It is a common scenario all over the country. If you have turned on the evening news in the past year, you know that real estate is not the happy story it once was.
A nutshell summary of what's happened: A lot of people bought homes using a subprime mortgage (loosely defined as a mortgage with an interest rate that wasn't a the government standard) with a monthly payment they thought they could afford (often without putting any money down). But they got into trouble when adjustable rates pushed their montly payments up hundreds or thousands of dollars. As payments went up, property values were falling, so owners could no longer recoup a real estate investment by refinancing or selling. this past March, RealtyTrac, an online foreclosure marketplace, reported that more than 230,000 homes were in foreclosure. People were stating income that wasn't there and the mortgage brokers were inflating beyond even that. People were allowed to buy houses they could not afford. They exaggerated their income.
Monday, October 6, 2008
Tuesday, August 19, 2008
The Causes of The Housing Crisis: The Wild West of Boom Years, Devastation and Impact on Communities
The Wild West of The Housing Boom Years, Devastation and Impact.
Many industry insiders just knew that it was just a matter of time. What goes up will have to come crashing down. Indeed, soaring home prices were just setting the stage for this country's greatest housing meltdown. Many onlookers could see that the high home sales were just a game. They were not fair deal. It was clear that the real estate industry was starting to crumble from the inside. Rogue appraisers, real estate agents and bad real estate brokers were running the show. They were making money left and right on the ignorance of unsuspecting homeowners, buyers and sellers. The bankers, mortgage companies and real estate investors appeared ready to make money along the way. Very few people raised their little fingers. Business was good. Since 2005, many potential buyers have been kept out of the market. They were priced out by speculators who flew in and flew out of hot deals and markets all over California. Those who were not too greedy amassed a fortune. Then, they moved this money to other shores or diversified.
Many appraisers were being pressured by all sides to inflate home values. They sometimes quoted prices only aimed at supporting loans that are more than the buyers can truly afford. According to former acting director at the Federal agency charged with monitoring the appraisal industry, Marc Weinberg, the system was completely broken. Since the height of the housing boom (which was fake or based solely on borrowed money), many violations could have constituted the red flags. According to a recent AP investigation, there were complaints that were lodged at the agency, but the lack of agents prevented it from investigating. Since the complaints were uninvestigated for many years, many of the appraisers who were accused of inflating prices continued to commit fraud in the industry.
What are the causes of the current housing crisis? Many will say greed, easy money-making tricks with no regards to the future
Here is a list of some of the perpetrators and victims: They were lenders who allowed people with spotty credit to buy homes with little or no money down, mortgage brokers who focused on selling loans without regard to the borrowers' ability to repay and investment bankers who bought and sold risky mortgage-backed securities. Failure to be able to monitor the real estate appraisals also contributed to the problems we are seeing now. Foreclosures are rampant and continue to destroy communities.
How does the process work? Once an appraiser receives an order from a real estate agent, lender, or mortgage broker to inspect a property, he or she is supposed to use some measurable tools of the trade. He will use the physical inspection of the home and comparable sales in the area to develop an estimated value for the property. What happens when the values of the other properties are not real? The figure the appraisers get will be used by banks to set the home's value as collateral for the mortgage loan. That is why it makes sense for the appraisers to come up with a value free of any outside pressure. In many cases, the appraisers were influenced by owners, buyers and sellers and the rest of the players to produce a number. They know that they are supposed to generate a value free of any outside pressure. Such was not the case in many of the cases investigated by AP. Some appraisers did complain to federal and state agencies about the fraudulent inflation of property values. Oftentimes, appraisers would put each other down in front of the buyers.
Many industry insiders just knew that it was just a matter of time. What goes up will have to come crashing down. Indeed, soaring home prices were just setting the stage for this country's greatest housing meltdown. Many onlookers could see that the high home sales were just a game. They were not fair deal. It was clear that the real estate industry was starting to crumble from the inside. Rogue appraisers, real estate agents and bad real estate brokers were running the show. They were making money left and right on the ignorance of unsuspecting homeowners, buyers and sellers. The bankers, mortgage companies and real estate investors appeared ready to make money along the way. Very few people raised their little fingers. Business was good. Since 2005, many potential buyers have been kept out of the market. They were priced out by speculators who flew in and flew out of hot deals and markets all over California. Those who were not too greedy amassed a fortune. Then, they moved this money to other shores or diversified.
Many appraisers were being pressured by all sides to inflate home values. They sometimes quoted prices only aimed at supporting loans that are more than the buyers can truly afford. According to former acting director at the Federal agency charged with monitoring the appraisal industry, Marc Weinberg, the system was completely broken. Since the height of the housing boom (which was fake or based solely on borrowed money), many violations could have constituted the red flags. According to a recent AP investigation, there were complaints that were lodged at the agency, but the lack of agents prevented it from investigating. Since the complaints were uninvestigated for many years, many of the appraisers who were accused of inflating prices continued to commit fraud in the industry.
What are the causes of the current housing crisis? Many will say greed, easy money-making tricks with no regards to the future
Here is a list of some of the perpetrators and victims: They were lenders who allowed people with spotty credit to buy homes with little or no money down, mortgage brokers who focused on selling loans without regard to the borrowers' ability to repay and investment bankers who bought and sold risky mortgage-backed securities. Failure to be able to monitor the real estate appraisals also contributed to the problems we are seeing now. Foreclosures are rampant and continue to destroy communities.
How does the process work? Once an appraiser receives an order from a real estate agent, lender, or mortgage broker to inspect a property, he or she is supposed to use some measurable tools of the trade. He will use the physical inspection of the home and comparable sales in the area to develop an estimated value for the property. What happens when the values of the other properties are not real? The figure the appraisers get will be used by banks to set the home's value as collateral for the mortgage loan. That is why it makes sense for the appraisers to come up with a value free of any outside pressure. In many cases, the appraisers were influenced by owners, buyers and sellers and the rest of the players to produce a number. They know that they are supposed to generate a value free of any outside pressure. Such was not the case in many of the cases investigated by AP. Some appraisers did complain to federal and state agencies about the fraudulent inflation of property values. Oftentimes, appraisers would put each other down in front of the buyers.
Wednesday, July 30, 2008
Find Bankruptcy Lawyers, Business Attorneys and Foreclosure Attoreneys List
A Few Tips to Avoid Bankruptcy and Foreclosure: Defend Yourself Against Foreclosure and Bankruptcy
1. Collect an itemized list of all assets that could be sold to avoid foreclosure and bankruptcy
2. Find out if you qualify for government assistance
3. If you are a military personnel or disaster area victim, you are eligible for special government loans to avoid foreclosure and potential bankruptcy
4. Find out what is in it for you in the new Housing Bill just signed by President Bush into law
5. Do Not Buy What You Can Not Afford
6. Stop Using your credit cards: If you can not pay cash for it, then you do not need this new handbag, iphone or designer clothing.
7. Find yourself a good business attorney to help you run your business or manage or maintain your assets.
8. Tighten your belt and make wise business and personal life, financial decisions. Invest in your education for a new career or line of work
1. Collect an itemized list of all assets that could be sold to avoid foreclosure and bankruptcy
2. Find out if you qualify for government assistance
3. If you are a military personnel or disaster area victim, you are eligible for special government loans to avoid foreclosure and potential bankruptcy
4. Find out what is in it for you in the new Housing Bill just signed by President Bush into law
5. Do Not Buy What You Can Not Afford
6. Stop Using your credit cards: If you can not pay cash for it, then you do not need this new handbag, iphone or designer clothing.
7. Find yourself a good business attorney to help you run your business or manage or maintain your assets.
8. Tighten your belt and make wise business and personal life, financial decisions. Invest in your education for a new career or line of work
Get more foreclosure info at WalkAway Foreclosure Counseling
Get more Foreclosure updates at Foreclosure MarketWatch Updates
Go to Foreclosure365Live to Get WalkoutCounseling Foreclosure365Live
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