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House of cards THE MORTGAGE MESS

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The Dog

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Senior Member
Joined
Apr 18, 2005
Professional Status
Certified General Appraiser
State
Oregon
A slightly different spin on the mess. This is one of the better article on the mortage mess and financial crisis that is on going. Steve Croft from CBS NEWS at:http://www.cbsnews.com/stories/2008/01/25/60minutes/main3752515.shtml
well worth reading.

"Kevin Moran, the real estate agent who gave Kroft the tour of foreclosed houses in the Weston Ranch subdivision, says it is happening every day. They were never really invested. Most of the people who lost the houses didn’t lose any money because they never put any money down. Though their credit is damaged, and they could face legal action in some circumstances, they got to live in a new house for a couple of years, and some of them even managed to get some money with home equity loans or by refinancing. "

"It turns out that if you give people free money, they will take it without really worrying too much about giving it back. Because after all, it was free," Jim Grant says.

Asked if it's a case of greed, Grant says, "Greed, sure. Greed on both sides of the table."

"What do you mean?" Kroft asks.

"Lenders and borrowers," Grant says. "Everyone was gaming the system."
 

DonRico

Senior Member
Joined
Nov 26, 2002
Professional Status
Certified General Appraiser
State
South Carolina
WOW! 15 minutes and 41 seconds and not one sentence bashing the appraiser! Get the Guiness Book of Records on the phone!

That piece should be required viewing for all. I love it when Jim Grant says, "Yes, the Sub-Prime Mess was contained......contained on Planet Earth!"
 

Terrel L. Shields

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Gold Supporting Member
Joined
May 2, 2002
Professional Status
Certified General Appraiser
State
Arkansas
Grant's backhand slap at Bernanke and Greenspan is exactly what they deserve. The Fed had the power and the bully pulpit to sober up the banks. I know they were under enormous pressure from Wall Street to let the bull run, and it may well turn out to be the worst downturn since the depression...not to mention ruinous inflation will hit the pocket book of the baby boomers just as they retire. So I ask? If Greenspan and Bernanke cannot resist the pressure coming from banks, how can a lowly appraiser do so? It takes an incredible ethic to not look the other way.
 

Richard Carlsen

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Joined
Jan 15, 2002
Professional Status
Licensed Appraiser
State
Michigan
Saw this in an email this morning referring to Michigan and Ohio. Thought it was interesting:

So, presumably the loan loss experience in Michigan is probably due to people borrowing too much money on terms they are not capable of repaying. This tactic might work in a 2005 California or Florida market, where appreciation was in double digits. After all, easy money is no risk when your exposure is decreasing day by day. Michigan and Ohio do not fall into these categories.
 

Big ole Boy

Elite Member
Joined
Dec 6, 2003
Professional Status
General Public
State
Tennessee
As I remember,

when things were going up like crazy banks did not care about ability to repay or its "real" market value ....

..... cause, they would loan into rising markets ...... with this idea of grabbing these loans before some other bank got them ...

.... that about the time I left the industry realizing our financial emporer had no clothes .....
 

Greg Bell

Senior Member
Joined
Jul 7, 2006
Professional Status
Gvmt Agency, FNMA, HUD, VA etc.
State
Louisiana
Wait until the 401K and Pension Plan notices start showing up in mail boxes .Many a retired person will need to apply for a greeter at Wal Mart , hey I hear you get a deal on day old bread...
 
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