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alstry (35.42)

Fannie MURDERS Condos!!!!!!!!!!!!!!!!!!!!

Recs

16

March 18, 2009 – Comments (7)

From Tonight's WSJ: 

Just as a flood of new condominiums are scheduled to hit the housing market this year, Fannie Mae has added restrictions making it more difficult for developers to sell their units.

The government-backed mortgage-finance company stopped guaranteeing mortgages in condo buildings where fewer than 70% of the units have been sold, up from 51%. In addition, the company won't back loans for sales in buildings where 15% of current owners are delinquent on association fees or where more than 10% of units are owned by a single-entity.

The new policy became effective March 1, and most lenders have started to implement Fannie's guidelines....

Still, condo developers say the rules may hasten the failure of countless buildings across the country and seem to be at odds with federal efforts designed to speed along a housing-market recovery. "These buildings are just in purgatory. This new requirement is the straw that's going to break the back of a lot of projects," says Norman Radow, an Atlanta real-estate investor who works with lenders to rescue distressed condo complexes. "It's a weight being tied to a drowning industry."

Moreover, Fannie and Freddie are both set to increase fees on condo buyers next month. Buyers without at least a 25% down payment will have to pay closing-cost fees equal to 0.75% of their loan, regardless of the borrower's credit score. The companies say these fees are necessary to protect against higher default rates.

The changes come as cities brace for a new flood of condo supply. Reis Inc., a New York-based real-estate firm, estimates that 93,000 new condo units will be completed this year, a 28% increase in new inventory from last year. More than 12,000 units will be completed in New York and northern New Jersey by year's end. Chicago will add 5,500 units, Seattle has 3,000 units coming online, and Los Angeles is readying 2,600 units, according to estimates provided by Reis.

GOOD LUCK TRYING TO SELL A CONDO NOW!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Aren't we trying to make it easier to get a loan??????  What happened to bailing out the homeowner.......how many building do you think 15% of the owners are delinquent on association fees.

Let's just BANKRUPT EVERYTHING and EVERYBODY right now and get if over with QUICKLY...including the banks....this slow death march is going to drive the nation into a Spector Vector downward trajectory uncontrollable frenzy.  If the banks are the only ones getting bailed out, they are going to foreclose on everthing and everyone and own the ENTIRE nation as all go broke.....maybe that is what Geithner wants after all??????

If you are an employee you have a good chance of getting fired.  If you own a business, there is a strong liklihood your customers won't pay you and you may be forced to shut down.  If you own a shopping center, tenants are likely to go out of business destroying your cashflow.  If you own a credit card, there is a good chance of getting your limit cut and FICO score reduced or interest rate raised.  If you own a condo, good luck selling it now after the NEW guidelines.  If you have a wage contract with a city, you could get a pay cut.  If you are an exectutive for the Largest Insurance company in the world and help bankrupt it.....you WILL get a bonus for millions.

Now do you see why I say Prepare?????

 

7 Comments – Post Your Own

#1) On March 18, 2009 at 12:57 AM, StatsGeek (29.26) wrote:

This was written in 2005!!!!!!!!

http://eldoradogold.net/Edwin%20Vieira/vieira_bank_crisis.htm

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#2) On March 18, 2009 at 1:04 AM, alstry (35.42) wrote:

Stats,

And some say ALL lawyers are parasites???

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#3) On March 18, 2009 at 1:17 AM, StatsGeek (29.26) wrote:

The more I educate myself about our economic and political system, the lower my target for the market goes.

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#4) On March 18, 2009 at 1:19 AM, alstry (35.42) wrote:

My guess is that it is still not as low as mine;)

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#5) On March 18, 2009 at 1:25 AM, MikeMark (29.39) wrote:

Thomas Jefferson was concerned that the people of the USA would end up being manipulated into trading everything they own to the banks if a central bank ruled over the money. That's why the Constitution requires Congress to coin the money. That's also why the money is required by the Consitution to be based upon gold.

So sorry we failed you Tom.

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#6) On March 18, 2009 at 1:50 AM, alstry (35.42) wrote:

THE BANKERS WERE SELLING FINANCIAL CRACK!!!!!

From tonights WSJ:

"Covenant-lite" loans, a hallmark of the buyout boom, were supposed to give private-equity owned companies the flexibility to ride out a recession. The ride is now getting very bumpy.

Nicknamed for their loose loan requirements -- "covenants" in banker-speak -- two big-name covenant-lite deals are showing signs of stress, underscoring the pernicious effect this recession is having on companies that borrowed money on even the most lenient of terms....

Covenant-lite loans grew to almost 19% of all bank debt outstanding, from about 1% at the beginning of 2006, according to Standard & Poor's Leveraged Commentary & Data. Buyers of Freescale Semiconductor, Neiman Marcus and Aramark Corp. all used the loans to finance their acquisitions.

THIS IS THE CRAP THEY WERE BOOKING AS PROFITABLE AND TAKING HUNDREDS OF BILLIONS IN BONUSES FOR SELLING THIS NONSENSE.....NOW WE ARE WAKING UP TO FIND OUT THE WHOLE GAME WAS A PONZI SCHEME....

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#7) On March 18, 2009 at 8:27 PM, sarahchang (< 20) wrote:

So the condo industry collapses: so what? It's riddled with corruption, conflicts of interest, faked credentials, arrogant boards, arrogant management firms ad nauseam.

To give just one example: the Arthur Edwards Firm operates in NJ, PA and New York. It's President claims the PCAM(the HIGHEST and most difficult to obtain credential given by the Community Associations Institute (CAI). The President, ed frank, of the firm does NOT have this credential. Neither does his stooge, allen dvorkin. You can verify this for yourself merely going to the CAI website and doing a search. Furthermore this firm has a Better Business Bureau rating of F -- the lowest rating possible; the highest rating possible is A+)

  And if you do a Better Business Bureau search of other management firms listed by CAI -- many, many of them also have an 'F' rating.

   The industry should collapse, and the faster the better

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