Wed 13 Aug 2008
From the Record:
Gunman surrenders after standoff
The son of a 88-year-old Saddle Brook woman whose house had been sold at foreclosure was arrested after pulling a gun on sheriff’s officers this morning.
Two Bergen County sheriff’s officers eventually talked John Brennan into giving up the weapon, and he was taken into custody.
The homeowner, Beatrice Brennan, was walked out of the house and taken away by ambulance.
…
eatrice Brennan had lived on the Adriana Street cul-de-sac for decades, neighbors said.But the house had been refinanced and the loan couldn’t be paid, a real estate agent at the scene said.
The home eventually was sold May 16 at a sheriff’s sale.
The movers, Moving For Less of Union, showed up around 9:45 this morning and were told by two sheriff’s officers posted at the scene to wait until 10 o’clock, under the court’s order, said mover Anthony Shpilnan.
Moments later, John Brennan emerged from the house.
He pulled a .22-caliber handgun from his waistband, and the officers drew their weapons, said Ben Feldman, a spokesman for Bergen County Sheriff Leo McGuire.
Some additional information from the Bergen Jersey Foreclosure Blog:
Saddle Brook man pulls gun during foreclosure eviction
It seems that the woman lived in the home for decades but had recently refinanced the existing mortgage. The foreclosure judgment was over $400,000. According to the foreclosure notice, it looks like the loan was taken out by John J. Brennan, the man that was arrested, not his mom, who owns the house, according to the tax records.
The last transfer seems to be a quit-claim deed. It might be that the son refinanced his mom’s home for some reason.
From MarketWatch:
Mortgage applications down 1.5% last week: MBA
Fewer applicants sought mortgages last week, with the volume of applications down a seasonally adjusted 1.5% compared with the last week of July, the Mortgage Bankers Association reported on Wednesday.
Measured against the same week last year, applications were down 36.9% on an unadjusted basis for the week ended Aug. 8, the Washington-based MBA said.
Seasonally adjusted filings for mortgages to purchase homes were flat on a week-to-week basis, while applications to refinance existing mortgages decreased 4.2%, the MBA said.
The four-week moving average for all loans was down 5.2%, also on a seasonally adjusted basis.
…
Mortgage rates for fixed-rate loans rose week over week, with 30-year fixed-rate mortgages averaging 6.57%, up from 6.41%. The average rate on 15-year fixed-rate mortgages stood at 6.17%, up from 6.02%.
From the AP:
Foreclosure of 88-year-old leads to standoff in Saddle Brook
Authorities say a son held Bergen County sheriff’s officers at gunpoint as they tried to evict his 88-year-old mother from her foreclosed home.
Officials say John Brennan threatened two officers with a .22-caliber handgun.
Officers talked to the 60-year-old, who surrendered after about five minutes when a SWAT team arrived Tuesday.
Beatrice Brennan had refinanced her two-bedroom, $250,000 home and had fallen behind on payments. The house was sold at a sheriff’s auction in May.
From the WSJ:
Toll Brothers Posts Revenue Decline
By DAVID BENOIT
August 13, 2008 6:39 a.m.
Toll Brothers Inc. reported continued weakness in the fiscal third quarter, but Chief Executive Robert Toll said the luxury homebuilder sees “growing pent-up demand” for people who have delayed buying the past three years.
Homebuilding revenue for the quarter ended July 31 fell 34% to $796.5 million. Analysts polled by Thomson Reuters had predicted revenue of $746 million.
Signed contracts fell 27% as their total value slid 35%, though the cancellation rate continued to fall, declining to 19.4% from 23.8%. The company’s backlog at quarter’s end was down 48% at $1.75 billion.
Toll Brothers estimates it will have $100 million to $200 million in pretax write-downs for the quarter, mainly land related. Homebuilders have written off billions of dollars of land and land options bought before the housing market cracked. Toll’s land holdings stand at about 48,500 lots, down 47% from a high reached two years ago.
From the Press of Atlantic City:
Polls finds businesses unhappy in N.J.
Statewide surveys in the past few months show businesses have an increasingly sour attitude toward New Jersey.
The latest poll released this week reveals much of the same: 54 percent of those who responded are not satisfied with New Jersey as a business location and 38 percent said state taxes were the biggest issue concerning them. Gas prices were the second-biggest concern at 31 percent; sales volume, 19 percent; cost of supplies, 8 percent; and obtaining credit, 4 percent.
Reporter was three years late with this one…
From the Bucks County Courier Times
Buy a house, get a car
FIRST!
ml-implode.com is reporting rumors ResCap/GMAC is exiting the home-eq business entirely.
foreclosure stadium:
http://www.cnbc.com/id/26159333
HOUSE SELLS FOR $1
Ron French / The Detroit News
DETROIT — One dollar can get you a large soda at McDonald’s, a used VHS movie at 7-Eleven or a house in Detroit.
The fact that a home on the city’s east side was listed for $1 recently shows how depressed the real estate market has become in one of America’s poorest big cities.
And it still took 19 days to find a buyer.
Advertisement
The sale price of the home may be an anomaly, but illustrates both the depths of the foreclosure crisis in Detroit and the rapid scuttling of vacant homes in some of the city’s impoverished neighborhoods.
The home, at 8111 Traverse Street, a few blocks from Detroit City Airport, was the nicest house on the block when it sold for $65,000 in November 2006, said neighbor Carl Upshaw. But the home was foreclosed last summer, and it wasn’t long until “the vultures closed in,” Upshaw said. “The siding was the first to go. Then they took the fence. Then they broke in and took everything else.”
http://www.detnews.com/apps/pbcs.dll/article?AID=/20080813/METRO/808130360
in mod, JB
Man…..Pizzeria Uno on the brink……
http://www.bloomberg.com/apps/news?pid=20601103&sid=aoWKvHAKm5lM&refer=us
OK - it looks like a covenant default, or technical default, they may actually have enough cash….
re: shorting
Our very own Ira Hovnanian should be proud he broke the top 10 in July.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aFGsS8sbqDvM
It sounds as if Chevy’s Mexican and Perkins are also on the radar…..
I don’t think I would want to live in that Saddle Brook house. The guy may return whenever he gets out of jail.
#14 I wonder if the Som talked the mother into refinancing?
She put his name on the deed in 2006
#16
I think that’s kind of common for people in their 70’s and 80’s to transfer assets to their children for estate and avoiding con man purposes.
#17: There is a danger in that, you really have to trust your kids. For instance, I have a sibling that I know would force my mother to sell her house if she were on the deed. To “cash out” of the house you would need all signatures on the deed, correct?
Troll, nitwit, or both? I am having trouble deciding.
#6 reinvestor X Says:
August 13th, 2008 at 8:11 am
FIRST!
A few smiles. Make sure you go through all the pics.
http://www.guardian.co.uk/world/gallery/2008/aug/12/bushlol?picture=336501045
Thanks grim, was a nice surprise seeing a mention when I came here this morning.
I updated the story on my blog. According to a comment on the northjersey.com story, it seems the mother did indeed transfer the deed to her son and he took out a loan against it. The comment was supposedly posted by a neighbor that knew the family.
grim (3)-
Is bi Bob Toll’s quant?
“…but Chief Executive Robert Toll said the luxury homebuilder sees “growing pent-up demand” for people who have delayed buying the past three years.”
Er, Bob…that’s PANT-up demand, pal.
Aug. 12 (Bloomberg) — The U.S. budget deficit widened to a record for July as tax rebates boosted government spending, a slower economy cut revenue and regulators covered insured deposits at failed banks.
The $102.8 billion deficit last month compares with a shortfall of $36.4 billion in July 2007, the Treasury said in a report issued in Washington. Spending last month rose 27.3 percent to a record $263.3 billion from a year earlier, and revenue decreased 5.8 percent to $160.5 billion.
re: Esperanza in Asbury Park
Yesterday I received an e-mail referencing a lis pendens for the Esperanza building. Can anyone here verify this?
tbw,
It looks like the mom signed over the house to her son through a quit-claim deed.
So it would be hard for her to have any legal standing.
make (23)-
Oh, yeah. Everything’s looking much better now. Grab your ankles, and get ready for Stimulus/Rebate II.
Weimar meets Zimbabwe. Good times.
[sarcasm off]
Its amazing what is coming out of the woodwork.
Credit Suisse hit by £5.6m FSA fine after sub-prime rogue trading
http://www.guardian.co.uk/business/2008/aug/13/creditsuisse.creditcrunch
Hunter (8)-
Foreclosure stadium?
Why not call it “Blunderdome”?
PGC (27)-
All the rotten sausage is being vomited up.
re: GMAC
Good to know. I have a zero balance HELOC with GMAC in case of the emergency. Now I have to use plan B.
22 Clot,
The renters that showed restraint are PANTS-UP, the ones that didn’t are now PANTS-DOWN.
Clot #27
http://blogs.telegraph.co.uk/ambrose_evans-pritchard/blog/2008/08/12/stage_two_of_the_gold_bull_market_is_just_beginning
Stage two of the gold bull market is just beginning
“Bank Stocks Drop Anew Amid Worry Over Falling Home Prices” - wsjonline - by
James R. Hagerty and Jonathon Karp
Under “sparse date” some snipits re: foreclosures…
“The pain may get worse before it starts to ease. A recent report from Barclays Capital estimates that there are 721,000 bank-owned homes nationwide, up from 112,000 two years ago. Barclays expects the total to rise 60% more before peaking in late 2009.”
“Financial institutions are acquiring homes through foreclosure much faster than they can sell them. Fannie Mae, a government-sponsored mortgage invester, disclosed last week that it acquired 44,071 homes through foreclosure during this year’s first half but sold only 23,627, leaving a balance of 54,173 as of June 30.”
“Fannie said it is opening field offices in California and Florida to try to speed sales of such homes and is evaluating offers from unidentified parties interested in “bulk” purchases.”
Why is there any suggestion buying silver vs. gold in this board? I would rather hoarding silver as it could be used in my kitchen :)
#33 make
So it seems like we have enough of a response to make the poker and liquor GTG a go. Let’s shoot for Friday night, August 22nd starting around 7pm. We’ll talk about what each person will bring as we get closer.
Grim,
Would you be willing to vet out my email address?
#25 Orion
Go to the Monmouth County Records website and you’ll see 5 pages of construction liens and lis pendens for Metro Homes Esparanza- Block-176 Lot-1.02
I’m wondering what’s the cpi in 6 months:
http://money.cnn.com/2008/08/11/smallbusiness/china_no_longer_cheap.fsb/index.htm?postversion=2008081111
In China, outsourcing is no longer cheap
As China makes big moves to improve its environmental and labor conditions, U.S. companies that manufacture there face soaring costs.
Blunderdome?
Clot, you are a genius.
Re: Esperanza
The NYT had an article spelling out the problems of this project and the city of Asbury Park in general. Looks like a combo of bad design, bad timing, and bad financing.
A true trifecta….
http://www.nytimes.com/2008/07/13/realestate/13njzo.html?_r=3&ref=realestate&oref=slogin&oref=login&oref=slogin
So much for Stu spending the whole weekend working on the house, while the Little Gator and I are away in Austin, TX. Yee Haw!
Tom,
The house was sold at a sheriff’s sale in May …for how much?
The story talks about her $250,000 home, but the loan was in excess of $400,000?
When I read these stories, another obvious question: So what did the son do with the money?
The emphasis in these stories is always on losing the house, but the obvious question that doesn’t get asked: So what happened to all of that money?
he did what everyone else did with their home equity loans. He had a lot of fun.
Oh come on Gator,
It’s only Friday night!
Don’t know if this was posted before. Shame we don’t have Pret to dissect the charts. I’ll leave the analysis to others.
http://www.federalreserve.gov/boarddocs/SnLoanSurvey/200808/
Repost from yesterday’s thread for more exposure:
Question for applicance gurus:
My parents’ refrigerator just kicked the bucket, after only 5 years. Frigidaire.
What are the most reliable brands, in your experience?
TIA
scribe,
There were no bids at the auction, it went back to the bank.
I think the son might have lost his home a few years ago to foreclosure in Burlington. I’m not sure though. I did see a foreclosure somewhere around there for someone with the same name.
Scary.
From the FT
The Greenwich survey found that 55 per cent of respondents had stopped using one or more financial institutions, other than Bear Stearns, as a counterparty on credit trades due to concerns about solvency, although it did not name them. Many had cut back their use of credit default swaps, the most common type of credit derivative.
http://www.ft.com/cms/s/0/ef75a636-67cc-11dd-8d3b-0000779fd18c.html
UK realtors are hurting.
http://www.guardian.co.uk/theguardian/2008/aug/13/housingmarket
“growing pent-up demand”
I’m confused. Was Bob Toll talking about the cancellation rate, or maybe outside of RE, scooter sales?
Re: Refrigerators: Go to your local library and see what the Consumer Reports buying guide says
46
Years ago I ran the kitchen and appliance department in a Lowes. I seemed to have the fewest problems with Maytag, but that was when they were still made in Iowa.
Whirlpool bought Maytag a few years ago, so I don’t know if the quality is still there, I think they are made in Mexico now at the Whirlpool plant.
A slight step down were the Whirlpools and GE’s, they were made in Mexico at the time, but still very well built, with only a few occassional problems.
If you go to Sears and get a Kenmore, make sure you find out who actually made it. It is just a GE, Whirlpool, or Frigidaire in disguise. There used to be website that listed the manufacturer of Kenmores by model number, but my Google-fu is weak today.
Frigidaire bites for every appliance.
Sybarite -
I have a GE Profile refrigerator that I purchased in 2004 - never worked quite right, cooling always hit or miss. Condenser fan died 2 weeks ago. I ended up buying a little fan from HD and put it behind the fridge blowing on the condenser. Fan runs 24/7, but is quiet and now the temperature stays consistent.
Wouldn’t buy another GE. (Also, my GE dishwasher had a recall last year - they gave me $75 towards a new one)
I have a KitchenAid refrigerator at another house. I bought it used in 1998 and it is still running today.
My parents had a Ford Philco refrigerator that they bought new in 1971. They used it as their primary refrigerator until they got rid of it late last year….
IMO, newer stuff is junk.
Make/Clot,
I’m digging.
Asbury Park is doomed again. They had a nice little run and managed to fill their abandoned commercial district with retailers and restaurants. Now that their real estate vitalization is dead and the shore industry is not booming, despite the beautiful weather this summer, you’ll see those places all abandoned again in a few years.
Sybarite-
This is not a direct answer to your question, but have you thought of subscribing to Consumer Reports online edition and just searching their archive? It’s only $26 for a year. Seems worth it and they’re a great source.
Tom,
Thanks
“Asbury Park is doomed again.”
Ben,
Not another rendition of; “My City’s in Ruins”?
53-
JoeR, you mentioned older refrigerators. The 1967 GE refrigerator we used just gave out on us last year. The reason I know it was from 1967. There was a sticker on the side that said “Golden Wheat and Avocado colors available in spring 1968.”
Also, was walking by a appliance repair place in upstate NY and saw the oldest fridge I’d ever seen. The condenser was the size of an old biplane engine. Stopped in and it was still running. The shop owner said it was from the early 30’s and ran on Sulphur Dioxide. He had thought about selling it, but said if it ever leaked the smell would be horrendous. So, he kept it to keep soda’s cold and store employees’ lunches. (I can’t remember the manufacturer).
I went with a GE based on Consumer Reports and am pretty satisfied with it. I bought it based on a bunch of research which yielded interesting results. Essentially, the highest rated appliance makers varied by the type of fridge. GE was supposedly the best freezer on top and that is what we wanted. It also had the water dispenser inside as well as a traditional icemaker which saves a lot of room over the outdoor dispenser.
I purchased it as well as an oven and washer from Rainbow Appliance who had the best prices by far. I ordered off of their website.
Clot: Question for you. A house in my town sold for 430K in May of 06.
It is now offered by the Realtor as a short sale at 359k.
All of the houses in the area are the same, except some have been updated/renovated over the years.
In your opinion is the 359K offered price now the comp for the other houses in this 2 block area?
If the house sells for less than 359K, does that become the new comp?
Do we have any sign of doing better in NJ?
#49
I have one of those college dorm cube refrigerators bought in 1977 that was passed down from my 6 older siblings to me plugged in at work. You want to talk indestructible? It’s a Sanyo. I also have a 13″ Zenith color TV from 1984 that is still cranking. It has knobs!
THIS IS A CHEAPSKATE SCAM designed to get all of you to buy his groceries for the next couple of months. Stu is too young to come up with this on his own, so undoubtedly the master cheapskate, 3bonehead, has his hands all over this.
Notice that the first thing he says is “We’ll talk about what each person will bring”. You all would be wise to question him VERY closely on what happens to the food and drinks that aren’t used? Do you get them back?
All I know is this: If this were legitimate, he would be providing the damn food.
Stu Says:
August 13th, 2008 at 10:36 am
So it seems like we have enough of a response to make the poker and liquor GTG a go. Let’s shoot for Friday night, August 22nd starting around 7pm. We’ll talk about what each person will bring as we get closer.
Grim,
Would you be willing to vet out my email address?
JoeR,
Condenser fans are pretty cheap and easy to replace. Should be able to find them for $30-$40 online.
[32] lifer
Are those the Pants made of Crush Valor?
There was a big shake-up in mrs.NJl$rd workplace. Quite a few MD in structure finance division got axed this time.
I think it’s an Inevitable result of the legal settlement between the rating agency and the SEC. Part of the agreement you’ll see tighter criteria in the street.
reinvestor X 64 - No worries. You will not be scammed. You are not on the authorized list allowed to get my address.
[64] re
you know, you don’t have to attend. I’m sure that will be all right with everyone.
Same goes for the Brigadoon GTG. It’s a long trek, and I will certainly understand if it is inconvenient.
Re: Poker GTG - I’m out; travelling to MD shore next morning with the Missus and the little DePlume.
I don’t know REtard.
My momma always taught me that you should never go empty-handed to a neighbors home.
Seems like you are the cheapskate who has been mooching of the neighbors for years.
stuw6 Says:
August 13th, 2008 at 11:20 am
I have one of those college dorm cube refrigerators bought in 1977 that was passed down from my 6 older siblings to me plugged in at work. You want to talk indestructible? It’s a Sanyo. I also have a 13″ Zenith color TV from 1984 that is still cranking. It has knobs!
You rpobably paying a lot more/year in electricity for this TV (unless you are not using it very often)..
Old refirirators lasted a lot longer as they were build with a lot less electrical components, and non-energy efficient electrical motors were designed to last vs. being energy efficient.
Plus - one you passed 10 year old mark on old appliances they almost never broke - all bad components break in the first 5-10 years :)
Longtime lurker, second-time poster. Awesome site, with great contributors.
So here’s a question - is a realtor who uses photoshop to cover up a major characteristic of a property guilty of fraud?
Take a look at the pics for MLS 2554027.
These are new condos on the Verona, Caldwell, Essex Fells border that sit maybe two feet away from 50MPH traffic on Bloomfield Ave. (and for what it’s worth, laughably listed as being in Essex Fells)
But when you look at the exterior photo in the listing, busy 4-lane, double yellow-lined Bloomfield Ave has mysteriously disappeared, replaced instead by a generous coating of new blacktop.
Notice also where the shadows from the trees abruptly stop at the curb.
Classy.
Thanks for all of your insights. I’m a bit leery of CR, that’s why I haven’t subscribed, but I suppose it can’t hurt to use them as an additional source of input.
I have to say, the fridge they’re using as a backup in the garage must be 20-30 years old, and runs like a top. And the fridge I had in my last apt must have been from the 60’s or so, with the freezer being inside the fridge, and is still running fine with the new tenants. I think that one was hotpoint.
I’m just shocked that a $1200+ fridge can crap out in ~5 years. Absolutely ludicrous.
Al,
its the bathtub curve
http://tinyurl.com/6o9xcj
you have a high initial failure rate at the begining of the life cycle, you level off, then the failure rate increase again at the far end of the life span
Could you go and check it out for me? I won’t be able to make it - all excuses. Until then I can not agree with you 100%.
#64 reinvestor X Says:
August 13th, 2008 at 11:20 am
THIS IS A CHEAPSKATE SCAM
Lookout 72 - I know those condos. I never actually believed they were going to be houses, because I couldn’t imagine anyone wanting to live all of 3ft off of Bloomfield Ave.
Why is there any suggestion buying silver vs. gold in this board? I would rather hoarding silver as it could be used in my kitchen :)
Nice. Silver Countertops. That’s a value added renovation.
I like Gold as a currency. End of discussion.
My mother-in-law bought a washer from Sears (Frigidair) and it broke after about 4-5 years use.
Repair-man came out for 75 dollars and turned the nob on the front of the machine, watched it fill up, then make a funny noise as it went into spin cycle. He began to fill out paperwork. He was there for less then 15 mins and said “Yep, you have bad bearings, it will cost 900$ to replace them”. Keep in mind that a new washer sold for 600$.
Turns out he was wrong, very wrong. He knew exactly what had happened because every front-loading washing machine sold by Frigidair in that model broke the same way and it wasn’t the bearings.
I searched the internet, found the common problem, and looked up a solution. I took apart the washer, ordered replacement parts, and put it back together. Cost me 250$ in parts, six hours repair time (I’m a novice) and all reports indicate that the machine will last another 4-5 years before failing from the same problem again.
I won’t buy another appliance from Sears nor will I ever call them for repairs. I am interested in people who tell the truth and don’t mind working for a living.
BC,
I love it when you’re digging. I’m already in a whole covered with this stuff.
Nicholas,
Was it the spider failure? My grandma’s Frigidaire washer failed within 4-5 years too, and when we opened it up the spider had fractured into several pieces. Turns out they used a cheap, brittle metal for that part and it seems to fail pretty often.
Fridges -
I just replaced a GE Profile that crapped out after about 6 years. Didn’t bother having someone diagnose the problem, because everything was starting to break. The condenser appeared to go in and out and eventually just gave out. Also the seals were ripping off the edge and the interior plastic racks were breaking at the screw connections.
Instead bought a Maytag. POS crapped out on me three weeks ago. Fan broke, so freezer was cold, but refrigerator did not go cold. Lost a lot of food. Was quite pissed. Warranty repairman said no parts available. After waiting for two weeks, took some yelling at the service rep on the phone and they finally said they would overnight the parts to the warranty repair people. So why did they not do this in the first place to keep a customer satisfied.
Now I don’t know what to buy next? The reason I chose the Maytag was because of Consumer Reports reliability. That went out the window after this experience.
Oh, I had the Maytag for 4 months before it crapped out.
Before I replaced the oven, the electric pilot (starter) would not work. I brought in a repairmen and he fixed it for $200. One month later, it stopped working again. I will seriously push my son into being a plumber or electrician the second he shows signs of not being an academic.
for those with an interest in CT:
for the first 6 months of 2008:
Greenwich sales of single-family homes were down 33 percent to 270, from 403 a year ago. Median price down 4.9 percent to $1.95 million, from $2.05 million in 2007.
Stamford single-family home sales down 39.4 percent to 206 from 340 in 2007.
Median price dropped 12.2 percent to $620,000, from $706,000.
http://www.stamfordadvocate.com/realestate-section/ci_10135461
Make,
I was spread short oil/long gold. Now flat oil, just long gold. I am using $800 Dec as my stop. If it sells thru there, I’m taken out. I will then place a buy stop at the same level. I love 20% pullbacks, when the long term technicals are not affected by the move. My time horizon on this, from entry in 03, is 12-15 years. When these cycles turn, the duration seems like it’s forever. That said, all that really matters is market action.
ALL DISCLAIMERS.
Naked short selling ended today for the Fav 19. Check out the results! BAC down 7%, C down 4.2%, WB down 6.19%, WM down to 4.07 with another 5.4% haircut, FNM down 4.3%.
How long before Paulson gets a phone call from his friends at GS to renew the ruling?
Yesterday, some guy posted a comment on my blog regarding, I’m just going to say a way to pay your mortgage faster using a HELOC and some software and hopefully don’t get stuck in mod.
Doesn’t seem like a great idea to use debt to help get out of debt so I made a spreadsheet using a way to do something similar using a savings account instead and made it available on my site.
My background isn’t in finance so I was wondering if any of you, that know more, have any thoughts on what I suggest or the original program?
From CR/Reuters , Countrywide option-ARMs deteriorate further.
The fun parts;
1 in 8 are 90+ days late
72% are making less-than-full payments
BAC won’t honor CFC debt
#42 Scribe:
I wondered that as well. I bet there is some similarities to this.
‘Extreme Makeover’ house faces foreclosure
Harper family used home as collateral for a $450,000 loan
http://www.msnbc.msn.com/id/25888546/
This Feb. 2005 picture shows the Lake City, Ga. home which was the subject of the “Extreme Makeover: Home Edition” television show. More than 1,800 people helped demolish the Harper family’s decrepit home and replace it with this sparkling four-bedroom mini-mansion that towered over ranch and split-level homes in their Clayton County neighborhood. But three years later, the home has become the latest victim of the foreclosure crisis after the family used it as collateral for a $450,000 loan. The two-level home is set to go to auction on Aug. 5.
#88 - That should be BAC won’t guarantee CFC debt.
“72% are making less-than-full payments”
tosh[88],
Wow! I didn’t realize that it was this high. 2009-2011, resets on prime/alt-a, will be the final keg of dynamite. Total bank losses will approach/exceed $2T, we are at approx $500B at this time. It will be a total bloodbath, probably worse that I imagined.
#91 - I didn’t either, but it’s not that surprising. This is the keg that will detonate the NYC-burbs.
BC Bob,
I don’t know, I think we may find out that a lot of the prime is more like chuck.
I guess it depends on your definition of “detonate,” but I think this is already happening in the NYC burbs. Transactions are down 40+% YoY in many areas, and in many places down 50% from peak volume. This is with prices down double digits from peak and pretty low interest rates for qualified buyers. The point is that 10% off and 6.5-7.0% mortgage rates clearly isn’t nearly enough to clear the market. Buyers are not jumping back in and will not without major price reductions
BC bob, make, et al
The trillions are adding up, 2 trillion here, 2 trillion there, and pretty soon we are talking real money.
Can the Fed pump out enough money to match the destroyed wealth plus an additional sum in order to inflate our debts downward without sparking runaway inflation?
I think it is becoming increasingly apparent that no one can prop up house prices. I think we are coming to the point where the federal government will decide which institutions are too big to fail and which are not (to the extent they haven’t already) and then simply directly prop up those institutions, rather than trying to indirectly do this by propping up house prices. Homeowners will be thrown under the bus because there is simply no other feasible choice available.
#95 - kettle1 - The Fed has been pumping out the cash for a year now and it isn’t reaching the consumer. I think we’re going to get deflation regardless of the Fed’s actions.
Hmm.. I thought one of the greatest invention in finance is to use paper/plastic instead of gold? Who’s still using gold as (implication) currency since the Brentenwood agreement was broke by US in 1971??
#77 make money Says:
August 13th, 2008 at 11:43 am
Why is there any suggestion buying silver vs. gold in this board? I would rather hoarding silver as it could be used in my kitchen :)
Nice. Silver Countertops. That’s a value added renovation.
I like Gold as a currency. End of discussion.
Senator Bunning is gunning for Bernanke.
http://www.wbko.com/home/headlines/26893864.html
“Can the Fed pump out enough money to match the destroyed wealth plus an additional sum in order to inflate our debts downward without sparking runaway inflation?”
kettle1,
I don’t think so. The wealth wasn’t real. It’s gone. The inflated home prices weren’t real, they’re gone too. The only ways to keep that wealth I think would just devalue the dollar further and just keep up the illusion of wealth. We have to get back to making things and making money offf of those things, not just making money by moving money. It doesn’t seem like a good idea to become a middle man.
Maybe while John’s out of town, we could have a ReInvestor knock-off contest.
He seems to be unnaturally obsessed with toilet paper and left-overs.
I’m afraid to say, the wealth is NOT destroyed. It’s more like a money scam and then spent recklessly by the citizens of this empire.
Unfortunately, every other cheapstakes like me would have to pay for it.
#95 kettle1 Says:
Can the Fed pump out enough money to match the destroyed wealth plus an additional sum in order to inflate our debts downward without sparking runaway inflation?
tosh,
i agree, but have been having a friendly ongoing debate with make and a few others about deflation/inflation
NJL$rd
Gold is the currency of last resort, among many other charateristics. The exact function of gold depends on the market conditions at the time you try to sell it. It can be a hedge, it can be a store of value, or it can be a losing proposition. It all depends on how you use it. gold has also been accepted as currency for the majority of human history.
kettle [95],
The fed has lost control after 28 years of artifically stimulating the markets. No econmomy can exist, long term, on constantly compounding debt and cheap credit. We are too deep in piles of do-do. Unfortunately, all that you can do is deleverage and make a concerted effort to eliminate debt.
The monster now has too many tentacles. The fed realizes this. It’s not a liquidity problem, never was, it’s strictly about solvency. The only cure is to allow the business cycle to run it’s course. Many have never experienced this, don’t know if they can cope. It will be a real wake up call.
“Hmm.. I thought one of the greatest invention in finance is to use paper/plastic instead of gold?”
[98],
How’s it working?
Sybarite-
Again, this isn’t exactly answering your question, but I’ve experienced Bosch vacuums first hand and can vouch for how well they are made. My neighbor has a Bosch dishwasher (got with a slight scratch that you can’t see) and swears by it. They have a refrigerator line called Integra.
ReInvestor is the best contributor to the economic and the board. While his wealth is being distroyed as housing going down, there is no point to punish him in this board again.
Besides, he’s being really really funny and make me laugh :)!!
#101 scribe Says:
August 13th, 2008 at 12:33 pm
Maybe while John’s out of town, we could have a ReInvestor knock-off contest.
He seems to be unnaturally obsessed with toilet paper and left-overs.
Sorry, meant Evolution. Integra is more specialized refrigeration units (like wine coolers, etc.)
We could print any many possible greenback (paper) and issue any many possible credit card (plastic). In the future, we don’t even need paper or plastic as we have computer now. All your wealth is just a number in the bank’s computer memory.
There is no need for the gold as a currency as more (intrinsic value).
#105 BC Bob Says:
August 13th, 2008 at 12:37 pm
“Hmm.. I thought one of the greatest invention in finance is to use paper/plastic instead of gold?”
[98],
How’s it working?
the market for Bosch vacuums must be pretty small. anyone who could spend that much on a vacuum likely doesn’t do much vacuuming
Yes,
It was the Spider Failure. There was a large buildup of soap/residue on the arms which held moisture against the arms. They oxidized and weakened the arms leading to eventual failure when the machine went into the spin cycle.
Origionally it was due to them using poorly constructed materials. This one had the upgraded version of the same tub and it failed also. It is a design flaw really, they shouldn’t have left any crevices for soap or water to settle on the interior basket.
Sybarite101 X Says:
August 13th, 2008 at 11:47 am
Nicholas,
Was it the spider failure? My grandma’s Frigidaire washer failed within 4-5 years too, and when we opened it up the spider had fractured into several pieces. Turns out they used a cheap, brittle metal for that part and it seems to fail pretty often.
I’ve heard nothing but repair nightmares with the Bosch washers. They’re selling point is the stainless interiors which really provide little value except that they don’t discolor like the plastic tubs.
interesting article from the WSJ:
Japan’s Bank Crisis Is Combed for Lessons
By YUKA HAYASHI
August 13, 2008; Page C2
TOKYO — As concerns about the mortgage crisis have engulfed U.S. financial institutions, some experts are looking for lessons from Japan’s experience fighting a major banking crisis a decade ago.
…
For years, Japanese regulators avoided big bailout plans as the public opposed using tax money to save bankers who had profited from lending to property speculators. But when the failure of two big financial institutions threatened to cause a panic in 1997, regulators implemented what is now considered the most effective of their measures: guarantee virtually unlimited amounts of public funds, so that banks could boost their capital to write off bad loans more aggressively.
…
“The problem was the government tried to save everyone,” says Naoko Nemoto, a banking analyst for Standard & Poor’s in Tokyo. “They should have taken steps to encourage the exit of the weakest players.”
*********
“We could print any many possible greenback (paper) and issue any many possible credit card (plastic). In the future, we don’t even need paper or plastic as we have computer now. All your wealth is just a number in the bank’s computer memory.”
[109],
You are describing the Greenspan/Bergabe mess.
That RE wealth, stored in your/any computer has just evaporated by approx $4T.
NJ$lrd
wealth is destroyed. When i default on the 500K mortgage and the bank can only sell the house for 300K, then 200K has been destroyed. Its all based on fractional reserve banking. When you put $100 in a saving account at the local bank they loan $90 of your deposit. Those loans go one the books as assets. IF the loans disappear so do the assest, or a significant portion of said asset.
Sean Says:
August 13th, 2008 at 12:28 pm
Senator Bunning is gunning for Bernanke.
Is that supposed to be a toungue twister?
ChiFi:
A friend of mine who lives and works in Manhattan was looking for a financial adviser as he is 10 years away from retirement and needs tons of advice as he is not financially savvy, although he is a pretty good saver. His income level is probably between 80K and 100K.
Where should he look for such a person? Any advice would be greatly appreciated. He as well as I am clueless as to where to find one and how to gauge their value.
BklynHawk Says:
August 13th, 2008 at 12:38 pm
Sybarite-
Again, this isn’t exactly answering your question, but I’ve experienced Bosch vacuums first hand and can vouch for how well they are made.
The Bosch vacuum rocks! It is also quiet so you can use it even when the baby naps….we have the stick with a HEPA filter…it is like having a mega-dust-buster…..
NJ$lrd,
Assets get pummeled but wealth remains constant? Interesting theory? How about the asset gets obliterated but the debt remains. What next?
TOSHIRO[97],
The fed and hank realized this last winter and hence Stimulus Package was born. put money directly into consumers hands and inflate the GDP.
They are working and trying to do their best in instilling confidence into the US economy and it’s markets.
Will they succeed? Lets say that they’re not the favorit ein vegas judging by the amounts of shorts out there.
I see what you’re saying. But the question for the difference of 500k and house: where was it from and where it went?
In a simple explanation, the bank (bag holder) just lost $200k to the original seller. It’s not destroyed. But the original seller may waste those $200k gain on bmw,boat,etc, that’s spent! And the $200k wasn’t even there if you don’t overpay the house (with bank,appraiser approval).
#115 kettle1 Says:
August 13th, 2008 at 1:02 pm
NJ$lrd
wealth is destroyed. When i default on the 500K mortgage and the bank can only sell the house for 300K, then 200K has been destroyed.
clot 29…and it is of Katrina proportion. all the statistics in the world don’t give you the impact…amazing.
post from yesterday..just interested:
to the realtors out there…just a general question. If a home has septic, and it obviously is either not passing inspections or borderline passing, why do most sellers try to make the buyer pay? a few years ago my brother received money in escrow, and in other cases I have not heard of the buyer fixing that kind of thing. I have two examples lately of people that say 1) I refuse to fix it, that is why the house is priced so low (not really) 2) I will pay for half…now come on, last quote I heard was for $42,000. How would someone come up with the down payment and the po*per as well. I suppose I feel this is an essential part of the home that the seller should be responsible for..
stuw6 Says:
August 13th, 2008 at 1:05 pm
ChiFi:
A friend of mine who lives and works in Manhattan was looking for a financial adviser as he is 10 years away from retirement and needs tons of advice as he is not financially savvy, although he is a pretty good saver. His income level is probably between 80K and 100K.
Where should he look for such a person? Any advice would be greatly appreciated. He as well as I am clueless as to where to find one and how to gauge their value.
stuw6: Before I answer completely, I will let the masses chime in, because everyone will have an opinion.
I will be biased based on my own background. The person has to have a CFP, and once that is established, check the person’s record for any incidents or disciplinary action. Basically, there shouldn’t be any…
There are two major organizations out there, one is the FPA and other is NAPFA.
I will leave it there and let the wave of responses begin. Ultimately, I will tell you in advance that people are going to be very authoritarian in their opinions, but in the end does that really help you find help? We’ll see……
I will respond more fully later….
kettle1 Says:
August 13th, 2008 at 11:36 am
Al,
its the bathtub curve
http://tinyurl.com/6o9xcj
you have a high initial failure rate at the begining of the life cycle, you level off, then the failure rate increase again at the far end of the life span
Gotta Love Internet - everything have a name.
I like “Bathtub Curve” - there is a nice ring to it, and it can have both short cross-section and long-cross-section as well…
then the failure rate increase again at the far end of the life span
- unfortunatelly this describes my 1994 camry…
BC, what’s the definition of your assets here? RE,Bonds I may suppose?
It’s a mess I have no double. But if your wealth is allocated on those overflated asset in the wrong time, hey sorry you just get scammed out of your wealth.
#119 BC Bob Says:
August 13th, 2008 at 1:06 pm
NJ$lrd,
Assets get pummeled but wealth remains constant? Interesting theory? How about the asset gets obliterated but the debt remains. What next?
Can someone offer some advice on a property I’m bidding on?
I think I finally found my dream home, but of course I don’t want to overpay.
Any thoughts on MLS #2506566?
NJSlrd
You seem to be missing the idea behind fractional reserve banking.
perhaps we agree to disagree
“BC, what’s the definition of your assets here?”
NJl$rd,
It does not make any difference, any asset.
Damn…some hard hitting truth here.
The Decline of the American Empire
- Roubini
http://www.rgemonitor.com/roubini-monitor/253323/the_decline_of_the_american_empire
” By now the US is the biggest net borrower in the world – running current account deficits still in the 700 billion dollars range – and the biggest net debtor in the world with its foreign liabilities now over 2.5 trillion dollars.
The trouble with these twin deficits is multi-fold. First, superpowers and empires - like the British Empire at its peak - tend to be net lenders – i.e run current account surpluses – and be net creditors, not net debtors; The decline of the British Empire started in World War II when the British fiscal deficits in the war and the current account deficits turned that empire into a net borrower and a net debtor both in its public debt and external debt. That financial switch into an external debtor and borrower position was also the reason for the decline of the British pound as the leading reserve currency. And the British twin deficits were being financed by a rising economic and financial power that was a net lender and a net creditor, the US.”
CF #124
“check the person’s record for any incidents or disciplinary action”
Is there an easy way to do this? thanks in advance.
Bank Stocks Drop Anew Amid Worry
Over Falling Home Prices
By JAMES R. HAGERTY and JONATHAN KARP
August 13, 2008; Page A1
Banks are selling foreclosed homes in some cases for less than half the price they fetched two or three years ago. The cuts are coming as the U.S. banking sector, slogging through its worst crisis in decades, bites the bullet out of fear that prices will keep falling.
One example of the deep price cuts on foreclosures: A 1,230-square-foot home in Corona, Calif., was sold by a unit of investment bank Credit Suisse in June for $198,000, down from $450,000 when the property sold in a regular transaction in December 2006.
notice the stock performance charts halfway down the page
http://tinyurl.com/58rzmm
“Except for budget wonks in love,” The Washington Post writer Frank Ahrens wrote last week of our film, “I.O.U.S.A. hardly counts as a date movie. The film’s thrilling action sequence has a guy going to a refrigerator for a Tab. There are no car chases and nothing blows up.
“Except, possibly, for the entire economic future of the United States.”
As the Aug. 21 premiere of I.O.U.S.A nears we’re seeing a passionate groundswell of interest among radio talk show hosts, congressional candidates, and some of the biggest bloggers on the web. MTV is orchestrating a “rock the vote” style campaign for the film. And the social networking sites, FaceBook and MySpace are getting in on the action trying to reach the young people who will be left with the bill for our current reckless trend of fiscal irresponsibility.
William Lawson, a gentleman who’s running for the 4th district seat in North Carolina, bought out I.O.U.S.A. ’s entire showing in Raleigh. Apparently, he liked the premise of the film so much he thought all of his potential voters ought to see it for free. We’re trying to set up a similar screening for a congressional candidate in New Hampshire.
The national attention I.O.U.S.A is getting is pretty exciting. But it doesn’t end there. The BBC and Australian Broadcast Corporation are also following the story. And the BBC has requested an interview with us to understand the objectives of the film. If we’re not careful we may have an international blockbuster on our hands…
127
You’re kidding, right?
lifelongrenter :127
It would be helpful if you told us what town or county your dream home is located.
The MLS is sliced up by county in NJ and that number you cited could be listed in several MLS. There are local area experts in basically every county in Jersey on this board. They will point you towards good recent comparable sales.
135
he was joking; it’s a $5k trailer in jefferson.