Just another sign of the times under President Obama.
Good thing that housing, Greece, debt, spending, etc.. thing is contained. /s
Foreclosures are good.
1. They are the legal mechanism for getting a family out of a contract that requires paying a mortgage that they cannot afford. It is cruel and counter productive to let them stay in a home that is beyond their means if they are trying to pay more than they can afford and falling behind. It is immoral to keep the bank from taking the property that was pledged to a loan if the family is strategically defaulting as a choice in the hope that the bank will have no recourse.
2. Foreclosures clear out the non-performing loans and allow us to put the housing bubble and the resulting crisis behind us so that financial and real estate markets can return to normal.
3. Government interference with contract law reduces business trust in the legal mechanism for enforcing contracts, increasing uncertainty and increasing costs. Business passes these costs on to all mortgage holders rather than just to those who create those costs by buying beyond their means.
from article;
“Foreclosures began to ease last year as banks came under pressure from the Obama administration to modify home loans for troubled borrowers.”
REPORTING ON Foreclosures began to ease last year as banks came under pressure from the Obama administration to modify home loans for troubled borrowers.
......... there, I fixed it
TYBO
This jump in foreclosures coming at this particular time makes perfect sense for 3 reasons:
1) Banks knew it was better to let people squat in their houses without paying the mortgage over the winter because it saved them (the banks) from having to deal with winterizing vacant houses, dealing with winter freeze damage, or trying to offload them during the slow sales season
2) With the Fed ending purchases of Freddie and Fanny trash MBS paper, the market for mortgage paper is going down, not up. Better to try to unload them now rather than continue to sit on them.
3) They know interest rates will soon be going up: better to try to unload these properties now because increasing rates will drive down market values even more.
So, in short, this wave of foreclosures simply proves what I’ve been trying to tell people for months: the real estate market has NOT recovered; it was only being temporarily propped up by government games. There will now be a mad rush of banks trying to beat each other to get their bad mortgages off their books.
I sure feel bad for anyone still in a house with a mortgage and less than 50% equity at this point, because they’ll soon be upside down.
All those suckers that took the bait of taxpayers paying 8 grand for their down payment, are going to find their houses value down 20%.
Housing as a utility, a shelter, a tool is still massively overbuilt, both in units and square footage per person.
More green shoots!
Thanks to Barney Frank and Chris Dodd for pushing banks to lend to non-credit worthy folks to get them into houses. Fannie and Freddie under Clinton’s buddy Franklyn Raines is also partly to blame.
No income or little income does not support a mortgage and the policies of 0bama cratering the economy pushing people out of jobs and the Financial Services Committees in the House and Senate pushing banks to GIVE money to folks who can’t afford to make payments leads to a lot of foreclosures. This news isn’t a surprise.
I heard from my deepthroat mortgage biz source back in Dec. that they were holding a ton of foreclosures that were not on the market yet.
Was there a regulatory decree that they couldn’t be processed until a certain time?