I
Igor The Terrible
Guest
....because what some folks wished for may well come true.
When Klinton signed NAFTA into law and the giant sucking sound became
audible, the IT folks, accountants, engineers, etc...shrugged it off
because, hey it is only the uneducated, low income, trailer trash
factory workers that were getting the boot. Well, not too long
afterwards, the technology bubble pops and suddenly the giant sucking
sound become audible in this industry as well. Hmm...then suddenly
accountants see their jobs go, engineers see their jobs go, then
health care folks...you get the picture.
So, for those who wanted to work in their fields were soon looking at
huge pay cuts or perhaps learning Chinese or Indian and look for jobs
across the pond.
Since that point forward, the middle and working class wages were
shrinking big time. The non existent inflation that Bubba and Dubya
hosed the public down with was here all along. But nobody gave it any
thought because guess what? There were too many other trivial BS
issues that were more important. So when the dust from 9/11 settled,
a great new bubble was in the works!!! Make lots of money flipping
houses, invest in real estate, and have fun!!
Well, now that the housing bubble popped, we are up to our asses in
hoc (not me!
) interest rates going up, property values
sliding, reality at long last is finally beginning to set in. I rang
the alarm bells a bunch of times on this and other groups. To no
avail except a lot denial.
I warned a lot of the younger people were going to get burned because
of president whose mouth was as big as the ****ing space between his
ears was lying through his teeth about the state of the economy.
Personally, I don't think the ****sucker could make a passing grade in
a community college econ 101 class. Nevertheless the public bought
his spew hook, line, and sinker.
And it came to pass, just like the giant sucking sound, interest rates
started going up and so did for closures. There were assholes
everywhere throwing darts at the situation claiming they couldn't
afford the house in the first place. Although it is a matter of
record that these claims were true but it also showed a lot of callus
arrogance on the part of the folks higher up the food chain. You
remember, kinda like the IT workers, accountants, engineers, etc...
the as long as it doesn't affect me, who cares crowd. In the
meantime, people working in America now are "gainfully" employed in
the Wal-Marts and McDonalds across the country
Once again, I warned after the first round of foreclosures, another
would soon follow...guess what? It's here.
I just hope nobody here gets burned. It would really suck to see
anyone get hurt over this bullshit.
So the next time you hear some wacko Hollywood piece of **** claiming
"greed is good" in their gutter motion picture or anything that is
contrary to what is time-tested honorable to our country, think it
through before you act on it. This is what it got us. Not just in
housing, but employment opportunities, and a completely out of control
income gap that soon ruin if not totally destroy all but the very
elite in this country.
Don't think it can happen...? Just go right on believing that...at
your own peril.
Wealthy may be next in line in home crisis By Nick Carey
Thu Jan 17, 2:41 PM ET
HINSDALE, Illinois (Reuters) - A house in this wealthy Chicago suburb
is far beyond the reach of most Americans.
Unfortunately, Hinsdale may also now be too expensive for some of the
people who already live here.
"There is a section of the population here that over-extended
themselves to buy here and then keep up the facade of wealth," said
Sharon Sodikoff, a broker associate at local real estate agency
Prudential Homelife Realty. "In the next year or so they'll be forced
out in dribs and drabs."
With a picturesque little downtown area and large, expensive houses --
according to the Headrick-Wagner Consulting Group, the average home
sale price here in the 12 months to September 30, 2007, was around
$1.15 million -- Hinsdale seems a world away from the housing slowdown
that may have brought the U.S. economy to the brink of a recession.
But even here, far from the housing crisis' epicenter, high earners
with good credit may be heading for trouble as their adjustable rate
mortgages (ARMs) adjust beyond their means, local real estate agents
and others say. In a normal housing market they'd be able to sell, but
now they are stuck.
"The next wave of problems will come from prime borrowers who bought
too much house or borrowed too much against it," said Michael van
Zalingen, director of home ownership services at Neighborhood Housing
Services of Chicago. A "prime" borrower is one with good credit.
Real estate agents warn that some high-income borrowers have already
been forced to sell or leave their homes and more will follow.
Especially those who used their homes as ATMs, withdrawing cash via
home equity loans.
"For those who utilized home equity loans for five to ten years to
finance their lifestyle, the chickens are coming home to roost," said
Chicago-based real estate agent Marki Lemons.
There are also signs some lenders are warily eyeing "prime" borrowers.
Tom Kelly, spokesman for Chase Home Lending, a unit of JPMorgan Chase
& Co, said the company raised its reserves for possible home equity
loan loss for subprime and prime borrowers by $635 million in the
second and third quarters last year.
"The concern is people who have borrowed a large percentage of the
equity (in their homes)," Kelly said. "Now the value of their homes is
falling and they can't refinance."
"Some just stop paying and walk away," he added.
SHORT SALE
Getting into property during the boom was easy, with mortgages freely
available for no money down.
Then came the subprime crisis and the credit crunch, slowing the
market, pushing prices down and home inventories up. In Hinsdale, for
instance, the supply of homes on the market rose to more than 17
months in early October from less than 6 months in January 2006.
While it's apparently a buyers' market, Lawrence Yun, chief economist
at trade group the National Association of REALTORS, says high-end
borrowers are put off by the high interest rates now applied to so-
called "jumbo" mortgages, those for $417,000 or more.
"Potential buyers say 'no way am I buying at that price,"' Yun said.
"If people can't enter the market, this slows everything down and puts
pressure on foreclosures."
If some borrowers can't get into the market, there are others who
can't sell to get out. Home owners who bought recently with no money
down are the ones most likely to abandon a property when they fall
behind on the mortgage.
"I've seen people who bought less than a year ago and have no equity
in their homes simply walking away with no regard for the
consequences," said Genie Birch, a real estate agent at Chicago-based
Koenig & Strey GMAC who covers the city's wealthier districts.
Real estate agents say speculative investors who bought to make a
profit are also walking away as the rents they charge fall behind the
mortgage payments as their adjustable-rate mortgages readjust.
The home owners who find it harder to walk away are those who took out
large home equity loans before prices started falling and now owe far
more than their home is worth.
"It's difficult for home owners in that situation to sell as they'll
still be left owing money," said Dave Hanna, managing partner of
Prudential Preferred CRE, which owns Prudential Homelife Realty in
Hindsale.
Unlike subprime borrowers, however, wealthy home owners are more
likely to try to cut a deal with their lender, rather than end up in
foreclosure. The alternative solution available to them is to opt for
a short sale.
Under a short sale agreement, the borrower sells below the mortgage
value and the lender writes off the difference. The lender gets less
than originally anticipated, but is not stuck with a foreclosed
property. The borrower's credit rating is damaged, but not as badly as
if they had lost the home.
"You won't see many foreclosed homes here because that would involve
public embarrassment," Prudential Homelife Realty's Sodikoff said.
"But they will call their realtor and get them to quietly broker a
deal to get out of their homes."
(Reporting by Nick Carey; Editing by Eddie Evans)
When Klinton signed NAFTA into law and the giant sucking sound became
audible, the IT folks, accountants, engineers, etc...shrugged it off
because, hey it is only the uneducated, low income, trailer trash
factory workers that were getting the boot. Well, not too long
afterwards, the technology bubble pops and suddenly the giant sucking
sound become audible in this industry as well. Hmm...then suddenly
accountants see their jobs go, engineers see their jobs go, then
health care folks...you get the picture.
So, for those who wanted to work in their fields were soon looking at
huge pay cuts or perhaps learning Chinese or Indian and look for jobs
across the pond.
Since that point forward, the middle and working class wages were
shrinking big time. The non existent inflation that Bubba and Dubya
hosed the public down with was here all along. But nobody gave it any
thought because guess what? There were too many other trivial BS
issues that were more important. So when the dust from 9/11 settled,
a great new bubble was in the works!!! Make lots of money flipping
houses, invest in real estate, and have fun!!
Well, now that the housing bubble popped, we are up to our asses in
hoc (not me!
) interest rates going up, property valuessliding, reality at long last is finally beginning to set in. I rang
the alarm bells a bunch of times on this and other groups. To no
avail except a lot denial.
I warned a lot of the younger people were going to get burned because
of president whose mouth was as big as the ****ing space between his
ears was lying through his teeth about the state of the economy.
Personally, I don't think the ****sucker could make a passing grade in
a community college econ 101 class. Nevertheless the public bought
his spew hook, line, and sinker.
And it came to pass, just like the giant sucking sound, interest rates
started going up and so did for closures. There were assholes
everywhere throwing darts at the situation claiming they couldn't
afford the house in the first place. Although it is a matter of
record that these claims were true but it also showed a lot of callus
arrogance on the part of the folks higher up the food chain. You
remember, kinda like the IT workers, accountants, engineers, etc...
the as long as it doesn't affect me, who cares crowd. In the
meantime, people working in America now are "gainfully" employed in
the Wal-Marts and McDonalds across the country
Once again, I warned after the first round of foreclosures, another
would soon follow...guess what? It's here.
I just hope nobody here gets burned. It would really suck to see
anyone get hurt over this bullshit.
So the next time you hear some wacko Hollywood piece of **** claiming
"greed is good" in their gutter motion picture or anything that is
contrary to what is time-tested honorable to our country, think it
through before you act on it. This is what it got us. Not just in
housing, but employment opportunities, and a completely out of control
income gap that soon ruin if not totally destroy all but the very
elite in this country.
Don't think it can happen...? Just go right on believing that...at
your own peril.
Wealthy may be next in line in home crisis By Nick Carey
Thu Jan 17, 2:41 PM ET
HINSDALE, Illinois (Reuters) - A house in this wealthy Chicago suburb
is far beyond the reach of most Americans.
Unfortunately, Hinsdale may also now be too expensive for some of the
people who already live here.
"There is a section of the population here that over-extended
themselves to buy here and then keep up the facade of wealth," said
Sharon Sodikoff, a broker associate at local real estate agency
Prudential Homelife Realty. "In the next year or so they'll be forced
out in dribs and drabs."
With a picturesque little downtown area and large, expensive houses --
according to the Headrick-Wagner Consulting Group, the average home
sale price here in the 12 months to September 30, 2007, was around
$1.15 million -- Hinsdale seems a world away from the housing slowdown
that may have brought the U.S. economy to the brink of a recession.
But even here, far from the housing crisis' epicenter, high earners
with good credit may be heading for trouble as their adjustable rate
mortgages (ARMs) adjust beyond their means, local real estate agents
and others say. In a normal housing market they'd be able to sell, but
now they are stuck.
"The next wave of problems will come from prime borrowers who bought
too much house or borrowed too much against it," said Michael van
Zalingen, director of home ownership services at Neighborhood Housing
Services of Chicago. A "prime" borrower is one with good credit.
Real estate agents warn that some high-income borrowers have already
been forced to sell or leave their homes and more will follow.
Especially those who used their homes as ATMs, withdrawing cash via
home equity loans.
"For those who utilized home equity loans for five to ten years to
finance their lifestyle, the chickens are coming home to roost," said
Chicago-based real estate agent Marki Lemons.
There are also signs some lenders are warily eyeing "prime" borrowers.
Tom Kelly, spokesman for Chase Home Lending, a unit of JPMorgan Chase
& Co, said the company raised its reserves for possible home equity
loan loss for subprime and prime borrowers by $635 million in the
second and third quarters last year.
"The concern is people who have borrowed a large percentage of the
equity (in their homes)," Kelly said. "Now the value of their homes is
falling and they can't refinance."
"Some just stop paying and walk away," he added.
SHORT SALE
Getting into property during the boom was easy, with mortgages freely
available for no money down.
Then came the subprime crisis and the credit crunch, slowing the
market, pushing prices down and home inventories up. In Hinsdale, for
instance, the supply of homes on the market rose to more than 17
months in early October from less than 6 months in January 2006.
While it's apparently a buyers' market, Lawrence Yun, chief economist
at trade group the National Association of REALTORS, says high-end
borrowers are put off by the high interest rates now applied to so-
called "jumbo" mortgages, those for $417,000 or more.
"Potential buyers say 'no way am I buying at that price,"' Yun said.
"If people can't enter the market, this slows everything down and puts
pressure on foreclosures."
If some borrowers can't get into the market, there are others who
can't sell to get out. Home owners who bought recently with no money
down are the ones most likely to abandon a property when they fall
behind on the mortgage.
"I've seen people who bought less than a year ago and have no equity
in their homes simply walking away with no regard for the
consequences," said Genie Birch, a real estate agent at Chicago-based
Koenig & Strey GMAC who covers the city's wealthier districts.
Real estate agents say speculative investors who bought to make a
profit are also walking away as the rents they charge fall behind the
mortgage payments as their adjustable-rate mortgages readjust.
The home owners who find it harder to walk away are those who took out
large home equity loans before prices started falling and now owe far
more than their home is worth.
"It's difficult for home owners in that situation to sell as they'll
still be left owing money," said Dave Hanna, managing partner of
Prudential Preferred CRE, which owns Prudential Homelife Realty in
Hindsale.
Unlike subprime borrowers, however, wealthy home owners are more
likely to try to cut a deal with their lender, rather than end up in
foreclosure. The alternative solution available to them is to opt for
a short sale.
Under a short sale agreement, the borrower sells below the mortgage
value and the lender writes off the difference. The lender gets less
than originally anticipated, but is not stuck with a foreclosed
property. The borrower's credit rating is damaged, but not as badly as
if they had lost the home.
"You won't see many foreclosed homes here because that would involve
public embarrassment," Prudential Homelife Realty's Sodikoff said.
"But they will call their realtor and get them to quietly broker a
deal to get out of their homes."
(Reporting by Nick Carey; Editing by Eddie Evans)
