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March 31, 2008 – Comments (6)

What'll happen to all those contracts out there, all the sales prices, and all those mortgage-backed securities if uppity local politicians decide to stop selling foreclosed homes?

We'll probably find out.

Authorities in Philadelphia will suspend foreclosure sales of homes whose owners have fallen behind on adjustable-rate subprime loan payments -- potential relief for tens of thousands of struggling debtors. 

(via HousingDoom...)

And hats off to Reuters for using the proper term, "debtors" instead of the inaccurate and emotionally-charged "home owners" that other media insist on when writing these stories.

6 Comments – Post Your Own

#1) On March 31, 2008 at 12:42 PM, devoish (98.58) wrote:

This article includes this concern which the Reuters report missed. Green said the reprieve would give his office more time to identify predatory-lending victims. I imagine it will only be on the local 'case by case' level that the actual work of sorting this mess will finally be done.

The banks have convinced the Fed to use my tax dollars to guarantee payment of the mistake they made buying these loans. Loans that these "banking experts" never should have bought to begin with. I am ecstatic to see the Sherrifs Dept stand up and make sure that my tax liability is reduced by not allowing the banks to sneak in the crimes that some brokers committed along with the blunders.

Hooray for that!

 

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#2) On March 31, 2008 at 1:12 PM, metoo105 (28.61) wrote:

"Lenders would take about $158 million in losses; homeowners $23 million; and local government $62 million if the foreclosures go ahead, the council's resolution said."

Not sure that I at all agree with your assessment that Reuters comes off as clean here.

For instance, in the quote above, note the use of the conditional tense, which suggests to my mind that somehow the losses won't be real until they get flushed through the foreclosure process.  

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#3) On March 31, 2008 at 1:26 PM, TMFBent (99.81) wrote:

to identify predatory-lending victims.

So, what is it that defines a "predatory lending victim?" Is anyone who signed a crummy loan a "victim?" Are victims only there where there is criminal fraud? What of those "victims" who knowingly committed fraud by signing loan applications that included false statements?

This is going to get messy indeed, and I suspect that, now that prices are falling, everyone will want to be a "victim." Of course, no one was a victim when the gamble worked out from 2001-2005. Then, it was just smarts!

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#4) On March 31, 2008 at 1:43 PM, TDRH (99.65) wrote:

Hate to say it, because it will be painful, and will probably hurt the value of my portfolio, but pull the bandage off, let the dust settle and start over.  Not to be insensitive to those in dire straits but IMHO delaying the correction will only serve to extend the duration and possibly the intensity of the pain.   

Not familiar with Philadelphia's government system, but if it is similar to the one here in St. Louis they cannot even distribute driver's licenses efficiently.  What makes the officials think they can sort through this mess?   

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#5) On March 31, 2008 at 2:21 PM, devoish (98.58) wrote:

So, what is it that defines a "predatory lending victim?" Is anyone who signed a crummy loan a "victim?" Are victims only there where there is criminal fraud? It seems to me the Sherrif would like the time to answer these questions. What of those "victims" who knowingly committed fraud by signing loan applications that included false statements? I don't include them as victims. I include them as gamblers who lost.

If someone had an adjustable rate loan presented to them as fixed, or if a broker changes the borrowers stated income to get an approval, they would be victims. If my lawyer or appraiser was in collusion with my broker I could be a victim. 

It is certainly probable that some localities have a much higher percentage of victims than other areas do. If he is the Sherriff and that is what he thnks happened, I think the authority of being Sherriff gives him the right and obligation to do what is neccessary to figure it out and try to get it right. I also admire his courage because it seems that in 2004 when he was trying to prevent predatory lending abuses the Council did not support him. He is possibly the most decent guy in this mess.

JMHO.

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#6) On March 31, 2008 at 4:46 PM, ATWDLimited (< 20) wrote:

This is a debacle, but I believe we still have the credit/debt problem to deal with. which is 100x worse than the mortgage crisis, although it is a big part of it.

Come visit the The Official Dollar Report, for some important information on the future of the dollar. 

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