Irvine Housing Blog

Hard working condonium indeed.  Somebody buy that condo a beer!  It’s earned it.

IrvineRenter: “This battle between investors and bankers is more important than most realize.”

IMHO, there is no way to fool Mother Nature. No matter who wins, economy suffers one way or another. Simply because stolen money cannot be recovered in this battle.

How much has WaMu & its remains lost due to cutting corners, under-staffing and outsourcing their operations to the point of losing this note?  Close to $1M in unpaid interest and possibly the loss of the ability to reclaim their collateral?  A $1M loss pays for a lot of $50k/yr back-office employees.  But $1M is a drop in the bucket in terms of WaMu related losses, so it wouldn’t produce any change.

Is the publicity this guy’s getting for going 8 years w/o payment going to help his cause or hurt it?  At what point can the city/county foreclose for non-payment of taxes?  Is the mortgage holder paying the taxes?  Are they paying the property insurance?

While on vacation, I met a retired bank loan officer.  After a year into retirement, he got bored and when back to the bank as a contractor.  He mentioned that the out sourcing on paper saved a lot of money until the rework was counted.  It looks like lost paperwork is the newest rework.

The money lost (HELCO out, squatting cost) will not be recovered into the economy.  The lost will just be transferred to the taxpayers, who will suffer with debt and high unemployment.  The investors have a right to have the bank make good on the defective loans.  Unfornately, the banks will make good by delaying, making the public suffer until the liabliity is shifted to the govt/taxpayers.

Great depression used regulated high prices and inflation as an attempt to get the US out of the depression.  But major factor were wars in Europe and Asian to buy American goods, especially weapons, ships and food.  What will the US sell this time?

IR:
While I generally like your postings, I am confused about one thing:  Why do you support a bank foreclosing when they cannot prove that they own the note?

Yes, the home “owner” owes the money.  He admits that.  The central point, that you completely ignore, is that in order to foreclose, the note holder MUST show the note.  This isn’t a mere technicality.  What is to stop other banks from similarly claiming ownership of the note?  With mortgages sliced and diced, any number of banks (or investors) can claim ownership.  Shouldn’t we be worried about ensuring the proper party is the only one able to foreclose?  How do you get around the issue of who, exactly, is ALLOWED to foreclose?

I agree that people shouldn’t be allowed to squat.  But unfortunately, the banks are the ones who screwed up a viable, well documented and easy to use recording system.  We can’t just say “oh well, too bad.  The owe *someone* the money, and we’ll take Bank A’s word on this.”

When will the public catch on? The notes in question didn’t go missing because of sloppiness or mistakes. This was wholesale fraud on a scale not seen before. If it was sloppiness, we might be talking about a couple hundred or a thousand notes, not hundreds of thousands.

Think about it—those notes will never be found! They have been shredded, burned and buried.

I am not saying those that are not paying their mortgages should be let off the hook. They won’t be getting free houses. I am saying it’s total clusterbomb.

One of the things being bandied around as a solution is for the banks to do major mortgage revisions, write-downs on existing mortgages.

How is this fair to those who pay their mortgage? If I heard my neighbor, the one who sucked all the equity out of his home already and has been living free in his house for more than a year, was being offered a downward revision in the principal on their mortgage, I’d ask for one too.

The question really is if banks don’t have the foreclosure option anymore, what will happen?

From 2008 @ Calculated Risk

Loan was a refi, so recourse.  Think the foreclosing party may sue to get whatever they can after 8 years of trying to just get their collateral back?

When a debtor ask the bank to show them their loan note the response should be something like this:

“Ok dipshit here is your loan note now get the f-ck out of the house”

It should be similar to an old man getting asked for his ID at a liquor store.  Ok dipshit here is my ID, I’m over 21.

The response should not be like this:

“well ugggghhh geee it’s kind of funny when we were loaning out money to people we shouldn’t have been loaning money to, we have no freaking clue where the paper work went, but ugggghhh please get out of the house you haven’t been paying the loan on for a year, we promise we own the loan”

Bad answer.

1-in-14 O.C. mortgages are in default

http://mortgage.ocregister.com/2010/11/01/1-in-14-o-c-mortgages-are-in-default/39666/

What if a loan gets paid off but “the note” cannot be produced?

that was pretty good reading until the lawyers got into a pissing match

I think that Kelja is right, unfortunately. By the way, is anyone reading “Monster” (about Ameriquest, etc..)? Just the first 5 pages are incredible.

Why is everything so complicated?

Cancel all fixed-rate mortgages and significantly increase rates on existing loans to cover bank losses. During risky periods for financial institutions, rates always go up. That’s already happening with credit cards.

Why would a taxpayer cover all these losses? Every working American’s share of the national debt is already $100,000. It’s a nice house somewhere in Texas.

I have an idea for recovering part of the trillion: Hire auditors and have the feds go after each fraudster on every level and recover every dime that we can from the people who actually committed the fraud. And every congressman/senator who tries to offload this to their taxpayers without first trying to recover loses their job in the very next election.

Or am I just crazy?

HEY! It’s MY old condo!!! I kid you not, I lived in this very condo for over 2 years! I lived here from December 2006-Jan 2009. The owner must have gotten quite a loan mod. He tried to sell it to us for $429K in Jan 2007, because he said that was what he paid for it a couple years before, and he just wanted to cut ties with the place. We said no thanks, we’ll keep renting it for less than half that monthly payment. We were paying him $1,850/mo until we renegotiated the rent down to $1,650/mo in July 2008 to reflect nearby comps.

If you’re looking to buy this, even as an investor, be sure to ask some questions about the water damage to the kitchen flooring. There was a water leak that the landlord procrastinated on for ~2 weeks, and it ended up flooding the kitchen and warping the wood flooring. It turned out to be from a water pipe going to the unit above, so the upstairs neighbor’s insurance paid for the damages, but the landlord did not replace any of the damaged flooring while we lived there. So far as we are aware, he just pocketed the cash! Hardworking condo, indeed!

If you are looking to live here, it’s actually a nice enough place, in spite of the damage to the kitchen. The upstairs neighbors are a very nice middle-aged couple that we still keep in touch with (not too hard, as we just moved a couple blocks away), and the neighbors that this unit shares a wall with on the first floor are the current owner’s (seller’s) parents. (The seller owns this unit, #29 to the right in the picture, and the unit above #29. The numbering on these units does not match the numbers in the MLS. The unit pictured has a mailing address of #27 Smokestone.) They (the seller’s parents) are very nice as well. They don’t speak much English, but they were always very kind to us.

-Darth