With all the postponements of trustee sales, it seems that if any defaulting borrower could just fog a mirror, the servicer would give them a break.
Apparently, they’ll go farther than that – from a reader:
My sister passed in mid 2007 from cancer. She was widowed and lived in Oregon. She put down 10% in 2004 for a house with 80/10 mortgages from Greenpoint. Greenpoint failed in late 2007 and Capital One stepped in to take over. Our family decided, since the house was the only Oregon asset and the holding cost during probate would offset any equity, that rather than going through probate to sell it, the bank could have it.
Two years ago this week I was in Oregon with my wife clearing out and securing the house because the bank was in foreclosure mode. Now here we are, two years later and the bank still has not foreclosed, postponing month over month and even refiling after the foreclosure deadline passed and cancelled the original filing. I’m glad I turned off the water and drained the pipes in the house since it was freezing while we were there. I can only imagine what that house looks like after being vacant all this time…
Hopefully some bandos are living there – do they have bandos in Oregon?
Banks are delaying foreclosure which is no surprise. In comes a few (or many?) Realtors to chop the Short Sale market and further depress what ever market there is. Those people who want to pro-actively refinance, and truly qualify because they have income, good credit and low DI ration are going to get screwed. My ARM is up in 2014 and I want to refi, but now I have to pony up even more because the local shorts and REO market are killing me. Can we just clear the inventory already? Apparently that is too much to ask given entitlement programs passing left and right – it is going to take a long time. Which program today will be the daily special. I just want to know if actually paying off this house on an acclerated schedule is worth it. Hell, I may even rent if the Wifey can get over the ‘stigma’.
Please send me the address. I’m looking to retire to Oregon and I would dig the free rent.
3clicks from da beach,
If you’re already considering renting. Just stop paying your mortgage and when the foreclosure is imminent file for bankruptcy. Purely second hand information seems to indicate that this would allow you to live rent-free for 2 years maybe more. How much money can you save up in that time?
If you can save up 100k+ in 2 years. Then stomach renting for 3-4 years. You’ll have a huge down for a new house with near perfect credit. (even after the BK)
This is the exact situation a relative of mine is considering.
I agree 3clicks. There are really no winners in this game other than the scammers. People who do decide to stick it out and make their payments are getting clobbered over the head with a fresh can of whooparse every time they turn around. Clearing the market of driftwood would be a good start but would further plunge prices leading to a fresh pile. If we had a strong economy outside of housing we could get through this mess quickly but since we don’t this may as good as it gets for a while.
I’m the double loser because I’m one of those that think there is honor in paying your mortgage even if the game has been rigged for a LONG time now. Hmmm there is a pattern. I missed the train during the dot com days and the real estate frenzy. Now, I’m missing out on an opportunistic time to de-leverage. LOL, there many of us who are 180 degrees out of phase with the cycle, but I digress.
I’ve been watching NODs on places, some that have not ever been listed. 2 years is common for a property to be twisting in the wind. I thought maybe b/c people have been making a payment here and there and stalling. This confirms that it doesn’t matter. Whether someone is living in the place making an occasional payment, or empty and not a dime going towards it. Banks are going to do nothing.
Maybe the plan is to wait for inflation to set in and then the house will be worth peak prices again. Of course, w/fewer jobs and/or less income, I don’t know who will be buying these places.
I always defer to my friend who lived in a Laguna Niguel ocean view mansion for 26 months without so much as an HOA payment, tax payment, insurance payment, or house payment.
Considering that payments before that (on an OA) were 6500+T&I&HOA, that’s some serious market inefficiency.
Until our regulators accept that our entire banking system is insolvent and moves to nationalize the lot in RTC2, we’ll be doing a lot more twisting in the wind. I reckon at this rate, we’ll be through the financial malaise in 2021. Maybe longer. We need to speed this up!
Hence my call 2 years ago for MORE foreclosures, not less.
People see the problem as being foreclosure, but foreclosure and bankruptcy are the ANSWER to the problem to too much debt, not the problem. The sooner we as a country realize what our father’s fathers knew (that debt is only useful to increase productive capacity), we can move to a better future supported on the fundamentals of economics.
Chuck
I wonder if that reader’s house was in Bend. We lived there for over 10 years. It once was the fastest-growing city in Oregon. My son was a framer there and always busy. Then real estate crashed in 2007. He couldn’t find any job–in or out of construction–and moved back to CA.
Trulia has 356 (Realty Trac) foreclosures listed. Today, the John L.Scott real estate website shows 1,771 active SFR for sale. As of 12/2009–per the Bureau of Labor Statistics– there was a 14.5% unemployment rate in Bend. No wonder some now call that beautiful city: “poverty with a view”…
People see the problem as being foreclosure, but foreclosure and bankruptcy are the ANSWER to the problem to too much debt, not the problem. The sooner we as a country realize what our father’s fathers knew (that debt is only useful to increase productive capacity), we can move to a better future supported on the fundamentals of economics.
———————
Until everyone grasps this fact, we will be stuck in this “more stimulus”/”more recession” hell. Thank you for stating what should be so obvious, Chuck.
This home is in Salem. Realquest.com shows 93 sfr scheduled for auction and 38 foreclosures in 97302. All of Salem shows 302 OREO and 617 set for auction. These numbers are only single family homes.