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    Hey Pam:) My take on the for sale signs..

    Posted by FlaMac (FranMac54) Email on March 28, 2007, 5:56 am, in reply to "O.T. A Disheartening Time. . ."
    64.12.116.18

    Scary! All the "For Sale" signs you speak about...but also..the responder's to your post I am constantly amazed at how short-sighted and ignorant people can be. Anyone, a signing agent or otherwise, should be concerned about the borrower understanding the ramifications of the loan terms.

    WHEN THE BORROWER'S ACROSS THE NATION AGREE TO UNSTABLE LOANS IT AFFECTS OUR ECONOMY THERBY AFFECTING ALL OF US. Geez!! That is basic economics. But leave it to the ignorant to plod on through life, singing the whole way, "It's not my problem!".

    Bottom line...all of the experts predict we are "in for" a recession. And it's thanks to all of the wonderful lenders, appraisers, brokers, agents, borrowers and yes, signing agents, that made the faulty loans happen. ALL of us share in the responsibility.

    It's simple math. You cannot safely loan 200k on something that is actually only worth 150k. It's called the "Risk Factor". The industry overall left no "cushion" for a downward turn in property values. Here in Florida, this also happened in the 80's and many folks were left with mortgages that were higher than their actual property values.

    BUT THIS TIME, it's much more serious because it's happened nationwide. People have stopped buying houses. Their worried about the war. Their worried about the election. Their worried about global warming. Inflation is increasing faster than their paycheck.

    The lending industry took what worked here and went across the country handing out loan terms that were risky. Now we will ALL pay the price.

    As for the ARM at 11%, or whatever the hell Miss Becca B said...I hate to say this...truly I do! But, in a sense she is right.. it was lost in her usual "bulldog" delivery.

    In some scenario's a borrower may need/want those terms. If he is deep in debt but know's his income will double over the next several years. Young doctors do this alot. Also, interest only loans.

    The theory is that whatever the closing cost are for re-financing again in 3-4 years far outway the interest differential over a 30 year note when your sure you can get a better interest rate down the road. But, these terms are not for the blue-collar worker, someone who's income will not drastically increase soon.

    But, some lenders didn't care. The middle income borrower overspent. The broker came along and offered a friendly solution. The subprime lender gladly accepted the loan app at face value, then tweaked the property value and handed the borrower paper for 125% value with a payment amount he could never make three years from now.

    Now, we will all suffer because in reality they were playing with paper money. This is the real world. They drove THEMSELVES out of business. Now, the "real banks" will come along and clean-up the mess...making tons more money along the way. You gotta' love banks...they win..even when they loose.

    --Previous Message--
    : I was in a particular city today
    : (one of my service areas), and it
    : was astonishing to see so VERY
    : many "For Sale" signs. On
    : one street
    : alone I counted approximately twelve
    : homes!
    :
    : I was in that area about ten days
    : ago.
    : Although there were the usual
    : "For Sale"
    : signs sprinkled about, it was nothing
    : like I saw today.
    :
    : On just about every block, there were
    : three or more signs. What makes this
    : particularly interesting, is that
    : many of
    : these properties were also marked
    : "just
    : reduced" or "priced for
    : quick sale".
    :
    : I know this area very well and
    : remember
    : a few years ago, when it was a
    : seller's
    : delight! During that time, many of
    : these
    : homes, (in my opinion) though very
    : nice,
    : were price Much too high.
    :
    : Now it seems as though these home
    : can't
    : even be given away!
    :
    : Though I do not have proof (without
    : actually researching the county
    : recorder's office), I suspect many of
    : these homeowners are victims of the
    : Sub-prime lending and/or
    : "creative
    : financing" fallout.
    :
    : I wonder how many of these Sub-Prime
    : Lenders and Mortgage Brokers are
    : having
    : to face the same situation? Probably
    : zero
    : (if that much).
    :
    : [And yes, I know that many of these
    : lenders etc. . .are
    : "closing-shop", but
    : I am very sure, that THEIR
    : residential
    : properties (for which they are
    : actually
    : living) are not facing foreclosure.]
    :
    : It is really a disheartening time for
    : many.
    :
    :
    : Pam
    :
    :
    :
    :
    :
    :
    :

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