Shadow Inventory: 1 in 5 homes are underwater and current on payments

HOME PRICES SET TO DROP AGAIN!

Editor’s Comment: You can spin this anyway you want, but the facts speak for themselves. People are worn out living under mountains of debt, some need to move for job purposes, and some need to reduce their payments because they are running out of resources to pay a mortgage balance that is based upon a valuation that was never valid in the first place.

With no proper redress of grievances from government despite thousands of cases showing that the banks were engaged in the largest economic crime in human history, these people will be forced to make the decision of strategic default — albeit on loans that are probably invalid starting at origination for reasons expressed in most of recent articles.

As pensions get slashed, household income continues to drop, wages are cut and expenses rise, it is fantasy to think or believe that most of these people won’t eventually walk from their homes, grieving over their loss of lifestyle and loss of social networks built up over years or even decades where homeowners were scammed into refinancing their homes based upon fraudulent appraisals.

The goal of the banks in pushing foreclosures is obvious. They are not stupid. The lower they can get housing prices, the less it will cost to buy them and the more profit they will get when they sell or rent them. Where they are mistaken is that they seem to believe that the bottom is near, and that their profits from these foreclosures will materialize anytime soon. True, since they were neither the lender who funded the loan nor were they the purchaser who bought the obligation, note and mortgage, whatever they get is profit — the ultimate “free house.”

When you combine the huge numbers of homes where the homeowners are declared delinquent or in default and combine those with the even larger number of homes where the owners simply cannot stay, there is nothing other than an over-abundance of supply and an underwhelming number of people who are willing or able to buy.

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Tags: fraudulent appraisals, home prices, housing, shadow inventory, underwater
Posted in bubble, Corruption, Eviction, securities fraud |