Hmm, wasn’t this housing bubble crap supposed to be slowing down? Guess not. The foreclosure numbers for last quarter are twice as bad as last year according to the new numbers from RealtyTrac (a firm that tracks foreclosure filings.) 1 in every 171 households nationwide was foreclosed on, received a default notice or was warned of a pending auction in the second quarter of 2008. Bloomberg says this is an increase of 14% from last quarter and an increase of 121% from this time last year.
What does this mean for you? Bank seizures, the final “worst case scenario” of the foreclosure process, depress the values of surrounding properties. One analyst quoted by Bloomberg estimates that 25 million homeowners have properties that are in danger of being worth less than they owe on them.
Bank seizures in the first half of the year increased by 154 percent to 370,179 from the same period in 2007, RealtyTrac said. Last year’s second-quarter data on bank repossessions was not available, according to RealtyTrac.
Forty-eight of 50 states and 95 of the 100 largest U.S. metropolitan areas had year-over-year increases in foreclosure filings in the second quarter, RealtyTrac said.
U.S. Foreclosures Double as House Prices Decline [Bloomberg]
(Photo: Getty)
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@Bladefist: “General welfare to some might be, provide me a car, a house, and spending money. To others it could mean, socialism. To others it could mean walk around w/ a smile.”
HA!
While your at it some people think having the government record all of their phone and electronic communications is reasonable search. So since it is a reasonable search the 4th amendment doeen’t apply.
“Lets not over analyze. “
This directly impacts with the “Life, liberty and the pursuit of happiness” that is in the United States Declaration of Independence.
So Yes even as far back as BEFORE the founding of the United stated and the current constitution the government ahas been involved in regulating property and housing law.
@Bladefist:
Exactly. An appraisal is a judgment that banks use to asses the risk of a loan.
Banks are not guaranteed that home prices will stay the same or rise just the same as consumers. However if the house is worth close to what the home is appraised at the bank will come out ahead.
In a world where banks don’t get bailouts banks will work for fair and accurate appraisals of home prices.
The regulation that I’d like to see is that a bank issuing a mortgage is required to keep at least 51% so that they are vested in the the property and there is a legal entity that can negotiate contract changes if need be.
@Bladefist:
While I disagree with this type of directly personal attack (really, if you dislike someone that much, ignore them, don’t talk about beating their brains in, especially over the internet), I still think you’re completely wrong.
Technically, Bush should be impeached and tried for starting a war on a (several) completely false premise(s). Technically, Tricky Dick II should be in jail for CIA leakage. Technically, Karl Rove should be there too.
@Bladefist:
how come your definition can mean “anything” and tinybugs’ can’t?
“Pursuit of happiness”, to you, includes buying a house you can’t afford and getting booted from it, but “promote the welfare” doesn’t include regulation? you bet it can.
Regulation isn’t punishment. It’s INTENDED to create a “fair” environment for said business. It INTENDS to …..promote the welfare…
Now. whether a specific regulation does that or not is a separate issue.
In the end of all of this, no matter how you slice it, or who you blame, tons of people on both sides (lender/borrower) pushed the limits of sanity, morality, and even in some cases legality for cash.
You can have your technical definition of a recession and run with it for now if you want. Who knows, maybe we’re fine-ish. The current “trends” that nags me the most are 2 things:
1. Incomes have not risen with inflation over the past 8 years.
2. The separation of wealth that we have today has not been seen since the Depression.
I don’t know exactly what that means or how that impacts us right now or in the future, but it does make me think of the massive debts creeping around the economy in all different places.
@Techguy1138: Well, that depends on whether the market is going up or down, now doesn’t it? An appraisal might be accurate at the time, but then the house could lose 25% of its value the next year if the market goes down. If down payments are required, the risk is much less.
But yeah, I agree with your other proposed reforms. Part of the problem seems to have been that banks were profiting from making bigger mortgages and then securitizing the loans and passing the risk off to someone else. This broke the system that provided a larger incentive for them to not make bad loans.
@johnva: That is exactly where I see the problem also. People have always been irresponsible.
In the past banks had incentive to not give them money.
Now they profit greatly by making loans well beyond the value of the collateral to people who can not repay them.
The market would have less bubbles if the banks had to determine what the future market risk would bring.
Apparently the ungrateful slugs who got an “Extreme Home Makeover” home, decided to take out a $450,000 home equity loan on it, are facing foreclosure, and if that isn’t skuzzy enough, I heard on the news today that it seems to be “going away” after they talked to the bank. ARGH! [www.accessatlanta.com]
The problem with housing is they cost too much.
Ok Bladefist lets look at the things that have been “de-regulated” or have been “free-marketed” by the republicans.
Health-care
Housing
Banking
Energy
Business practices
Business taxes
Lobbying
Election rules
the constitution
Wow all these are in great shape right now. I am sorry you have bought in to 30 years of Republican propaganda (democrats aren’t any better) But you have to admit ALOT of the issues we have now can be directly attributed to a Republican.