My my my, how times have changed.

From the Record “Ask the Realtor” section. For those not familiar, this is a staged advertorial section paid for by one of the local Realtor boards. This “column” is usually filled with puffery and “great time to buy” nonsense.

Proposed legislation may ease short sale process

Q: I do not understand why my lender is not responding to my multiple requests for a short sale. My home is worth less now than when I purchased it in 2007. I do not want to just walk away from it, but if these guys won’t respond, what am I supposed to do?

Tom M.


A: Tom, members of the RealSource Association of Realtors who work within this same environment and attempt to find the best solutions understand your frustration. As you may know, the Realtor association works to protect your private property rights and, in this case, a smooth transition from the hardship you are trying to deal with. That said, there may be good news on the immediate horizon. Homeowners who are underwater — meaning, whose home is worth less than they owe on their mortgage — may find that relief is on the way from a bill strongly supported by the National Association of Realtors that would impose a deadline on lenders to respond to short sale requests. The legislation, H.R. 6133, “Prompt Decision for Qualification of Short Sale Act of 2010,” was offered recently in Congress by U.S. Reps. Robert Andrews (D-N.J.) and Tom Rooney (R-Fla.). The bill would require lenders to respond to consumer short sale requests within 45 days. Hopefully this legislation, coupled with an improving market, will help you and others work through your financial challenges.

This entry was posted in Economics, Housing Bubble, New Jersey Real Estate. Bookmark the permalink.

116 Responses to My my my, how times have changed.

  1. freedy says:

    first,and good luck

  2. grim says:

    As commented on a prior post discussing a similar topic, any kind of legislation requiring a prompt decision be made in a specific timeframe will largely result in a negative decision being made, in that timeframe. I’m sure the short sale approval pipeline is packed just as tightly as the foreclosure timeline. Lenders just aren’t staffed up to sell sausage retail.

  3. grim says:

    From RealtyTrac:

    Foreclosure Activity Increases 4 Percent in Third Quarter

    RealtyTrac® (, the leading online marketplace for foreclosure properties, today released its U.S. Foreclosure Market Report™ for the third quarter of 2010, which shows that foreclosure filings — default notices, scheduled auctions and bank repossessions — were reported on 930,437 properties in the third quarter, a nearly 4 percent increase from the previous quarter but a 1 percent decrease from the third quarter of 2009. One in every 139 U.S. housing units received a foreclosure filing during the quarter.

    Foreclosure filings were reported on 347,420 U.S. properties in September, an increase of nearly 3 percent from the previous month and an increase of 1 percent from September 2009. A record total of 102,134 bank repossessions were reported in September, the first time bank repossessions have surpassed the 100,000 mark in a single month.

    “Lenders foreclosed on a record number of properties in September and in the third quarter, taking a bite out of the backlog of distressed properties where the foreclosure process was delayed by foreclosure prevention efforts over the past 20 months,” said James J. Saccacio, chief executive officer of RealtyTrac. “We expect to see a dip in those bank repossessions — and possibly earlier stages of the foreclosure process — in the fourth quarter as several major lenders have halted foreclosure sales in some states while they review irregularities in foreclosure-processing documentation that has been called into question in recent weeks.”

  4. grim says:

    From CNN/Money:

    Foreclosure auctions hit record as document crisis unfolds

    Bank repossessions and foreclosure auctions hit record levels in the third quarter, RealtyTrac said on Thursday.

    372,445 foreclosure auctions were scheduled in July, August and September, while 288,345 properties were repossessed by lenders over the same time period.

    Overall foreclosure filings edged up to 930,437 in the third quarter, a 4% increase from the previous quarter. One in every 139 homeowners received a foreclosure filing during those three months.

    Bank repossessions, or REOs, also are on the rise. In September, a record 102,134 homes were taken back by banks. It’s the first time repos have topped 100,000 in a single month.

    The uptick is not expected to last, RealtyTrac CEO James Saccacio said in a statement, because several major loan servicers have halted foreclosure sales pending a review of documents.

  5. 30 year realtor says:

    Grim #2 – “I’m sure the short sale approval pipeline is packed just as tightly as the foreclosure timeline. Lenders just aren’t staffed up to sell sausage retail.”

    Perhaps we could have a stimulus package for exactly this purpose. Stimulate employment and moving along the foreclosure and short sale problems in one fell swoop?

  6. grim says:

    From the WSJ:

    The Short Sale Alternative

    When newlyweds Justin and Rebecca Rakitin starting shopping for their first home in the Fort Lauderdale, Fla., area last year they assumed the process would be quick and easy, with a $8,000 first-time buyer tax credit at their disposal and ‘For Sale’ signs littering every block.

    In fact, most of the listings in the Rakitins’ price range were either foreclosures or short sales, where sellers were asking for less than they owed on their mortgage. After seeing some “really nasty” foreclosures, says Ms. Rakitin, age 27, the couple decided to stick with short sales.

    In November 2009 they found what they wanted–a three-bedroom, two-story townhome that sold for about $300,000 in 2007, listed for half the price. Worried that other buyers would pounce, they offered $165,000. The sellers quickly accepted.

    Then the waiting game began.

    Such was the case for Rakitins. While the seller’s two lenders wrangled behind the scenes, the couple waited nearly a year, renting month to month. Just this month, the couple finally closed on their townhome–hours before the home buyer tax credit expired. “Our [agent] kept us on alert about what came in the market,” says Ms. Rakitin, who works in public relations for the travel industry. “But they were all short sales and we didn’t want to start the process over again.”

  7. Lamar says:

    I can confirm that the NJ average days delinquent is somewhere near the NY level. I have consulted with several people who were able to stretch it to almost four years.

    I already see the lenders pulling back on lis pendens filings in my area. When the backlog that develops from this finally gets added to the current inventory of REO, it will be the kill shot to the housing market here.

    “Before we get into the latest bank assessment of fauxclosure, this time from BofA’s Michelle Meyer, we wanted to highlight one point from today’s JPM financial supplement which appears to have evaded pretty much everyone (perhaps due to its appearance on the last page, and only lawyers go that far). In today’s earning call, Jamie Dimon stated that the average length a mortgage is delinquent before it is finally foreclosed upon is 14 months, or 448 days. However, it seems that average and median in this metric are quite different. To wit, on page 21 of the supplement we read that the average delinquency at foreclosure for Florida is 678 days, while for New York, it is, get ready, 792 days! That’s right, a house is delinquent on its payments, which usually means not paying anything, for over two years in New York before it is foreclosed upon. Which also means that only now are those who stopped paying their mortgage around the days when Lehman filed being foreclosed upon. And guess what happened to the economy, and the stock market in the 6 months immediately after… In other words, there is such a huge cliff of accrued foreclosures that is supposed to be hitting right about…now, that the double whammy of foreclosure gate and the accrued foreclosures will blow right through the balance sheets of banks like JPM. And with that out of the way, here is why BofA believes that there is a “heightened risk of a more dismal scenario. If negative momentum in the housing market kicks in, and feeds into the banking system and broader economy, it will be hard to fight.” Alas, Michelle, it already has.”

  8. Lamar says:

    Stench of death is overwhelming this AM. Oblivion beckons.

  9. Lamar says:

    40 years in the wilderness.

  10. Lamar says:

    So, 250K is long the stock market as a hedge against his gold longs? Or, does he think he’s Texas hedged by going long both?

    Let’s not tell him that gold is a proxy for equity shorts who understand that you can’t put on a short without facing certain annihilation. His brain might explode.

    And his mom has already dropped him on his head several times.

  11. still_looking says:

    Yesterday’s post, Essex

    This place wasn’t my first choice, by far.


  12. still_looking says:

    All-Hype, yesterday

    You are welcome anytime. You know that already, little brother.

    Call me when you’re free…. my work schedule this week is scathing…


  13. still_looking says:

    Hyde, Yesterday

    My work schedule is nuts for the next 5 days…that, and my loose cannon, back stabbing, mid-life crisis experiencing, liar of a relative is up my ass like a colonoscope and torturing my spouse as well.

    I’d give my eyeteeth if they could aerosolize haldol. Hell, I’d settle for an atomic vaporizer of it (for her, cuz, God knows she needs it…)


  14. still_looking says:

    All-Hype, yesterday

    You are welcome anytime. You know that already, little brother.

    Call me when you’re free…. my work schedule this week is eviscerating me (along with my delusional MIL…)


  15. still_looking says:


    don’t bother unmodding my old post #12.

    So sc.athing puts you in mod?? Who knew?


  16. Mr hyde says:


    Are you familiar with any new reactions to the new flu shot?

  17. grim says:

    Just the first four letters

  18. Mr hyde says:


    Put the injectable haldol into a nebulizer and tell the family member that they have asthma and need a breathing treatment. The effects should last longer then a straight injection but have a slightly slower onset.

  19. Dissident HEHEHE says:


    Go to an al-anon meeting. Those people know how to help you deal with such people.

  20. still_looking says:

    Hyde, 16

    No, not that I have heard of. All of us are now required vaccination (and the swine flu shot) or required to wear masks. Got mine last week. Not even sore at the site. Have not heard of side effects (for my N=40 or so co workers.)


  21. still_looking says:


    ah. figures.

    can you check on prop across street? sign still there, no activity.

    been past lately? you can see the flowers/pumpkins that got me in hot water with my lunatic family member. Hubby has been working like crazy and made mad-ass progress, too.


  22. still_looking says:


    She needs a shrink.


  23. still_looking says:

    Hyde, 18

    Which of the two faces do I apply the nebulizer to??


  24. Mr hyde says:


    My son got the flu shot and about half of his bicep area got and angry red and vieny look with a little swelling and tenderness for about 36 hours. Our pediatrician wasn’t concerned, but it seemed an unusual reaction o me.

    I’m not looking for medical advice just wondering out loud. I happen to love our current pediatrician and thing she’s fantastic.

  25. Lamar says:

    I like french fries.

  26. still_looking says:

    A local reaction isn’t uncommon. Did he get the injection high up or mid arm

    Deltoid is the usual site of injection… One possibility is that she or the nurse may have punctured a vein or small artery on the way in and the reaction you are seeing is from blood that was released locally (which will cause swelling and pain lower than the site as gravity pulls the blood down.)


  27. Mr Wantanapolous says:

    “I like french fries.”


    Take delivery of them, as much as possible.

  28. Dissident HEHEHE says:

    “I like french fries.”

    I remember the days of freedom fries.

  29. Mr Wantanapolous says:

    Idiot bankers, thank god they present enormous opportunities. Now we [yen] are at 15 year highs, after massive intervention. Print more.

    “¥82 yen per dollar is “the line of defense to prevent currency strength from harming the economy”

    OK Sengoku, your move. Has anybody seen or heard from Mrs Wantanabe?

  30. Lamar says:

    ZH is nothing else, if not preternaturally timely. Here’s another little primer for 250K:

    “With deception in the mainstream financial media reaching new heights regarding the recent rallies in Western stock markets, it’s time to shed some light on this matter. The first rule of building wealth is that your gains have to outpace the rate at which Central Bankers depreciate the currency in which your asset is denominated. Otherwise you end up with more money in you account but no better standard of living. For example, if your investment adviser tells you that his or her goal for you this year is 8% returns, if Central Bankers have depreciated your currency by 15% this year, then fulfilling his/her goal actually results in a 8.2% destruction of your wealth, exclusive of tax consequences.”

  31. Lamar says:

    BC (26)-

    I guess I should take it in McDonald’s fries. Seems they don’t degrade over a six-month period.

    Stable shelf life is going to become a very big concern pretty soon.

  32. Lamar says:

    Oops. Think I got moderated.

  33. Lamar says:

    BC (28)-

    Pink baths are all the rage in Japan. Settles the nerves. Permanently.

    “Has anybody seen or heard from Mrs Wantanabe?”

  34. All "H-Train" Hype says:

    Clot (29):

    Why bother with 250k, he will be pounding his chest all proud of the fact he has made 20% in the markets but will fail to realize that the dollar value is down the same amount.

    Still_looking: I have a new, unopened bottle of Johnny Walker Blue with your name on it. Just let me know if you need to hang for a few hours to blow off some steam. Bring the hubby and kid and we can have a grand old time!

  35. Lamar says:

    The Knob Creek Single Barrel, that is.

  36. Mr Wantanapolous says:


    Melt up or melt down. Why buy the cart when you can own the horse?

  37. Mr Wantanapolous says:

    Lamar [29],

    99% will look at you like you have 2 heads.

  38. Mr hyde says:

    Injection appeared to be above midpoint of bicep. Your guess makes a lot of sense. All is well though and was just curious. Thank you

  39. Libtard says:

    About the Flu shot this year. My son said his arm was sore, but it lasted less than 24 hours. Gator said her arm was sore too and did get the not-so-unusual headache on the night that the shot was taken. I almost always have this reaction. Go get your shots to travel to the third-world and you’ll wish you had gotten the flu shot.

    IMO, the vaccine may be a little tougher for the body to fight off then it usually is (I haven’t gone for mine yet as I like to wait to find it for free), but that simply means that it is working, IMO. At least that is what my mom would say.

  40. 250k says:

    Lamar’s latest headshot:

  41. Shore Guy says:

    “Lenders just aren’t staffed up to sell sausage retail”

    I doubt this is the main proble. Were the lenders inclined to move these properties, they would contract with a third-party to sell these things on their behalf. The main issue, I suspect, is a preference to carry the properties on their books at unreasonably-inflated values.

  42. Libtard says:

    So how about the US Dollar? Is the market up or is it worth the same?

  43. Libtard says:

    I always envisioned Clot was more like this

  44. Shore Guy says:

    “A local reaction isn’t uncommon”

    Ahh, medicine, just like RE is local.

  45. Shore Guy says:

    My, my
    Hey, hey
    The RE crash is here to stay
    Is it bet-ter to keep paying
    Or to just walk away
    My, my
    Hey, hey

  46. A.West says:

    Nobody yet has mentioned that South Park featured New Jersey in last night’s episode. Pretty much on the money ridiculing Real Housewives of NJ, and NJ Shore.

  47. Shore Guy says:

    For the farming types lurking about, if one were looking at buing some agricultural land to use as a source of income in case of a large disruption to the economy, what should one be looking for in terms of renting part of the land to full-time farmer, minimum pasture size to raise a couple dairy cows, and goats, and what minimum equipment is necessary for tending to a small pasture, a large garden. With respect to fruit trees, how long does it take to get small orchard up and running, something on the order of 10 each apple, pear, peach, and cherry trees and what is the productive longevity of such trees? Also, what is the minumum garden size necessary to produce the bulk of greens and roots for eight to 10 people?

  48. Confused In NJ says:

    Good thing Americans don’t have to eat or use energy for things like heat:

    WASHINGTON (AP) — Wholesale inflation stayed tame last month outside of a sharp rise in food and energy prices.

    Moderate price inflation allows the Federal Reserve to keep the short-term interest rate it controls at a record low of nearly zero, where it has been since December 2008. Low inflation also makes it more likely the Fed will launch another effort to lower longer-term rates by purchasing Treasury bonds when it meets next on Nov. 2-3.

    The producer price index, which measures price changes before they reach the consumer, increased 0.4 percent in September, the Labor Department said Thursday. It rose by an equal amount in August.

    Excluding volatile food and energy costs, core producer prices rose only 0.1 percent in September from the previous month. That rise was driven by higher car and truck prices. In the past year, core prices have risen only 1.6 percent.

    A 1.2 percent rise in food prices and a 0.5 percent rise in energy prices drove the index up. Wholesale prices have increased 4 percent in the past year. The cost of meats and fresh vegetables drove the increase in food prices.

    The weak economy is keeping a lid on prices. Frugal consumers are seeking out discounts and balking at higher costs. That has made it harder for producers to raise the prices they charge to retailers.

    In addition, high unemployment is keeping paychecks low, so consumers can’t afford to spend more.

    Wholesale prices fell for three straight months in the spring and early summer. That stoked fears of deflation, a widespread and debilitating drop in prices, wages, and the value of homes and investments.

    But the recent increases in the producer price index have eased those concerns. Federal Reserve officials saw “only small odds of deflation” at a meeting last month, according to the minutes released on Tuesday.

  49. JJ says:

    My only possible reaction to the flu shot is that on wall street as part of pandemic planning since swine flu is nearly all broker dealers have a health fair where they give out free flu shots to all employees.

    Some employees refuse to get it, however if it is “go-time” at work and the bozo is out with the flu cause he refused the flu shot which I gave him time at work to go get it and I was paying for it it will be go-time for some of his bonus. .

  50. Al Gore says:

    The metals are on fire. Hong Kong opened and gold went to and through 1380 and silver just shy of 25.

  51. still_looking says:


    You and the missus free next week? Would love to see you both! Did you eat the top piece of your wedding cake yet? :)

    As for the 23rd — I guess 6 or 7 pm.


  52. Mr Wantanapolous says:


    Regarding JPM;

    “I did not begin to get a grasp on those financials until at least 2,000 hours into them”

    Somehow I missed this yesterday. What was your conclusion after 2,000 hours of mm?

  53. Shore Guy says:

    Tliban want peace (yea, right):

    All we want is peace
    A little piece of Wazirastan
    A little piece of Swat
    A little piece if Kabul
    Without firing a shot
    A little piece of Karrachi
    And Mumbai, ’cause were swell
    And then we’ll kill all infidels
    And send then stright to hell

  54. Anon E. Moose says:

    from the Pantheon of Bad Advice:

    There are only two situations where paying interest makes sense, at least mathematically. The first is when the purchase goes up in value at a rate greater than the rate of interest you’re paying to finance it. Example: You borrow money at 5 percent to finance real estate that you think might return 8 percent on your overall investment. Other examples might include a business loan or a student loan — in other words, something that’s going to return more (at least potentially) than it costs in interest payments.

    The other situation where paying interest makes sense is when you can earn more on your cash than you’re paying in interest. Example: After taxes, I’m only paying about 3.5 percent to finance my house. Since I think can make more than 3.5 percent after-tax in the stock market, I’ll forgo paying off the mortgage, even though I have the cash.

    Obviously there are times when we have no choice but to borrow. The point is that unless the math works out, the less you borrow, the better.

    You catch that kiddies – you could earn 8% on your real estate investment, so lever up! And don’t you dare pay off your mortgage, you can earn better in the stock market.

    We are so Weimarred.

  55. NJGator says:

    Montclair Taxpayers To Rally Against GovernmentEvent will be held on Sunday, October 24 in West Orange.

  56. Mr hyde says:

    And the flames continue to spread….

    You thought the foreclosure mess was bad? You’re right about that. But it gets so much worse once you start adding in a whole bunch of parallel messes in the world of mortgage bonds. For instance, as Tracy Alloway says, mortgage-bond documentation generally says that if more than a minuscule proportion of notes in a mortgage pool weren’t properly transferred, then the trustee for the bondholders can force the investment bank who put the deal together to repurchase the mortgages. And it’s looking very much as though none of the notes were properly transferred.

    But that’s not even the biggest potential problem facing the investment banks who put these deals together. It also turns out that there’s a pretty strong case that they lied to the investors in many if not most of these deals….

    First, the bank would put in a winning bid for the pool of mortgages, with the intention of slicing it up into mortgage bonds and selling those bonds off to investors at a profit.

    After submitting the winning bid, the bank would commission Clayton to take a closer look at a representative sample of loans in the pool……Clayton reviewed 1,280 loans on behalf of Citigroup in the first quarter of 2006. Of those, it accepted 554 outright: they lived up to the originator’s underwriting standards. It also waived another 144, on the grounds that there were mitigating factors (a large downpayment, say). And it rejected 582 for a rejection rate of 45%.

    This kind of information was valuable to Citigroup: it showed them that the quality of the loan pool was much lower than you’d think just by looking at the ostensible underwriting standards……

    it’s clear that the banks had price-sensitive information on the quality of the loan pool which they failed to pass on to investors in that pool. That’s a lie of omission, and if I was one of the investors in one of these pools, I’d be inclined to sue for my money back. Prosecutors, too, are reportedly looking at these deals, and I can’t imagine they’ll like what they find…….

    were the bond investors able to do their own due diligence on the loan pool? The answer is no, they weren’t — the prospectus did not include the kind of loan-level information which would enable them to do that…..

  57. Mr Wantanapolous says:

    Hyde [56],

    It’s a freaking inferno. How about the trilllions of securitized mortgage debt in pension plans?

  58. Happy Daze says:

    Inferno because
    mortgage-related paper makes for a great bonfire.

  59. JJ says:

    After 2,000 chargeable hours I got a new kitchen, GMC truck and a family vacation to Disney world. Oh yea the financials were good.

    Actually, I was shocked at what was on the balance sheet. Remember, JPM – IB and Private Equity Business buys things to either fix-up and resell or IPO. I recall they were the second largest owner of parking garages in the world, third largest owners of movie theaters in the world and even more amazing buildings all over the place, for instance 1NY Plaza Chase owns with out a mortgage, when metro tech, jersey city had deals they moved employees there and re-rented building out at fully market rent. I recall they locked in a 25 per sq foot deal in metro tech and re-rented old space at 50 a sq foot. The credit card, TSS, Mortgage, IB were all throwing off huge cash streams. To a point of I was only deep diving on items that were 1/2 of 1% of pretax income and the student loan business was out the door, heck the whole 6.000 branch system was almost immaterial to profits and losses. Leased a branch in 1991 for peanuts and pay teller 8 bucks an hour. Branches were just a feeder system for cash to invest. Heck they had so many data centers is was scary, even more amazing JPM operates in almost every country, meanwhile only parts of England and Japan IB business was material.
    Mr Wantanapolous says:
    October 14, 2010 at 10:22 am


    Regarding JPM;

    “I did not begin to get a grasp on those financials until at least 2,000 hours into them”

    Somehow I missed this yesterday. What was your conclusion after 2,000 hours of mm?

  60. Fabius Maximus says:

    #46 Shore

    The quick answer is ask Lou Dobbs … :*)

    No looking to step on Noms consulting gig, but get past the title and just read this.

  61. Mike says:

    Anon Number 54 I get it, if your mortgage is 4.00% and I have the funds to pay it off but I can get 5.00% on a bond or whatever it’s better to keep the bond and write off the mortgage interest I guess

  62. Mr Wantanapolous says:

    JJ [59],

    I get it, not done recently. If you saw their naked short bullion book, you would have been long silver; up approx 4,000% at this time.

  63. Mr hyde says:

    Silly politician, laws only apply to the little people.

    October 14, 2010

    Robert S. Mueller III
    Director Federal Bureau of Investigation
    935 Pennsylvania Ave, NW
    Washington, DC 20535

    Robert O’Neill
    US Attorney
    Central District of Florida
    400 North Tampa Street, Suite 3200
    Tampa, FL 33602

    Dear US Attorney Robert O’Neill and Director Mueller,

    When it comes to foreclosures, there is mounting evidence of a state of rampant lawlessness in Central Florida. There are increasing signs that big banks routinely evade laws meant to protect homeowners, in many well-documented cases of ‘foreclosure fraud’. Despite the demonstrated existence, for instance, of ‘robosigners’ signing affidavits attesting to documents that they have never seen, the parties engaging in such misconduct are not being brought to justice. Big banks are mischaracterizing this as mere “technical problems,” and apologizing only where there is clear and very public evidence of harm.

    It is not enough for big banks only to apologize for fraud, perjury, and even breaking and entering – when they are caught. It is time for handcuffs. Fraud does not become legal just because a big bank does it.

    On September 20, 2010, after my office found evidence of systemic foreclosure fraud perpetrated by big banks and foreclosure mills, I called for a halt to illegal foreclosures.

    Since then, big banks such as Bank of America, JP Morgan Chase, GMAC, PNC and others have suspended foreclosures or foreclosure sales. These banks are still claiming that the massive fraud they have perpetrated amounts to nothing more than a series of technical mistakes. This is absurd. This is deliberate, systemic fraud, and it is a crime.

    To give but two of the many available examples, attached is a deposition from an ex-employee of one of the largest ‘foreclosure mills’ in the state, the Law Offices of David Stern. In it, this employee testifies under oath that it was routine for that office to falsify documents regarding military records, in order to move foreclosure cases along more quickly.

    The local media has reported on the case of Nancy Jacobini; a contractor for JP Morgan Chase broke into her home after the bank mistakenly foreclosed on it. JP Morgan Chase ‘apologized’ for terrifying her. But we do not have an apology-based legal system; we have a system of laws. I am writing to ask you to enforce them.

    The organized and systematic manufacturing of falsified documents to deprive people of their homes is not only a threat to the integrity of the legal system. It also aggravates and extends the weakness in the housing market. Who is going to feel comfortable buying a home if a big bank can simply take it, whether or not that bank has a right to it? Given the securitization of mortgage-backed securities, this misconduct is a threat to our securities markets as well. But fundamentally, this is a question of protecting basic property rights – if you don’t own it, then you shouldn’t try to take it. Without clear property rights, and a legal system that insists on clear proof of those rights before transferring ownership by force, the economy will fall apart.

    If perpetrators of perjured affidavits and other systematic criminal activity can get off simply with civil liability — or even less, an insincere bureaucratic apology — the freedom that Americans enjoy will erode quickly in the face of lawless seizures of property. I appreciate your work on the joint Middle District of Florida’s Mortgage Fraud Initiative, and respectfully request that the efforts of your offices turn towards reining in this rampant criminality.


    Alan Grayson
    Member of Congress

  64. Anon E. Moose says:

    Mike [61];

    Yeah, but the a$$inine thing is to believe that going forward real estate will appreciate at anything remotely resembling 8% per annum. Real estate has at best made 1% over inflation long term. So that advice is either stuck on stoopid in 2004, or silently presumes 7% inflation. That’s a doubling of prices about every 10 years (rule of 72: 72 divided by annual compound rate = years to double).

    As for the ‘borrow on my home at 4% and invest at 5%’: like Pol says — it works great… until it doesn’t. Who wants to literally bet the farm ($500k?) to net 5 grand a year (1% margin on $500k?) That logic assumes that J6P can easily do what the banksters do for a living — the banksters are better at it and don’t suffer competition unless they can fleece it.

  65. JJ says:

    100% keep mortgage if it a tax free bond, other than that all depends.

    On a 100K bond vs. 100K mortgage 40% tax bracket 5k taxable interest on bond is $3,400 in your pocket and 4k mortgage interest only saves you $2,400 on your taxes.

    On a 100K bond 15% tax bracket, 5k interest on bond is $4,250 in pocket but the 4k mortgage interest only nets you a $600 dollar write off.

    October 14, 2010 at 12:35 pm

    Anon Number 54 I get it, if your mortgage is 4.00% and I have the funds to pay it off but I can get 5.00% on a bond or whatever it’s better to keep the bond and write off the mortgage interest I guess

  66. JJ says:

    100 year average for real estate is 3%, 100 year average for mortgage is around 7.5%.

  67. Mr Wantanapolous says:

    Canadain and USD at parity. Who’s loonie now? They didn’t teach that at the university, eh.

  68. Mr Wantanapolous says:

    RE is one of the worst long term investments on the board. It has appreciated at/near the inflation rate for 100 years, before the charade. When you add in the cost to carry, improvements, etc.., it’s a net loser. Actually it’s not an investment, it’s consumption.

  69. ricky_nu says:

    Wantan #68

    it should be a break-even (with inflation) investment at best, otherwise where would the money come from?

  70. Mr hyde says:


    Look at EUR and AUD

    There should be a nasty retrace at some point. Who knows when thought????

  71. Mr hyde says:

    Ricky Ru


  72. Barbara says:

    Late. Flu shot this year has 13 strains, last year only 7. My daughter got it yesterday and slept last night for 14 hours. She’s stiff today but not cranky. JJ, shut up.

  73. chicagofinance says:

    I like this…..

    68.Mr Wantanapolous says:
    October 14, 2010 at 2:13 pm
    When you add in the cost to carry, improvements, etc.., it’s a net loser. Actually it’s not an investment, it’s consumption.

  74. JJ is full of It says:

    JJ says:
    October 14, 2010 at 11:53 am
    After 2,000 chargeable hours I got a new kitchen, GMC truck and a family vacation to Disney world.

    I smell major Bull sh!t here

  75. Mr Wantanapolous says:

    Ricky [69],

    Nominal or real?

  76. JJ says:

    Babs, I have never took a kid to a flu shot in my life. I have heard about it from wife but usually, my ear starts hearing blah blah blah blah, I know it is bad but wife thinks that is why I am good at my job, she would be worried if the kids had the flu and were deadly sick and she had to go to some bs meeting. I mean if someone dies or something I am pretty sensitive, I always sends flowers. Heck last time I sent flowers it took like 20 minutes to order and I missed at least two rounds of drinks. Three kids getting flu shot on Friday, I am out of town tommorow so I guess I will hear how it goes,
    Barbara says:
    October 14, 2010 at 2:46 pm

    Late. Flu shot this year has 13 strains, last year only 7. My daughter got it yesterday and slept last night for 14 hours. She’s stiff today but not cranky. JJ, shut up.

  77. Simply Ravishing HEHEHE says:

    Here Comes The Scramble For Capital: JPM To Raise $4 Billion

    Even as JPM Jamie was crowing earlier about how great JPM’s feces smell, and how the future is so bright, he’s gotta wear Dimonshades, a little yet very important headline hit Bloomberg. To wit:



    Is JPM, with its massive cash trove, suddenly a little more nervous about the teeny, weeny foreclosure problem? Furthermore, with JPM seeing $4.35 billion in TLGP maturities on December 1 and 2, which are paying ridiculously low taxpayer-subsidized rates, just how big will the cash crunch to JPM suddenly be? And all this avoids the fact that JPM’s overly optimistic NPL charge off projections will have to be revised dramatically higher as shadow foreclosures, ironically, suddenly surge, and remain in suspended animation until the “moratorium” is lifted, only to flood all over the banks and their fraudulent and massively mismarked balance sheets, like a pent up tsunami, once the next foreclosure wave is released.

    Hahaha, let the lying begin again “we are well capitalized”

  78. Mr hyde says:

    Even the MSM is now using terms like fraud.

    It appears the mortgage content of many of those pools—created when the banks were dominating the mortgage securitization market in 2005, 2006 and 2007—may have been misrepresented. For example, an underwriter may have maintained that 80 percent of the mortgages in the pool were for primary residences when in fact far fewer were for that purpose. Or the underwriter stated that only 10 percent of the pool would be made of of “no-doc” loans—those that include less documentation about the borrower—when in fact the percentage was far higher.

    That could be fraud, and if so, the creator of the mortgage pool could be liable. Given that the market for private label RMBS (residential mortgage-backed securities) was $1.5 trillion, the potential liability may be considerable. And while most of the originators of these mortgages are long gone, the securitizers are not. It appears the mortgage content of many of those pools—created when the banks were dominating the mortgage securitization market in 2005, 2006 and 2007—may have been misrepresented. For example, an underwriter may have maintained that 80 percent of the mortgages in the pool were for primary residences when in fact far fewer were for that purpose. Or the underwriter stated that only 10 percent of the pool would be made of of “no-doc” loans—those that include less documentation about the borrower—when in fact the percentage was far higher.

  79. Mr hyde says:


    a separate study by SNL Financial has determined that the total amount of residential (not commercial) mortgages in foreclosure between directly serviced, and those serviced for others, for the big three banks alone (JPM, WFC, BAC) is nearly a quarter of a trillion dollars! And this number will soon surge. Keep in mind, as we disclosed yesterday, per JPM, the bank, which is a good proxy of the Big 3, keeps mortgages in the delinquent category for on average of 448 days before moving to foreclose (and 678 days in Florida and a stunning 792 days in New York). This means that banks, and especially regional banks, are about to experience the mother of all delinquency-to-foreclosure cliff events, as squatters now certainly will have no intention of ever paying down their mortgage.

  80. Simply Ravishing HEHEHE says:

    Hey JJ,

    You might need to spend a few more hours looking at them financials:)

  81. Mr hyde says:

    2 questions. What is the related CDO value that was based on the MBS that are susceptible to forced buy backs? Secondly arent pension funds fiduciary agents, in that they would be required by law (assuming they actually followed it) to pursue buy backs on any instrument they held associated with this?

    I would throw out a WAG of 2X to 10X as the value of the CDO’s based on the MBS. So that 200 billion liability could be more like a trillion $ liability

  82. Mr hyde says:


    If we were smart we would have levered up on a house in NY with a mortgage by JPM. You’re guaranteed to live for free for 2 years at a minimum and 3 – 5 if you get a good attorney.

  83. ricky_nu says:

    Mr Want #75

    real return should be = 0%

    price should keep up with inflation, but nothing more (for sustained periods)

  84. Mr hyde says:

    ….More than $2.1 trillion, or 19 percent, of outstanding mortgages have been bundled into securities by private banks, according to Inside Mortgage Finance, a Bethesda, Maryland-based industry newsletter.

  85. Simply Ravishing HEHEHE says:

    Kettle at some point the Feds have to step into this mess. Post-election they’ll pass legislation that I am sure the banking lobby is feverishly drawing up right now that will side-step all this stuff. Obama will sign. It will be challenged in court on constitutional grounds; it will get an expedited appeal and the SCOTUS will come up with some bizzaro rationale for upholding the law. It’s the only way this thing can play out without causing a bigger banking collapse than lehman.

  86. Mr hyde says:

    85 HEHE

    I agree with your logic, but that series of events would require state laws to be widely altered. There is a long standing history of state laws being dominant in RE and while I am not a political guru, I would be surprised if the states just went along with it. Another question is that regardless of the method used, if the FEDS manage to bury this zombie somehow, its going to cost massive amounts of money. They are already treading on thin ice and could easily trip some very nasty FX results.

  87. Simply Ravishing HEHEHE says:

    I wouldn’t expect the state’s to go along with it at all; there’d be a lawsuit by one of the states that would result in an injunction; the injunction would result in an interlocutory appeal; that appeal would speed up the ladder.

  88. Mr hyde says:


    I thought the problem was only subprime and that it was contained?

    NEW YORK, April 20 | Fri Apr 20, 2007 5:59pm BST

    NEW YORK, April 20 (Reuters) – U.S. Treasury Secretary Henry Paulson said on Friday the housing market correction appears to be at or near its bottom and that troubles in the subprime mortgage market will not likely spread throughout the economy.

  89. JJ says:

    4 billion on a trillion dollar balance sheet. ru kidding? At large money center banks, BAC, JPM, C, a single trading desk can take a billion dollar hit on a single trade and it is insignificant.

    You need to look at the following to even determine what is and isnt significant , zero hedge I am sure never did,
    All primary statements, i.e., balance sheet, income statement, cash flow statement, statement of changes in stockholders’ equity and footnote disclosures; excludes MD&A
    and all ‘individually significant accounts’, being those with balances for the year of approximately 3.75% normalised pre-tax income and cover key ‘firmwide’ controls such as fraud prevention, corporate governance processes, market risk processes, etc.
    as well as ‘financial statement integrity controls’ such as CFO and Controller oversight and monitoring

    TOP DOWN – take consolidated financial statements and disaggregate ~70% to Line of Businesses (LOBs); within LOBs to disaggregate to sub-LOBs / processes, for each process identify key financial controls, link to key underlying IT applications and map those applications to data centers supporting them – for each key IT app and data center to identify key controls, document and test

    If you did the above you will realize 4 billion is peanuts, heck 100 billion is peanuts. Heck 400 billion was peanuts 20 years ago, heck I counted all the stuff in the chase vault 20 years ago and they had 100 million certificates, it took 40 of us 8 hours to count, sick sick sick.

    BTW have you ever seen one trillion? I have I was in the largest vault in the world once, size of a football field with 40 foot ceilings. Trillion dollars worth of securities in one room. In a room the size of a football field with one trillion in securities, 4 billion you can stick in a folder and carry out.

    Simply Ravishing HEHEHE says:
    October 14, 2010 at 3:21 pm

    Here Comes The Scramble For Capital: JPM To Raise $4 Billion

  90. Mr hyde says:

    “I don’t see (subprime mortgage market troubles) imposing a serious problem. I think it’s going to be largely contained,” -Henry Paulson April 2007

  91. Simply Ravishing HEHEHE says:

    “trillion dollar balance sheet” – that should read trillion dollar NOTIONAL balance sheet

  92. Confused In NJ says:

    Interesting, good business news market up, fake government news market up, bad business news market flat. Ben’s props are really working, temporarily.

  93. yo'me says:

    Median Home Values

    2000 1990 1980 1970 1960 1950 1940

    Adjusted to 2000 dollars
    United States $119,600 $101,100 $93,400 $65,300 $58,600 $44,600 $30,600

    Median Home Values: Unadjusted

    2000 1990 1980 1970 1960 1950 1940

    United States $119,600 $79,100 $47,200 $17,000 $11,900 $7,354 $2,938

  94. JJ says:

    That is net. Actual assets. Not Notional.

    Ambac and MBIA rocked the house today.

    Simply Ravishing HEHEHE says:
    October 14, 2010 at 4:08 pm

    “trillion dollar balance sheet” – that should read trillion dollar NOTIONAL balance sheet

  95. Simply Ravishing HEHEHE says:

    “That is net. Actual assets. Not Notional.”

    And a large chunk of those assets are valued how exactly?

  96. yo'me says:

    If I bought a house in 1940 at $2938.00 and paid 10% interest for 40 years,i would have paid a total of $11,975.00. Unadjusted median home price in 1980 is $ 47,200.00
    adjusted to year 2000 dollars is $93,400.Deduct constant cost of rent.Tell me it is a loosing investment.

  97. yo'me says:

    Cost of Living 1940
    How Much things cost in 1940
    Average Cost of new house $3,920.00
    Average wages per year $1,725.00
    Cost of a gallon of Gas 11 cents
    Average Cost for house rent $30.00 per month
    Radio $16.95
    Average Price for a new car $850.00
    Battery for Torch 10 cents
    Hoover $52.50

  98. Essex says:

    96. My sister (yes, study of one) has had to move twice in the last 4 years. Both times she sold at a profit. Yep. It happens.

  99. Mr Wantanapolous says:


    Now go back and invest the same amount in the the S&P’s. Your 2,900 investment in 1940 would be worth approx 300K in 2000.

    Now compare rent to the cost to carry over the same time period; probably not much of a difference.

  100. Essex says:

    11. Not sure what that means. You bought a place, but you settled? Confusing.

  101. Libtard says:

    Do you guys remember Victorian?

    Well he joined my investment club in May of last year. Since he joined he has made 29% with minimal risk.

    Mad Loot Investment Club 29.0%
    Vanguard Total Stock Market Index Fund (VTSMX) 21.1%

    Compared to the S&P we did even better. S&P only returned 19%.

    We sold our remaining portion of DV last Friday and doubled our position in Google this morning. We are absolutely on fire these last two years.

    Of course, past performance in no guarantee of future results.

    If any of you are interested in joining us and becoming financially educated, feel free to reach out. I’ll send you info. Nothing shady here either. We are essentially a self-managed mutual fund. Our fees are significantly cheaper though!!!

  102. Lamar says:

    250k (40)-

    My headshot of you would involve full metal jacket and your head looking like a watermelon dropped off a NJ Turnpike overpass.

  103. Lamar says:

    jj (49)-

    Yeah. Your company will be god-damned if they let a guy miss even a single day of destroying the world.

  104. Lamar says:

    gator (56)-

    When the final event at one of these GTGs involves laying siege to the town hall in Montklair, count me in.

  105. Lamar says:

    hyde (87)-

    The banksters have pretty much locked up state politics, too. What’s worse, they own all the judges in states where judicial positions are electoral.

    The Hindenburg known as Amerika is going up in flames. No way to stop it now.


  106. Al Gore says:


    I have an interesting article/discussion from 1997 that you might find interesting. An obvious insider discusses the international monetary system and its relation to gold, oil, the LBMA/BIS, and the US dollar/fiat currency. The naked short selling manipulation which to many is criminal insanity actually serves a purpose in the global markets. Very enlightening on how central bankers are tweaking a system that was set up to fail from the beginning.

    One would think the words spoken are from Henry Kissenger himself.

    Its a long read but would love to hear your opinion.

  107. Al Gore says:



    Dont let the gold vs S&P charts get you down. Soon enough it will be time to choose a side. Fiat criminals vs sound money. You are a smart guy and you know dam well how it all ends and we all will see it within the next 10 years.

    That Wall St firm handshake and girlish looks might do you some good at the roadside vegetable stand but it wont go far against an angry lynch mob.

    Heres another hint. Best lay low with the spending. Dont make yourself a target.

  108. chicagofinance says:

    Dude…just keepin’ it real……WTF does that mean? ..and if so, then why are you benchmarking against Wilshire 5000 and S&P 500?

    Libtard says:
    October 14, 2010 at 5:24 pm
    Since he joined he has made 29% with minimal risk.

  109. yo'me says:

    NJ Median Home Values since 1940
    2010 2000 1990 1980 1970 1960 1950 1940

    New Jersey $287,000 $170,800 $162,300 $60,200 $23,400 $15,600 $10,408 $4,528

    Notice home values from 1970 to 1990.Biggest jump in home prices in 20 years.$23,400 to $162,300 then it was flat from 1990 to 2000.Jump again in 2000 to 2010.I guess it will be flat again for the next 10 years.

  110. Any particular idea of God must work for the people who develop it. Supplier Qualification

  111. 96. My sister (yes, study of one) has had to move twice in the last 4 years. Both times she sold at a profit. Yep. It happens.

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