Buyers return to market after foreclosure

Mandor March 20, 2013 I would not want a mortgage default to stay with you forever. If someone loses their job and simply no longer has the income to pay the mortage, but they`ve sold darn near everything and depleted their savings... hey, they tried. They still failed, and should be carrying the credit hit for a decent amount of time... but not forever. Still. Two years? Seems a bit quick. I would have figured 7 years minimum of trying rebuild credit and convince lenders that they`re worth of another shot, AND, I would have figured when they could get another mortgage, the interest rate would not be kind. As long as they`re being lent to by private lenders, hey fine, not my business if someone wants to make a bad bet. If it`s coming out of taxpayer money, they it really does kind of stick in my craw that they can wipe the slate clean that fast. It really does tend to make you feel like a sucker if you`ve been living a life of modest means and being responsible the whole time. 53 1 Reply

Dan Mandor March 20, 2013 Agreed. If a private bank wants to lend money to someone that has only walked a block away from their last mortgage, I`m fine with that. What I`m not ok with is insuring those mortgages with public money. Dan 42 Reply

Doglover77 Dan March 20, 2013 Dan, these people are jumping back into home ownership because the mortgage rates are being held artificially low at the cost of the savers. Any society that punishes it`s savers to reward people (with bailouts and near zero interest rates) who got our country into this mess, both in housing and Wall Street, deserves to die. 17 Reply

Dan Doglover77 March 20, 2013 I agree. But if a bank were to actually loan to a person, that just defaulted on their last house, without the express backstop of Uncle Sam, the rates that bank would charge would be substantially higher... ...Making our liquid savings rates much higher in the process. This government sponsored, "Everyone has a right to a house" mentality is killing us. Dan 17 Reply

G8KeaPoR Dan March 20, 2013 "without the express backstop of Uncle Sam, the rates that bank would charge would be substantially higher" That`s the way it should be. These people should be paying +20% 11 2 Reply

Doglover77 Dan March 20, 2013 Then, instead of aspiring to be a banana republic with nukes, we could begin to catch up with Germany, a country which rewards it`s savers. 2 Reply

Darrel Crayon Dan March 20, 2013 The official rule is 3 yrs for FHA (*these loans carry new hefty mortgage insurance premiuims for life) after a foreclosure, 2 years after a BK (no foreclosure) Fannie/Freddie 4 years after BK, 7 years after foreclosure, so the logic is if you have had a foreclosure and want a Gov loan, they will now insure that loan for life , unless you pony up 20% and wait 7 they limit their down side so not as easy but certainly not the kiss of death that the teapartiers would like 1 Reply

peace Dan
March 17, 2013
It depends of whether the borrower was truly caught in the bubble or if they caused their own foreclosure due to multiple refinances and home equity loans. The latter kind of irresponsibility hurt all responsible homeowners and I would not want people in the market again who could adversely affect my retirement savings by destroying my home value. I truly feel sorry for the ARM buyers who thought they could refi without PMI when they reached 80% equity because they were told and sold that their home values would rise. Those people bought in good faith at the wrong time and were lied to by their bankers. At any rate, cleaning up the inventory on hand will help current homeowners and hurt those wanting to get into the market. 0 Reply

comoncents7 Mandor March 12, 2013 Here is my plan and let me know what you think. And I`m dead serious. I bought a house in Florida six months ago, my payment is 1500/mo. I`m thinking about stopping making payments, you can live in your home for about three years in florida before you are evicted. I can save the 1,500/mo or 18,000/yr, which would be about $54,000 (nice little chunk of change). I might put this money in an off shore account or something to avoid big brother gettin their hands on it. The house is under my credit only so I can always get another mortgage under my wifes credit ( we r both nurses and make about the same money). So I wouldn`t have to even wait the 3 years. If it goes well I`ll probably due the same thing to her credit and then we will have $108,000 cash money. My credit score right now is about 780 so I figure heck I probably won`t even drop out of the 700`s. Someone please tell me where I`m going wrong here. 2 1 Reply

Mandor comoncents7 March 12, 2013 Tactically, nothing wrong here at all. Morally, quite a bit. Proceed as you will. 6 Reply

San Adalberto comoncents7
March 14, 2013
"My credit score right now is about 780 so I figure heck I probably won`t even drop out of the 700`s. Someone please tell me where I`m going wrong here." Your credit will take a bigger hit than you anticipate. 0 Reply

James Sentry Mandor March 12, 2013 Oh, get over it, and by the way, get back to work. 0 1 Reply

repealobamacare March 20, 2013 Why the h3ll are these deadbeats getting mortgages after they went into foreclosure? As far as I`m concerned, these people should be renters for the rest of their lives as they were partially responsible for the collapse to begin with. . 72 8 Reply

Health1au repealobamacare March 20, 2013 FHA is the new subprime. 17 1 Reply

Doug Health1au March 20, 2013 Hardly. You still need decent credit, fully documentable income, reasonable debt to income ratios, etc. 7 1 Reply

guesttodae Doug March 20, 2013 A 680 credit score is NOT decent, and this allowed these 2 bums to turn around and get another mortgage in just 2 years. And those of us who have an 840+ credit score and suffered through our bad times by digging in to our retirement savings to maintain a high score are PAYING for these A-holes. This country is down the tubes, there is NO incentive to do the "right" thing anymore. 37 1 Reply

twinmomma guesttodae March 20, 2013 Actually, VA is 2 years, FHA is 3. Make sure you read and comprehend before spouting off. And should a family neglect putting food on the table to pay the mortgage? Unless you`ve been there, keep your judgement to yourself. 8 2 Reply

nononsense123 guesttodae March 20, 2013 You poor thing. 2 1 Reply

James Sentry guesttodae March 12, 2013 Get over it! 1 Reply

Health1au Doug March 20, 2013 All you need is 3.5% down and a job and that`s it for FHA. 6 Reply

Doug Health1au March 20, 2013 So not true. 3 Reply

Health1au Doug March 20, 2013 See brokeroutpost. The truth is out there. 0 Reply

Doug repealobamacare March 20, 2013 So a guy that loses his job should be a renter for the rest of his life? You`re an idiot. 40 10 Reply

repealobamacare Doug March 20, 2013 A guy that walks away from his mortgage should be a renter for the rest of his life. Responsible folks took out loans against their retirement accounts so they would not default on their obligations. The problem with this country is that we do not let people suffer the consequences of their bad decisions and then wonder why people (and businesses alike) continue to make bad decisions. . 71 3 Reply

Doug repealobamacare March 20, 2013 I understand thinking that way about people that chose to walk away from their home because the value dropped, but when something unexpected happens (like job loss, illness, etc), and you do everything you can to keep your house, but still lose it, you should not be penalized for life. Not everyone has enough in their retirement account to borrow against to get through times like that. It`s unreasonable to expect every homeowner to be able to survive a prolonged period of reduced income. 34 2 Reply

repealobamacare Doug March 20, 2013 Good point, but two years is hardly a penalty. I was under the impression that it was more like 7 years. Going by age, this particular couple should have had enough in savings and retirement to dip into to cover rough times. They probably did, but took the easy way out and were rewarded for doing so. More people will be likely to bail now knowing that there really is no disadvantage to doing so. . 30 2 Reply

Dan repealobamacare March 20, 2013 Look at the calculators for any financial website. What it will show you is that everyone (aside from people just starting out in their careers) should have enough retirement savings to absorb a year or two of unemployment without having to lose the house. If you don`t, you`re either not saving nearly enough for retirement, or you bought way too much house. Pointing to people that were "laid off" or some such and claiming "it wasn`t their fault" is still a cop out. Yes, it wasn`t their fault that they lost their income stream, but the poor choices made in the years/decades prior were their fault. Finally, stop with the half-arsed medical malady tear-jerking angles CNN. First of all, the vast majority of people that defaulted in the last couple of years were *not* due to major medical issues. Yes, it happens, and it can blindside even the most fiscally prepared, but it is a cheap angle to *constantly* keep putting them under the spotlight like they are the only people being "victimized" by the system. Second of all, where was this lady`s Long Term Disability Insurance if she knew she had bad arthritis that might one day make her quit working? Dan 33 Reply

repealobamacare Dan March 20, 2013 I totally agree. . 8 Reply

James Sentry repealobamacare March 12, 2013 I totally disagree, you racist! 0 Reply

nononsense123 Dan March 20, 2013 `the vast majority of people that defaulted in the last couple of years were *not* due to major medical issues.` Youu have statistics on the cause? 3 2 Reply

repealobamacare nononsense123 March 20, 2013 If you are implying that most people that walked away from their mortgages because of health issues, I have a bridge to sell you in Brooklyn...... . 6 Reply

nononsense123 repealobamacare March 20, 2013 So what are the statistics? What WERE the reasons that people cited? 0 1 Reply

repealobamacare nononsense123 March 20, 2013 Oh yeah, let`s trust the people that walked away from their mortgages to tell the truth why they bailed. Foolio . 2 Reply

nononsense123 repealobamacare March 20, 2013 Oh. So we should just trust your negative judgement, based on no data you are willing to cite? 0 Reply

repealobamacare nononsense123 March 20, 2013 Burden of proof is on you. Where`s your data? . . . Crickets . . . About that bridge...... . . . 3 Reply

nononsense123 repealobamacare March 20, 2013 No it isn`t. I didn`t make any sweeping claims like you did. 2 Reply

San Adalberto Dan
March 14, 2013
I think it`s great that everyone gets large amounts of surplus money to put into retirement accounts, and that these accounts are invulnerable to collapsing markets. I also think it`s fantastic that everyone can afford the best insurance to carry them through illness and injury. What a country! Unfortunately, I live in the United States where this is not the case. 1 Reply

Auto 101 Dan March 20, 2013 I argree that many put the blame of how there life was ruined by one avent. However they don`t look at how to fix it. When we got married we had 90K of debt and then we bought a car that added it to 130K we paid that off in 4.5 years and had two children. 1 2 Reply

MikeSL Auto 101 March 20, 2013 130K in 4.5 years means you`re paying off at a rate of 29K per year (or $2,400 per month). This is on top of all living expenses (food, rent/mortgage, utilities, etc...) and health insurance, gas, car insurance, etc... Either you made enough to be in the top 20% in which case your story doesn`t correspond to the rest of us, you lived in a cardboard box and ate ramen for 4.5 years, or you`re making this up. I call the last one. 3 Reply

Joe Smith repealobamacare March 20, 2013 It`s so easy to make judgements without having any of the details regarding their financial position, health (although that was mentioned in the article), or family commitments, isn`t it? 10 2 Reply

Dan Joe Smith March 20, 2013 No more difficult than it is to claim that everybody that has defaulted has done it for reasons that are completely out of their control. Dan 5 Reply

nononsense123 Dan March 20, 2013 Or to claim that evreyone defaulted because they are deadbeats. 2 1 Reply

Brian Mathies repealobamacare March 20, 2013 I think it depends on the situation. None of this is cast in stone. 4 Reply

ME Doug March 20, 2013 Perhaps if people would have a savings plan for a future energency instead of spending every time they make and getting all the brand new stuff they think we need, people would be able to take responsibility for their actions. Most people do not default only becuase their house becomes too expensive for them. Its all the other debt they have at the same time that creates the problems. 0 Reply

Joe Smith repealobamacare March 20, 2013 I have one very simple question. Why is it that when a business takes out a loan, with property as collateral, and the management of that business decides that it can`t afford the loan any longer, it`s perfectly all right for the business to just stop making payments on the loan and let the lender take the collateral, yet, when an individual is in the same situation vis a vis their home, they`re deadbeats who deserve to be vilified? 20 2 Reply

repealobamacare Joe Smith March 20, 2013 You can`t use a property you don`t own as collateral. Do you even know what collateral is? It is the LACK of collateral that makes it easy for DEADBEATS to walk away from their mortgages. . 4 Reply

John Canaday Joe Smith March 20, 2013 The businesses are also deadbeats. Just try to get a small business loan in this market with a perfect payment record. Much less with any dings. Big business loans, you are correct. 4 Reply

Marla Fugate DeJarnette repealobamacare March 20, 2013 Your assumptions about millions of people across the united states who lost their homes 06-09 can not be all inclusive in your plan that we all should be doomed as renters the balance of our lives surely! I loved my home. I had a beautiful 1300 sq ft house in Columbus, OH. I was on a 2/1 buy down mortgage. At the third year my house payment was still within my own income. By the 4th and 5th years I added a fence and a beautiful deck and hot tub. Had the prettiest flower garden in the subdivision. I also added a second income by way of a husband at the 3rd year. Now, the mortgage including deck, fence and hot tub was more than my sole income, however, no worries cause I`m a two income family! UNTIL, in the 6th year I caught my husband cheating and filed for divorce. The small amount of equity that was in the house coupled with a subdivision that was not completed when the housing market busted prevented the sale of the house. On the market for 18 months. Got a land contractor for 12 months who screwed off after 11 months. Divorce agreement is he will move back into the house and pay mortgage until house sells. He moved out two months later-without my knowledge. I live in a different city, but house is in MY name. Foreclosure killed me. I absolutely tried everything to avoid it. Now tell me I should rent all my life. 3 1 Reply

repealobamacare Marla Fugate DeJarnette March 20, 2013 − Hello - I am sad to hear your story. But nobody forced you to take loans out for a deck, fence and hot tub. I bought a house that could be easily paid with one income, and any improvements were done with 100% down - no monthly payments. When the kids came and it was time for bigger home, we kept the first one as a rental and followed the same formula for buying the new home. We lived in the small home for a long time until we had a substantial down payment on the bigger house. Of course, the realtor and mortgage companies told us we could finance a lot more than what we were looking at, but we kept to our conservative estimates. Over the years me and wife have endured three layoffs, two career changes, health issues, etc. I am not gloating, but trying to sell the idea of economic conservatism. It works every time.

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