Impossible? Home Prices Drop Again in 16 Metro Areas

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Editor’s Comment: 

Every day, every week, every month and every day we are bombarded by conflicting news reports. If you believe the pundits, the housing recovery has already begun. Their logic and their facts are convoluted, but they are sure. And they are sure because the banks paid them to be sure and to spread disinformation such that the pubic will be lulled into apathy.

The facts are simple. Prices are at their lowest level since 2001, the bottom is continuing to fall, and the “bottom” will never be reached until we remove the downward pressure on pricing. The downward pressure comes from two sources — the enormous inventory overhanging the Market and the knowledge that even if you did buy property, there is a high probability that your title will come under attack.

The news media has been fast to report the fines and penalties against the banks for wrongful foreclosures but very slow to report or investigate what happens to those wrongful foreclosures. No fine or penalty will ever correct title deficiencies. It’s time to face up to the world of reality — title will never be cleared without the signature of the dispossessed owner on a brand new document — and this time the signature better be real.

Home prices drop in 16 metro areas: Case-Shiller

By Kerri Panchuk

Standard & Poor’s/Case-Shiller home price indices for the month of January show prices falling in most major metro areas.

The latest report shows annual price declines of 3.9% and 3.8%, respectively, for the 10- and 20-city composite indexes in the month of January.

Both composites combined fell 0.8% in January, with 16 of the 19 metropolitan statistical areas surveyed experiencing price drops over the prior month. Analysts with Econoday said “the unadjusted monthly decline of 0.8 percent is the best reading since September with the year-on-year rate, where adjustments play a much less significant role than on month-to-month rates, at minus 3.8 percent rate for the same rate as the unadjusted data.”

The only cities with price increases for the month included Miami, Phoenix and Washington D.C.

S&P says eight metro areas and both composite indexes posted new lows in January on the index chart.

Still, the 10- and 20-city composites marginally improved their annual return rates over the month of December. The Dallas, Denver, Miami, Minneapolis, New York, Phoenix, San Diego, Seattle, Tampa and Washington D.C. metros saw their annual rates improve over the month of December while price returns fell in nine other areas.

“Despite some positive economic signs, home prices continued to drop. The 10- and 20- city composites and eight cities – Atlanta, Chicago, Cleveland, Las Vegas, New York, Portland, Seattle and Tampa – made new lows,” said David Blitzer, chairman of the index committee at S&P indices. “Detroit and Phoenix, two cities that have suffered massive price declines, plus Denver, saw increasing prices versus January 2011. The 10-city composite was down 3.9% and the 20-city was down 3.8% compared to January 2011.”

Atlanta continues to suffer severe price drops with its index score down 2.1% from the previous month and 19.7% over the past six months.

“It also posted the worst annual return, down 14.8%. Seven of the cities were down by 1.0% or more over the month,” S&P said. “With the new lows, both composites are now 34.4% off their relative 2006 peaks.”

Rick Sharga, executive vice president of Carrington Mortgage Holdings, summed up the report saying it “suggests that buying activity is focused on the low end of the market, especially distressed assets, which continue to drag down home prices. With several million more properties in various stages of delinquency and foreclosure, pricing will continue to suffer while

25 Responses

  1. Of course prices continue to drop now that RE agents can’t use their pet appraisers any more.

  2. @E.Tolle

    They can’t take their “soles” with them…and they have no “souls”…but they will soon find out the cost of that reality…

  3. E.Tolle- maybe the use of “soles” v. “souls” has a sinister meaning in legalese, or lawyer speak, to which we 99% are not privy. Or is that “privvy”, whereas “privy” is a toilet, in Britain? Or is the opposite the case? Not apposite, which of course means something else completely. So many questions, so little time………..

  4. ” ….who sold out their soles….”

    The ones I’m up against have thousand dollar leather wingtips.

  5. @ James J. Bickerton law firm.
    You don’t get it. Entire system is rigged mainly due to incompetent and corrupt lawyers who sold out their soles long ago to corrupt county courts, sheriffs, and all the way up. Whenever an honest judge surfaced he was quickly knocked off bench, like judges Bufford and Sargis, both Central California Bankruptcy judges.

  6. @Dee,

    One by one, we’ll prevail.

  7. The Securitization Curtain is Lifting in Hawaii!

    Posted on March 29, 2012

    “One of the most important decisions for Borrowers Rights in the history of Hawaii has been made with this decision,” remarked Honolulu attorney Gary Dubin. Honorable Judge J. Michael Seabright of the Hawaii United States District Court, today GRANTED the homeowners’ Motion to Dismiss the case filed against them in federal district court by Plaintiff Deutsche Bank National Trust Company, as Trustee Morgan Stanley ABS Capital I Inc. Trust 2007-NC1 Mortgage Pass-Through Certificates, Series 2007-NC1.

    The Williamses (Leigafoalii Tafue Williams and Papu Christopher Williams), who were represented by Honolulu attorney, James J. Bickerton (Jim), of Bickerton Lee Dang & Sullivan, filed a Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1), in which they argue, among other things, that Plaintiff has no standing to foreclose because it has not established that it was validly assigned the Mortgage and Note.

    The Court noted that: “Because the court finds that Plaintiff has failed to establish its standing to bring this action, the court need not reach the Williamses’ other arguments for dismissal.”

    Honorable Judge J. Michael Seabright gets it! And his ORDER was detailed. In the Discussion, Judge Seabright notes an argument that homeowners have being trying to persuade the courts (especially at the lower state levels) to grasp: STANDING and JURISDICTION.

    “Standing is a requirement grounded in Article III of the United States Constitution, and a defect in standing cannot be waived by the parties. Chapman v. Pier 1 Imports (US.) Inc., 631 F.3d 939,954 (9th Cir. 2011). A litigant must have both constitutional standing and prudential standing for a federal court to exercise jurisdiction over the case. Elk Grove Unified Sch. Dist. v. Newdow, 542 U.S. 1, 11 (2004). Constitutional standing requires the plaintiff to “show that the conduct of which he complains has caused him to suffer an ‘injury in fact’ that a favorable judgment will redress.” Id. at 12. In comparison, “prudential standing encompasses the general prohibition on a litigant’s raising another person’s legal rights.” Id. (citation and quotation signals omitted); see also Oregon v. Legal Servs. Corp., 552 F.3d 965, 971 (9th Cir. 2009).”

    Let’s continue – but we’ll get back to that injury issue later in the post.

    The WILLIAMSES’ ORDER continues: “The Williamses factually attack Plaintiff’s prudential standing to foreclose, arguing that there is no evidence establishing that Plaintiff was validly assigned the Mortgage and Note on the subject property. The issue of whether Plaintiff was validly assigned the Mortgage and Note is inextricably intertwined with the merits of the Plaintiffs claims seeking to foreclose…”

    Of course, this was a New Century Mortgage (Home123) and the Plaintiffs were taking part in a fabricated assignment in 2009 to a 2007 Trust… (that boat had sailed 2 years before because theTrust had long since closed) – but even more compelling in the Motion to Dismiss-Memorandum was the Williamses assertion that New Century aka Home123 was in a liquidating bankruptcy as of August 1, 2008 and they had nothing to assign in January 2009.

    Deutsche argued that the Williamses were not parties or beneficiaries to the assignment such that they cannot challenge it… [we’ve heard that before, yeah?]. However, the Judge Seabright clarifies a valid point:

    “Plaintiffs argument confuses a borrower’s, as opposed to a lender’s, standing to raise affirmative claims. In Williams v. Rickard, 2011 WL 2116995, at *5 (D. Haw. May 25, 2011), — which involved the same parties in this action and in which Lei Williams asserted affirmative claims against Deutsche Bank – Chief Judge Susan Oki Mollway explained the difference between the two:

    “…Standing” is a plaintiff’s requirement, and … Defendants must establish “standing” to defend themselves.”“

    Judge Seabright continues: ”Deutsche Bank asserts affirmative claims against the Williamses seeking to enforce the Mortgage and Note, and therefore must establish its legal right (i.e., standing) to do so. See, e.g., IndyMac Bank v. Miguel, 117 Haw. 506, 513, 184 P.3d 821, 828 (Haw. App. 2008) (explaining that for standing, a mortgagee must have “a sufficient interest in the Mortgage to have suffered an injury from [the mortgagor’s] default”).”

    Attorney Bickerton faced off in court and explained to the Judge in oral argument that the banks didn’t just miss the date to file their assignments or needed to tidy up paperwork, this was a ‘Business model using the loans for overnight lending.’ Bickerton told the Court that if this wasn’t dismissed, his first line of discovery would be geared to uncover the outside financial advantages being derived from the use of the Williamses’ loan.

    Understanding the premeditated intentions of these banks, how they pledge, collaterize, swap, sell, lease,and trade these loans that are SUPPOSED to have been in a static trust will open the eyes of lawmakers to the real moral hazard – the fraud upon the homeowners, the courts and the state.

    Jim Bickerton profoundly says that, “every foreclosure in the state is a victim of this shadow banking scam.”

    James J. Bickerton
    Bickerton Lee Dang & Sullivan
    Fort St Tower
    745 Fort St Ste 801
    Honolulu, HI 96813
    808-599-3811
    Email: bickerton@bsds.com

    “Security trusts will no longer be able to hide behind the hocus pocus of the pooling and servicing agreements. The ramifications of this decision are extraordinary,” praises Gary Dubin.

    INJURY – Remember that issue from above?

    Let’s discuss the trusts. We can see by the assignments that they were not made timely and NY trust laws call them VOID. The REMIC has failed. But maybe the investors ARE getting paid with the behind the scenes shadow banking scheme.

    And let’s suppose we can see the trading in the trust is active, numerous investors have already been paid off – where is the “injury”….hmmm?

    We’re connecting the dots, people with above average intelligence are realizing, just like Judge Seabright, that there are huge schemes behind the scenes of an everyday mortgage that the borrower never intended to participate in… and eventually we’ll know whether the application for a mortgage started the securitization process before the borrower signed the note making them securities with no disclosure, how many insurance policies were attached to the loans and when (we never agreed to be over insured which would give someone the incentive to “off” us)… it’s coming soon – to a court room near you…

  8. @Shelley,

    This on is for you: WA Supreme Court hears arguments in case against MERS. It is a video worth watching.

    http://www.nakedcapitalism.com/2012/03/abigail-field-mortgage-settlement-institutionalizes-foreclosure-fraud.html

  9. As I was saying, if we thought we had problems, we haven’t seen anything yet.

    Below is the latest Abigail Field expose on the Paid-by-taxpayers’-AGs-settlement-with-banks-paid-for-by-taxpayers-money. The good thing is that it doesn’t leave taxpayers, as in “what starts with taxpayers end with taxpayers”. The bad thing is that it doesn’t leave taxpayers with anything; they’re fully wiped out. Worst of all: taxpayers don’t do anything about it.

    From that, I infer they must like it that way. And… things haven’t gone bad enough to start reacting. After all, so long as the Kardachians nd Dancing with the Stars are on, why bother with anything else? Those are the real serious issues in life!

    And to allow you to click on the different links refered to in the original post, here is the link via Naked Capitalism:

    http://www.nakedcapitalism.com/2012/03/abigail-field-mortgage-settlement-institutionalizes-foreclosure-fraud.html

    Thursday, March 29, 2012
    Abigail Field: Mortgage Settlement Institutionalizes Foreclosure Fraud

    Yves here. I hope you’ll take the time to read this important post. There has been a great deal of discussion of the many deficiencies of the mortgage settlement, but its biggest has gone pretty much unnoticed. It isn’t just that the settlement gives the banks a close to free pass for past predatory, illegal conduct, but it also has such lax servicing standards and weak enforcement provisions so as to give the banks license to carry on with servicing abuses.

    By Abigail Caplovitz Field, a freelance writer and attorney who blogs at Reality Check

    Updated at end

    The mortgage settlement signed by 49 states and every Federal law enforcer allows the rampant foreclosure fraud currently choking our courts to continue unabated. Yes, I realize the pretty servicing standards language of Exhibit A promises the banks will completely overhaul their standard operating procedures and totally clean up their acts. But promises are empty if they’re not honored, and worthless if not enforceable.

    We know Bailed-Out Bankers’ promises are empty, so what matters is if the agreement is enforceable. And when it comes to all things foreclosure fraud, the enforcement provisions are laughable. But before I detail why, let’s be clear: I’m not being hyperbolic. The bankers running and profiting most from our bailed-out banks are totally dishonest when dealing with the public, and their promises are meaningless.

    To see their dishonesty in the mortgage context, read the complaint filed in the mortgage deal, or my take on it here. But the bankers don’t limit their lying, cheating and stealing to homeowners. They abuse their clients the same way. Most broadly damaging, the bankers steal from taxpayers on a federal, state and local level and practically everybody else too. Fraud is just how they do business. When dealing with bankers, you can’t do business on a handshake.

    I’ve already written about how banker-sympathetic, consumer-destructive the mortgage settlement’s “Servicing Standards Quarterly Compliance Metrics” are. But I didn’t address the rule-of-law metrics. So here goes.

    The Empty Promises

    You’d think the top law enforcers in 49 states, the Department of Justice, (including its defenders of the integrity of the Bankruptcy System), and regulatory agencies would be concerned with defending the rule of law. Boy, does it need defending. Consider how transparently foreclosing lawyers are fabricating evidence against whistleblower Lynn Syzmoniak.

    And if you looked at Exhibit A to the settlement, focusing on the anti-foreclosure fraud provisions of part I, you’d think that law enforcement had done an excellent job. The rule of law looks vindicated. Consider how the Exhibit begins:

    “Unless otherwise specified, these provisions shall apply to bankruptcy and foreclosures [everywhere] and regardless of [which type of sworn document we’re talking about]

    “A. Standards for Documents Used in Foreclosure and Bankruptcy Proceedings.

    “1. Servicer shall ensure that factual assertions made in [in any kind of court-filed or otherwise important foreclosure document] are accurate and complete and are supported by [solid] evidence….”

    This kind of ‘bankers won’t lie, cheat and steal anymore’ language is surely helped persuade consumer allies like the Center for Responsible Lending to praise the settlement. Check out the Center’s press release, the day the deal was announced, titled “AG SETTLEMENT ENDS ROBO-SIGNING AND PROVIDES A MODEL FOR PREVENTING FORECLOSURES”. Notice the Center’s tagline: “Protecting Homeownership and Family Wealth.”

    Just meeting the “thou shalt not lie when taking thy neighbor’s house” language I quoted would require fundamental process overhauls at all major mortgage servicers. And yet it’s just the start of 11 pages aimed at ending document fraud (42 pages of detailed provisions overall). Given how much bankers lie, driving those process overhauls requires a mighty big incentive, i.e., penalties for non-compliance.

    The pathway to penalties runs through the metrics. The big ticket $1 million and $5 million penalties only kick in if the bankers failed a metric two quarters in a row. So what are the metrics for foreclosure fraud?

    Measuring the “End” of Foreclosure Fraud

    The first “end”-foreclosure-fraud metric is on page E-1-2 of Exhibit E. Inauspiciously, the section is called “Integrity of Critical Sworn Documents.” I say inauspiciously because the “mandated” banker truth-telling in Exhibit A wasn’t limited to “critical sworn documents.”

    The first “Metric” (that’s the column header) is “Integrity of AOI” [Affidavits of Indebtedness.] The first “Measurement” is “Based upon personal knowledge, properly notarized, [and the amount owed is kinda close to right.]” The real measurements are the “Test Questions.” Question 1 relates to the knowledge and notarization requirements:

    “1. Taken as a whole and accounting for contrary evidence provided by the Servicer, does the sample indicate systemic issues with either affiants lacking personal knowledge or improper notarization?” (bold mine.)

    See how that works? If enough garbage documents (not verified, not executed in compliance with the law) get plowed into the system that the enforcement structure suspects there’s still systemic problems, the bankers get to say why they think no problem exists, and the monitor is supposed to take them seriously. The monitor is supposed to weigh the bankers’ defense considering everything, not the narrow concept that the so-called “Measurement” touted–”Based upon personal knowledge, properly notarized, [and the amount owed is kinda close to right.] I mean, that measurement reads like it’s a simple yes or no, on a per-document basis, right?

    Bottom line: it’s up to the monitor to decide how much foreclosure fraud he’s willing to tolerate before he insists systemic issues exist, and the bankers will be lobbying him hard. How do you feel about that Exhibit A ‘Bankers shall tell the truth when taking your home’ language now?

    The next two “Metrics” within the “Integrity of Critical Sworn Documents” section (Proofs of Claim and Motions for Relief from Stay Affidavits) don’t even pretend to care about process at all; they only look at the accuracy of the amounts owed. The Test Questions are, respectively,

    “Are the correct amounts set forth in the form, with respect to pre-petition missed payments, fees, expenses charges, and escrow shortages or deficiencies?” [and yes, the error rate and error threshold mean not every incorrect amount counts]

    and

    Verify against the system of record, within tolerance if overstated:

    a. the post-petition default amount;

    b. the amount of fees or charges applied to such pre-petition default amount or postpetition amount since the later of the date of the petition or the preceding statement; and

    c. escrow shortages or deficiencies.” (See E-1-3 for both quotes.)

    So much for the rule of law.

    But wait, there’s more; skip ahead to page E-1-9. In a section called “Policy/Process Implementation” we find “E. Affidavit of Indebtedness Integrity”. Here’s what the metric supposedly measures:

    “Affidavits of Indebtedness are signed by affiants who have personal knowledge of relevant facts and properly review the affidavit before signing it.”

    Sounds like the end of “robosigning“, right? Well, here’s the test question:

    “1. Is there evidence of documented policies and procedures sufficient to provide reasonable assurance that affiants have personal knowledge of the matters covered by affidavits of indebtedness and have reviewed affidavit before signing it?”

    This metric says: look at what we say–what our handbooks say–not what anyone actually does. Think I’m reading too much into it? Here’s the “Test Loan Population and Error Definition”, which is what the people measuring compliance are supposed to look at when asking the “Test Question”: “Annual Review of Policy.”

    Through the magic of the metrics, ‘Affidavits are done correctly’ dissolves to ‘look at our policy once a year and be reasonably confident we’re doing things right.’

    And those four metrics are it. So much for “AG SETTLEMENT ENDS ROBO-SIGNING AND PROVIDES A MODEL FOR PREVENTING FORECLOSURES”

    I can’t imagine that the Center read the metrics. I’ll bet pre-press release they were never even shown it. Surely the pre-deal promotional tour just pushed the “strong” Exhibit A language.

    Prosecute or the Release Becomes Immunity

    The liability releases let the bankers off all sorts of foreclosure fraud hooks (see details in “Covered Servicing Conduct” in the Federal release.) But the release only covers conduct up through February 8, 2012. In theory, the bankers could be sued for all the fraud they’re committing now and will in the future. In theory, unless these metrics are treated like a back door ongoing liability release. In which case it’s not a release at all: it’s foreclosure fraud immunity.

    Update: Isaac Gradman points out that the Enforcement provisions in Exhibit E include at J. the right to enforce the banks’ obligations in court. However, the only remedies are a court order telling the banks to obey or other “non-monetary” relief, and monetary penalties for metrics-based violations. See J.3. Unless the banks are litigated into contempt of court, or unless an injunction forces the banks to overhaul their standard operating procedures, it’s not obvious the servicing standards have any teeth outside the metrics. Moreover, violations of the terms of Exhibit A that aren’t included in the metrics are unlikely to be systematically assessed, and thus are unlikely to be the basis for an enforcement action. Finally, it’s not clear when the anti-foreclosure fraud servicing standards take effect. You can’t violate what you don’t yet have to do. In short, given the deal’s expiration date, it’s hard to imagine change we can believe in happening.

  10. I like chicken!

  11. Real estate prices falling is just a drop in a bucket. Foreclosures? Almost a joke.

    We’ve got a few more problems… In a few months, we won’t even have an economy worth speaking about. O well. Some of us have more than one passport. Because the way i see it, more money (mine and yours) goes daily to the banks, more money (your and mine) goes daily to the oil companies, more money (yours and mine) goes daily to big pharma. And every day, I get up and think: “Jeez. Another service gone for good. And more expenses in order to earn a living. Indeed, today will be another good day.” I guess we can’t give money to everyone, right? And since the 99% don’t appear to be making a meaningful move yet, gotta have a plan B…
    -:-:-:-:-:-:-:

    BRICS agree to local currency credits to ease dollar dependency
    http://rt.com/business/news/brics-currencies-credit-deal-755/
    Published: 29 March, 2012, 14:56

    Dimitry Medvedev (L) and Manmohan Singh during the BRICS summit in New Delhi on March 29, 2012 (AFP Photo / Prakash Singh)

    The BRICS – Brazil, Russia, India, China and South Africa – have agreed to provide credit to each other in local currencies. Officials say the deal will facilitate economic growth in times of crisis.

    The currency swap deal is aimed at promoting trade and investment in local currencies as well as to cut transaction costs. It’s also seen as a step to replace the dollar as a reserve currency in trade between BRICS.

    “The idea is in line with many interests and economic exigencies in the world economy,” Yaroslav Lissovolik, the chief economist at Deutsche Bank told RT. “The euro and dollar are no longer seen as unquestionable monopolies in the role of reserve currencies. Clearly the world needs more reserve currencies.”

    The deal would also increase the BRICS influence on the international arena and will make their cooperation less sensitive to sanctions from the West, experts say.

    “The BRICS countries are in the first rank to do the job that international financial system now needs. What the BRICS said was a very welcomed wake up call,” John Kirton, the Co-Director of the BRICS Reasearch Group told RT.

    Russia and China have been trading in the rouble and yuan for several years, now Russia plans to expand local currency settlement with India.

    “With China it took us three years to (evolve) from initial conversations to trading in local currencies,” Vladimir Dmitriev, the chairman of Russia’ s VEB told reporters. “I think we will meet similar terms with India”.

    Meanwhile the swap requires a lot of technical work by each country such as the synchronization of national banking legislation, according to Mr. Dmitriev.

    The BRICS countries are also going to announce plans on a joint development bank which is considered a possible rival to the World Bank and the IMF. If established, it would function as a lending agency and would provide finance for joint BRICS projects.

    “They made it very clear it would be built to benefit not only BRICS countries themselves, but developing countries more broadly,” said KIrton. “But the big message was to give the World Bank more resources, only then would they see how the BRICS bank would fit in the supplement what they’ve already got.”

  12. Bank of America Sold Card Debts to Collectors Despite Faulty Records

    for FULL article:

    http://www.americanbanker.com/issues/177_62/bofa-credit-cards-collections-debts-faulty-records-1047992-1.html?zkPrintable=1&nopagination=1

    “…Bank of America has sold collections agencies rights to sue over credit card debts that it has privately noted were potentially inaccurate or already repaid.

    In a series of 2009 and 2010 transactions, Bank of America sold credit card receivables to an outfit called CACH LLC, based in Denver. Co. Each month CACH bought debts with a face value of as much as $65 million for 1.8 cents on the dollar. At least a portion of the debts were legacy accounts acquired from MBNA, which Bank of America purchased in 2006.

    The pricing reflected the accounts’ questionable quality, but what is notable is that the bank could get anything at all for them. B of A was not making “any representations, warranties, promises, covenants, agreements, or guaranties of any kind or character whatsoever” about the accuracy or completeness of the debts’ records, according to a 2010 credit card sales agreement submitted to a California state court in a civil suit involving debt that B of A had sold to CACH…”

    “…We’re not getting what we need from the seller,” says Mark Schiffman, a spokesman for the American Collections Association, which wants to see better recordkeeping and more documentation included in debt sales. “Consumer groups want to see original contracts and original documentation. That would make a lot of these debts disappear because a lot of that documentation may not exist…”

  13. Chris is right, in many cases they can’t give you a mod because they are not the rightful owner.

    Over 2,000 HAMP modifications through fannie and freddie, not one came back saying fannie or freddie were the llender on the final mod package. Every final modification states that the Lender is the National Association whom never transferred the Notes past the SPV, SPE..

    Don’t believe, just ask them on the telephone if the note was ever transfered to one fo the former GSE master trusts’.

    Just ask.

  14. @wendell – you are wrong. Although land value increased significantly in regions close to any major metropolis, the main rise came from the inflation directly attached to the demand, due to bottom sweeping underwriting guidelines and non-recourse SPV’s..

    The cost of labor and materials went throught he roof as US Home Builders competed with growing nations such as China and India for the same resources. The developers did drive up the cost of land, but most large builders merely worked through inventory and tracts owned at 2000 and 2001 land pricing.

    New Construction is dependent on a robust exisiting home model and the builders cleaned up. They builders are so afraid of the coming market that most of them started private equity funds to buy distressed assets for rental and management.

    Yes, the banks that were at teh forefront of free markets and capitalism are the saem banks socializing losses through the FDIC, FHLB’s Treasury and the Federal Reserve Corporation. You must cut off the head to kill the beast.

  15. @Chris,

    It isn’t that they “can’t” give you a mod (although I would be very, very careful if mine were to offer one I could live with… I’d make sure as hell to be indemnified against any past, present, future, asserted or potential claims before agreeing to anything).

    The fact that has been brought up over and over and over is that the incentive for the banks is much higher when they foreclose than when they modify. They make more money foreclosing than negotiating. Thanks to us, tax payers.

    That’s what Krugman meant by “They socialized the risks and capitalized the gains”. Bill Black calls it “perverted incentives”. A slew of economists can formulate the problems. Up to them to resolve the situation. Not my line of business.

    We don’t like it? That’s what revolutions are for.

  16. This is probably a very dumb question, but here goes: If a supposed bank owns your loan and cannot give you a modification, how can they foreclose? Both prospects need authority! It seems they are inexplicable intertwined, if you get my point?

  17. @Wendell Fitzgerald ,,

    Land values (building lots zoned R-1) in my area may have increased by 50% or so 2000==>2007 but that still only represented maybe 15% of the total cost of a completed house ,, prices for existing housing have fallen here by 65% or so (and continuing to drop as the job market SUCKS) , I don’t get your argument … due to the government created bubble in farmland that land is priced higher than ever , however UNPRODUCTIVE LAND (read that as raw land , empty subdivision lots and such) is WAY DOWN in value … I don’t see your argument at all.

    @javagold ,

    I have a very real chance at getting discovery and a settlement FAR BETTER than the 40% you mention , however I would say that the only chance we have at an economic recovery is first to clear the decks by “fixing” all the invalid loans ,, perhaps with a one time offer of new docs at the current local price of the real estate minus your initial down payment on the original loan (in dollars not as a percentage). We can live without a half dozen or so TBTF banks … Iceland got it right.

  18. Atlanta down 20% in 6 months!!! That’s one helluva recovery .. another few months of this and we’ll probably get that “money expert” talk host Dave Ramsey to see the obvious.

  19. LAND VALUES DECLINES, NOT THE VALUE OF HOUSES
    It is primarily the value of land that is declining since it was land value and not he value of houses per se that increased during the so-called “housing” boom. Everyone in the know understands this and for some strange and unknown reason they never speak of it.

    “Housing” prices are continuing to decline because the speculative value of land is continuing to decline as it must until it reaches its real value in the real economy where people can afford to buy based on values the land can actually deliver. This may take a bit more time since land values were bid up so ridiculously high. There is a little understood underlying condition in an economy where people are encouraged to speculative with land by being able to keep the profits of buying, selling, flipping etc. due to tax policies that let real estate speculation go virtually untaxed with the main burden of taxation shifted onto earned incomes from labor and real capital investment in the real economy. All of this “fundamentals” of the market were ignored and then made far worse by a factor of ten or more by the shenanigans of Wall Street, mortgage brokers and banks.

    I find it extremely interesting that nowhere do I see reference to the underlying bias toward land/real estate speculation built into our current land tenure and tax laws as part of the list of proximate causes to explain the current economic debacle. Follow the money is a pretty good reason I suspect. After all land speculation (i.e. getting something for nothing) has been America’s favorite game from the very beginning.

    Perhaps the price of land will finally dip below its real value in the real economy given the momentum of its downward drift but people in the real economy and those drooling for land speculation to be reignited will soon become aware of that and that is when prices “housing” prices will stabilize and begin to be bid up again. Unfortunately the price of land and therefore of houses will once again be bid up speculatively in another round of boom and bust in the market for housing. It is an 18 year cycle and unless it is delayed by the greater than typical magnitude of the current downturn, it will boom until 2026 when again there wil be a bust. I suggest telling your children if they are in real estate for quick profits to get out no later than 2024 if the market even begins to look squishy. You heard it here first. Of course they may not listen any more than we did this time. Or will they?

    Of course the solution to an unstable real estate market is to shift taxation off of improvements and other earned incomes from labor and real capital investment onto community created land values. This way land speculation will be discouraged if not eliminated and purchase of land/real estate for real USE in the real economy will be encouraged (or at least not discouraged as they are now). Production of real values in the real economy that canot disappear as do speculative land values. We could have an economy that works if we are willing to earn what we get rather than depend on cashing in on unearned values.

  20. Guys, listen to Ed Pinto on Mandelman Matters. FHA is leveraged 840 to 1. We are in a much, much bigger doodoo than anyone will let us on.

    It’s going to blow…. And no, Forthemany, we are NOT in a socialist country. We are in something much worse: a capitalist country where gains are concerned (you make it, you keep it) and a socialist country only for what bank losses are concerned (you’re losing money. Let government help you.) If we were in a socialist country, we would fare much better. The Americans’ problem is that when something works, they can’t leave it alone. Regulations worked. Government out of the housing business worked. Europe, with thousands of history and experience, will come out on top. China will come out on top. We? We’ll keep our slow descent to hell.

  21. Indeed…the fight for truth and justice and compassion is the greatest and most worthy fight of all…God bless you. Our time on this planet is short—what are we here for? Money and Power are the gods of the “physical” powers that be…our is Justice…and Love…those are things we take with us—not money or power.

  22. Just goes to prove how blind the government is…bailouts by the trillions and homes being sold to “armed robbers’ and thugs, with impunity.

    NICE! The government “for the people, by the people” …sure!

  23. oh yes we are NOT recovering my home dropped 10k in one month
    still pay big time and for what appears to be a place to sleep at night at this point. Guess I will throw a couple of camper on the property to make ends meet, never wanted to be a landlord but we do not have choices in this country any longer we are a socialist lot now but I will resist now and until my last breath, just to find a way to master this BS is actually getting to be interesting in a brutal kind of way, guess we learn to master what we are dealt to live with. I will find a way to overcome this crap and hopefully before I die. Blessings to all as we will need it, we still have many that are fighting and many more to come and join. This BS will never brake my faith in humanity as a whole. We are not evil, we are the patriots.

  24. i would think everyones signature may be available at the very fair price of 40 cents on the dollar……

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