                                        
 
(703) 589-8960                                                       aaron@allenmediastrategies.com" title="mailto:aaron@allenmediastrategies.com" target="_blank">
 
aaron@allenmediastrategies.com
  Raf : Nourishment Economist

Re: Mortagage Foreclosures Skyrocketting: Up 42% in 2006

Raf said Dec 30, 2007, 4:32 PM:
 

I haven't posted here for a while as I've been posting mainly on my blogs.

What I would say is we are experiencing the beginning of the fall out from the extended credit binge of the last 16 years. There will be at least 2 more years of pain for those in debt and for the rest of the economy. Asset values could fall further as the impact spreads throughout the system.

No amount of paper shuffling will cover over the cracks.

Simply put there has been too much money created and asset prices have inflated well beyond what the underlying economy can support.

In the UK now house prices are starting to fall. If the contagion spreads then it could become much worse. Gold will go through $1000/oz as people grasp at something tangible. The manipulations of the oil price will continue to cause inflationary concerns.

In short we are stuffed.

If people are haviung problems they need to see a debt counsellor or citizens advice. I work as a volunteer budget advisor and constantly see peopl struggling with debts they simply cannot pay.

It's time to batten down your hatches and make sure you don't take on any unnecessary debt. Do a budget and look at your cashflow.

Best wishes to all for 2008 :-)