Three reasons why the mortgage industry is going to Hell

  1. The house across the street and three doors down, which has been sitting empty since foreclosure a year and a half ago.

  2. The house three doors down from me, which has been sitting empty since foreclosure about six months ago.

  3. The house NEXT DOOR TO ME, which is nearing the end of the foreclosure process. The Sheriff should be visiting any day now to boot out the (former) owners.

This isn’t Phoenix, Las Vegas, or Miami. This is an established middle-class inner ring suburb of Cleveland, where the real estate boom didn’t even make a rumble. Well, maybe formerly middle-class, if these houses eventually sell for a pittance and meth labs or the Crips move in.

I’m doing okay; 30 year fixed mortgage that I’m able to pay, even though with nothing moving and having so many foreclosed houses around me, I’ll have negative equity for the next several years. Still …

What, all those mortgage brokers going to Hell? Well, there goes the neighborhood…

Can I add another?

  1. When you need a foreclosure, you can’t get one!

About a year ago, a local man bought a house and died in a car accident shortly after. The man he bought the house from is interested in buying it back, but nobody from the mortgage company will talk to him. They won’t talk to anybody. Phone calls and letters from relatives and city officials and lawyers go unanswered.

All they need to do is foreclose and schedule a sale, but apparently they can’t be bothered. There’s a cash buyer waiting!

I wonder how much of the industry’s problems can be laid to simple incompetence.

The guy who wants the house needs to contact the probate court, not the mortgage company. More specifically, he needs to talk to the executor of the estate.

Ah, a topic I can rant on.

Two summers ago, we bought a house in Bend, Oregon. Right as the market crested, apparently. Yay me. Still, it’s a really nice house, in a great neighborhood.

Last year, I started getting a queasy feeling about my studio’s longevity, so I arranged to transfer to another studio in the same company, here in Seattle. At that time, I started to look into selling the house… and started to realize how screwed I was.

We couldn’t rent the damn thing out. What’s worse, renting here is much higher than renting there- so we would’ve been looking at losing a good chunk of change every month. We contacted a lawyer about doing a short sale.

Well, here it is six months later, and we just now got an offer… for over a hundred thousand dollars less than what we bought the house for, just a year and half ago. To add insult to injury, the buyer wants us to pay for the closing costs!

Goddammit, all I want is a good place to live. Right now, I’m living in a rental house that’s being neglected by the owners who view it merely as a financial investment, and my odds of buying a house anytime in the next couple of years are between nil and none.

And now, because of the downturn, when I finally find a house I like and can afford, all the low downpayment mortgages have dried up. Despite a good income and great credit, I can’t do 5% down. So I am having to cash in every dime I own (at a crappy time to take money out of the market) to scrape up 10%. I officially live in a distressed area, it seems.

I feel your pain there, Lightnin’, but it appears you’ve been Californiaed! Home prices in Bend were WAAAAY out of line for the area, mostly due to damned Californians on the run from high property prices figuring that those inflated prices (by Oregon standards) were one hell of a deal (by California standards.) Something very similar happened in the Sacramento valley due to a huge influx of SF Bay area residents who were creaming their jeans at all the “cheap” housing a mere 2 hour commute away! :rolleyes: So of course those who actually LIVE in Sacto can no longer afford a house near where they work (at substantially lower salaries than Bay Area residents) and have to move two hours away just to be able to afford a house.

None of which helps you, since you’ve moved into one of the legitimately high value cities in the PNW. At least you can curse the Californians for your plight legitimately, which we all do anyway… :stuck_out_tongue:

Hey, maybe you can get a nice affordable house in Chehalis! Only a couple hours drive from work!

Nothing’s been filed. There’s no probate. Young, single guy, owned nothing except the house. His family refuses to get involved. Weird, huh?

I’ve read some of the posts here on the housing market, most of you seem to be labouring under one of two outlooks that seem, to me, absolutely incredible. Either you think:

  1. Residential real estate is an investment that cannot possibly lose value. People should be able to retire without savings or other investments after a lifetime of living paycheck-to paycheck(which I understand describes the financial state of most American households at this point), and live soley off the accumulated fortune of forever-appreciating real estate. This must be maintained. The federal government should do whatever it takes to make this happen.


  1. Residential real estate is NOT an investment for me, I just want a place to live. Larger economic conditions don’t affect me, so I don’t need to know anything about them. My pure-as-snow intentions will protect me from the market. (a la Lightnin’) Everyone knows that we all should buy as much real estate as possible. No further research on my part is needed.
    …and you folks here are suppose to be the smartest ones?


Not that I love the mortgage industry, but I haven’t seen any post in this thread that is the fault of mortgage brokers or banks. They can’t sell a house out from under an estate. They can’t create a purchaser of foreclosed property out of thin air. There’s an ad running on the radio in the Bay Area for an auction involving 1,000 foreclosed houses. It’s bad out there.

Or possibly

  1. it fucking sucks and they want to vent.

Or is that not smart enough for you?

You know, it’s often more effective if, when you summarize people’s opinions and then sneer at them for holding them, your summaries bear any remote resemblence to the posts in the thread where you’re doing the sneering.

Just a little tip. You know, for the future.

What happened to that dearly held canard on the Dope about being ready to face some critical thinking and critical language when you put out an OP lacking in the former?

If your mortgage broker lied to you or you were confused about the terms of a loan, I have some sympathy. I know that there were deceptive practices going on during this past housing boom, but posters like villa and SmartAleq are essentially bitching about opposite behaviors and I hear, “rabble, rabble, rabble!!!”

I have no problem with someone criticizing the OP, or any of the posts that followed it. I just find that coupling a condescending tone ("…and you folks here are suppose to be the smartest ones? ") with positions that no one has taken (e.g. “The federal government should do whatever it takes to make this happen.”, “Everyone knows that we all should buy as much real estate as possible.”) tend to be less “critical thinking” and more “pointless douchebaggery”.

The OP is a bit unfocussed as well as being pretty personal. I was commiserating specifically to Lightnin’ regarding his/her specific situation and the specific housing markets he/she named (which, since I’m in the real estate biz AND a PNW resident I bet I know more about than either threemae or Throatwarbler Mangrove.) Neither the OP nor I are making any points regarding anything other than specific examples of housing markets that suck right now and personal situations that suck because of it. Nobody in this thread is saying anything regarding the larger state of the mortgage business, or the subprime bubble.

Reading for comprehension obviously not being either of y’all’s strong suit, I suggest that y’all can both fuck off back to wherever your drivel might be apropos. With bells on.

Oh, and on preview–Giraffe, you rock!


It wasn’t aimed at anyone in particular, only general themes that seem to pop up in these kinds of threads here. I suppose the people it DOES apply to will show themselves soon enough. Goes right for those raw nerves.

You should hear the things people say about the American “real estate biz” and the people in it. :slight_smile:

See, the funny thing is I suspect my own views are not far from yours. Much of the hype surrounding real estate in the past few years was ridiculous, with people spouting nonsense back and forth to each other like it was obvious fact. And I think housing prices falling right now is a good thing, and in fact they need to fall a fair amount more before things are back to normal, even if it means some people end up owing more than a house is currently worth.

But the difference is in how you express them, and to whom. Personally, I don’t feel the need to shit all over people who may or may not have fueled that hype or held unrealistic views and who are now paying the price. Had you waited to direct your comments at the people who actually hold the opinions you (rightly) mock, you wouldn’t have looked like quite such a dick as you do here.

If your views are not far from mine, then why do you feel like I’ve shat on you?
It was a general comment about how supposedly smart people here seem to have no problem espousing views that are economically nonsensical, such as those I have outlined. If that doesn’t describe you, then congratulations . If it does, well, now you know what I think.

Let me expand on that. I’ve been following the “US economy, what should be done” thread in GD, and I’m…suprised by some people who are calling for some kind of government intervention to “help” the mortgage/housing markets.

Were there calls for the government to bail out in 2000? If there were it probably didn’t come from ordinary citizens. The underlying problem I see is that people are still wedded to the pre-bubble-burst view projected by the real estate industry that assets related to residential real estate are somehow “special”, since it’s people’s HOMES we’re talking about here, and we have to do something about people “losing” their “homes”.

The fact that it’s just a bunch of marginally useful, low quality stucco boxes built on the cheap with illegal Mexican labor, and the fact that the people who live in them haven’t “lost” anything, since most of them didn’t actually PAY anything for them (the wonders of 100% Leverage) seems to be lost.

Housing is a commodity. Commodity markets wax and wane. I don’t come here and whine whenever one of my stocks goes through the floor. Why should anyone care about housing?

I’ve heard stupid people say stupid things about a veritable myriad of subjects–your point?

And FYI, I’m in the appraisal end so I get to see from both sides how bad lending practices are fucking people over. EVERY real estate transaction, sale, foreclosure, refinance, etc., requires the house to be appraised. We get to see the whole process in its full, depressing glory. Appraisal clients are both owners and lenders. We see and hear it all, every single way people are getting it up the ass as well as what it’s doing to the community as a whole. It’s all very well to sit on your ass snickering about the stupid Americans, but it’s a whole different matter to watch some poor bastard trying desperately to save his family from homelessness by any means available. Every empty foreclosed house is a slashed carotid artery to the former owner and a slow cancer for the remaining owners around it.

And no, not all those foreclosures are due to someone taking out a too-large loan they can’t afford. Some of them are people who had other issues, needed to get a refi to take care of them but can’t because the lenders are sewn up tighter than a bull’s ass in fly season and those foreclosed houses on the street are driving the value of their houses down because SHORT SALES AND FORECLOSURES COUNT AS COMPARABLE SALES. Let’s not even get into what those lower values are going to do to tax assessments and funding for schools.

But hey, just keep on laughing there buddy. I’m sure you’ll be equally amused the next time you guys flood or something and we all make fun of you for being too stupid to stay out of flood plains in the first place or move somewhere else. Somehow I’m certain that when the shoe’s on the other foot it will be a totally different matter. :rolleyes:

Also, if your post “wasn’t aimed at anyone in particular, only general themes that seem to pop up in these kinds of threads here” I respectfully suggest that you take your threadshitting ass on out and open your own thread, in which you may “[Go]…right for those raw nerves” on your own dime. This is not a thread about whether or not people are or are not “espousing views that are economically nonsensical” it’s a thread about how fucking depressing dealing with the current economic reality is.

Again, reading for comprehension is your friend. Do they not teach it in Canadian schools?