BoA OWNED by person

[derf]

Originally Posted by 101lifts2

This is true to an extent, but please rent the movie Inside Job to better understand the whole mess. It was more profitable to write subprime loans than conventional 30 yr loans because the interest rates were higher over the long term and yielded more profit when they were sold off. I believe many people were duped by loan officers for the sole purpose that banks did not care if the homeowner could pay after the fixed rate period. They packaged up these loans and sold them as CDOs to investors.

you just described me. my loan guy sold me on the adjustable rate, even though I was pre approved for almost 50k more than I paid. His argument was that it was cheaper for me on a monthly basis especially since most likely I would sell the house withing 5 years and make a profit. At the time it sounded right because it was at the time a rarity for people to loose money on a property. Since then my mortgage has been sold 5 times, and I cant get a conventional loan because the house is worth half what it was when I bought it the month before the housing market went kaput.

[goof2]

Originally Posted by 101lifts2

Many of these banks did NOT hold the mortgages for subprime loans. Do you think banks were stupid? They kept the 30yr/15yr loans with 5% down/PMI and sold off the subprime loans. The ONLY purpose of the subprime loans were to sell to investors to make a buck when they bundled them and sold them off. Since these investments were AAA rated, many investors from other countries bought them up. The investors lost, not the banks, yet the banks got the bailout.

Once in a foreclosure, the bank will sell the property for it's value, then the PMI pays 25% of the market value. If the owner put 5% down and say paid 3 years in payments, the bank is not taking a loss. In many cases, the bank makes money. This is why they force you to pay PMI unless you put 20% or more down.

We can also go into how banks bet against CDOs paying out the full loan terms.

Avatard is right (not very tactful, but right). These banks and large corporations are using the government to deregulate shit/mandate legislation or tax so a small few can become very weathly at the expense of the taxpaper. It's going to lead to this country's demise.

The banks did securitize and sell off some of the mortgages but they still hold a ton of them too. PMI is also nice for the banks when the homebuyers had to pay it. Many didn't and even when they did home values have dropped much more than 25% in many areas. In Tampa I would guess the average drop has been around 40%, but for neighborhoods built out in the 03-07 timeframe it is probably closer to a 70% decline. ETA: For condos I have seen 75-80% declines.

We can also talk about Bank of America who was pretty much doing everything right by properly evaluating potential borrowers and sticking with more traditional loans and as a result wouldn't have needed to be bailed out. All that changed when the government "encouraged" them to acquire Countrywide, the poster child for junk loans. Working off your theory it shouldn't have mattered because Countrywide wouldn't have had any exposure to the losses. Instead it was a money pit that BoA had to deal with.

[Homeslice]

Originally Posted by derf

you just described me. my loan guy sold me on the adjustable rate, even though I was pre approved for almost 50k more than I paid. His argument was that it was cheaper for me on a monthly basis especially since most likely I would sell the house withing 5 years and make a profit. At the time it sounded right because it was at the time a rarity for people to loose money on a property. Since then my mortgage has been sold 5 times, and I cant get a conventional loan because the house is worth half what it was when I bought it the month before the housing market went kaput.

I'm guessing the only time in history that the AVERAGE American could make a profit after only 5 years of home ownership was during the huge uptrend between 2000-2006 or whatever it was. Again, I'm talking average, not Joe Blow in some hot market.

Consider you have closing costs, commission, property tax, repairs, maintenance, utilities, cutting the lawn, HOA dues, and all the other bullshit costs of home ownership. Not to mention the time you waste.

[Avatard]

Originally Posted by derf

you just described me. my loan guy sold me on the adjustable rate, even though I was pre approved for almost 50k more than I paid. His argument was that it was cheaper for me on a monthly basis especially since most likely I would sell the house withing 5 years and make a profit. At the time it sounded right because it was at the time a rarity for people to loose money on a property. Since then my mortgage has been sold 5 times, and I cant get a conventional loan because the house is worth half what it was when I bought it the month before the housing market went kaput.

Sure doesn't sound like your fault. You must really bristle at the fact that people say such stupid shit. Your the fucking posterboy for how such banking abuses harmed even the most responsible and well-meaning home buyer.

[shmike]

Originally Posted by Avatard

Sure doesn't sound like your fault. You must really bristle at the fact that people say such stupid shit. Your the fucking posterboy for how such banking abuses harmed even the most responsible and well-meaning home buyer.

How was he abused?

It sucks that Derf got caught up in the market crash but he could have gotten a fixed mortgage. He wasn't forced into an ARM.

He also could have rented. Nobody forced him to buy when he did.

Getting caught up in the whole "make the lowest monthly payment possible, home values will ALWAYS go up" logic that was pervasive a few years ago is a shame but it's not like the bank(s) signed the contract to purchase the home.

[Particle Man]

Originally Posted by shmike

It sucks that Derf got caught up in the market crash but he could have gotten a fixed mortgage. He wasn't forced into an ARM.

Are you saying nobody twisted his....






ARM?






Hahahahaha

[Papa_Complex]

Originally Posted by Captain Morgan

Please explain how the banks are profiting from the foreclosures.

http://fatcatexecutive.com/2009/07/l...fication-scam/

[Papa_Complex]

Originally Posted by 101lifts2

The deregulation started way back in the Carter years, but progressed significantly under Clinton and continued under Bush. The whole point was to keep from regulating derivative loans so banks could create this "subprime" loan in order to sell it off for a profit. Keep the less risky loans and sell off the risky ones. Therefore, write as many subprime loans as possible without regard to delinquency.

This was thought out way before the housing bubble. The greediest usually reside at the top.

And it went even further than that, with various entities producing commercial paper that was backed by sub-prime loans. Can you imagine backing a valued product with the profit that's supposed to be made, from a money losing proposition? It was a Ponzie Scheme, of epic proportions. There never was enough money, to pay out even a small portion of the debtors.

[shmike]

Originally Posted by Papa_Complex

http://fatcatexecutive.com/2009/07/l...fication-scam/

In other words: They're not.

In some cases they may not be losing money because the loan is insured but on the other 1/2 they are still getting their asses handed to them.

[Papa_Complex]

Originally Posted by shmike

In other words: They're not.

In some cases they may not be losing money because the loan is insured but on the other 1/2 they are still getting their asses handed to them.

As I recall they get the insured value, minus whatever the property might be valued at, which leaves them with a property that will likely only appreciate in value.