Loans in Foreclosure at Record Highs Into 2013

The real estate market is in a choke-hold which won't be released until 2015-2018.

Foreclosure House in Tampa

A homeowner loses his house to foreclosure and trashes the entire place before leaving. Wonder if they also took a dump in the basement?

Congressional Panel Says Foreclosure Program is a Failure

What a surprise.

Study: No Housing Recovery Until 2015

The numbers referenced in this study jibe with my opinion but that worries me. The crowd is never right when it comes to things like this so I might have to push my recovery date further out into the future.

Homosassa Foreclosure for $11K

I'm not in the market but if I were, I'd buy the following Florida property just for the hell of it. I'd never live in the house but I'd probably rent it out and attain the status of landlord.

Foreclosure, Have Americans Given up? How to fight back today

Jiggaboo Jones layin' it DOWN, son.

Foreclosure Bullies

Bullies... they're everywhere. Must be the new reality we're living in.

Home loan modifications lead to foreclosure

From the producer

   This was an in-depth news story I did about three families who found themselves in danger of losing their homes to foreclosure after applying for a home loan modification through their lenders. The families believe that it's in the lender's best interest to have a home go into foreclosure than give a homeowner a modification. This is a practice that's called "parallel foreclosure".

(Side note: I also edited this piece)

The New Face of Foreclosure

A local news story from Minnesota regarding the foreclosure mess.

The Noise Continues

   Some headlines that blipped on my screen this morning are in bold below and my commentary follows:

* Expectations of Aid for Ireland Lift Global Markets
   The bailout was never in doubt. The only people who thought that Ireland's "debt crisis" would be allowed to create another contagion were the amateurs. The patzers. The ones who haven't a clue as to how the game is played.

* Foreclosure class actions pile up against banks
   Noise. Someone turn it off already. Stop feeding the lawyers, stop borrowing against your home equity, stop the greed, stop the handouts, stop the bailouts, and definitely stop the blame. All this is noise though. Just another distraction to keep the money in play.

* GM is back: Good news for taxpayers, investors
   Whomever wrote this headline shouldn't be in the news business. I'm talking about the real news business and not the business of misdirection, thought control, and utter stupidity ('ello, Huffington Post). GM isn't good for taxpayers - GM swallowed up $50 billion in aid and the IPO is going to net about half that. The government gets the proceeds of those shares they're selling and none of it is going to taxpayers. So, how is this "good news" for taxpayers or is the headline writer just blowing smoke? As for investors, okay sure GM provides another mindless trading stock to play but it's not an investment. It's all noise though. Just another distraction to keep the money in play. See the theme here?

Panama City Beach Luxury Home Foreclosure of the Day

   Youtube has become the spamming ground of choice for businesses seeking to gain exposure for the products that they sell. I look at the daily foreclosure offerings from time to time and this one caught my eye. As an added bonus, a midi version of Lady Gaga's "Poker Face" kicks the video off. From the video's sparse description:

"2,700 square foot home in The Preserve coming on the market in Panama City Beach, Florida."

   The guy in the video mentions that the house was built in 2005. That was the height of the boom when cheap construction materials were used to build homes as soon as possible to fill demand. Were substandard materials used to build this house? Who knows. I know I wouldn't buy a house that was built in the past 10 years. The house looks okay from the outside but the dining room that they show isn't a selling point with its green walls and droopy hanging light from Home Depot.

Foreclosure activity up across most US metro areas

   From an AP article today:

LOS ANGELES (AP) -- The foreclosure crisis intensified across a majority of large U.S. metropolitan areas this summer, with Chicago and Seattle -- cities outside of the states that have shouldered the worst of the housing downturn -- seeing a sharp increase in foreclosure warnings.

California, Nevada, Florida and Arizona remain the nation's foreclosure hotbeds, accounting for 19 of the top 20 metropolitan areas with the highest foreclosure rates between July and September, foreclosure listing firm RealtyTrac Inc. said Thursday.

Those states saw housing values surge during the housing boom years. When the boom ended, values collapsed and foreclosures soared.

   I feel like I'm beating a dead horse when I state that the "foreclosure crisis" won't be over for at least another 5 years and recovery in the real estate market won't arrive until 2018-2019. I know that seems like a long time but this is how financial crises work. They take time and they burn up huge amounts of wealth before they're contained. While the foreclosure crisis is resolving itself over the next few years, the economy will continue to get stronger and the stock market's going to go ballistic. The seeds of the next boom have already been planted and all it's going to take is time. Most people don't have the patience to wait nearly a decade for all this to happen but my advice is to continue working at your job (if you have one), invest monthly, take care of your family, and watch for the boom to happen right before your eyes.

How the Foreclosure Fiasco Threatens the Economy

^^ Another doom and gloom article, this time from US News and World Report. The first paragraph starts like so:

http://finance.yahoo.com/news/How-the-Foreclosure-Fiasco-usnews-610419413.html?x=0&sec=topStories&pos=8&asset=&ccode=
It might seem like a respite for struggling homeowners, but the sudden snags and slowdowns in thousands of foreclosure proceedings could prolong the housing bust well beyond its fifth year--and spell deep trouble for the broader economy.

   The broader economy's already in recovery mode and it'll soon be galloping along like a stallion despite the stumbling banks, the struggling homeowners, and the snarky foreclosure proceedings. America's like an engine that might sputter every now and then because of overheating but once it's been sufficiently cooled and lubricated, it's going to purr like a kitty kat. Yeah, I believe in America and the resourcefulness of our citizens and workers. Watch with me and see how the economy rebounds in the next few years. When the country is basking once again in the spotlight, we'll reminesce about how awful 2008-2010 was. When it's 2015 and the economy's hotter than the Alabama sun at noon, I'll probably be preparing for the next bust because by then, the engine that is America will be reaching for another critical temperature event.

Bank of America starts thaw in foreclosure freeze

   Remember the foreclosure moratorium that was mentioned last week? Remember how some people thought it was seriously going to be considered by the banks? Well, there won't be a moratorium and BAC is already restarting their foreclosure machine after halting it in 23 states. From an AP article published today:

"Bank of America said Monday that it plans to resume seizing more than 100,000 homes in 23 states next week. It said it has a legal right to foreclose despite accusations that documents used in the process were flawed.

Other major lenders have yet to say whether they will follow suit and resume foreclosures in the 23 states that require a judge's approval. But analysts said they expect the move by the nation's biggest bank will mean other lenders will proceed with a wave of foreclosures that have depressed the housing market.

Banking analyst Nancy Bush of NAB Research said other lenders are likely to follow because foreclosure practices were similar from bank to bank."

   On the back of that news,  bank shares rebounded today. Am I buying the banks now? Nah, not yet. If I'm late to the banking party, so be it but as mentioned last week, I buy on strength. If the banks are going up, they're going up by a lot more than what they've shown in the past year and there's always time to take a bite out of the impending move once it's in motion.

A House in Maine kicks off Foreclosure Freeze

   A woman named Nicolle Bradbury lives in the house in Maine that set off the current furor over the foreclosure mess that the banks find themselves mired in. The NY Times captures her case like so:

http://www.nytimes.com/2010/10/15/business/15maine.html
"Nicolle Bradbury bought this house seven years ago for $75,000, a major step up from the trailer she had been living in with her family. But she lost her job and the $474 monthly mortgage payment became difficult, then impossible.

It should have been a routine foreclosure, with Mrs. Bradbury joining the anonymous millions quietly dispossessed since the recession began. But she was savvy enough to contact a nonprofit group, Pine Tree Legal Assistance, where for once in her 38 years, she caught a break." 

   That break came in the form of a retired lawyer named Thomas A. Cox who was volunteering at Tree Legal. Cox exposed the shoddy paperwork that GMAC was using to evict Ms Bradbury and eventually showed that all of the banks were using the same shoddy paperwork and questionable tactics to foreclose on borrowers.

   This type of laxity on the part of the banks shows me that there's no leadership at the top. The troops look to the leadership for guidance and structure but what happens when there's no leadership to begin with? Well, just look at the sorry state of banks like Citi, BAC, and GMAC for the first clue. Are we really in 2010? Is this still America? Feels more like the old times I've seen in movies where banks did whatever they wanted and kicked widows and orphans to the curb with all the might of a grizzly old sea captain. Shit's depressing.

Wall St blames homeowners in foreclosure fiasco

   I'm ambivalent on the opinions of Wall Streeters who scalp their earnings and profits from the backs of the general population whom they despise. Okay, maybe that was harsh but it's true. People in positions of power don't find the unwashed masses agreeable. That's why the ultra-rich and nouveau-riche build fences and gates around their estates and seclude themselves in protected enclaves to huddle with their own kind. In a Reuters article titled "Wall St blames homeowners in foreclosure fiasco,"  I have to grudgingly agree with the following statement:

"Wall Street's reaction to the allegations that some banks cut corners while foreclosing on 3 million homes since 2007: Pay your mortgage in the first place.

Those on Wall Street, however, are largely unsympathetic, insisting that possible errors in the foreclosure process are beside the point, that the process begins only when a borrower starts missing mortgage payments."

   It's true that the foreclosure process only kicks off when a borrower misses payments but should it really just be business as usual without regard as to why the borrower has missed payments? I understand that altruism isn't part of the Wall Street vernacular and it's a shark-eat-shark world out there but a part of me feels there should be a little more compassion and a willingness to work with borrowers. That won't ever happen though because banks are huge corporations and once they get that big, they lose their humanity and become more machine-like even though it's still humans that operate within the corporation. What's the primary driver of corporations? Profit. Greed. Avarice. It's as simple as that and the reason why robo-signers, foreclosures, and the whole dang real estate mess ignited into a conflagration in the first place.

Bank shares drop on foreclosure woes

   Banks can't get out of their own way but I like it. Earlier this morning, shares of JPM were down 3.2%, BAC down 5.5%, C down 5.4%, and Wells Fargo was dropping 5%. Will they go lower? Yes, I think so. Although it is unlikely that a moratorium on foreclosures will be instituted, the fear of such a stoppage is going to weigh on shares in the short term. I've mentioned before that a moratorium won't happen but not everyone knows that. These weak hands flee on any sign of trouble and their selling presents opportunity.

    This doesn't mean that traders should blindly buy when trouble rears its head however. I've mentioned before that I prefer to buy shares on strength instead of weakness. With the bank shares sliding, I'd take a wait and see approach before starting any positions but I like the banks for trading. I'd never hold them long term however because they blow up every now and then and destroy capital like nothing else.

Foreclosure Fraud: It's Worse Than You Think

^^ That's a headline from a CNBC article today. The writer assumes that the reader doesn't know how bad the "Foreclosure Fraud" has become but I know. I've looked into the hearts of men and I have found unbounded greed, lust, and a thirst for vice. Think about it this way: As bad as someone tells you something is, multiply it by 5 to get the true reality of the situation. Sometimes you have to muiltiply it by 10 depending on how good a liar the official in charge is.

   Where do we go from here? Now that the writer Diana Olick has told us how bad it is, what happens? Well, nothing really. Facts and figures don't make things happen. What does make things happen is greed, lust, and a thirst for vice. The country will slog through the mortgage and foreclosure mess for a looooong time until someone figures out a way to make money from all this crap. Once that spark is ignited, action will be taken, swamps will be cleaned up, and things will get moving again. Until then, the reality will be like molasses. Slovenly, syrupy, and slow to move.

How Banks Can Fix the Foreclosure Crisis

   Daniel Gross has written an article for Yahoo Finance which states that banks can "Fix the Foreclosure Crisis" by doing the following:

"Jamie Dimon of J.P. Morgan Chase, Brian Moynihan of Bank of America, and other banking CEOs willing to show their face in public should call a press conference today and announce their intention to hired 50,000 people to deal with all aspects of the foreclosure crisis. They should hire processors who will actually read the legal documents, but also professionals to work on debtor counseling and modification, landscapers to mow loans of real estate they own, and security guards who will ensure that repossessed homes aren't stripped or occupied by squatters."

   Does Daniel Gross live in a fantasy land where 50,000 people can be hired and marshalled into a foreclosure force capable of efficiently going through the muddle that is the American real estate crisis? How long will it take for the banks to train those 50,000 people and ensure that the foreclosure process is performed in admirable fashion? My estimate would be at least 3-5 years and banks aren't going to invest the capital and time for that. In the eyes of the banks, hacking and slashing people out of their homes should be quick and painful. Daniel goes on in the article to state the following:

"Doing so would help put a small chunk of the underemployed workforce back on the job.  It would be a bold, public gesture that might spur other companies to hire. It would demonstrate to courts and politicians that the banks are finally getting serious about getting on top of the problem. Perhaps some of the newly employed will use their wages to stay current on their mortgages, and the banks can certainly afford it. Fifty thousand people at $50,000 per year comes to $2.5 billion. J.P. Morgan Chase earned $4.8 billion in the second quarter. In other words, it would cost the industry about what one of its leading members makes in seven weeks."   

   Since when was altriusm part of any banks' business model or vernacular? I found this sentence particularly laughable" "It would be a bold, public gesture that might spur other companies to hire." HAHAHA. Daniel, you do live in fantasy land. Can I join you and look at the unicorns and rainbows? Daniel insinuates that just because banks hire people, other businesses like Dunkin' Donuts, Saks Fifth Avenue, and British Petroleum are going to start hiring people too. Damn, that's the kind of logic that writers for Yahoo are capable of? He even works out the equation for hiring 50,000 people and then multiplies everyone's $50,000 in annual wages to come up with $2.5 billion in total wages. This guy is a simpleton of the highest order and he can't be taken seriously. I'm done with this guy and his future articles will be shitcanned immediately.

White House doubts need to halt all foreclosures

   That headline up there is from an AP article today. First off, who is proposing a "need to halt all foreclosures?" A few paragraphs into the article, we find one of the culprits who are calling for a moratorium:

"Rep. Debbie Wasserman Schultz of Florida, a top House Democrat, said she backed a foreclosure moratorium and government talks with the banking industry to concoct ways to let lenders reshape troubled mortgages. She said the foreclosure problem has been "extremely vexing" in her state."

   I'm not going to blame her for being a woman. I'm not going to blame for her being stupid. I'm not even going to blame Debbie of being self-serving in the face of her proposal. I'm not going to do any of those things because there simply won't be a moratorium. It really is that simple. Why belabor or argue a point when I know that nothing will come of it? Debbie, you're going to get some votes and nods from constituents but that's pretty much it. Well, the banks probably won't contribute anything to your next campaign but you'll probably make it up from the donations provided by impoverished homeowners who are facing foreclosure. Yeah, that's the ticket.