Tuesday, August 01, 2006

Double digit declines will take years to work out

Surprising that this piece comes from RealtyTimes, given the very negative outlook. Author Bob Schwartz takes a position not often seen among real estate columnists, calling for a double digit decline in prices.

San Diego Home Sales Figures: Not All That They Seem

Reviewing the recently released real estate sales data for San Diego, the lay person might conclude that the June home appreciation figures were down approximately 1 percent as compared to June 2005. The reality is the decline is probably much closer to three or five times the published figures.
...
year ago one would be hard pressed to find any individual home seller or major new home builder offering incentives. Now, it is just these incentives that also skew the appreciation data. A $500,000 home sale with a $25,000 interest rate buy-down/closing costs package incentive will be recorded as a $500,000 sale. Yet, the $500,000 sale, in reality was only $475,000 or 5 percent below the reported sales data!

So if the $500,000 sale was just 1 percent below the June 2005 median appreciation, you can see that the 'real' difference was 6 percent below last year!
...
Typically the period from late March through September is the strongest for real estate sales. What does both a huge and continuing month over month sales decline and now a home appreciation drop, during this 'hot' time, portend for the market as it enters the weaker Fall/Winter period? Lastly, the bulk of the interest only, 100 percent loans used to prop up our market for the last few years, has two or three year time periods until the re-amortization (at the current prevailing interest rates) of the loan balances. The majority of these interest rate adjustments will occur in 2007 and 2008.

In my opinion, this is no 'return to normal' or 'slight correction' to the San Diego real estate market. By year's end there will be no denying we will experience a double digit appreciation decline. A decline that will take years, not months, to work itself out.

58 Comments:

Anonymous Anonymous said...

Local Newspapers charge $400 for a 3-day weekend "Home for sale by owner ads" !!!!

Can you tell now why media doesn`t want coverage on REAL ESTATE BUBBLE ????

8/01/2006 11:45:00 AM  
Anonymous Anonymous said...

Gear-up for another FED RATE hike !!!
---------------------------

Stocks drop on increased inflation fears
By MICHAEL J. MARTINEZ, AP Business Writer
6 minutes ago
http://news.yahoo.com/s/ap/20060801/ap_on_bi_st_ma_re/wall_street;_ylt=AiY0DHNZ7Qnq4Jr3svFDI0KyBhIF;_ylu=X3oDMTA2Z2szazkxBHNlYwN0bQ--


NEW YORK - Heightened fears of inflation prompted investors to sell off stocks Tuesday as a key price index climbed to an 11-year high and an improving manufacturing sector raised the likelihood of another interest rate hike by the Federal Reserve.

ADVERTISEMENT

While inflation-adjusted consumer spending rose a sluggish 0.2 percent in June, the Commerce Department also reported that consumer prices are up 2.4 percent year over year, the highest rate of inflation since April 1995.

A big increase in the Institute for Supply Management's manufacturing index deepened investors' interest rate worries, as a strong economy would make it easier for the Fed to raise rates without cutting off growth. The index rose to 54.7 in July, far better than the 53 reading economists had expected.

The Fed meets next Tuesday to gauge whether more interest rate hikes are needed to clamp down on inflation. The Commerce and ISM reports could push policy makers toward another quarter percentage point increase, which would put the benchmark rate at 5.5 percent. That would make capital more expensive for corporations — and hurt corporate earnings and share prices.

"The market is trying to read every tea leaf to gauge where the Fed is going to go, and we have a lot of data out this week," said Bryan Piskorowski, market analyst at Wachovia Securities. "You're going to see these kind of movements, up and down, before you get to the Fed meeting."

In midday trading, the Dow Jones industrial average fell 74.60, or 0.67 percent, to 11,111.08.

Broader stock indicators also fell. The Standard & Poor's 500 index lost 7.75, or 0.61 percent, to 1,268.91, and the Nasdaq composite index dropped 27.15, or 1.3 percent, to 2,064.32.

Bonds edged lower, with the yield on the benchmark 10-year Treasury note rising to 4.99 percent from 4.98 percent late Monday. The dollar rose against other major currencies, while gold prices rose.

Rising crude oil and natural gas futures added to Wall Street's worries, since the Fed has signaled that high energy prices could further feed inflation. Crude prices rose $1 to $75.40 per barrel due to multiple crises in the Middle East, while natural gas futures built on Monday's 14 percent surge based on higher U.S. electrical demand in a nationwide heat wave.

The chronic concerns over inflation caused investors to again overlook corporate earnings, which have been strong overall. Verizon Communications Inc. fell 61 cents to $33.21 after reporting a 24 percent drop in second-quarter earnings that nonetheless beat Wall Street expectations by 2 cents per share. Investors were disappointed, however, with the company's full-year forecast.

Qwest Communications International Inc. posted a profit after a year-ago loss, helped by improved profit margins on flat revenues. Qwest gained 43 cents, or 5.5 percent, to $8.22.

The higher energy prices that has the stock market in flux helped Marathon Oil to double its second-quarter profits from a year ago. Marathon rose $1.64 to $92.28 after reporting earnings that beat analysts' forecasts by 59 cents per share.

Agricultural processor Archer Daniels Midland also benefited from the energy markets as demand for corn-based ethanol fuels helped the company double its quarterly earnings. ADM added 7 cents to $44.07.

Eastman Kodak Inc. tumbled $2.51, or 11 percent, to $19.74 after it posted its seventh consecutive quarterly loss. The one-time leader in cameras and film is undergoing a difficult transition to digital photography.

Declining issues outnumbered advancers by about 7 to 3 on the New York Stock Exchange, where volume came to 638.66 million shares, compared with 622.72 million traded at the same point Monday.

The Russell 2000 index of smaller companies fell 10.28, or 1.47 percent, to 690.28.

Overseas, Japan's Nikkei stock average fell 0.1 percent. In afternoon trading, Britain's FTSE 100 was down 0.8 percent, Germany's DAX index fell 1.5 percent, and France's CAC-40 lost 1.22 percent.

8/01/2006 11:47:00 AM  
Blogger patient homebuyer said...

i hope it does not take that long

check out these prices i was sent

via email form a broker. this is

in astoria where they lost power

for 10 daysHi,



Brand new Astoria Development. Please call me if you are interested.



Description:

This unique boutique building offers a limited number of carefully crafted modern apartments for buyers that are looking for a contemporary city living. It features residences with 9 ft ceilings, Kohler whirlpool bathtub, Motion Alarm system and some units with outdoor spaces and Manhattan skyline views. This intelligent building is made of 10 residences has an electronic doorman with security cameras and video intercom, gym, common outdoor area, laundry room, wi-fi access and central A/C(with HEPA air cleaner to reduce indoor pollen levels).The designed lobby combines exposed brick, steel, glass and stones. Each residence comes with a bike room, a scooter private parking and a private storage space





Listings:

Studio 430SF Juliet Balcony $249K

1BR 454SF $315K

1BR/1.5Baths 500SF Terrace $355K

1BR/1.5Baths 650SF $419K

2BR/2.5Baths 1278SF Balcony, Terrace $897K

2BR/2.5Baths 1327SF Balcony, Terrace $929K


what bargains where do i sign???

8/01/2006 12:50:00 PM  
Blogger grim said...

Video clip from the Today show, I believe this was from this morning
Today Show

NAR Chief Economist David Lereah talks about buyers making serious lowball offers (up to 30% off).

grim

8/01/2006 01:02:00 PM  
Anonymous Anonymous said...

Good clip, Grim! I just watched it. My feeling is we should take advantage of still-not-too-high-rate, and ofeer lowball to drive the market forwrad faster.
MM

8/01/2006 01:18:00 PM  
Anonymous Anonymous said...

Take a look bubbleheads You can LOSE money on real estate.

BAAAAAAAAWAAAHAHAHA

http://flippersintrouble.
blogspot.com/2006/07/
flippers-in-trouble
-gallery.html

Bob

8/01/2006 01:21:00 PM  
Anonymous Anonymous said...

4201 Sharwood Way
Carmichael, CA 95608 $460,000
Bedrooms:3 Baths: 2 Sq. feet:1793
Price Changes:
Down 8.0% from $500,000 On 04-21


Previous Sales:
Sold on 2005-10-28 for $500,000

MLS# 60038357

GO AHEAD BUY BUY BUY AND LOOK LIKE A MONEY LOSING FOOL LIKE ABOVE.

BAAAAAAAAAAWAAAAAAHAHAHA

Bob

8/01/2006 01:24:00 PM  
Anonymous Anonymous said...

I bet this IDIOT is lucky to get out with a minimum LOSS of $100k-$125K.

So go ahead and buy a bargain now.NOT!
You can lose Dummies. Listen up and don't be the last bagholding fool.
BAAAAAAAAWAAAAAAAHAHAHA

Bob

8/01/2006 01:26:00 PM  
Anonymous Anonymous said...

Hey Lowballers. Your underwater about now!

Go ahead try selling!


It ain't easy to sell a bloated overpriced house now.

The Greedy grubbing Seller stuck you with the Overpriced house.

You bought in the last year you are likely underwater!

BAAAAAAAAWAAAAHAHAHAHAHAHAHA.

Bob

8/01/2006 01:29:00 PM  
Anonymous Anonymous said...

BAAAAAAAWAAAAAAAAHAHAHAHA


8053 Cantata Way
Antelope, CA 95843 $435,000
Bedrooms:4 Baths: 3 Sq. feet:2159
Previous Sales:
Sold on 2006-02-10 for $475,000

MLS# 60001458

ANOTHER BAGHOLDING LOSER!

Grimster needs to come out with a new posting: "THE BAGHOLDERS CLUB"

JOIN THE CLUB AND BUY!

BAAAAAAWAAAHAHAHAHA

Bob

8/01/2006 01:33:00 PM  
Anonymous Anonymous said...

lOOK AT THE DATE BAGHOLDERS.


Bedrooms:4 Baths: 3 Sq. feet:2159
Previous Sales:
BOUGHT on 2006-02-10 for $475,000**********

ASKING NOW $435,000

SO LISTEN UP SO CALLED 'LOWBALERS' YOU ARE MOST LIKELY UNDERWATER ALREADY!


BAAAAAAAWAAAAAHAHAHAHA

Bob

8/01/2006 01:35:00 PM  
Anonymous Anonymous said...

Hi Bob,

If no lowballers now, how the market move forward...

8/01/2006 01:40:00 PM  
Anonymous UnRealtor said...

"If no lowballers now, how [will] the market move forward."


1) Greater Fools

2) Price Drops

8/01/2006 01:45:00 PM  
Anonymous Anonymous said...

Remember many of these greedy grubbing johnny come lately sellers HAVE TO SELL.

INFLICT MAX PAIN. ENUF OF THIS MULTI-YEAR DROPS. GET IT DONE QUICKLY IN 2 YEARS.

NO BIDS NO NOTTTING!

BOOOOOOOOOYAAAAAAA

Bob

8/01/2006 01:46:00 PM  
Blogger grim said...

Bob!

Relax!

8/01/2006 01:50:00 PM  
Anonymous Anonymous said...

Ok

BOOOOOOOYAAAAAAAAAA

Bob

8/01/2006 01:54:00 PM  
Blogger chicagofinance said...

finally with the "Booooya"

whew!

BAAWAAHAHA BOB is nowhere near as catchy :)

8/01/2006 01:55:00 PM  
Blogger chicagofinance said...

grim said...
Video clip from the Today show, I believe this was from this morning
Today Show
NAR Chief Economist David Lereah talks about buyers making serious lowball offers (up to 30% off).
grim
8/01/2006 02:02:40 PM

Um.....Brandy [not my speed, but PLENTY smokin'] noting a whole bunch of strategies intended to maintain comps - seriously, what in goods name is she saying? Kind of sleazy at best, or simply just patent double talking.

Lereah - I could see his nose getting longer and longer with each word out of his mouth. By the end it appeared as if his head was about to explode. Yes?

8/01/2006 02:09:00 PM  
Anonymous Anonymous said...

Enjoy

http://www.boston.com/news/
special/spotlight_debt/
part1/page1.html

8/01/2006 02:55:00 PM  
Anonymous Anonymous said...

http://zfacts.com/p/461.html

8/01/2006 03:13:00 PM  
Anonymous Anonymous said...

I bought in the last year and am not underwater. I started out with 25% equity and have a 30 yr fixed at 6.5%. I have no plans to move in the next 5-7 years. In the meantime I have a nice place to live for my family, in the town I want to live in. If it comes time to sell and the place is worth less than the mortgage, that's life and I will deal with it. I didn't want to rent and live in someone else's home, or in an apt complex with 400 other people goin up and down elevators all day. So, there is risk in real estate. I understand. Get over it!

What is all the hysteria about?

8/01/2006 03:27:00 PM  
Anonymous Anonymous said...

25% equity? 25% down the tubes so you lose only 25%!

Read this one Big Guy!

http://www.azcentral.com/
news/articles/
0730emotional0730.html#

8/01/2006 03:31:00 PM  
Anonymous Anonymous said...

Who says your NOT underwater. Go ahead try selling it!

Real estate is illiquid. Not so great when things are going down.

8/01/2006 03:33:00 PM  
Blogger RichInNorthNJ said...

"Hysteria"

As you mentioned, there is less risk because you plan on staying in your home.

Many here (as I do to Bob) feel that prices are over inflated and due to the over inflated prices the ever present risk in housing is now greater.

I don't think there is any hysteria on this board (other than a few inane posts); just those that feel this correction could end up being more severe and longer than previous corrections.

But, like you if I find a home that meets my "price point" I'll purchase also as it'll be a home I plan on staying in for more than 10 years.
I don't plan on using my future home equity for a load or retirement other than having a place where my largest expense (housing) will not be an issue in my "golden years".

So, any hysteria you may see in the future will probably be those who didn't expect a decline or planned on their future equity to retire or make major purchases.

8/01/2006 03:39:00 PM  
Blogger RichInNorthNJ said...

Oh, that hysteria...

8/01/2006 03:46:00 PM  
Blogger skep-tic said...

re: debt collectors

-- perfect jobs for realtors who can't cut it in a down market. opportunity knocks!

8/01/2006 03:47:00 PM  
Blogger chicagofinance said...

Anonymous said...
So, there is risk in real estate. I understand. Get over it!
What is all the hysteria about?
8/01/2006 04:27:01 PM

#1 As noted by others, most of the hysteria is from people in your position. Although it may not be obvious, much of the discourse here is relatively upbeat and humorous, if at times incredulous.

#2 I compliment you on your focus and pragmatism. Most people in your situation have been far less civil to the economic philospohy espoused on this blog and its participants.

8/01/2006 03:51:00 PM  
Blogger chicagofinance said...

A client just received the most massive check from an i-bank to sign-on.

Impressive.

They are packing their bags and moving to a Southampton rental for a month with the kids. His first day is after Labor Day.

I think they will be going jeans shopping.

He is my age - 38.

8/01/2006 04:18:00 PM  
Anonymous Anonymous said...

I don't understand what the hysteria is about neither, why do you have to sell, if it is a dream home that you plan to live in for a long time. All these "The sky is falling" articles only scare the investors or those greedy people who went after homes that they can't afford. If you love the house you got(I am sure most people do), you can manage your mortgage without any problem. Why not just stay where you are and stop worrying about how much the paper value of your house really is? Only people that wanted to make a profit of their purchase have to worry about that.

8/01/2006 04:25:00 PM  
Blogger Ramesh Reddi said...

I would not buy before December 2008. It is going to get ugly in 2007 and horror in 2008. 2009,2010 flat. 3% appr from 2011. Then again bubble starts some time 2015. So if somebody is looking to make a killing i would rather look at csco, vod etc.

8/01/2006 04:35:00 PM  
Anonymous Anonymous said...

If we low ball them, then lower ball them, then lowest ball them.....then we don't have to wait until 2008!

8/01/2006 04:42:00 PM  
Anonymous Anonymous said...

i made an offer at 35% off asking price of an above Million dollar house...:-))

8/01/2006 04:45:00 PM  
Blogger grim said...

There is no hysteria here, only the open exchange, discussion, and exploration of a very specific topic, the state of the Northern NJ real estate market.

Because we focus very closely on that specific topic, it might be easy to interpret (perhaps projection is more appropriate) our discussion as hysteria. It is not.

Yes, the outlook of many here is rather, well, grim. It's fine to disagree here, don't feel like you are going out on a limb if you don't agree.

Some come here to discuss the economic implications, others come to vent anger or frustration, some come to learn, and a few just hang out because of the sense of community here.

I have a handful of my own personal goals as well.

The first is to reduce the information asymmetry that exists in the local real estate industry. Both buyers and sellers are being short-changed if they are not privvy to all of the information that exists in the market. The market can not be efficient if a small group of individuals controls that information, especially so when those individuals stand to profit based on the interpretation of that information.

Secondly, is to educate new buyers. Many new buyers are under incredible pressure to purchase. This is the direct result of the media, trade groups, and even family telling them so. Real estate is so intertwined with emotion that it's difficult to make an informed financial decision with those pressures looming. First time buyers are being pushed into risky loans and risky purchases under false pretenses. "You better buy now, prices are only going to go even higher, you'll be priced out forever, they aren't making any more land, you'll be forced to move away, you'll be poor while we're all rich, etc etc"

The market was in dire need of a counter point and a place to discuss it.

Caveat Emptor!
Grim

8/01/2006 04:54:00 PM  
Blogger Mr. Oliver said...

Chi, for future reference when we decide to buy...any other Realtors (tm) that look like Brandy out there?

8/01/2006 04:56:00 PM  
Blogger Mr. Oliver said...

Grim said...
"'You better buy now, prices are only going to go even higher, you'll be priced out forever, they aren't making any more land, you'll be forced to move away, you'll be poor while we're all rich, etc etc'"

If only I had a dollar for each person that told me this over the past two years.

8/01/2006 04:59:00 PM  
Anonymous UnRealtor said...

"All these 'The sky is falling' articles only scare the investors or those greedy people who went after homes that they can't afford."

That's sorta the point -- few can afford today's prices without exotic loans/massive debt burden.


"If you love the house you got(I am sure most people do), you can manage your mortgage without any problem."

That is, if you can make PITI + expenses as ARMs adjust, etc.

8/01/2006 05:26:00 PM  
Anonymous UnRealtor said...

"i made an offer at 35% off asking price of an above Million dollar house."


Well, you can't just drop that bomb and leave. :-)

What was the response?

8/01/2006 05:27:00 PM  
Anonymous Anonymous said...

unrealtor:

I know -talk about leaving us hanging! I went to every thread just to see if he/she posted the results of the offer by accident on another thread!

Pat

P.S. Bob is sounding a lot like Crazy Eddie. Is that what happened to him? I always wondered.

P.P.S. My husband just got off the phone. Another friend took a transfer to Georgia today. We're now the last of the holdouts up here. He doesn't even have enough guys left for the monthly poker game anymore.

8/01/2006 06:31:00 PM  
Anonymous Anonymous said...

Do they have $300 jeans in Georgia?

Pat

8/01/2006 06:40:00 PM  
Anonymous UnRealtor said...

I hear Georgia is very nice, lots of great houses under $300K, family-oriented vibe, etc.

8/01/2006 07:33:00 PM  
Anonymous Anonymous said...

A coworker of mine is uprooting his whole family to Georgia where he bought a huge house for a little over 300k in a nice neighborhood. His taxes will be around $2500 per year if that. Sure, the weather is hot and sticky, but you should see the pool he has in the back. The house has at least 5 bedrooms with all the fixins. It really makes me think about leaving NJ for good.

-frustrated with NJ

8/01/2006 07:51:00 PM  
Anonymous Anonymous said...

they have $300 jeans in bucks
county over in feasterville

8/01/2006 07:55:00 PM  
Anonymous Anonymous said...

Hah, Hah, 8:55.

BTW..the only thing in Feasterville is a Value City, I think.

Pat

8/01/2006 08:45:00 PM  
Anonymous Anonymous said...

Things might seem fine now, but if the value of your home falls below the amount of your loan, its called being upsidedown, and the bank views you as a credit risk. If a bank views you as a credit risk, there goes your FICO and good luck with things in the future. Also, banks can, have, and will do margin call on your mortgage (just like stocks), were they say...hey....give us more money....i.e they "call" your loan.

So you may not be immune from the bubble as you think you are and the banks don't give a shit about you or your family.

Cold, harsh, but reality.

SAS

PS. Pat, I really like my new sunglasses. They are called Perzol or something like that.
I have no debt and life is good. Because I always lived by the saying "the borrower is servant to the lender".

I was a servant once in the USMC, I will be damned if I will be some pork belly banks servant.

8/01/2006 08:56:00 PM  
Anonymous Anonymous said...

Persol? My husband would sit on those the first day he had them.

If I pay more than 30 bucks, they get trashed immediately. The cheap stuff from Englishtown he has all summer. Go figure. The god of sunglasses has a sense of humor.

8/01/2006 09:16:00 PM  
Anonymous Anonymous said...

Does the new HUD law even matter in NJ? Don't know if this was already discussed. Maybe help South Jersey and Trenton?

HOUSE PASSES BILL TO MODERNIZE FEDERAL HOUSING ADMINISTRATION
Legislation Will Increase Access to FHA for Potential Homebuyers

1)Eliminate the current statutory three percent minimum down payment, reducing a significant barrier to homeownership. FHA’s existing down payment requirement does not meet the demands of today’s marketplace, where most first-time homebuyers put down two percent or less. The "new” FHA would offer a variety of down payment options.

2) Create a new, risk-based insurance premium structure for FHA that would match the premium amount with the credit profile of the borrower. It would replace the current structure, in which there is standard premium amount for all borrowers, while still protecting the soundness of its Insurance Fund. FHA would have the flexibility to charge a lower premium for low-risk borrowers, and to charge higher-risk borrowers a slightly higher premium.

3) Increase and simplify FHA’s loan limits. FHA’s loan limit in high-cost areas would rise from 87 to 100 percent of the GSE conforming loan limit and in lower-cost areas from 48 to 65 percent of the conforming loan limit. This change is crucial in today’s housing market. In many areas of the country, the existing FHA limits are lower than the cost of new construction, eliminating FHA financing as an option for buyers of new homes in those markets. FHA has simply been priced out of the market in other areas, such as California, where FHA insured only about 5,000 home mortgages in all of 2005, down 95 percent from 109,000 in 2000.


Pat

8/01/2006 09:28:00 PM  
Blogger chicagofinance said...

SAS

Perzol?

Isn't that a prescription ointment that Merck produces to soothe an aching wallet after you sign an Option ARM and subsequently become upside-down?

8/01/2006 10:01:00 PM  
Blogger rymingrealtor said...

Chi, for future reference when we decide to buy...any other Realtors (tm) that look like Brandy out there? >

Mr. Oliver
Are looks what need
in your- Realtor ?
How about info and knowledge, and
and limericks galore ?

When your ready to buy some of this over priced crap.
You need more than good looks
to keep you from being a Sap!

It's not that blonde Brandy you need for this War!
It's none other than Me !
.......RHYMING REALTOR! ......


KL

8/01/2006 11:12:00 PM  
Anonymous Anonymous said...

Also, banks can, have, and will do margin call on your mortgage (just like stocks), were they say...hey....give us more money....i.e they "call" your loan.


Yeah, and Simon Legree will come and take your first born child as collateral, too.

This statement is complete and utter nonsense. It's in the bank's best interest to keep you in the house, and paying, for as long as possible. Workouts, forebearance....anything but foreclosure.

"Margin call" on your mortgage? Please. I realize that the purpose of this blog is at least partly to induce homeowner panic, so that you 30-somethings can at last put landlords and leases behind you...but spreading disinformation is not the way to do it.

8/02/2006 05:20:00 AM  
Blogger grim said...

The only thing similar to a "margin call" is the neg-am limit on a mortgage that allows for negative amortization.

The neg-am limit is often set at approximately 110% (give or take a few bps). Say they buyer puts 5% down, and proceeds to pay the neg-am amount each month. They will quickly erode their equity, bringing the loan to 100% LTV. As they continue down the path, they'll eventually owe more than the home is 'worth'.

When the neg-am limit is reached, the loan is recast immediately, often times it is reset to the max, bypassing any other interest rate limits. At this point some loans will no longer allow the owner to make the minimum or neg-am payment. The new minimum would be the amortizing amount at the new interest rate.

The payment shock in this situation can be massive for a marginal buyer who needed to use the IO/Neg-am options to "afford" the home.

"Go directly to jail, do not pass go, do not collect $200"

grim

8/02/2006 05:41:00 AM  
Blogger grim said...

Actually a "collateral call" on a Pledged-Asset Mortgage is much closer to the concept of a "margin call".

Here is an example, easier than me typing it up..

100% Mortgages: The Low Down on No Money Down

The amount you pledge usually exceeds the amount required, thereby allowing for some fluctuation in the value of the securities. However, if value of the securities you pledged goes down below a minimum amount set by the firm, your firm may issue a collateral call, which is a demand that you deposit additional cash or securities. If you can't do so or the value of the securities continues to decline, your firm may sell some or all of your securities, sometimes even without notifying you.

I don't believe that this type of mortgage is common, although I admit that I have not seen any statistics on them.

grim

8/02/2006 05:56:00 AM  
Anonymous Anonymous said...

Grim..obviously you haven't been wasting a lot of time trolling sites like Yahoo answers. Sites with an s.

You'd be pretty surprised at what's really going on out there with the Walmart crowd.

I couldn't believe the number of questions about foreclosure. If you can filter out all the garbage, and tune in only to mortgage, debt, etc., take a peak.

Pat

8/02/2006 06:22:00 AM  
Anonymous Anonymous said...

anon 06:20:36 AM

ha, 30 somethings..ha

I was knee deep in the Vietnam war while most of these bloggers fathers were jerking off to the lingerie section in the
Sears catalog. I have been hired and now consult companies to do what is called "undercover" economics (think of it as the Navy Seals of economists). I went to and taught at (Tuck), people who were in my class are now CEO of banks, banks whom give you and everyone else on this blog loans for all sorts of nick nack patty whacks.

Review your history, especially last RE bust, and the logistics that lead up to the depression.
Or better yet, just call the banks and ask them, but don't talk to some cute minimun wage teller, you need to talk to someone "upstairs".

Grim gave a good example in his post. Grim is much more elegant with his speech then me. But there is more to the picture.

Remember, the banks own you. So they can pretty much do whatever they want to you, and if they view you as a credit risk....look out, especially if the bank thinks itself might go down, then you really better look out, because they will bring you down along with them.

SAS

8/02/2006 07:55:00 AM  
Anonymous Anonymous said...

oh one more thing...

FDIC means nothing. Its just a worthless little logo and a ploy to make people "feel" safeabout your money.

SAS

8/02/2006 07:59:00 AM  
Blogger grim said...

Interesting.. Fannie has a pledged-asset product. Even lets family members pledge assets towards a mortgage.

I'm trying to find the data, but short of subscribing to Loan Performance or one of the other services, it's almost impossible to get the data..

grim

8/02/2006 08:19:00 AM  
Anonymous Anonymous said...

Good morning UnRealtor, Pat and all follow readers,

I did made the offer at a little lower than one Million for a house (5BR, 4.5Bth) asking 1.5M in Bergen conuty. The listing agent said my offer only can buy 3Br of it...so here I am, still hunting...

One friend got government job offer in DC (without re-location package) and list their house asking about 1.2M in Bergen since Feb-06...Ends up he came back in NJ couple weeks ago for his old firm because he can't sell their house...

I am waiting for my agent to call me back for that house...

8/02/2006 08:43:00 AM  
Blogger chicagofinance said...

SAS
8/02/2006 08:55:31 AM


SAS: Appreciate the candor, but maybe you want to tone down the colorful descriptions a tad? Is this request fair?

8/02/2006 10:55:00 AM  
Anonymous UnRealtor said...

"The listing agent said my offer only can buy 3Br of it."


Well, it was worth a shot! You'll probably hear back from them as school starts, and they'll throw in the other two bedrooms.

8/02/2006 12:48:00 PM  

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