Real Estate News Blog July Archive

Suckered in by subprime lenders

By Art C Ryter at 07/31/07 02:48

Presents arguments for greater government regulation of the mortgage industry as subprime loan defaults are increasing forclosures. Paying poor people's loans through government bailouts to lenders so homebuyers can stay in their overpriced houses is not the way to go. The best foreclosure help is to send crooked brokers to jail and increase oversight of the mortgage finance industry.

Original source: . Suckered in by subprime lenders

Central America Might Steal the U.S. a Large Part of its Retiring Boomers

Details the benefits being offered by Central American governments to foreigners looking to retire in the next decade or so. Many Central American countries are betting U.S. baby boomers will be the generation that globalizes retirement. They're gearing up by offering financial incentives that could make retiring internationally a smart financial move for some individuals. The same advances that allow companies to do business across borders are making it possible for people to live out their golden years in another country. Countries that have good “packages” for foreign retirees are Costa Rica, Nicaragua, Panama, Belize, and Honduras.

Original source: . Central America Might Steal the U.S. a Large Part of its Retiring Boomers

Loan Spree to Come Back Against Small Banks

Until recently, banks were eagerly doling out loans to real-estate developers looking to capitalize on soaring home prices. Today, as housing markets cool rapidly, banks are starting to reappraise the collateral behind those loans, often finding that land and property values have deteriorated, forcing the lenders to take painful write-downs that are taxing earnings. Foreclosures are further deteriorating returns and there is little relief in sight.

Original source: . Loan Spree to Come Back Against Small Banks

FICO ‘08 - We Live In A Credit Score Driven World - Get Ready For A Major Change

Details the changes that will take place with the new scoring model to be presented to the three major credit bureaus that takes into account a persons individual credit and further refining the grades between people with great, good, and poor credit. All in all, your value as a consumer is increasingly placed in the faith people have in a three digit number attached to your nine digit social security number.

Original source: . FICO ‘08 - We Live In A Credit Score Driven World - Get Ready For A Major Change

Alliance Bancorp, a Mortgage Lender, Files for Liquidation

“Dunt, dunt, dunt, another one bites the dust!” Mortgage lender Alliance Bancorp filed for bankruptcy due to heavy foreclosure volume and inability to make ends meet. I’m sure that those who orchestrated the loans were handsomely paid and are sorry that the piggy bank of easy credit is now closed. More important, is what happens next to people with mortgages with the company? Do they get to keep their original loan terms or can they refinance?

Original source: . Alliance Bancorp, a Mortgage Lender, Files for Liquidation

Housing troubles begin to snowball

Portrays the financial impact foreclosures and the troubled housing market will have on the general economy. As foreclosures rise, the securities that were issued and tied to the subprime real estate and interest rate market will be hit with massive revaluations. These revaluations will bring the stock market into a slump matching the real estate slump which will lead to lower prices throughout. Hopefully some of us will finally be able to buy a house at a reasonable price.

Original source: . Housing troubles begin to snowball

26 charged in $200m subprime case

The case, filed by the US attorney's office in New York, offers a glimpse into the kinds of fraud that appear to have invaded the subprime lending market in the last couple of years and helps explain why so many recent mortgages have gone into default so quickly. Many of the accused worked in the real estate industry and so knew the ropes of inflating appraisals and other financial maneuvering. Victims are not only the people facing foreclosure, but also the lenders involved.

Original source: . 26 charged in $200m subprime case

Can’t Sell Your Home? Maybe It’s Priced Too Low

Details the interesting phenomena of affluent suburbs maintaining home sale prices despite the wider real estate downturn due to foreclosures and other effects of the subprime interest rate market. It is almost as though the real estate brokers are encouraging people to take on bigger houses and bigger loans because they are continuing to sell to better heeled buyers. If people continue to buy up, more foreclosure troubles are sure to follow.

Original source: . Can’t Sell Your Home? Maybe It’s Priced Too Low

Ex-athlete gets 5-year sentence in Ponzi scheme

Presents the case against Favata,an ex-athlete turned mortgage broker, who embezzled over $30M from investors in a Ponzi scheme linked to real estate. Favata took on new investors offering 30-60% return on investment to pay off older investors, all the while using the funds to finance his lavish lifestyle and pay the bills of his legitimate mortgage business. Scams and scammers are at every turn in this real estate market with many people facing foreclosure.

Original source: . Ex-athlete gets 5-year sentence in Ponzi scheme

Increasing Rate of Foreclosures Upsets Atlanta

Details the effects increasing rate of foreclosures have on real estate and people’s lives in Atlanta, Georgia. The main culprit has been adjustable rate mortgages which enables homebuyers to afford more house upfront than they can afford if they were borrowing on normal terms. Many more people will be facing the foreclosure crunch due to interest rates resetting at currently high rates. Foreclosure may be avoided if you can refinance at your current or lower fixed rate.

Original source: . Increasing Rate of Foreclosures Upsets Atlanta