Wednesday, February 03, 2010

Mortgage Lenders Aren't Gonna Take It...Anymore!

Channeling Dee Snyder - Mortgage lenders say they're not gonna take it...anymore.



Here in Northern California, we've been housing outcasts for awhile. We were weirdos for renting throughout the housing boom. Now, we're weirdos for a different reason - we're not walking away from our mortgage.

It's the latest trend, and it's getting hotter. Why make mortgage payments when you're down a cool few hundred grand on your digs?

But now, mortgage lenders are fighting back! From CNNMoney:

As terrible as it is to lose your house to foreclosure, at least it's a relief to put your biggest financial headache behind you, right?

Wrong.

Former homeowners may still be on the hook if there's a difference between what they owed on their mortgage and what the bank could sell it for at auction. And these "deficiency judgments" are ticking time bombs that can explode years after borrowers lose their homes.

It can even happen to people who got their bank to approve them selling their home for less than it is worth.

I read today, I believe in the Daily Reckoning, that two-thirds of homes in Nevada are underwater. Two-thirds!

This is not going to end well. Get yourself some gold, sheep, guns - and of course US dollars - and get ready for the next shoe to drop.

Ed. Note: Why US dollars? Because the dollar's fate is driven by global liquidity flows, which are starting to dry up once again.

1 comment:

peter2o10 said...

It remains to be seen if this was the turning point or if it is coming down the road.

I've been trading for about a year but I have always been a fan of Economics.

What is absolutely frightening is how the crowd can be so wrong but exhibit extreme aggression when challenged on their opinions. If these are human beings, I fear that this could extend beyond the financial markets.

This is frightening.

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