UPDATE: an FB situation 14 months later

I know many of you are waiting for the next dose of subprime mortgage madness...don't worry...it is coming. I have been out of town quite a bit lately, and I am going to be gone a bit more. Don't worry though, you aren't going to miss anything as this mess is going to take years to pan out. This post should hold you over for a little while until I can get the next big post up.

That said, I wanted to post the following e-mail that I received. Some of you might remember this person from an earlier post. Well, here is the update from this individual. Here is the link to the earlier post so you can 'refresh' your memory to the situation: Confession from a reader "I was in denial...I might be an FB myself"

Here is the latest e-mail to me:

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Dear Mr. AFB-blogman,

My name is xxxxxx xxxxxx. You might remember me from January 22, 2006. http://anotherfuckedborrower.blogspot.com/2006/01/confession-from-reader-i-was-in.html

I should tell you what happened to me in the last year. I give you free permission to post this e-mail on yor site, if you like.

After your post, and the ensuing comments, we tried real hard to sell the house FSBO for $639K. Didn't happen. We had our baby, and, with four mouths to feed now, I got another title rep job, but it only lasted for three months. Got one realtor to list at $639K, just to cover the $601K in debt, commissions, etc. Didn't get a bite for 90 days. We let him go after the contract, and hired a "hitter." She listed at $599K. We spoke to her assistant for the ensuing months. Not much really happened. We stopped paying the mortgage after April 2006's payment. We received the notice of default in September. I had already moved the family to a rental in Garden Grove in June. After three short sales fell out of escrow, we closed on a short sale to a landscaping contractor for $550K. He went no money down. The bank had to eat, among other things, a new septic tank, a tenting for termites, and $30,000 in agent commissions. We bought the house for $605K, paid $3K of principal, and stuck the bank with a $122K loss. The short sale closed on the day of filing for Notice of Trustee Sale in November. The bank, in their deduction schedule, showed the entire period of January through September 2006, as mortgage interest paid, making our write-off 4 times larger than I expected. [Maybe I'm ignorant: is this supposed to happen, and I just didn't know?] Also, the bank didn't 1099 us! I talked to the supervisor in the collections department eight weeks ago, and he said our file was noted as "do not issue 1099." The super interpreted this to mean that the bank must have thought it wasn't worth it. I was planning on claiming insolvency to the IRS through my job loss, anyway, but they didn't even give us a 1099!

I continue to follow the national real estate scene on the Internet; now, through, with a great deal of schadenfreude, because I'm no longer an FB.

Incidentally, the wife and I opened a transcription business from home, and are doing excellent in the first quarter of 2007. Ironically, I produced the podcast transcript for Casey Serin these last couple days.

Yours,

xxxxxx xxxxxx

NobleTranscription.com

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As you might remember, this individual was a title rep in the industry. If you haven't done so already, I suggest you read the earlier post from about 14 months ago. It will shead some light on why I see things getting worse.

This individual was 'in' the industry making good money for a relatively short period of time (less than 3 years). I call this a short period of time, because most mortgages require 30-50 years of payments these days.

You are going to see even more 'industy' people foreclose on homes as that 10-20k+ a month isn't coming as easily, or at all. Not to mention that most people in the industy were caught up in the madness just as much, if not more than the 'average joe'.

Anyway, keep the feedback on topic and constructive. I know there are going to be some people that don't agree with the way things pan out, and that is fine. All I will say is that a few hundred thousand here, a few hundred thousand there, and pretty soon you are talking about 'real money'. There will be consequences when tens of thousands of people start walking from homes and leaving 'somebody else' to hold the bag. You had just better hope that 'guvment' doesn't step in and use taxpayer money to bail people out. Remember: government does ONE thing well...perpetuate itself.

Stay tuned...

SoCalMtgGuy