Comments on: Subprime Borrowers Have No Escape Hatch http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/ #1 Free Home Loan Modification & Debt Relief Help For US Home Owners - Truths, Facts & News About the Mortgage Industry Mon, 09 Nov 2009 22:42:54 -0700 http://wordpress.org/?v=2.8.3 hourly 1 By: Tracy http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7990 Tracy Thu, 13 Dec 2007 18:29:27 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7990 This disaster is just one more red flag that this country has no crisis management skills. Recently we have seen 911, (many of the rescuers got sick and died due to improper safety gear), Hurricane Katrina ( I dont think this needs any explanation), The fires in California where things spiralled out of control into a major catastrophy. There will be many more crisises in the future it is part of life. Maybe we should be thinking of putting together government crisis management agencies to plan for these incidences instead of waiting for the clean up teams who only have a limited amount of power and resources to manage ginormous messes. How many more times do we have to go through various different scenarios until we step back and really change the way our society handles things. This disaster is just one more red flag that this country has no crisis management skills. Recently we have seen 911, (many of the rescuers got sick and died due to improper safety gear), Hurricane Katrina ( I dont think this needs any explanation), The fires in California where things spiralled out of control into a major catastrophy.
There will be many more crisises in the future it is part of life. Maybe we should be thinking of putting together government crisis management agencies to plan for these incidences instead of waiting for the clean up teams who only have a limited amount of power and resources to manage ginormous messes. How many more times do we have to go through various different scenarios until we step back and really change the way our society handles things.

]]> By: Don http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7610 Don Wed, 05 Dec 2007 16:55:30 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7610 Mike, I totally respect your opinion and know what you are saying, but Ms. Ross would better serve the members of NAR by communicating REALISTIC expectations. Morgan is SPOT ON!!! I've been in and out of the business for 20 years, first in title for five years, then a 10 year break from real estate, then 5 years in mortgages (an industry I LOVE), and now real estate and loan origination. The fact is that there are people that need to leave the real estate and loan industry. The roaches not only need to scatter, they need to go to jail. People got greedy, jacked up the prices and didn't save anything. Now they want the Feds to come in with taxpayer money to bail this all out so the can continue to be greedy. How about members for NAR AND MBA and CAMB start living within their means? If I just made 3 real estate transactions at the average price in SD County, I'd make more than I did all last year, and to me, that's great! The same if I originated about 6-8 loans! The problem is that people want fast and easy money, don't care about their clients, are lazy and stupid and are waiting for the next victim. And they make 6 figures doing it. These people need to go back to being used car salesmen and bartenders. The sooner we take our medicine, the sooner we can bring a normal market. Mike, I totally respect your opinion and know what you are saying, but Ms. Ross would better serve the members of NAR by communicating REALISTIC expectations. Morgan is SPOT ON!!!

I’ve been in and out of the business for 20 years, first in title for five years, then a 10 year break from real estate, then 5 years in mortgages (an industry I LOVE), and now real estate and loan origination.

The fact is that there are people that need to leave the real estate and loan industry. The roaches not only need to scatter, they need to go to jail. People got greedy, jacked up the prices and didn’t save anything. Now they want the Feds to come in with taxpayer money to bail this all out so the can continue to be greedy.

How about members for NAR AND MBA and CAMB start living within their means?

If I just made 3 real estate transactions at the average price in SD County, I’d make more than I did all last year, and to me, that’s great! The same if I originated about 6-8 loans! The problem is that people want fast and easy money, don’t care about their clients, are lazy and stupid and are waiting for the next victim. And they make 6 figures doing it.

These people need to go back to being used car salesmen and bartenders.

The sooner we take our medicine, the sooner we can bring a normal market.

]]> By: Fielding Mellish http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7588 Fielding Mellish Wed, 05 Dec 2007 03:55:52 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7588 Realtors are universally angry with "the media" right now. They think that if the media would just "stop all the negative stories" everything would be OK & buyers would come out of the woodwork. But people have finally figured out that owning a house isn't always better than renting. If you have a $2,000 interest-only mortgage payment or $1,000 rent for the same property, the rent is the better deal. The only advantage to owning is the possibility of selling to another sucker at a higher price. The only reason to have owned Cisco stock @ $80/share years ago was the hope that you could sell it for $100 to someone else. What it became apparent that that wasn't gonna happen, it dropped to $10. Stock values (in the aggregate) are driven by earnings. Home values (in the aggregate) are driven by household income and are reined in by comparable rent & the cost of new construction. Home values will, on average, drop further. I will not tell borrowers otherwise - although selective good "buys" can be had. Regarding subprime borrowers: You can take the borrower out of the trailer park, but you can't take the trailer park out of the borrower. Realtors are universally angry with “the media” right now. They think that if the media would just “stop all the negative stories” everything would be OK & buyers would come out of the woodwork. But people have finally figured out that owning a house isn’t always better than renting. If you have a $2,000 interest-only mortgage payment or $1,000 rent for the same property, the rent is the better deal. The only advantage to owning is the possibility of selling to another sucker at a higher price. The only reason to have owned Cisco stock @ $80/share years ago was the hope that you could sell it for $100 to someone else. What it became apparent that that wasn’t gonna happen, it dropped to $10. Stock values (in the aggregate) are driven by earnings. Home values (in the aggregate) are driven by household income and are reined in by comparable rent & the cost of new construction. Home values will, on average, drop further. I will not tell borrowers otherwise – although selective good “buys” can be had.

Regarding subprime borrowers: You can take the borrower out of the trailer park, but you can’t take the trailer park out of the borrower.

]]> By: Desperate Agents http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7580 Desperate Agents Wed, 05 Dec 2007 01:04:35 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7580 Gee Mike, I almost felt like breaking out into song. "Tomorrow, tomorrow, the sun will come out tomorrow". Being positive is over rated. Being truthful is not. The truth is that there are few positives in this market. It is not the job of agents to be cheerleaders. Their job is to sell real estate, regardless of the market, just like a stockbroker. ?Only 25 percent of all mortgages are subprime, and of these, 75 percent are performing.? I spoke with a private sub prime lender last week. December 2005 they funded a record number of loans. Every one went sideways. Gee Mike, I almost felt like breaking out into song. “Tomorrow, tomorrow, the sun will come out tomorrow”.

Being positive is over rated. Being truthful is not. The truth is that there are few positives in this market. It is not the job of agents to be cheerleaders. Their job is to sell real estate, regardless of the market, just like a stockbroker.

?Only 25 percent of all mortgages are subprime, and of these, 75 percent are performing.?

I spoke with a private sub prime lender last week. December 2005 they funded a record number of loans. Every one went sideways.

]]> By: mike http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7552 mike Tue, 04 Dec 2007 17:55:46 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7552 Morgan, Ms. Ross is a motivational speaker for real estate agents. I am not sure that she knows what portion of subprime loans are performing. Her job is to try an motivate a group of people who have been beatin down lately with bad news. Much like how I love to hear positive things about this industry. Believe it or not there are still positive people in the real estate industry. There are those that believe things arent going to be as bad as the predictions. There are those who know that economies experience real estate bubbles. Bubbles exist for just about any marketable product. The markets will correct themselves and present many more opportunities for those of us who are strong enough to weather the storm. It may take a few years for things to improve noticeably. But things will eventually improve. The sky is not falling. The government is working on plans to help borrowers and to stabalize the credit markets. The federal reserve will undoubtedly cut rates several more times. They never just make a few rates movements and we have not been so financinally sick in a long time. You can count on them cutting rates. You are seeing the weaker banks starting to receive capital injections from investors. Its time that we start focusing on the positives. The facts...we will weather this bubble just like we have all of the others because markets correct themselves and move higher than ever. It may take a little time but thats precisely what WILL happen. Morgan, Ms. Ross is a motivational speaker for real estate agents. I am not sure that she knows what portion of subprime loans are performing. Her job is to try an motivate a group of people who have been beatin down lately with bad news.

Much like how I love to hear positive things about this industry. Believe it or not there are still positive people in the real estate industry. There are those that believe things arent going to be as bad as the predictions. There are those who know that economies experience real estate bubbles. Bubbles exist for just about any marketable product. The markets will correct themselves and present many more opportunities for those of us who are strong enough to weather the storm.

It may take a few years for things to improve noticeably. But things will eventually improve. The sky is not falling. The government is working on plans to help borrowers and to stabalize the credit markets. The federal reserve will undoubtedly cut rates several more times. They never just make a few rates movements and we have not been so financinally sick in a long time. You can count on them cutting rates. You are seeing the weaker banks starting to receive capital injections from investors.

Its time that we start focusing on the positives. The facts…we will weather this bubble just like we have all of the others because markets correct themselves and move higher than ever. It may take a little time but thats precisely what WILL happen.

]]> By: Ann http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/comment-page-1/#comment-7528 Ann Mon, 03 Dec 2007 22:12:16 +0000 http://blownmortgage.com/2007/12/03/subprime-borrowers-have-no-escape-hatch/#comment-7528 "Unfortunately, things are going to get a lot worse before they get better." I think that says it all. You brought up many great points and really highlight why the proposal to freeze rates is not going to be anything more than a finger in the dam. You are correct there is no escape hatch... If the borrowers didn't try to improve their credit over the past few years, what makes you think that 5 to 7 years is going to make any difference? Is there a guarantee that the inventory levels are going to go down and prices are going to go up for those that are upside down?...wish I had that crystal ball... “Unfortunately, things are going to get a lot worse before they get better.”

I think that says it all. You brought up many great points and really highlight why the proposal to freeze rates is not going to be anything more than a finger in the dam. You are correct there is no escape hatch…

If the borrowers didn’t try to improve their credit over the past few years, what makes you think that 5 to 7 years is going to make any difference? Is there a guarantee that the inventory levels are going to go down and prices are going to go up for those that are upside down?…wish I had that crystal ball…

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