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| User Info | The Dumbest Thing I've Seen Yet in forum [Ticker] | |||
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Genesis Posts: 71359 Incept: 2007-06-26 
KD^2 
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http://market-ticker.org/archives/1137-T....
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 13:01:09
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Rufust445 Posts: 362 Incept: 2007-08-11 Oakland Co., MI
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"When you find yourself in a hole, stop digging." -- Will Rogers
---------- "The stock market isn't bullish, it's bull$hit." -- Alan King
2009-06-19 13:09:02
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Statusquojoe Posts: 2397 Incept: 2008-11-20 
Land of the fees Home of the slaves.
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Quote:WHERE ARE THE DAMN ADULTS Our glorious central planners have ignored the adults for years, Adam Smith, Hayek, Mises, Rothbard. At this point we are foolish to believe they would consider economic reality. Quote:They are like children who sit in the market place and call to one another, and they say, 'We played the flute for you, and you did not dance; we sang a dirge, and you did not weep.' ---------- "In short, you are the definition of moral hazard." Senator Bunning to Bernanke
2009-06-19 13:10:00
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Tdray Posts: 115 Incept: 2008-12-11
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Where is the bong smoking emoticon when you need it? Lord help us!
2009-06-19 13:12:31
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Xanares Posts: 1288 Incept: 2008-11-10 
London
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2009-06-19 13:14:00
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Offshoreman Posts: 87 Incept: 2008-10-22
Austin, Tx
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Insanity.
2009-06-19 13:16:20
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Greenrebellion Posts: 429 Incept: 2009-01-03
Los Angeles
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For those not extremely familiar with the refinance process, how does this hurt the homeowner. Wouldn't they just refi with a lower rate which may alleviate their payment problems? Yes it will cream the taxpayer, but what else is new.
2009-06-19 13:23:17
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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You lose the non-recourse nature of the mortgage when you refinance. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 13:23:54
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Xqqme Posts: 76 Incept: 2009-01-09
Ohio
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I'm beginning to believe they really want to destroy us.
2009-06-19 13:27:34
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Greenrebellion Posts: 429 Incept: 2009-01-03
Los Angeles
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Thanks Gen, I didn't realize that.
2009-06-19 13:28:14
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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Yeah, neither do most people. That of course remains undisclosed by those pushing these "solutions." The only solution that WORKS is to default the bad debt and force prices DOWN so you can afford to buy a house - whether its your current house or a different house. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 13:30:22
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Weaseldog Posts: 282 Incept: 2008-12-11 Texas Banned
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Quote:I'm beginning to believe they really want to destroy us. They are desperate to save themselves. They'll do anything, even if it kills us. ---------- "You can know the name of a bird in all the languages of the world, but when you're finished, you'll know absolutely nothing whatever about the bird... So let's look at the bird and see what it's doing -- that's what counts." - Richard Feynman
2009-06-19 13:34:20
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Kab Posts: 625 Incept: 2009-04-02 Colorado
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Is that true of ALL refinances? The SO is about to close a refi getting a rate around 4.7. She's a bit underwater though. I'm sure it's going to go down further but she didn't overpay much in the first place and the area hasn't been hit super hard and doesn't look likely to be.
2009-06-19 13:34:54
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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As I said in the article - NEVER EVER refinance an underwater note without getting BOTH paid legal and accounting advice. Understand EXACTLY what you are giving up - it varies from state to state - in exchange for the supposed "help." ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 13:38:05
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Armedmichigander Posts: 379 Incept: 2009-03-27
MI
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Deleted. Last modified:
2009-06-19 13:41:16 by armedmichigander
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Dji Posts: 718 Incept: 2009-04-21
Fleming Island Online
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cram down idea strike 1 refi at low rate of 4% strike 2 this new idea strike 3 your out. ---------- What goes up Must come Down- Alan Parsons Project THE TRUTH HURTS! -Dji
2009-06-19 13:45:49
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Hihoherewego Posts: 595 Incept: 2009-02-25
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What if home prices go back up? Isn't that the hope logic they're selling here? Now you're no longer underwater. Temporary problem solved. Everybody lives happily everafter in Mayberry, U.S.A. ........... "I have committed thought crime." 1984
2009-06-19 13:53:00
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Shrpblnd Posts: 1169 Incept: 2007-08-06
Los Angeles, CA
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Quote:In every state if you refinance the resulting mortgage is a recourse loan, which means they can sue you for any deficiency if you subsequently default... Although this is true, in California most lenders do not seek recourse on refinance loans because they must use a much more difficult foreclosure process in order to do so. Instead, they almost always use a non-judicial foreclosure, which does NOT allow for deficiency judgements. http://www.foreclosureradar.com/ca_forec.... So unless the law gets changed, leeches in CA give up virtually nothing when they attempt to refi their way out of it. Last modified:
2009-06-19 14:13:20 by shrpblnd
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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If home prices go back up why do you need to refi in the first place?
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 13:57:04
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Hihoherewego Posts: 595 Incept: 2009-02-25
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Quote:If home prices go back up why do you need to refi in the first place? Well let's see. Lower monthly payments because of fixed lower interest rate? Terms extended out to 40 years? Consolidation of variable home equity line into fixed rate? ........ "Room 101." 1984 Last modified:
2009-06-19 14:02:57 by hihoherewego
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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#2 and #3 can done once the danger of losing the house has passed. #1, ok. But how much are you saving? BTW, 40yr terms are a MISTAKE. Don't. The radical increase in total interest paid makes them a bad deal - period. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 14:04:02
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Mscreant Posts: 79 Incept: 2009-02-22 State of Anomie
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If I was to give them credit for wanting to do the right thing, then I would have to conclude they are terrifyingly stupid. No jobs = deflating asset prices. Anything you finance now is going to have a lower value later. Never mind if you put 20% down, getting a loan worth 105 to 125% of current value? NOW? The LTV ratio is only going to get worse. The tax payers are subprime lenders without someone to sell the loans to. Bagholder of last resort. Either they don't know about deflation and if anything expect inflation, or they truly can only see about 1 foot in front of themselves and no further. The last choice, that they are deliberately ripping us off... As an abstract concept, it sounds like what has to be true. In reality, that is a whole lot of backroom meetings and agreements. To pull it off everyone has to be on the same page and agree to not speak, or to tell the same story. That is a lot of coordinated effort I just don't give them enough credit for. The other way it could happen is a structural explanation, that is to say, the culture of greed naturally drifts this way. In other words no conspiracy per se, but folks seeing the playing field and acting. Crisis style management, where there is no steering function, but only reactivity, will always yield this type of result. I hope this is coming across. This is so obviously stupid that I feel a great need to get inside these people's experience and try to figure out how this can make sense to them. 
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2009-06-19 14:17:54 by mscreant
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Hihoherewego Posts: 595 Incept: 2009-02-25
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Quote:#1, ok. But how much are you saving? Oh I agree with you. But looking at it from the perspective of a desperate underwater homeowner who really wants to protect his credit score I guess I can see it being palatable even though it doesn't make sense from a standpoint of saving money. There also could be instances for example where a family has a great school district where they currently live and having to move out into an apartment that can house 6 people comfortably is prohibitively expensive much less they might lose the school. People sometimes stay in their homes because of intangibles such as that. Everyone has unique circumstances. Last modified:
2009-06-19 14:12:07 by hihoherewego
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Pcaldallas Posts: 279 Incept: 2009-03-02
Dallas, TX
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I'm sure housing prices are going to go up at any time based on all the rosy financial news, improving employment situation and all the rest of the green shoots. How long before we see the first 100 year mortgage? 
2009-06-19 14:12:45
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Genesis Posts: 71359 Incept: 2007-06-26
KD^2
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I hope Lockhart has a coronary. (Heh, its legal for me to wish for him to expire from NATURAL causes!) This sort of **** perpetrated on the public ****ES ME OFF. ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-06-19 14:13:53
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