What else can you do?
Whew…I’m tired! The horse is down, but no matter how much we beat it with data, facts, math, inventories, etc. ‘the horse’ will just not believe it one bit that real estate can go down. I have covered most of the popular mortgages….from 2/28, 3/27, 5/25, 3/1, 5/1, 7/1, 10/1 ARMs, interest only ARMs, option ARMs, fixed rate loans, even 40 year mortgages on up to 100 year mortgages. We have looked at HELOC’s (home equity line of credit), seconds, 125% loans, sub 500 FICO score loans, stated loans, NINA loans (no income no asset), no doc loans, and more.
We have looked at the data for ARMs and option-ARMs. We have seen that in many ‘bubble areas’ ARMs are used well over 70% of the time. It doesn’t matter if the option-ARM is tied to the COSI, COFI, MTA or LIBOR…it is going to adjust or recast sometime. It doesn’t matter if the I/O period is 1 year or 5 years, it is going to adjust. When these loans adjust, people better have equity to refi, or the income needed to support the payment. When I see things like THIS, I think people just might be a little too comfortable with 50-100k in equity.
I have looked at the data, and compared it with my personal experiences, and nothing surprises me based on what I have seen. I have seen the option-ARM become 80-90% of the business at some of my broker shops. I have seen the way they are sold, and how many clueless borrowers fall for the ‘low payment’.
We have looked at income, inventories, and housing statistics. If I were in Vegas, I know where I would put my money on the direction I think things are headed…and I think many of you feel the same way.
That said, no great long post from me tonight. There are now over 160 active topics and over 1000 posts in the forums. Use the comments here, or the forums to chat back and forth over the weekend. Lots of good posts in there. It is worth checking out if it has been a while since you last stopped by…it has grown a lot!
As usual, I look forward to the comments and feedback!
Have a great weekend!
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I am going to keep making my posts over here, but most of the comments are happening at the new site. Go to...
www.housingbubblecasualty.com
or
www.anotherf@ckedborrower.com
...if you would like to see more comments and activity. Don't forgot to check out the activity in the FORUMS!
SoCalMtgGuy
posted by SoCalMtgGuy at 10:30 PM
6 Comments:
There's another intresting perspective on changes in the mortgage market at Bubbletracker. It talks about how the indsutry is starting to change how they report thier data.. ironically enough.
Duh.. I meant Bubbletrack
darn.. sorry.. lets just say it's bubbletrack.blogspot.com
There's another intresting perspective on changes in the mortgage market at bubbletracker.blogspot.com. It talks about how the indsutry is starting to change how they report thier data.. ironically enough.
Socalmtgguy:
Well, I have just spent a hair-raising hour or two reading these blogs written by
RE "investors"/flippers/whatever you want to call them.
They all (so far) seem to be quite young (20's) and, astoundingly, making none to teeny tiny amounts of money off of their flips. It's not even clear that they are figuring in all of the costs of their transactions before they add up their profits.
And some of them are in markets that are peaking and/or falling as we speak, ie. CA., Seattle, etc.
the one in CA. that I checked out was "slomoney" who posts as "net worth 1M/debt 3M" or thereabouts.
To find links to a lot of them, go to:
http://trishasblogsite.blogspot.com
So here's my questions:
1) Am I the only person on the planet who didn't know this was happening?
I mean I knew there were flippers out there, I just assumed they were making some big bucks (except the ones at the end/peak of course).
2) When you've got some free time, socalmtgguy, (oh yeah I know you've probably got oodles of that!) could you check some of these sites out and maybe give us an analysis of these peoples' financial situation?
The guy in Seattle, Eric, for one, gives a pretty thorough account of the types of loans he takes out.
Anyway, these kids sure seem like they're having a lot of fun and that's great but for this reader it was like watching a train wreck in motion.
It hosts a numbers of home for sale by owner, Canadian vacation rentals,
rent and agents listing Vancouver, BC Canada. www.realsale.ca
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