The Times: Housing bubble is finally at bursting point

[Eddy]

Van diciendo las cosas despacito, para no ahuyentar al prepepito compulsivo pa que piense ... ezo zijnifica que 3 de cada 4 pepitoz no entrarán en la negative equity eza.

Pero si compras ahora, y baja un 10%, habrás perdido 2/3 de lo que diste de entrada (precio 100+gastos 10=110 Financiado-80 Entrada-30)

Para un piso que vale ahora 250.000 pounds, comprar ahora y no dentro de un año te ocasiona una pérdida de 50.000 pounds, si los precios caen un 10%ese año.

No entras en negative equity, pero pierdes 2/3 de tus ahorros. Sólo con que baje un 10%

 

[Tuttle]

Fredie y Fannie se ponen chulas.

Freddie and Fannie Face Off Against Mortgage Borrowers Who Walk Away
Published abr 15, 2008 | RSS Feed RSS Feed | Text Size Descrease article text Increase article text
Lenders are becoming increasingly frustrated as a growing number of borrowers make the decision to walk-away from mortgage obligations. Freddie Mac and Fannie Mae are so fed up that they've decided to aggressively pursue 'walkaways' and prohibit foreclosed borrowers from getting another mortgage.

Roughly 8.8 million Americans are underwater in their mortgage, meaning they owe more on their mortgages than their homes are worth. Fifteen to 20 million are expected to be in the same position by next year.

The underwater phenomenon is one of the main reasons why many people are choosing to walk away from their homes and their mortgage obligations. In response, the two largest sources of mortgage financing in the U.S. recently decided to issue dire warnings to anyone who is thinking about walking away from their mortgage.

On March 31, Fannie Mae issued new guidelines for walkaways and similar foreclosure situations. Under the guidelines, foreclosed borrowers will not be able to get another mortgage through Fannie for five years. If borrowers can document 'extenuating circumstances' the prohibition period will be reduced to three years.

Freddie Mac is cracking down as well. They keep foreclosures on file for seven years. The company has also announced their intentions to aggressively go after rogue borrowers who walked away. A senior official for Freddie was quoted as saying they will make every effort to preserve 'deficiency rights' where state law permits.

Can Mortgage Borrowers Be Punished for Walking Away

In a recent interview with the San Francisco Chronicle, Freddie Mac consumer outreach manager Robin Stout Migala claimed that there are many reasons why homeowners shouldn't walk away from homes, including federal income tax liability and the chance that lenders may pursue walkaway borrowers.

Although Robin's statements may be true in certain circumstances, it is equally likely that borrowers may not face the above-mentioned consequences.

As Mike 'Mish' Shedlock pointed out in a blog post Monday, some states (like California) are non-recourse states, which basically means that borrowers owe lenders nothing more than the house should they default. There are also non-recourse loans in recourse states with the same provision. As for tax liabilities, there are provisions in the Mortgage Forgiveness Debt Relief Act that allow tax free debt forgiveness.

The bottom line is that there will be consequences for those who do walk away--like a drop in credit scores--but the end result may not be as bad for borrowers as Migala implies.

 

[aterriza como puedas]

70% of subprime borrowers aren't getting help

70% of subprime borrowers aren't getting help
A new report finds that efforts to help at-risk borrowers are barely keeping pace with rising delinquencies. Many borrowers are left out.

By Les Christie, CNNMoney.com staff writer
April 22, 2008: 12:29 PM EDT
NEW YORK (CNNMoney.com) -- Seven out of 10 seriously delinquent subprime mortgage borrowers are still not getting the help they need to keep their homes.

That's according to a report released Tuesday by the State Foreclosure Prevention Working Group, a coalition formed by eleven state attorneys general and the Conference of Bank Supervisors in the summer of 2007 to work with loan servicers to prevent unnecessary foreclosures.

"Our collaborative efforts to date have failed to prevent a large number of unnecessary foreclosures," said North Carolina Deputy Commissioner of Banks Mark Pearce. "We need to find solutions that fit the size of the problem we are facing."

The report, which surveyed lender efforts and programs like Hope Now, found that the number of borrowers getting help each month has increased from about 210,000 in October to nearly 261,000 in January. But because the total number of troubled borrowers is also growing so quickly, from 820,000 seriously delinquent loans last fall to over 1 million at the start of the year, the proportion of mortgage rescues has remained essentially unchanged.

"We're still way behind," said Iowa Attorney General Tom Miller, who helped form the coalition.

Nearly a quarter of all subprime loans are in delinquency. About 300,000 subprime borrowers are now in some stage of foreclosure, up 8% since last October.
Hard to handle

Mortgage servicers are overwhelmed, unable to cope with the sheer numbers of delinquent loans, according to the report. The fact that about two-thirds of all mortgage modification efforts are not completed by the amowing month is evidence that servicers are falling behind.

"We're finding the servicing system can't manage and re-underwrite millions of loans," Pearce said at a press conference announcing the results. "The case-by-case approach [they're using now] was not designed to handle the numbers of loans they're dealing with."

Delinquent loans headed for foreclosure are "clogging up" the system, slowing the pace of modification efforts and possibly adding to the number of vacant homes in many communities. The report warned that could drive down home prices even more.

There was some good news: More troubled borrowers are getting comprehensive, long-term mortgage modifications. These workouts change the the loan terms, lowering the interest rate, the balance or both to make payments more affordable.

The Working Group also made two recommendations to improve the rate of mortgage modifications: Slow down the foreclosure process to give servicers more time to find solutions for individual borrowers, and take a more systematic approach to modifying loans. That would eliminate some of the intensive case-by-case counseling that is now involved.

Additionally, the coalition came out in support of efforts to allow bankruptcy judges to reduce mortgage balances to reflect current market values, as well as expanding the role of the Federal Housing Authority in refinancing subprime loans.
Subprime loan performance still subpar

The performance of subprime loans has continued to deteriorate, with many of the loans completed in 2006 and 2007 already in default.

For example, 28.5% of subprime adjustable rate mortgages (ARMs) that won't reset until Spring, 2009 are already delinquent. About 21% of these same loans were delinquent in October.

The report concluded that "very weak underwriting and mortgage origination fraud, and not simply payment resets," are what's driving subprime loan defaults.

 

[ronald29780]

70% of subprime borrowers aren't getting help

De camino han inventado otra idea de malgastar dinero publico.

La fiscalia coordina el Bail-out.:

 

[azkunaveteya]

mi ejperto:

Jonathan Davis – housepricecrash.co.uk

Prediction: Another 35% fall

“The market will not bottom out until spring 2011, by which point there will be a 40 to 50 per cent drop from when house prices were at their peak in August last year.

“If you remember the last house price crash in 1988, it took until 1994 for the market to recover, so a good four or five years. There is no reason whatsoever to suppose the market will recover any quicker this time.

“It is far too early to bag a bargain – people should not be buying for at least another two years. We are only one year into the crash, and it has a long way to go yet.”