I laughed when i read this article. They are talking about expanding the auction process to the average person-not the savy investor. That should tell you something-STAY AWAY!!
According to this article the credit crunch which has entered its 2nd year has hit a turning point. The first year was marked by financial institutions in trouble to try to raise cash to help their balance sheet.
The new phase we are entering is the fire sale of assets by banks and brokerages because no one wants to give them any more money.
“We are approaching a solvency crsis that we think is about to result in an avalanche of asset sales.”, says a savvy hedge fund manager.
Don’t cha just love it!!!!!!! I told you it was coming. Hang on, folks!!!
Have you read about the nonsense about Mc Cain and his houses? Obama is all over him for owning so many houses.
Too bad he did not belong to our club. Then he would have known that you put your properties in land trusts for privacy.
Falling Prices bring jump in sales
Fri, 22 Aug 2008 04:21:42 GMT
The hardest hit areas in S. Cal. (riverside ) are starting to show an amazing gain in sales– up 48% yer to year. L.A. is still losing ground. The most up– the most down- the most starting to recover.
Buyers are starting to move back in and some investors also. If you can rent with a positive cash flow, who cares about values going lower. We are investors and investors look for cash flow.
Maybe it’s time to check out some of these auctions. The ones that are on-site rather than in a big room will be more fruitful. Get yourself on their lists.
Fannie adding fees
Sun, 17 Aug 2008 16:28:02 GMT
Now a 740 fico is not good enough unless you have 30% to put down. Fees will be added for all sorts of reasons. Looks like the pendulum has swung completely the other way.
Be careful when you figure a loan payment that you know what other fees will be added to either your closing costs or your interest rate. If you are not careful, when you go to close with a new buyer, they will get surprised and won’t have the money. Guess who pays at the last minute surprise?
Notes and subject to,and owner financing look more and more like the only way to go.
Those funky securites are being bought back
Fri, 15 Aug 2008 16:50:55 GMT
Things are really happening in the junk note industry.
First Citi bank and Merrill said they would buy back the junk notes they sold to unsuspecting investors, Now JP Morgan and Morgan Stanley will do the same.
Earlier the fed agreed to exchange worthless notes for treasury notes. ( that itself is scary)
So where are all these notes? What is the govt and the institutions doing with them?
Could it be that wholesale buy downs are happening? Could it be a buying opportunity just waiting to happen?
Turmoil over this is keeping Ca from adapting a budget.
“The plan would allow many large financial companies that are currently enduring record losses to eventually receive tax breaks millions of dollars greater than are currently available to them. Subprime lenders would be among the largest beneficiaries because they experienced a large boom followed by a bust.”
Can’t wait to see if fannie and freddie really start to sell properties to investors.
Also can’t wait to see how Arnold’s new bill works with foreclosures. Giving them more notice may make them more likely to go to sale. Who knows?? Lots of things happening every day. This is not the time to be uneducated.
What surprises us about this market is that anyone finds it surprising.
Lenders lent to people who couldn’t pay the money back. Naturally, the loans went bad; what’s surprising about that?
Consumers spent more than they could afford. Naturally, they ran out of money and have to cut back. Do you see anything unusual about that?
Wall Street partied for years on cheap credit. Now, credit is becoming harder to come by. Is it any wonder that they’ve had to turn off the music and close down the bar?
The only good news is that it looks like Europe may beat us to the recession. That speaks well for the dollar. Maybe we can schedule that European vacation next year and actually affored it.
Good news and bad news
Fri, 08 Aug 2008 21:19:20 GMT
First the good news:
Fannie Mae is opening offices in Fla and Ca. to sell reos. Hey, the RTC lives again.
Now the bad news:
They are tightening fees and underwrtiting standards.
The Section 121 personal residence exclusion is being limited. Beginning in 2009, the $250,000 ($500,000 if filing jointly) exclusion of profits on the sale of your principal residence will be limited to “qualified use.” You still must own and reside in the property 2 out of the last 5 years, but the amount of profits excluded will be determined by your use divided by the time you held the property.
Here are examples from the congressional committee report:
Example 1–Assume that an individual buys a property on January 1, 2009, for $400,000, and uses it as rental property for two years claiming $20,000 of depreciation deductions. On January 1, 2011, the taxpayer converts the property to his principal residence. On January 1, 2013, the taxpayer moves out, and the taxpayer sells the property for $700,000 on January 1, 2014. As under present law, $20,000 gain attributable to the depreciation deductions is included in income. Of the remaining $300,000 gain, 40% of the gain (2 years divided by 5 years), or $120,000, is allocated to nonqualified use and is not eligible for the exclusion. Since the remaining gain of $180,000 is less than the maximum gain of $250,000 that may be excluded, gain of $180,000 is excluded from gross income.
Example 2–Assume that an individual buys a principal residence on January 1, 2009, for $400,000, moves out on January 1, 2019, and on December 1, 2021 sells the property for $600,000. The entire $200,000 gain is excluded from gross income, as under present law, because periods after the last qualified use do not constitute nonqualified use.
So, if you are planning to move into one of your rental properties or a second home and claim it as a principal residence for the exclusion, plan ahead for this new law!
Most sellers are still in La-La land
Thu, 07 Aug 2008 00:22:52 GMT
They still think their houses are worth more than reality proves. They still think that the values will increase or remain level in the next 6 months.
compares real estate and other things.Don’t listen to their estimate. Only go by sales.
Extreme foreclosures
Sat, 02 Aug 2008 16:17:21 GMT
I used to watch those tv shows and laugh. They never bought the properties far enough below market and over improved them. Then at the end of the show they showed that the owner was considering moving in themselves or renting it. Can i say my 4 words?
Here is a list of some of those folks and also some celebs who had their houses foreclosed on. Being “rich” or famous does not insulate you from foolishness.
What a bunch of crap this is. it will do nothing to stop the foreclosures. The best thing it can do is make deals available to investors from cities that have no idea how to fix up the foreclosed houses that the govt allocated money for.
This is an interesting article about what it really means.
Parts of it could be good for investors. First time home owners are getting a tax credit. That will inspire people to act.
The bad part is Congress ended up raising minimum down payment requirements for FHA-backed loans to 3.5 percent. Also, beginning in October, home buyers will no longer be able to rely on nonprofits that funnel money from homebuilders into seller-funded down payment assistance programs.
The main question is where is this money coming from?
Greeting from Hot Florida!
Tue, 29 Jul 2008 19:14:30 GMT
I am tending to my mom for the week but wanted to make sure you knew that the government passed the mortgage bill.
It looks like it guarantees that FHA will not fail. They will buy the bad loans if necessary. It gives homebuyers an 8k downpayment assistance. It also gives cities money to buy and rehab foreclosures. How can they do this? Hopefully they will allow us to do it.
Supposedly it allows FHA to refinance some of the bad loans. If these people could not qualify in the first place, how in the world are they going to do it now? With money down, with full documents? I doubt that it will save many people from the inevitable.
Trust investors to come up with creative ideas to help themselves and figure out the way around the legislation.
congress passes mortgage relief bill
Thu, 24 Jul 2008 10:58:24 GMT
I like the part about communities getting money to buy foreclosed houses. Can you say RTC? Looks like opportunity for us.
