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Trapped by the mortgage meltdown
http://money.cnn.com/2007/09/13/real_estate/mortgage_meltdown.moneymag/index.htm?postversion=2007091 ^ | 9-14-07 | Les Christie

Posted on 09/14/2007 5:37:16 AM PDT by Hydroshock

NEW YORK (Money Magazine) -- Whether you're a home seller, owner or buyer, by this point you've got to be feeling a little rattled. The bad news about the housing market seems never ending: Foreclosures have more than doubled over the past year.

Sales of existing homes are off 11 percent from this time last year. At that rate, it will take at least nine months to work off the inventory of unsold homes. And median home prices in July (the most recent figure available) dropped for the 12th month in a row.

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Worse yet, all that happened before problems in subprime lending expanded throughout the mortgage market and beyond, creating what's popularly being referred to as the credit crunch.

While it's too soon to see the impact reflected in the numbers, the immediate future is clear: As lenders tighten their borrowing standards, fewer people will qualify for mortgages.

Fewer qualified buyers can only mean that housing prices will slump further. Worst of all, economists don't see much chance for a turnaround until mid- 2008 and possibly into 2009.

(Excerpt) Read more at money.cnn.com ...


TOPICS:
KEYWORDS: brokenrecord; vulturegram
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To: o_zarkman44

Try telling that to the vultures here hoping for a housing plunge.

It DOES affect ALL OF US. Things don’t happen in a vaccuum.


41 posted on 09/14/2007 6:33:16 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: Fairview

Good to know!

As for the stock markets, it all depends how you were invested over that time.

You know, with houses, you really have to take out insurance and taxes and such, and minor repairs made over time to keep up the property, to get a real idea of your profit or likely profit.

I’m sure you enjoy your home! I do, too!


42 posted on 09/14/2007 6:33:21 AM PDT by RexBeach ("Americans never quit." Douglas MacArthur)
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To: ClaireSolt

A huge part of the demand was speculative buying of houses. In some markets in California, I’d heard that 60% of the buying was purely speculative buyers looking to flip houses for a quick profit. 60% of the demand gone. Poof!

While it will hurt many, returning to sane housing prices a good thing. Many will benefit being able to buy houses they can afford.


43 posted on 09/14/2007 6:34:09 AM PDT by listenhillary (millions crippled by the war on poverty....but we won't pull out)
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To: ctdonath2

Yes but you’re forgetting that it’s not that simple. You’re failing to realize that you have to have a place to live. If you either pay the mortgage or pay the rent on something, you ARE better off in your exact scenario to pay a mortgage than rent.


44 posted on 09/14/2007 6:34:21 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: ctdonath2

You also forget that the $100,000 cash that could have been used for the home purchase instead is also sitting there earning money, putting you ahead.


45 posted on 09/14/2007 6:35:05 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: RockinRight

Vultures = first time home buyers?


46 posted on 09/14/2007 6:36:13 AM PDT by listenhillary (millions crippled by the war on poverty....but we won't pull out)
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To: Fairview

Good to know!

As for the stock markets, it all depends how you were invested over that time.

You know, with houses, you really have to take out insurance and taxes and such, and minor repairs made over time to keep up the property, to get a real idea of your profit or likely profit.

I’m sure you enjoy your home! I do, too!


47 posted on 09/14/2007 6:36:42 AM PDT by RexBeach ("Americans never quit." Douglas MacArthur)
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To: ItsOurTimeNow

All good till you find out you don’t have a job due to the recession lower prices could cause!

Seriously, good luck to you. Although as someone who works in the lending business...my income is directly affected by lowering prices...and while lower priced homes are easier to buy I also make less money when that happens...so it’s a negative for me.


48 posted on 09/14/2007 6:37:08 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: Hydroshock
Whether you're a home seller, owner or buyer, by this point you've got to be feeling a little rattled.

I'm 8 years into a 30 year fixed and plan to stay in the house another 10-15 years. Even now, it's worth over 50% more than I paid for it, and I've not taken a nickel of equity out of it.

Yeah, I'm rattled for sure ... NOT!!

49 posted on 09/14/2007 6:37:22 AM PDT by TheRightGuy (ERROR CODE 018974523: Random Tagline Compiler Failure)
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To: RexBeach

Why 22 1/2? Is there a significance to that number?


50 posted on 09/14/2007 6:37:44 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: RockinRight

I know they do not, that is why I ahve been warning of this train wreck for over a year.


51 posted on 09/14/2007 6:38:39 AM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: Hydroshock

Very true. At least 10% down and most people who can verify income at at least have a half-a$$ed record of paying their bills can get a mortgage.


52 posted on 09/14/2007 6:39:11 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: RockinRight

Yeah, that’s what the mortgage company wanted me to put down in order to get the loan. Ah, those were the days!


53 posted on 09/14/2007 6:39:25 AM PDT by RexBeach ("Americans never quit." Douglas MacArthur)
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To: Hydroshock
Whether you're a home seller, owner or buyer, by this point you've got to be feeling a little rattled.

Sorry to disappoint you, Les, but I'm not.

54 posted on 09/14/2007 6:40:59 AM PDT by MEGoody (Ye shall know the truth, and the truth shall make you free.)
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To: RockinRight

I was once a realtor and was raised in the home building a remodeling industry so I have seen a lot. I once saw a guy who had a divorce, and a bankruptcy in the past 12 months buy a house. He inherited some money and put 50% down.


55 posted on 09/14/2007 6:42:12 AM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: RockinRight

Unless you just started working, or didn’t save, you can get a suitable home within your cash range.

Yes, one can play money games to squeeze out a few percent more - but that piles on risk, which the sub-prime borrowers are finding can be a problem.


56 posted on 09/14/2007 6:42:23 AM PDT by ctdonath2 (The color blue tastes like the square root of 0?)
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To: ctdonath2

Obviously you live somewhere away from the big cities of the East or West coast.

There’s no way on God’s green earth you could ever save enough cash to buy a home in those areas unless you live with your parents and don’t pay rent. Or, conversely, make an insane amount of money.

Besides it’s stupid to pay cash for a house if you have money. Leave the money invested and earn more than you pay in interest.

Very few wealthy people buy their homes with cash, and there’s a reason. And by wealthy, I mean someone with a good income AND good asset balances, NOT high-income but living paycheck to paycheck.


57 posted on 09/14/2007 6:42:23 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: ctdonath2

I’m not talking subprime here though. See my last post.


58 posted on 09/14/2007 6:42:56 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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To: RexBeach

I hope to see a return of sane lending stanards and banking.


59 posted on 09/14/2007 6:43:06 AM PDT by Hydroshock ("The Constitution should be taken like mountain whiskey -- undiluted and untaxed." - Sam Ervin)
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To: o_zarkman44

Not really true. A $50 doctor bill usually doesn’t affect an interest rate at all in my experience, unless everything else about the file is tight, i.e. income is questionable, and pay history on bills is bad over time.

Either that or people who should be using me to finance their homes are going elsewhere! ;-)


60 posted on 09/14/2007 6:44:47 AM PDT by RockinRight (Moderation in temper is always a virtue; but moderation in principle is always a vice. -Thomas Paine)
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