Two thirds of current foreclosures not listed

[30ashopper]

RealtyTrac, the online marketer of foreclosed properties, recently discovered that it has far more foreclosed properties listed in its database, which the company compiles using courthouse records, than there are listed in the multiple listing services (MLS) maintained by real estate agents.

RealtyTrac looked at listings in four states, California, Maryland, Florida and Wisconsin, and found that they contained only a third of the foreclosures it has in its database.

The scope of the problem isn't clear, but it could be huge considering that RealtyTrac has a total of 1.5 million bank-owned properties on its site.
"Many properties that should be listed on the MLS are not listed on the MLS," said Lawrence Yun, chief economist for the National Association of Realtors (NAR).

The National Association of Realtors calculates official housing inventory statistics using data from the multiple listing services. By that measure, there were 4.2 million existing homes for sale in November, an 11.2-month supply at the current sales pace, up from a 10.3-month supply in October.

But now it seems quite possible that these figures, which are already at record highs, are underestimating the situation. And if that's the case, it could take much longer for the housing market recovery than analysts currently expect.

Flood of foreclosures: It's worse than you think - Jan. 23, 2009

I wonder if we'll see inventory levels start to rise again?

[AAbsolute]

The best bulk asset transfers are done without the MLS. Why would two parties who are in the business of dealing in property pay a middleman if they feel completely confident in their business? Banks and their best customers are conducting quite a bit of business without the MLS.

[Bobby J]

Flood of foreclosures: It's worse than you think - Jan. 23, 2009

I wonder if we'll see inventory levels start to rise again?

These foreclosures are sweet deals for the buyers right now. They eliminate all the pain of the short sales. I hope that all these foreclosures will make short sales so 2008! It seems that the foreclosures do not last long on the market. One of the only things the banks have done correct is price these things to sell!

[DuneAHH]

These foreclosures are sweet deals for the buyers right now. They eliminate all the pain of the short sales. I hope that all these foreclosures will make short sales so 2008! It seems that the foreclosures do not last long on the market. One of the only things the banks have done correct is price these things to sell!

It's a baffling curiosity to me...

Why are banks STUCK on going through all the time & expense of thousands upon thousands of foreclosures, only to REWRITE new loans at a fraction of the original amount that they originally foreclosed on?

Wouldn't it be less costly and more expeditiously productive for the banks to immediately attempt offering some similar degree of principle loan reduction to the original defaulting mortgage holder (who if given the opportunity, may be quite capable of making good on their payments if the loan amount was lower?). It just seems that banking "solutions" are stuck in an old chicken-game-rut, in grave need of an industry driven facelift.

I'm probably just being stupid & short sighted... so I hope somebody can enlighten me.

[Bobby J]

It's a baffling curiosity to me...

Why are banks STUCK on going through all the time & expense of thousands upon thousands of foreclosures, only to REWRITE new loans at a fraction of the original amount that they originally foreclosed on?

Wouldn't it be less costly and more expeditiously productive for the banks to immediately attempt offering some similar degree of principle loan reduction to the original defaulting mortgage holder (who if given the opportunity, may be quite capable of making good on their payments if the loan amount was lower?). It just seems that banking "solutions" are stuck in an old chicken-game-rut, in grave need of an industry driven facelift.

I'm probably just being stupid & short sighted... so I hope somebody can enlighten me.

Wait! That makes sense! Have you lost your mind. This is not supposed to make sense! They are right where they belong. Taking 8 months to answer on a short sale, the market drops another 30% and they wonder what is going on? It is one of the most baffling things I have ever been involved with.
One could explain the complexity to a class of school children and they would come back with a better plan to get through this.

[Miss Critter]

It's a baffling curiosity to me...

Why are banks STUCK on going through all the time & expense of thousands upon thousands of foreclosures, only to REWRITE new loans at a fraction of the original amount that they originally foreclosed on?

Wouldn't it be less costly and more expeditiously productive for the banks to immediately attempt offering some similar degree of principle loan reduction to the original defaulting mortgage holder (who if given the opportunity, may be quite capable of making good on their payments if the loan amount was lower?). It just seems that banking "solutions" are stuck in an old chicken-game-rut, in grave need of an industry driven facelift.

I'm probably just being stupid & short sighted... so I hope somebody can enlighten me.

If you are stupid and short-sighted, then so am I. I've thought the same thing many times.

Is their current response due to the nature of existing banking laws? If so, can something be done expeditiously to allow them to re-work existing loans and stop the foreclosure tsunami?

[scooterbug44]

I don't understand it either - but most banking/loan/real estate regs and practices are WAY over my head or illogical IMO.

Frankly, the fact that I still don't understand the intricacies of the mortgage process makes me understand why it's such a cluster and how so many ended up with mortgages they don't comprehend.

Fewer strange rules & loopholes, plainer language, and a massive increase in accountability are needed!

[traderx]

John Steinbeck explained it well.

The squatting tenant men nodded and wondered and drew figures in the dust, and yes, they knew, God knows. If the dust only wouldn’t fly. If the top would only stay on the soil, it might not be so bad.

The owner men went on leading to their point: You know the land’s getting poorer. You know what cotton does to the land; robs it, sucks all the blood out of it.

The squatters nodded they knew, God knew. If they could only rotate the crops they might pump blood back into the land.

Well, it’s too late. And the owner men explained the workings and the thinkings of the monster that was stronger than they were. A man can hold land if he can just eat and pay taxes; he can do that.

Yes, he can do that until his crops fail one day and he has to borrow money from the bank.

But you see, a bank or a company can’t do that, because those creatures don’t breathe air, don’t eat side-meat. They breathe profits; they eat the interest on money. If they don’t get it, they die the way you die without air, without side- meat. It is a sad thing, but it is so. It is just so.

[Bobby J]

True Story:

Home owner in over his head with a mortgage of $575,000. He tries to work with bank about reducing his loan so he can hold on. Home owner had excellent credit during this time. The bank agrees to reduce note $200 per month. HO decides to short sale because they still could not make it work. Due to radical reduction in his pay he still could not make numbers work. First offer on home is $399,000. After many months buyer gets fed up and walks. Next offer is $325,000. I think one can tell the direction of the offers to come. Once again This buyer gets fed up and walks. Mean time the foreclosure clock is ticking and the two different departments do not work hand in hand... Homeowner receives foreclosure papers and decides he is fed up and done. He lets the home foreclose with a short sale offer in hand and with the bank. The home forecloses and gets listed for $299,000. Sits on the market and finally goes under contract for the new reduced price of $270,000.

The moral of the story: Don't even begin to try to understand it. The system is broken and we are in for a long ride. The positive side: Sure wish I was a buyer because the banks will and are doing everything in their power to lower the market. I don't believe that is the intent but just look at the outcome. Another note, many of the foreclosures are listed with out of town agents using out of town title companies. The above home did not even have the correct picture. It had a home 3 blocks away pictured. Also the sq. footage was 1000 sq. feet off!

[scooterbug44]

And I bet the bank that lost over $300k on that transaction alone is either charging its customers out the wazoo for services to make it up or asking for a bailout!

Seriously, I get better service from my hometown bank when I question a $5 transaction on my credit card than most people are getting for transactions worth hundreds of thousands!

[DuneAHH]

Possible solution:
Banking + ExLax = Healthy Marriage

[Lake View Too]

When this whole mortgage meltdown started, it always seemed to me like the simplest thing to do would be to re-write these toxic mortgages to something the borrower could afford. It could be a lower fixed mortgage. It could be lowering the amount to a level commensurate with the actual appraised value.If all these borrowers could keep making payments the whole system would remain functioning. It would be trickle-up economics. The banks could share a little of the pain. Even before the meltdown, I heard some people proposing adjustable loans based on the appraised value rather than some somewhat arbitrary index that only benefits the bank. Does this sound sensible?

[Bobby J]

When this whole mortgage meltdown started, it always seemed to me like the simplest thing to do would be to re-write these toxic mortgages to something the borrower could afford. It could be a lower fixed mortgage. It could be lowering the amount to a level commensurate with the actual appraised value.If all these borrowers could keep making payments the whole system would remain functioning. It would be trickle-up economics. The banks could share a little of the pain. Even before the meltdown, I heard some people proposing adjustable loans based on the appraised value rather than some somewhat arbitrary index that only benefits the bank. Does this sound sensible?

That's my point. Sounds very sensible but sense is not how they got in this situation. We look to them as if they should know what to do. I am afraid they are clueless.

[Joe Mammy]

Skip the shorties unless you are lucky enough to step into a pre-approved number where a buyer had the paitience to stick it out and his offer was finally accepted by the lender. Then for whatever reason he could not close. The loss mitigation dept will only keep the file alive for so long, a good listing agent will scramble to find another buyer advertising the accepted number. File stays open with a quick replacement buyer and close within 45.

[SWGB]

Skip the shorties unless you are lucky enough to step into a pre-approved number where a buyer had the paitience to stick it out and his offer was finally accepted by the lender. Then for whatever reason he could not close. The loss mitigation dept will only keep the file alive for so long, a good listing agent will scramble to find another buyer advertising the accepted number. File stays open with a quick replacement buyer and close within 45.

Which high ethical standard does the BOR or NAR does that fall under?

[Joe Mammy]

Closing shorties 101.

[AAbsolute]

That's my point. Sounds very sensible but sense is not how they got in this situation. We look to them as if they should know what to do. I am afraid they are clueless.

I'll take disagreeing with the majority for $1,000 Alex.....

The number of loans in foreclosure as a part of all the mortgages out is small. Banks can't give a principle reduction deal to every loan currently in effect.
The banks can't, and shouldn't, give a principle reduction deal to their borrowers. Those borrowers who can't keep up with their obligations should face a consequence. Banks should also face a consequence if they can't recover their funds through the sale of the collateral.

[Bobby J]

I'll take disagreeing with the majority for $1,000 Alex.....

The number of loans in foreclosure as a part of all the mortgages out is small. Banks can't give a principle reduction deal to every loan currently in effect.
The banks can't, and shouldn't, give a principle reduction deal to their borrowers. Those borrowers who can't keep up with their obligations should face a consequence. Banks should also face a consequence if they can't recover their funds through the sale of the collateral.

I think the point is the amount of money they are losing by the way they are handling this mess. Borrowers are facing consequences. Most are losing their credit with the "possibility" of judgments and liens for years to come. Many Banks are getting bailed out. I agree with what you are saying but that is not what is happening. Banks should just tell us how much they will sell these homes for if you want to make sense of any of this. Give us a number and it is over. No, lets play the mystery game for 8 months while the market keeps dropping.

[Dominoes]

As someone who does not yet own on 30-A this is music to my ears. I searched hard last year to work a short sale in Watercolor that did not pan out. That home has been unoccupied without electricity since May and the bank still has not finished the foreclosure proceedings. I cannot imaging the amount of mold that has accumulated on the inside, but it gave me very little confidence that the banks have a clue about dealing with the problem. There are going to be alot of sweet deals out there for the upper middle class with steady incomes that were previously reserved for the uber-wealthy.

[rapunzel]

As someone who does not yet own on 30-A this is music to my ears. I searched hard last year to work a short sale in Watercolor that did not pan out. That home has been unoccupied without electricity since May and the bank still has not finished the foreclosure proceedings. I cannot imaging the amount of mold that has accumulated on the inside, but it gave me very little confidence that the banks have a clue about dealing with the problem. There are going to be alot of sweet deals out there for the upper middle class with steady incomes that were previously reserved for the uber-wealthy.

You make an excellent point. The thing that bothers me, though, is what does this do to our community as we wait? Houses filled with mold, leaks going unattended, whole subdivisions looking like shanty towns. It destroys our neighborhoods and our local economy to just let these things drag out for years.

I wish someone would just rip the band-aid off quickly and be done with it...the foot dragging makes things so much worse. Why does it take 18 months to work through the foreclosure process?

[Geo]

I think the point is the amount of money they are losing by the way they are handling this mess. Borrowers are facing consequences. Most are losing their credit with the "possibility" of judgments and liens for years to come. Many Banks are getting bailed out. I agree with what you are saying but that is not what is happening. Banks should just tell us how much they will sell these homes for if you want to make sense of any of this. Give us a number and it is over. No, lets play the mystery game for 8 months while the market keeps dropping.

I hear this "possibility" of judgements/liens often...
Folks in the know pls enlighten me.

If someone went subprime (or alt a) with little no money down on a primary residence- someone with good intentions who had no intentions of flipping, yada, yada...

All of a sudden, stuff happens (lost jobs, divorce, etc.) and they can't pay it anymore and the market value is only 60% of the purchase price...

So with a scenario like the above, what happens if they call the bank, tell them they cannot afford it and leave the keys on the counter?

Their credit is destroyed.
What else?

Are they really doing judgements/liens?

Are the bailouts making banks more forgiving? Is the fact that the above scenario is so common these days making banks more forgiving?

Interesting times...

[SWGB]

I'm just wondering what will happen to home values when a bank finally forecloses, puts the house on the market for the price they feel it is worth, and the first home inspector pries open the front door to find mold, rot, mildew, etc.

[AAbsolute]

So much of what I'm reading in this string of Posts here reads against the United States Constitution. The U.S. has three branches of government and was set up that way on purpose. Every time action is taken inopposite to the Constitution there is an equal, lasting and opposite reaction. This system of government performs hypocritically when corners are shortcut.

I wish someone would just rip the band-aid off quickly and be done with it...the foot dragging makes things so much worse. Why does it take 18 months to work through the foreclosure process?

I understand your point and wish it would be over quickly, but the consequence of shortcutting will have affects that last through the next several business cycles.

[AAbsolute]

I think the point is the amount of money they are losing by the way they are handling this mess. Borrowers are facing consequences. Most are losing their credit with the "possibility" of judgments and liens for years to come. Many Banks are getting bailed out. I agree with what you are saying but that is not what is happening. Banks should just tell us how much they will sell these homes for if you want to make sense of any of this. Give us a number and it is over. No, lets play the mystery game for 8 months while the market keeps dropping.

Banks are making a business decision. There are things that banks know that we aren't privy to. It seems to me that bank loan committees should be able to decide the bank's asking price of at least 5 of their properties each time they meet for committee. There is an unknown variable in their consideration that you and I don't understand yet.

[AAbsolute]

As someone who does not yet own on 30-A this is music to my ears. I searched hard last year to work a short sale in Watercolor that did not pan out. That home has been unoccupied without electricity since May and the bank still has not finished the foreclosure proceedings. I cannot imaging the amount of mold that has accumulated on the inside, but it gave me very little confidence that the banks have a clue about dealing with the problem. There are going to be alot of sweet deals out there for the upper middle class with steady incomes that were previously reserved for the uber-wealthy.

Mold requires moisture. Mold issues caused by inactive conditioning can be remedied. Mold caused by recurring moisture intrusion, that's another story.

[Bobby J]

Banks are making a business decision. There are things that banks know that we aren't privy to. It seems to me that bank loan committees should be able to decide the bank's asking price of at least 5 of their properties each time they meet for committee. There is an unknown variable in their consideration that you and I don't understand yet.

Not sure what you mean here. I understand the foreclosure process. It takes time. Up to 24 months. But, making the short sale process smoother in a timely fashion would only making it better for everyone. This has nothing to do with a short cut. Common sense is not against the Constitution. I think the over load has bogged the system down. So identify the problem and fix it.
The consequences will still be here (borrowers and bankers) but lets get on with the consequences.

[Here4Good]

Banks are making a business decision. There are things that banks know that we aren't privy to. It seems to me that bank loan committees should be able to decide the bank's asking price of at least 5 of their properties each time they meet for committee. There is an unknown variable in their consideration that you and I don't understand yet.

It's dangerous to assume that banks know something you don't know - you, who are in the housing market up to your ears day in and day out, and have been for years. You have a MUCH better idea of the market and what will happen.

The only variable we do not see is the mission they have to prop the numbers up just for this quarter, since their bonuses are awarded quarterly. I do not think that bankers, or many other corporate types, are looking at the long view (and by long view, I mean past the end of this quarter or year).

Back in another lifetime, I started my career working for a retail bank. The chairman was the grandson of the founder, and the chairman of the mortgage company I worked for had been with the holding company for his entire career, 30+ years.

They always had the long view, since they had no intention of ever quitting.

Now, banks and other corporations are bought, sold, mergered and the execs don't expect to stay more than 24 months, if they are lucky. They know that the entire merry go round could stop tomorrow.

Just as all of us are sitting on our wallets (even those of us who could afford to make major purchases), and not buying cars or computers because we are acting in our own best self-interest, so are they.

There will be no reward for the executive who starts writing down principal, since the effect will not be seen for a year or more. There is no reward in following a policy which will cost more now, and (possibly) less later.

[Santiago]

Not sure what you mean here. I understand the foreclosure process. It takes time. Up to 24 months. But, making the short sale process smoother in a timely fashion would only making it better for everyone. This has nothing to do with a short cut. Common sense is not against the Constitution. I think the over load has bogged the system down. So identify the problem and fix it.
The consequences will still be here (borrowers and bankers) but lets get on with the consequences.

Bobby I'm with you but it's not always as easy as it looks to people on the outside. There may be a problem with a loan that you the realtor knows about, the seller knows about and the lender has a suspicion about but is not willing to deal with at the moment. The bank may not need to charge the loan down due to loan loss reserve requirements so he ignores the problem as long as he can. Maybe they know that things will get better if they can just hang on. They(the bank) are still making money and refortifying their loan loss reserves every month from the profits they are making. This enables them to carry forward another month much like the consumer that keeps paying interest. There are many cases where the banker knows that the loan has gone south but can't stand the charge off that month. You on the other side just thinks he's crazy because he didn't take that offer that you brought in. You are probably right. That still doesn't help him with his bigger problem which is keeping his reserve requirements at a level that he(the bank) doesn't get a cease and desist order slapped on.

As much shuffling and restacking the deck as the owners are doing to try to make things work, the bank's are having to do the exact same thing. You are just not privy to all of that. And then the federal government comes along just in time and re-capitalizes the bank enabling them to charge things down that should have been done long ago. As long as their basic business model is still sound, they can re-group and begin to profit and grow again. All is well. All of this by the way, has and is really happening. There's lots of interesting stories out there.

[AAbsolute]

Not sure what you mean here. I understand the foreclosure process. It takes time. Up to 24 months. But, making the short sale process smoother in a timely fashion would only making it better for everyone. This has nothing to do with a short cut. Common sense is not against the Constitution. I think the over load has bogged the system down. So identify the problem and fix it.
The consequences will still be here (borrowers and bankers) but lets get on with the consequences.

Here4Good and Santiago were much clearer than I can be. My point was trying to weigh liberal construction against strict construction of banking regulation.

[Bobby J]

Bobby I'm with you but it's not always as easy as it looks to people on the outside. There may be a problem with a loan that you the realtor knows about, the seller knows about and the lender has a suspicion about but is not willing to deal with at the moment. The bank may not need to charge the loan down due to loan loss reserve requirements so he ignores the problem as long as he can. Maybe they know that things will get better if they can just hang on. They(the bank) are still making money and refortifying their loan loss reserves every month from the profits they are making. This enables them to carry forward another month much like the consumer that keeps paying interest. There are many cases where the banker knows that the loan has gone south but can't stand the charge off that month. You on the other side just thinks he's crazy because he didn't take that offer that you brought in. You are probably right. That still doesn't help him with his bigger problem which is keeping his reserve requirements at a level that he(the bank) doesn't get a cease and desist order slapped on.

As much shuffling and restacking the deck as the owners are doing to try to make things work, the bank's are having to do the exact same thing. You are just not privy to all of that. And then the federal government comes along just in time and re-capitalizes the bank enabling them to charge things down that should have been done long ago. As long as their basic business model is still sound, they can re-group and begin to profit and grow again. All is well. All of this by the way, has and is really happening. There's lots of interesting stories out there.

I had a banker go over this with me recently but I am still puzzled why it takes 8 months to get an answer on an offer. I hear some states are looking into legislation that will not allow a short sale to be listed unless the bank states what they are willing to accept. That just makes sense. I really question the listing of a short sale if no one has been given the authority of a price. Seems almost fraudulent and is crushing the market for sellers. They become the comp but they have no basis. The sad part is I have pulled several off. The only reason is because I needed new shoes.

[Miss Critter]

I had a banker go over this with me recently but I am still puzzled why it takes 8 months to get an answer on an offer. I hear some states are looking into legislation that will not allow a short sale to be listed unless the bank states what they are willing to accept. That just makes sense. I really question the listing of a short sale if no one has been given the authority of a price. Seems almost fraudulent and is crushing the market for sellers. They become the comp but they have no basis. The sad part is I have pulled several off. The only reason is because I needed new shoes.

Milk.

[Bobby J]

Milk.

So true.

[30ashopper]

You make an excellent point. The thing that bothers me, though, is what does this do to our community as we wait? Houses filled with mold, leaks going unattended, whole subdivisions looking like shanty towns. It destroys our neighborhoods and our local economy to just let these things drag out for years.

I wish someone would just rip the band-aid off quickly and be done with it...the foot dragging makes things so much worse. Why does it take 18 months to work through the foreclosure process?

Summing it up in two words - property rights. The laws are designed to protect homeowners from large corporations and government which have heavy weight legal strength. Everything needs to be processed, stamped, approved, signed off on, and judged before a bank can legally evict someone from their home and take ownership. (That's a good thing!) 3rd party filings by HOAs and the like tend to gum things up as well - banks need to re-file and amend and communicate to all parties involved. All of this has to pass through the county's administrative and legislative process linearly which adds to the time it takes for the entire process to complete.

It's funny you know, sometimes we want government to expedite things and sometimes we find expediency to be flat out wrong. Government really can't do it one way here and another there, laws have to be followed explicitly no matter what.

[30ashopper]

Which brings to mind a funny story about the FDA. 30 years ago there was this big push to shorten the approval process for new bleeding edge drugs because people were dying waiting for their approval. 20 years ago the FDA shortened it's approval process and tried to expedite testing on bleeding edge drugs. 10 years ago the FDA lengthened it approval process because people were dying after taking bleeding edge drugs the FDA had expedited the approval of. Today people want the FDA to shorten it's approval process because people are dying waiting for bleeding edge drugs to get approved...

I'll never work in government.

[SWGB]

I had a banker go over this with me recently but I am still puzzled why it takes 8 months to get an answer on an offer. I hear some states are looking into legislation that will not allow a short sale to be listed unless the bank states what they are willing to accept. That just makes sense. I really question the listing of a short sale if no one has been given the authority of a price. Seems almost fraudulent and is crushing the market for sellers. They become the comp but they have no basis. The sad part is I have pulled several off. The only reason is because I needed new shoes.

Am I the only one this comment doesn't scare the bajeezus out of? States take years to enact legislation and now they are discussing this. Me thinks the woods are deeper than we thought.

[Busta Hustle]

[quote=30ashopper;524893]
It's funny you know, sometimes we want government to expedite things and sometimes we find expediency to be flat out wrong. Government really can't do it one way here and another there, laws have to be followed explicitly no matter what.[/quote

You're not from around here are you?

[Santiago]

I had a banker go over this with me recently but I am still puzzled why it takes 8 months to get an answer on an offer. I hear some states are looking into legislation that will not allow a short sale to be listed unless the bank states what they are willing to accept. That just makes sense. I really question the listing of a short sale if no one has been given the authority of a price. Seems almost fraudulent and is crushing the market for sellers. They become the comp but they have no basis. The sad part is I have pulled several off. The only reason is because I needed new shoes.

I think in lots of cases its simply buying time. I guess it worked to some degree with the tarp funds becoming available.

[jerome]

As someone who does not yet own on 30-A this is music to my ears. I searched hard last year to work a short sale in Watercolor that did not pan out. That home has been unoccupied without electricity since May and the bank still has not finished the foreclosure proceedings. I cannot imaging the amount of mold that has accumulated on the inside, but it gave me very little confidence that the banks have a clue about dealing with the problem. There are going to be alot of sweet deals out there for the upper middle class with steady incomes that were previously reserved for the uber-wealthy.

I think you may be damn near correct on that. I am feelin it. Something else that I've read a few weeks ago - banks have "shadow" properties they aren't disclosing/advertising that are or may be in the future short sale or near foreclosure status. Banks are allowing or processing around 25-30% of the short sale/foreclosure properties currently on their books, the rest are shadowed. Couple this with putrid economic conditions with the perspective that the remaining 60-70% are not even on the market and YOU, my man, may get Watercolor minus some fungi. Imagine Watercolor at $250-300 sqft. Paradise lost and found. Just a thought. I remember realtors telling me that short sales in Watercolor would be a rarity at best. Not from what I am seeing. I've been through a short sale right before the worldwide collapse. They are a b-^@^%. Patience and don't get your heart set on anything. Value is really transitory and is at best, hard to define. Get a group of some brilliant economists together to overcome a problem and you know what you get- 20 different theories and a request for a few weeks to work on the details.
Hang in there, you may have some competition from some wealthy out-of- staters, but when it comes down to it, they are only homes, right? People are realizing that. They are not assets until paid off. They don't pay you back. They are, (especially in today's climate), highly illiquid debt obligations whose values were toyed with childish greed and lack of potential consequences that in turn vacillated wildly. Now alot of people's lives are ruined over this gov-backed real estate pinball machine. Nobody in the golden days seemed to realize mortgages are obligations to borrow money; it is not money that you have. Value involves the agreement of two parties. Remember, nationwide appreciation of real estate has historically been slighty above our rate of inflation. This area is more of a guessin' poker faced quagmire as far as potential value and appreciation . You know what Warren Buffett said when marital obligations forced him to buy his first house. " I am going to name it Buffett's Folly." He paid in cash of course, but lamented over the amount of money invested in the home and its potential return versus the market. Bubbles happen all the time, but rarely twice within the same item of displacement. Good luck brother, let me know how things work out. I like this area. I am sad to see what happened to it. I hope for the best.

[AAbsolute]

I heard a caller to one of the CNBC shows Wednesday night describing her re-finance dilemma. She described that she bought a home with 30% down in '06 and had used a mortgage for the rest. She said she could not get a cash out re-fi at this time because the current appraised value was less than the mortgage balance. She went on to say that she couldn't understand why they could not get the cash out re-fi because she has 30% equity.

[Lynnie]

So true.

And, many are violating RESPA - we understand why they are doing some of the things they are doing, but they are worsening the economy by doing so......