Posted on 10/02/2011 9:03:41 PM PDT by Borough Park
By Kenneth R. Harney
October 2, 2011
Reporting from Washington—
Negative equity and underwater homeowners are frequently in the headlines, but what about positive equity in Americans' homes?
Is there much of it left after the wealth-killing recession and real estate bust? Where is it? Who's got equity? You might be surprised.
A new study, conducted by mortgage and real estate data firm CoreLogic for this column, found that there are substantial reserves of positive equity across the country. CoreLogic maintains the largest database on home loans — 42 million active accounts, more than 80% of all existing mortgages — with information supplied regularly by lenders and servicers.
First some basics on equity. The Federal Reserve estimates that at the end of June, Americans held $6.2 trillion in equity in their homes. This was down sharply from $13.2 trillion in 2005. Roughly 1 of every 3 homes is mortgage-free, according to federal and industry estimates.
Among owners who have mortgages, according to CoreLogic, 48.5% have at least 25% equity stakes in their properties. Roughly a quarter of owners with mortgages — 24.6% — have more than 50% equity.
At the other end of the spectrum, 22.5% of owners are in negative equity positions, burdened with houses worth less than their mortgage balances.
(Excerpt) Read more at latimes.com ...
Well this is obviously unfair. The positive equity should be shifted to the “homeowners” who are underwater. < / sarcasm>
LOL...too late...they already did that under TARP...
I found out the hard way...when I refinanced...
Freddie somehow ended up with my note....and was kind enough to cut my stated home value in HALF...which placed me severly underwater (as a statistic)..
I had to “cram up” my value through a second appraisal..
Luckily...my home value was really well over what I actually owe....so I was able to inturn knock of a couple intrest points and two years of payments...
I was one of the three or four people who took advatage of the making home affordable program and suceeded.
But the goal here is clear...to strip the middle class of the wealth they have in their properties by making them nearly worthless...
“Any revolutionary change must be preceded by a passive, affirmative, non-challenging attitude toward change among the mass of our people. They must feel so frustrated, so defeated, so lost, so futureless in the prevailing system that they are willing to let go of the past and change the future. This acceptance is the reformation essential to any revolution.”
Alinsky
Our home is still underwater. Dropped another 24K this year. Thankfully we are not planning on selling.
I strongly doubt the accuracy of this statement. Best guess, the number is likely closer to 40%, as a home's true value is what a buyer is willing to pay.
Read the housing bubble threads going back for the last six or eight years. Freepers have been explaining what was going to happen because of the oversupply the US was building. Now we are there.
My house is also underwater by at least 50K. I am seriously thinking of letting them have it. It will not rebound in price for at least 10 years, and I will never pay it off. The way they are bailing out banks, things look very bleak. There is a plan to make the US govt the owner of the property of all but the elite. We will then be tenants, completely at the mercy of this “beast”. Thinking of a severe downsizing, and save save save.
If we would have kept the original mortgage we would have been fine. Where we got in trouble was a refi done in 2005 combined with a 40K second.
“Freddy did not cut your home value in half.
It just is no longer tenable to lie about actual real estate values.”
Right...cuz you saw the paperwork...the apparaisal...and my note...
I obviously imagined the agent show me the stats, and faked my outrage that 42k of stated value just up and dissappeared...
And I must have somehow faked the reappraisal to get the stated value back up high enough to qualify...
The house next door selling for a 199k must have also been a figment of my imagination...
Gee...I have a very active imagination...
I know what happened...Under TARP freddie and fannie were allowed to “reassign value” all of it’s notes.....
Take good notes like mine with value...and take some of that value and apply it to worthless notes....to bouy up their mortgage back securities...
It was a scam...not rocket science...
This is like saying “most Jews escaped the Holocaust.”
No refinance, just the reality of a house I paid 50K too much for. People talk about the sanctity of signing a contract, and keeping your word. That carries O weight with me, as the people that caused this to happen, live the high life, while the peons sink into slavery. The slavery of debt, everlasting debt. This nation is a cesspool of corruption, and it will never come out of it unless enough citizens drop to their knees, and give their lives to God. The very financial system our country is built upon, is Satanic. The people must come out, or die with it....It is that simple.
My answer is, SO WHAT. What did you buy the house for? Did you really buy a house with the idea that they ALWAYS go up in value? Well they don't! Real Estate historically increases in value over time but at any specific time period it can be up or down. If you do not understand this then you should probably stick to renting.
Can anyone here describe what happens when you buy that 40k new SUV and drive it off the lot? You guessed it. You are under water big time but does that notion prompt these same people to just throw up their hands and say I'm letting go back to the bank?
So these people that think they should just let the bank have it are being completely irresponsible. In my opinion anyone who can make the payments on a home they bought but lets it go back to the bank because its decreased in value should never be given a home loan again. If I'm a lender and see this type of activity you are out of there. No loan under any terms, period.
Lastly, what if we get rid of obama and in a few years home prices skyrocket. How would you like it if the bank called you up and said hey this home we loaned you money on is now worth a crap load more money. We are increasing your payments and the amount you owe us to reflect the original loan to value ratio. How does that sound?
Final point. Just because your home is down 50k now does NOT mean it won't be 50k up in ten years. If you bought the home to live in and you could afford it just live your life and stick it out. That's the way Real Estate go.
I am sure that will make those who aren’t feel much better. /s
It’s the 22.5% that have a negative equity that is bringing down the entire market. They is simply way too much supply for the demand. the real estate bubble has burst and as long as the government stays involved in real estate financing, the true market price will be too high.
Heh. No sale, but thanks for the laugh.
“. The slavery of debt, everlasting debt. “
No one forced people to buy huge cars, huge homes, that they couldn’t pay off right away, or at all near the time that they purchased them. No one forced anyone to go on vacations that they couldn’t afford and forced them to max out the cards on designer clothes. There’s a reason that Thailand and a lot of ‘third world’ countries aren’t doing to bad, mainly that the average citizen, no matter how dirt poor, at the very least aren’t up to their eyeballs in unneeded debt.
“Can anyone here describe what happens when you buy that 40k new SUV and drive it off the lot?”
They are idiots to pay that much for a car in the first place.
It is a little easier to pull that stunt in non recourse states, but it still has credit rating consequences. If someone has a stellar credit rating, it is probably not worth nuking it for $50K.
I had the opposite experience. My loan was underwater and owned by Citi. As a stealth part of the bank bailout, Freddie bought my loan from Citi. Citi was the servicer and immediately turned around and sent me a refi offer. I applied, expecting nothing. When the numbers came in, I had 1k equity (owed 240 so essentially zero). Citi told me that Freddie had a special deal for me, relaxed rules for equity. So I got my 4.5 loan on no equity, no PMI, no other hooks or gotchas, which I’ve been paying for two years now. Just got another letter for 3.5, looks like Citi wants to keep churning the loan
One of the big reasons I've been able to pay down my mortgage as much and as fast as I have is that I haven't been burdened with a $500-$800 monthly car payment.
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