I now have a personal reason to like this Obama guy…
Read the poor used house salesman:
I now have a personal reason to like this Obama guy…
Read the poor used house salesman:
*Some may enjoy seeing the agents and mortgage bankers get their comeuppance but it would also destroy most HI businesses.
We all rely on the sale of homes.
Perhaps. But on the flip side of this, if rates get to where they were back in the late 80’s (like 16%) we’ll be looking for new careers. I’m unfortunately old enough to remember the last serious debacle. I was a broker back then and inspectors I knew didn’t have work for 8-10 weeks at a time. :shock:
A little history gentlemen and ladies.
Nice illustration, Mike. I’m older than I thought. :neutral:
This current slowdown is nothing compared to some of the past bs. But then again I get this feeling I’m not the only one here who is 50…
The problem with mortgages is no one but the brokers really know how mortgage originators get paid, think yield spread premium. $$$$$
It is not a free market, the deck is stacked against the consumer.
For those who don’t know what “real interest rate” is.
It’s the stated interest rate on a mortgage - the rate of appreciation.
Back to Jim’s original post, it would be great to see some accountability on the agent’s side of business. They’re on a free ride blaming the world’s problems on home inspectors.
I read some of the blog James, looks like title insurance will also be lumped in with real estators and everyone else.
Title companies and title insurance is just a rip off as it is, I do not even know why we still need it?
Many loan originators make between 2 to 4 percent of the loan value, for what? They can make even more if the hook you up with a pre-payment penalty, sweeeet.
Not a free market.
I know some loans that pay 3% on the front side (which is disclosed to the consumer) and 3% on the back side (A kick back for charging the consumer a higher interest rate). That is 6%. Real estate companies get it. Why not mortgage companies?
I believe 3% is a great rate for an inspection fee.
The true problem is not the realtors or mortgage brokers.
The real problems is with the securitization of these thousands of loans.
It is the large banking institutions who are at fault.
Despite the fact that most of the loans in default are insured by AIG (Remember them? We bailed them out so they couldnt fail because they underwrote the loans), banks continue to seize homes, even though they have been paid off.
Even though short sales must be okayed by the banks, the banks are now coming after the homeowners who they allowed to sell their homes for less than owed. BTW… the banks are paid for these loans by AIG, as well.
BAnks have purchased the assets of other banks (Remember IndyMAc) for 50 cents on the dollar. They then dont allow loan modifications and foreclose or do a short sale.
So, let’s say they purchased a $100,000 loan for $50,000. They allow the short sale to go through for $75,000 (they are alreadt $25k ahead of the curve.
BUT… through a sweetheart deal with the Fed, the bank is guaranteed 90% of the shortfall between what the property sells for and the value of the ORIGINAL loan. So, they now get another 90% or the $25,000 “Shortfall” between the short sale amount and the value of the loan… another $22,500.
Then they go after the lowly homeowner they forced out for the difference between the value of the short sale and original loan amount ($50,000)
Yep… this is a FACT.
Dont even get me started with abuse of authority, fraudulant assignments, violations of security agreements, and blatent securities fraud.
I agree but let’s not forget the millions of people who committed fraud as they lied on their loan applications claiming income they didn’t have.
People treated their homes as cash machines.
It worked until it didn’t.
True, Mike… but not in all cases.
Let me ask you this:
If you took out a loan and fell on hard times…
And you tried to work something out with the bank and they refused…
And your mortgage was not upside down (you had plenty of equity)…
And the bank tried to foreclose on you for missing two payments…
And they legitimized their actions based on something called a PSA…
And then you discovered that the bank never followed the terms of the PSA…
And you loan could never have legally been part of the securitized pool of mortgages thich were bundled and sold to investors…
And three years after the date that no additional loans could be added to the pool of loans, it was mysteriously assigned in violation of the PSA to a trustee in charge of the pool…
And the person who signed, claiming to be the vice president of the bank, but who was really only an employee of a title clearing house, and actually never worked for the bank, assigned your loan to the trust…
And the bank foreclosing attempts to use this instrument to seize your home…
And your actual physical original Note no longer exists…
If you were on the short-end of this foreclosure, what would you do?
Please tell me that this isn’t fraud, because if it looks like a duck, walks like a duck, and quacks like a duck… it’s a duck.
These things are being exposed in the courts, and banks are starting to end-up on the losing end.
Mortgages are being forgiven, and banks are being told they have no standing to foreclose.
Personally, I believe the mortgages should be forgiven, and allow the investors to sue the firms who sold them these bogus investments. It will cost this country no more in lost jobs or disappearing credit then what we currently see. Deutsche Bank National Trust, a foreign entity, serves as trustee for many of these trusts. Imagine that…
It goes much deeper, with credit swaps. This is where the banks bet against the homeowner, because they, and the loan servicers, make more with defaults. Imagine betting (and hoping) that the homeowner will default because it improves the bottom line.
If you look at the prospectus’ describng the investments, you will see that they warn investors that the mortgages will likely end in default. So, not only does the homeowner lose, but the investor loses.
This explains how folks got loans. It was rigged from the start. This explains teaser rates, ARMs, and predatory lending practices.
The only problem is that Wall Street, the f-ers who caused all of this, are making money too fast to care.
It is starting to look like a re-distribution of wealth, engineered from the top, and crashing down on America. One law firm filed over 7000 foreclosure actions in NY State alone during 2009. It is called a foreclosure mill, and for good reason. Business is apparently pretty good…
I don’t disagree Joe except with the mortgages being forgiven part. Why should the borrower be let off the hook completely?
I only wanted to point out that there was obvious fraud being committed by multiple parties. (the borrower, the mortgage lender, the appraiser, the underwriter)
Basic lending practices were thrown out the window to promote sales and implicitly backed by the federal government because much of this paper ended up with freddie mac and fannie may.
Real estate commissions, mortgage origination fees and the housing boom became the driving force that contributed to the speculative bubble that eventually burst.
There was great incentive to close deals and a mortgage origination industry sprang up where college dropouts made great money filling out the loan documents collecting their commissions and moving on to the next target.
BTW-They weren’t called liar loans for no reason.
Unfortunately, the banks have created the situation for themselves. The courts are almost compelled to forgive the mortgages, as the banks neglected to follow the rules of the securitized trusts. They attempt to re-create documents three years after the fact, using fraudulent means, and then crying foul.
I hope now that all of you understand why states and special interest groups want us, the home inspectors of the U.S., licensed, so we are under their thumbs, so we do not kill deals. We are the last cog on the chain that is in their way.
Consumers must understand that we are the last ones left in the RE industry that are honest, and informative, on the largest investment they are ever likely to make in their lifetime. The only way to stop fraud, negligence, and poor lending practices is to keep us un-licensed, properly inform the buyer, and even make it mandatory for Inter-NACHI inspectors to pre-inspect every home before it is allowed to be marketed.
We must be allowed to imform the buyer, our client, about the home they are purchasing to the best of our ability, and not under any state or goverment regulation.
I agree with Joe. I have seen some of these mortgage messes first hand with my clients. Sad but true.
We, as home inspectors, are the THIN GREY LINE.
For those of you who have taken my courses, yu have heard me say this time and time again.
We are the SOLE player in the RE transaction that has no vested interest in whether the sale goes through or not.
We recognize more than black and white, because if that is all that is needed to be a home inspector then any moron would be competent in our profession
We have the ability to interpret GREY, and as we become better educated and more seasoned inspectors, we can recognize SHADES OF GREY.
We are the THIN GREY LINE.
And, as a profession, we need to recognize the necessity to sometimes agree to disagree witrh each other.
This is where I am able to find common ground between all associations, so long as the people steering the local (statewide) effort arent positioning themselves with the upper hand.
It is the ONLY way this profession will EVER be recognized. Sometimes, you need to check your guns at the door and find commonality, for the betterment of our livlihoods and this profession.
I think I’ll start a newsletter called the Thin Grey Line, and invite everyone to contribute.