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Second-lien holders put drag on short sales
San Francisco Chronicle ^ | July 28, 2012 | Gopal and John Gittelsohn

Posted on 07/29/2012 8:14:06 AM PDT by Cincinatus' Wife

........Facing an onslaught of pending foreclosures, banks increasingly are turning to short sales. They lose about 15 percent less on short sales than they do on repossessions, which can take years to complete while taxes accumulate along with legal, maintenance and other costs, according to Moody's Investors Service. To encourage short sales, banks are streamlining the closing process, forgoing their right to pursue unpaid debt, and giving some homeowners cash incentives of as much as $35,000 for relocation expenses.

Roadblocks involving second liens are standing in the way of even more short sales, which reached the highest number in three years in the first quarter-133,192 total transactions, said Daren Blomquist, vicepresident at RealtyTrac. While about 39 percent of homes that have entered the foreclosure process have more than one lien, just 4.2 percent of short sales completed in the second quarter-5,658 transactions-were on homes with second mortgages, according to an analysis RealtyTrac performed for Bloomberg.

"It appears that short sales with multiple liens aren't happening as frequently and are taking longer to complete," said Blomquist, adding that when a short sale doesn't go through, the home often ends up in foreclosure.

...The four largest U.S. banks-JPMorgan Chase, Bank of America, Citigroup and Wells Fargo-held 48 percent of the $849.5 billion in second liens as of March 31, according to the newsletter Inside Mortgage Finance. Some banks sell second mortgages to outside investors such as Franklin Credit Management for anywhere from a quarter of a cent to 60 cents on the dollar...

....While Franklin's Axon declines to say how much his company collects on the loans it buys, he said it averages more than the industry standard of 6 percent of the unpaid balance. His company focuses collection efforts on younger, more educated borrowers, he said....

(Excerpt) Read more at sfgate.com ...


TOPICS: Business/Economy; Culture/Society; Front Page News; Government
KEYWORDS: banking; economy; homemortgagecrisis; loans
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This is a VERY educational article.
1 posted on 07/29/2012 8:14:18 AM PDT by Cincinatus' Wife
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To: Cincinatus' Wife
Roadblocks involving second liens are standing in the way of even more short sales

How rude of 2nd position lienholders to want to get paid. Who do they think they are.

2 posted on 07/29/2012 8:19:46 AM PDT by vbmoneyspender
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To: Cincinatus' Wife

Everyone’s playing a waiting game. The banks are sitting on TRILLIONS in near-worthless real estate holdings that known about for at least 6 years. The FED is keeping the banks alive by pumping them money.

...and the waiting continues, and continues, and continues. They are waiting for the next boom in real estate prices, to unload all of their garbage. The problem is that every time they see an uptick and try to unload, they cap-off the uptick...due to increasing the supply.

There are still millions of properties doing nothing today, and it will be a decade (at least) before the demand catches up to them...unless there’s mass Amnesty or something like that.


3 posted on 07/29/2012 8:24:00 AM PDT by BobL ( It's easy to be a saint when you have nothing on the line)
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To: Cincinatus' Wife

I’ve been house-hunting for the last few months, and have avoided short sales like the plague on the advice of my realtor. Once the “home owner” accepts your offer, you’re still faced with the probability of several months of delays waiting for the lien holders to decide, and they’ll often make you wait 6-12 months before making up their minds.

I don’t have that kind of patience.


4 posted on 07/29/2012 8:35:24 AM PDT by MarineBrat (Better dead than red!)
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To: vbmoneyspender

I am stunned at the communist infection in our thinking. Pay your mortgage or get out. I paid mine years ago . I didn’t buy a home that I couldn’t afford. Our entire economy has beed ruibed by government policy to guaranty bad loans to people who had no chance to pay for them. The guaranty was to use YOUR money to do that. Abd use they did!!! The banks pressured to make these ctapy loans knew they were crappy but were forced by government regulators enforcing the “Community Reinvestment Act” (look it up). So the banks sold the mortgages in bungles to both forien and domestic institutions who bought the sub prime loans BECAUSE THEY WERE INSURED BY THE TAXPAYERS!!! Disaster struck so the government blamed the banks? I guess if you tell a lie loud enough some weak intellects will believe.
By the way, Government Motors is failing real bad. To move their inferior cars they now are financing with”sub prime’ lending to people with credit scores of 300!! They have a money printing company called GM Credit. My Dog has a score of 350. Now you don’t think you will pick that tab too? In short we are going to give people a “piece of the pie”!! Your Pie. It has ruined our great country. Cris Dodd and Representative Frank are directly responsible.


5 posted on 07/29/2012 8:38:18 AM PDT by marygonzo
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To: marygonzo
....By the way, Government Motors is failing real bad. To move their inferior cars they now are financing with”sub prime’ lending to people with credit scores of 300!! They have a money printing company called GM Credit. My Dog has a score of 350. Now you don’t think you will pick that tab too? In short we are going to give people a “piece of the pie”!! Your Pie. It has ruined our great country. Cris Dodd and Representative Frank are directly responsible.

And if all this isn't enough to destroy the U.S. economy, and its backbone the middle class, they're going to forgive student loans to finish the job and shove capitalism over the cliff.

6 posted on 07/29/2012 8:43:09 AM PDT by Cincinatus' Wife
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Short Sales are being approved at a swifter pace. The Banks finally got a clue that it saves them MUCH more money as compared to a foreclosure and the property is typically in much better shape with the owners continuing to live in them during the short sale approval process.

There are also, from what I've seen, equal or better pricing with short sales compared to foreclosures.

7 posted on 07/29/2012 8:46:52 AM PDT by NoRedTape
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To: BobL
The FED is keeping the banks alive by pumping them money.

Bernanke thought he could get the economy going by goosing the housing market with an easy money policy. The result has been laughable. As a result of the feds and Obama's economic policies, prices have increased on everything except housing.

In contrast to Bernanke and Obama and Congress, the banks have acted fairly heroically in refusing to reinflate the housing bubble. Otherwise, if they had done want the politicians wanted them to do, we would be in a recession accompanied by raging inflation.

Put simply, the Banks have learned their lesson and are acting like adults by refusing to loan out money they know cannot be paid back. The children running Washington D.C., however, cannot seem to learn the lesson that it is a bad idea to go into debt when you know you cannot pay it back.

8 posted on 07/29/2012 8:47:11 AM PDT by vbmoneyspender
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To: Cincinatus' Wife
It looks like the world of home finance has turned upside down. A second mortgage is subordinate to a first mortgage, and as such it is always seen as a less attractive loan for a bank (which is why second mortgages typically come with less favorable lending terms, higher interest rates, etc.).

In a scenario where the primary mortgage holder is willing to approve a short sale, however, the second lien holder apparently has a lot of power to kill the sale or demand substantial concessions. In effect, the second lien holder is acting like the first lien holder!

9 posted on 07/29/2012 8:49:48 AM PDT by Alberta's Child ("If you touch my junk, I'm gonna have you arrested.")
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To: vbmoneyspender
Put simply, the Banks have learned their lesson and are acting like adults by refusing to loan out money they know cannot be paid back.

It's a little more complicated than that. The Fed basically lends money to banks for nearly 0%, and then offers to sell them U.S. Treasury bills paying 2% to 3% rates. These rates are all being kept artificially low by the Fed. The banks prop up their balance sheets by buying all these Treasuries that help them maintain their cash flow and don't come with a risk of default from the "borrower" the way a home mortgage does.

Banks aren't acting so much "acting responsibly" in the lending process as they are recognizing that they don't make any money in the mortgage lending business anymore.

10 posted on 07/29/2012 8:55:01 AM PDT by Alberta's Child ("If you touch my junk, I'm gonna have you arrested.")
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To: BobL
It is a weird market here in Phoenix. New home sales are strong and inventory is short. Still a ton of foreclosures though. The newer and nicer are moving but the older homes ( in Phoenix a ten year old home is starting to be old), nobody wants and they sit empty forever. Especially the huge, two stories. I could have picked up a 3,500 sq ft. in a decent area, 10-12 years old for 175k. The decent resales are getting 30 offers in one day ( non short sales).

I should add that Canadians are coming in with cash and winning all the bidding wars. Strange market though.

11 posted on 07/29/2012 8:56:22 AM PDT by riri (Plannedopolis-look it up. It's how the elites plan for US to live.)
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To: MarineBrat

NEVER again will we buy a short sale. Our offer was excepted in 24 hours, took nine months to close. BofA held both 1st&2nd, the sale price covered all but 5k. The bank after four months demanded the owner pay them (BofA) 6k out of pocket.
The owner refused, bank then started really jerking everyone around, the owner personally talked to BofA after two more months they caved closed the next day.
Regardless never again.


12 posted on 07/29/2012 9:08:17 AM PDT by svcw (If one living cell on another planet is life, why isn't it life in the womb?)
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To: Cincinatus' Wife

A co-worker of mine filed for bankruptsy due to living it up on borrowed money. They had taken a $150K home equity loan and the lawyer had it completely forgiven (they kept the home). She said he told her that the loan was illegal and they are written off all the time. Makes me feel stupid sometimes for paying my bills.


13 posted on 07/29/2012 9:10:01 AM PDT by Rusty0604
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To: Alberta's Child
In effect, the second lien holder is acting like the first lien holder!

That's nonsense. In a short sale, the first needs to get approval from junior lienholders because they are either going to take a haircut or they are going to get wiped out entirely. That is as it should be because the juniors have a legal interest in real property that cannot just be made to go away by waiving a magic wand.

Of course, if the first thinks the juniors are being unreasonable, the first has a remedy. The first can foreclose. Then the juniors either have to bring the seniors current or they lose their interest in the property.

Our real estate market has operated this way for quite and there is no reason why it should operate differently now.

14 posted on 07/29/2012 9:11:47 AM PDT by vbmoneyspender
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To: BobL
"The banks are sitting on TRILLIONS in near-worthless real estate holdings that known about for at least 6 years. The FED is keeping the banks alive by pumping them money."

That's enough to collapse any economy, but it's even worse. The Fed is artificially keeping interest rates below the cost of capital to reinflate the housing market and let zombie banks make free money by parking it with the Fed, or leverage with derivatives.

Banks are foreclosing as a legal process (when they don't get tripped by the MERS title fiasco or second liens) but they're not evicting because there are still not enough buyers and entire communities would quickly fall into disrepair.

It gets worse, the top global banks cooked the books on LIBOR, calling into question the pricing of $365 TRILLION in interbank loans, business, adjustable rate, and student loans, and an incalculable mountain of exotic derivatives.

I could go on and on. This coming global collapse will make all previous depressions during modern industrial times look mild and short.

15 posted on 07/29/2012 9:14:18 AM PDT by uncommonsense (Conservatives believe what they see; Liberals see what they believe.)
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To: marygonzo
The banks pressured to make these ctapy loans knew they were crappy but were forced by government regulators enforcing the “Community Reinvestment Act” (look it up).

I've never seen any analysis on how many of the failed mortgages were CRA loans. Someone with essentially no income buying a $100,000 house because of the CRA was a problem. However someone with a $50,000 income buying a $500,000 home anticipating that it will be up to $700,000 soon was also a problem but had nothing to do with the CRA. Which was the more common loan? I really don't know and have never seen any numbers on it.

The biggest problem seems to have been the disappearing down payment. I you needed 10% down, then you could only afford a $300,000 mortgage if you had $30,000 available. Eliminated the down payment requirement with 80%/20% loans or even 100% on the first and suddenly you can "afford" any price of house.

By the way, whatever happened to the private mortgage insurers? I remember that I had to pay PMI because I could only put down 10% instead of 20% when I bought a house in 1990. Why aren't they paying anything? Or were they just set up to pay for an occasional individual being unable to pay instead of a wholesale collapse and they quickly went bankrupt in 2008?

16 posted on 07/29/2012 9:15:56 AM PDT by KarlInOhio (Recycled Olympic tagline Shut up, Bob Costas. Shut up! Shut up! Shut up! Shut up! Shut up! Shut up!)
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To: Rusty0604
Soon we'll be like countries with no rule of law but the bribe.

English contract law is a body of law regulating contracts in England and Wales. With its roots in the lex mercatoria and the activism of the judiciary during the industrial revolution, it shares a heritage with countries across the Commonwealth (such as Australia, Canada and India), and the United States. It is also experiencing gradual change because of the UK's membership of the European Union and international organisations like Unidroit. Any agreement that is enforceable in court is a contract. Because a contract is a voluntary obligation, in contrast to paying compensation for a tort and restitution to reverse unjust enrichment, English law places a high value on ensuring people have truly consented to the deals that bind them in court.".....

17 posted on 07/29/2012 9:27:09 AM PDT by Cincinatus' Wife
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To: vbmoneyspender
"That's nonsense. In a short sale, the first needs to get approval from junior lienholders because they are either going to take a haircut or they are going to get wiped out entirely."

True, in the world before ObaMao. The recent settlement with the AG forced the 1st lien holders to write down their mortgages without regard to 2nds. Hundreds of years of settled contract law has been upended with the union pension bailout (GM's VEBA), Fannie/Freddie/AGI and bank bailouts - the list it too long for me to type.

Another factor is proving a free-and-clear title after all of the securitization, illegal title assignment to MERS (or is it mears), the Fed, Fannie, etc. It's fubar on steroids and there is no case law to unravel it. It'll take a collective do-over to reset the market.

18 posted on 07/29/2012 9:36:36 AM PDT by uncommonsense (Conservatives believe what they see; Liberals see what they believe.)
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To: Cincinatus' Wife

Well we know what Obama thinks about contract law from the GM bailout deal.


19 posted on 07/29/2012 9:44:05 AM PDT by Rusty0604
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To: KarlInOhio

The private mortgage insurer was AIG and the government stepped in (bush) and bailed them out in TARP one. It was the sole cause of AIG Failure.
Noe , I think you are correct on the 300,000 homes. FHA changed its rules to actually go to $750,000 with government purchase or guaranty. These big loans wer put into Tranches with other crappy loans. FHA. Fannie and Freddie required+ no down payment and had lower requirements for women and minorities ( even to the point of waiving closing costs!! . Mortgage brokers will tell you that a warm body could get a huge loan on stated and not even verified income. Many were coached to lie, Appraisals were rigged to meet FHA rules. FHA and Fannie Mae and freddie mac were all politically trying to get poor people in houses at any cost for votes, If you had that guaranty you could sell that loan WITHOUT RECOURSE for about 109% of its face value because the total cash stream was much larger than that with ARM interest,
Now we see the bad old banks used robo signature to foreclose?? Give me a break!


20 posted on 07/29/2012 11:23:47 AM PDT by marygonzo
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To: marygonzo

The banks pressured to make these ctapy loans knew they were crappy but were forced by government regulators enforcing the “Community Reinvestment Act” (look it up).
***************************************
MaryGonzo ,, you couldn’t be MORE WRONG ... Take a look at the heavy foreclosure areas ,, Florida , Nevada , California ... NONE HAD ANY SIGNIFICANT NUMBER OF CRA ordered loans ... The problem was that with a cost of money at 0% ,, and their risk at 0% because they pre-sold the loans off ,, and the ability to artificially inflate the market with bogus appraisals and by adding to the pool of buyers by lowering standards THE BANKS ARE FULLY TO BLAME FOR THIS CRISIS ...

GROW A BRAIN AND LOOK AT WHAT ACTUALLY HAPPENED.


21 posted on 07/29/2012 12:03:10 PM PDT by Neidermeyer
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To: Neidermeyer

You spew government propaganda. No one believes it.


22 posted on 07/29/2012 12:10:51 PM PDT by marygonzo
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To: Neidermeyer
No, the banks are not, GSA's were required by HUD to purchase up to 50% or more of subprime loans. During the Clinton administration, the AG was threatening banks who didn't provide low income earners with 'liar loans' and the like with legal action. Activists such as 0bama sued and won against financial institutions like Citibank to guarantee a high proportion of their loand were subprime and offered to people unqualified to pay them.

Anybody who believes banks collectively lost their corporate minds starting in the '90's without being frog marched into it by Uncle Scam should buy a bridge from me. I have an extra good deal on several.

23 posted on 07/29/2012 12:19:58 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Alberta's Child

” In effect, the second lien holder is acting like the first lien holder!”

I wouldn’t put it quite like that. None, or very few of us can say “what the banks are thinking”. Oh, we think we can, and there are some with the industry knowledge to make educated guesses. But I can just tell you, as a matter of learning to negotiate, that in most cases it is a near-fatal error to assume you know the motivation of the other side. Just generically, this is way to mislead yourself.

That said, my belief is that most first mortgages are not held by banks. They are mostly held by Fan and Fred or FHA. They could be stuffable back to the originating banks, but in many, many cases, the paper trail back to the originating banks is questionable if not near impossible to reconstruct.

Many, many second morts, are, in contrast, held by banks. And they are worried about setting the precedent of forgiving them. A second mortgage on a home where the first mort is not being paid and is subject for foreclosure is in 95% of cases completely worthless.

The banks-holding-seconds are interested in being paid, but there’s every likelihood that they will not. But the longer they avoid settling out these 2nds, the greater the chance that some miracle will occur, eg; some gov bailout, some cash-rich investor who will offer at least a quarter on the dollar for an otherwise worthless 2nd, or some unspecificed something. As is, they have ZERO motivation to clear this item from their books since the act of settling for zero marks the asset to market, and FASB 157 allows them to mark the asset to fantasy. If all the banks holding RE loans had to mark their assets to market tomorrow, the great majority of them would detonate on the spot, their statutory capital falling below FDIC limits at once.


24 posted on 07/29/2012 12:23:11 PM PDT by Attention Surplus Disorder (This stuff we're going through now, this is nothing compared to the middle ages.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


25 posted on 07/29/2012 12:30:43 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


26 posted on 07/29/2012 12:30:43 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


27 posted on 07/29/2012 12:30:43 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


28 posted on 07/29/2012 12:30:43 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


29 posted on 07/29/2012 12:30:43 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


30 posted on 07/29/2012 12:32:02 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


31 posted on 07/29/2012 12:32:02 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s rather than GSE’s because now they are being managed and funded directly by Uncle Scam as a result of the real estate crisis.


32 posted on 07/29/2012 12:32:02 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

sorry - more problems with my internet provider, Clear.


33 posted on 07/29/2012 12:33:02 PM PDT by Post Toasties (Leftists give insanity a bad name. 0bama: Four years of failure and fingerpointing.)
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To: Post Toasties

I call them GSA’s GSA’s GSA’s GSA’s

Sory, couldn’t resist


34 posted on 07/29/2012 12:34:48 PM PDT by bert ((K.E. N.P. N.C. +12 ..... Present failure and impending death yield irrational action))
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To: vbmoneyspender

“How rude of 2nd position lienholders to want to get paid. Who do they think they are.”

You would think they would forgo the $35,000 relocation incentive and give that to the lien holder at the very least.


35 posted on 07/29/2012 12:38:32 PM PDT by Heart of Georgia (Boston's mayor is anti-Christian and anti-free speech.)
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To: svcw

That’s the kind of horror story my realtor had been telling me about. Banks that are under no compulsion to act in a civilized manner.


36 posted on 07/29/2012 12:44:39 PM PDT by MarineBrat (Better dead than red!)
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To: marygonzo

“Pay your mortgage or get out. ....... The banks pressured to make these ctapy loans knew they were crappy but were forced by government regulators “

If you don’t like government regulators forcing CRA, then get out.....out of the “banking” business.

(Or maybe they we’re in on it after all)


37 posted on 07/29/2012 1:05:40 PM PDT by Varsity Flight (Extortion-Care is the Government Work-Camp: Arbeitsziehungslager)
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To: MarineBrat
I was typing on the phone so didn't add the “event” that changed BofA’s mind and closed the next day.
The owner of the place we were trying to buy, found out who was running the show, went to his office (no appointment, she is 90, and uses a walker), just walked right in, introduced herself. The guy she said was livid.
Then she leans over his desk and said “close the deal”, his reply “not until you pay them money”.
She said, "my grandparents and parents were gassed in Auschwitz, here is my mark (shows her tattoo) do you really think you can intimidate me?”
As I said we closed the next day.
38 posted on 07/29/2012 1:47:29 PM PDT by svcw (If one living cell on another planet is life, why isn't it life in the womb?)
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To: vbmoneyspender
How rude of 2nd position lienholders to want to get paid. Who do they think they are.

Usually the same people that have the first lean.

39 posted on 07/29/2012 4:20:07 PM PDT by itsahoot (Old people cost too much money. They make lots of typos too.)
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To: itsahoot

The whole point of the article is that they are not the same as the senior lienholder.


40 posted on 07/29/2012 4:32:50 PM PDT by vbmoneyspender
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To: Post Toasties

Anybody who believes banks collectively lost their corporate minds starting in the ‘90’s without being frog marched into it by Uncle Scam should buy a bridge from me. I have an extra good deal on several.
**********************************************
Do they come with clear title? or are they clouded? There’s enough clouded , unsalable real estate for the next 100 years on the market already just looking for the right rube to lay a down payment on it.

The banks didn’t “lose their minds” ,, they simply didn’t GIVE A SH*T because they had interest rates at rock bottom ... meaning the pension funds and other buyers were DESPERATE for higher yields... They had the product to sell (and could manufacture more with rules changes), and they had NO RISK to themselves because it was pre-sold... The banks knew the loans were CR*P and bet against the revenue streams ... Where do you think their record profits came from? They booked large chunks of every loan as “trading profits” rather than fees ... and hid the fact that they were doing so with multiple closings (you attended the one with the straw man entity) ...


41 posted on 07/29/2012 8:50:24 PM PDT by Neidermeyer
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To: marygonzo

You spew government propaganda. No one believes it.
******************************************************
I “spew” the truth ,, my positions and arguments have been unchanged for the last 4 years... it’s you bankster apologists that have been slowly coming around... If I’m not right why is the entire gov’t structure running interferance for the banks... buying them time to unwind and attempt to unscramble the omelet the created... YOU SHOULD CARE ... THIS IS WHAT IS DRAGGING THE ENTIRE US ECONOMY DOWN ...


42 posted on 07/29/2012 8:54:46 PM PDT by Neidermeyer
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To: marygonzo

The private mortgage insurer was AIG and the government stepped in (bush) and bailed them out in TARP one. It was the sole cause of AIG Failure.
****************************************
MARY ... Please get the facts straight ... AIG insured the cash flow for the investors (and the creators of the issues created ) entire tranches and certificate issues ,, NOT INDIVIDUAL LOANS ,, NOT PMI ... people with no clue about the facts are annoying.

P.S. I suspect you were making an attempt at sarcasm with the line about robosigning... the truth is that the document trail , the assignments and sales never took place as a firewall to isolate the banks... so yes now they are creating a document trail out of whole cloth and YES it IS FRAUD ...


43 posted on 07/29/2012 9:02:58 PM PDT by Neidermeyer
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To: Neidermeyer

You sir are badly disillusioned to believe your own bs.It is common to talk oneself into erroneous conclusion. Always test your delusions with hard fact and you will come to grips with reality. Bank policy had zero impact on government regulation. absolutely zero. Bad loans were 100% demanded by government. You might enjoy the DU website. Are you Barney Frank?


44 posted on 07/29/2012 9:06:06 PM PDT by marygonzo
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To: Neidermeyer

And the dead beat folks that stole the money for the house they couldn’t pay for were innocent as lambs.
AIG was the insurer of PMI . I refuse to do your research. They were both direct and reinsurer of the whole glob of crap. Why do you think they were bailed?


45 posted on 07/29/2012 9:11:42 PM PDT by marygonzo
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To: Heart of Georgia

You would think they would forgo the $35,000 relocation incentive and give that to the lien holder at the very least.
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Two problems here ,, first the banks REALLY REALLY want a new buyer to paper over the fraud they perpetrated That’s why they have incentives ,, they want that short sale , they want that old transaction buried as far as they can... and anyone that simply denies denies denies and forces discovery will cost the banks far more than that $35k ... they will (by recent reports from 2nd DCA FL ) be offered forgiveness and a 75% to 90% haircut to sign new paperwork and not countersue.

second ,, there is no first lien on the vast majority of these properties... when the mortgages were sold to create the certificate issue by OCC rules the original note/obligation is destroyed (so the issuer/banks cannot sell it a second time)... there is no mortgage ,, only collection rights on an anticipated income stream.


46 posted on 07/29/2012 9:11:49 PM PDT by Neidermeyer
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To: Neidermeyer

http://seekingalpha.com/article/122484-why-is-aig-backing-fannie-freddie-enhanced-mortgages
Awe heck. Education is a gift. Here it is.


47 posted on 07/29/2012 9:16:09 PM PDT by marygonzo
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To: marygonzo; businessprofessor; Kartographer; Chunga85

And the dead beat folks that stole the money for the house they couldn’t pay for were innocent as lambs.
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testy testy ... you’re almost as ill informed on economics as Rush Limbaugh ... AIG doesn’t/didn’t issue PMI ... in almost every instance the SERVICER was required in the PSA to make payments on behalf of the borrower for (usually 6 months) if the borrower didn’t make payments ...

It’s the banks that are the deadbeats that want a “free house” that they have NO REAL INTEREST IN ,, never had an interest in as they table funded and pre-sold ,, just collected fee income ... they were more-or-less just another (undisclosed) broker collecting a BIG slice ... wake up and smell the fraud.


48 posted on 07/29/2012 9:20:40 PM PDT by Neidermeyer
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To: marygonzo

http://www.pmi-us.com//

AIG doesn’t do onesies and twosies ,, they may have backed consolidated groups of loans at FNM and FRE but they don’t sell to you and me..


49 posted on 07/29/2012 9:28:56 PM PDT by Neidermeyer
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To: Neidermeyer; marygonzo; businessprofessor; Chunga85

The only thing hurt the banks right now is the lost of income from managing these mortgages. The banks were long ago paid for these loans and never lost a penny on them despite all their crying as they sold the mortgages off the investors or the government after making a healthy market. In fact in most cases not one penny of the banks money was ever involved in the transaction as the mortgages were bundled and sold long before the loan was even made.

Now the trouble is as many on here have been warning that no one knows who actually owns the mortgages. The servicers aren’t even sure any more and as they don’t want to be out money for up keep on homes that they aren’t sure who to go to to get their money back they have stopped keeping up the foreclosed and abandoned properties. We have a few ring here in my subdivisions at lest two had pipes burst and ruined the house to a point where the city has issued no occupancy notices and the HOA is getting one hell of a run around on who owes the yearly fees and are at a point of having to place liens on a number of properties.

And it just isn’t here here a story from Florida on the same thing:

Now It’s the Big Banks That Are Getting Foreclosed On

http://www.cnbc.com/id/48259827

Face it the mortgage industry has twisted and broken long standing real estate law to the point it will take years to straighten out and many honest home owners who pay off their mortgage will have to spend thousands of dollars to uncloud titles for YEARS.


50 posted on 07/29/2012 10:19:02 PM PDT by Kartographer ("We mutually pledge to each other our lives, our fortunes and our sacred honor.")
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