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any advice on how to save home from foreclosing?
options that were brought up:
1. buy new house while credit is good and let the house foreclose
2. short sell to someone trustworthy
3. feds (yeah right)
have you heard of any possibilities of renegotiating the the loan in anyway?
*background: my close friend got loan with managable monthly payments for the first 5 years, where after, the payments double. i think another friend referred to it as a bubble loan or some shit.
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| Originally posted by 72hrpartyanimal any advice on how to save home from foreclosing? options that were brought up: 1. buy new house while credit is good and let the house foreclose 2. short sell to someone trustworthy 3. feds (yeah right) have you heard of any possibilities of renegotiating the the loan in anyway? *background: my close friend got loan with managable monthly payments for the first 5 years, where after, the payments double. i think another friend referred to it as a bubble loan or some shit. |
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| Originally posted by gehzumteufel Balloon payment. owned. Honestly, tell the friend to call the bank and try to get a rate adjustment or loan adjustment. If they aren't willing to do that, they have no choice but to allow the start of the process. There aren't that many options till you do. |
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| Originally posted by 72hrpartyanimal when you say the "start of the process", do you mean foreclosure? |
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| Originally posted by gehzumteufel Yep. Sad but true. |
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| Originally posted by 72hrpartyanimal any advice on how to save home from foreclosing? |
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| Originally posted by 72hrpartyanimal NICE!!! New Party Pad... hopefully... |
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| Originally posted by djGT Let's hope he didn't refinance and took some cash out (HELOC). If so, his loan becomes "recourse" and the bank can go after his assets for any deficiency from the foreclosure. Good luck with that tax bill! |
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| Originally posted by gehzumteufel lol you gonna try to buy it out from under him and let him stay there? |
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| Originally posted by djGT Let's hope he didn't refinance and took some cash out (HELOC). If so, his loan becomes "recourse" and the bank can go after his assets for any deficiency from the foreclosure. Good luck with that tax bill! |
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| Originally posted by 72hrpartyanimal i think they did. explain that one to me. |
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| Originally posted by djGT Say the loan left on the house is 600K and the bank foreclose it for 400K. Then they can send a bill to Uncle Sam and your buddy will be responsible for 200K worth of "income". |
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| Originally posted by djGT Say the loan left on the house is 600K and the bank foreclose it for 400K. Then they can send a bill to Uncle Sam and your buddy will be responsible for 200K worth of "income". |
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| Originally posted by gehzumteufel You should have added if that extra 200k is a Home Equity line of credit (HELOC). |
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| Originally posted by djGT It doesn't have to be a HELOC, just a refinance, like trying to get a lower rate. If the guy is really in this situation, he should hire a CPA to see what his best options are. |
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| Originally posted by 72hrpartyanimal oh... i seeee... there goes the beer. |
On a serious note, what the shit is going on with government bailouts?
I know the arguments for it: it will affect the average person, the trickledown etc.
But WTF?
So profits are privatised and losses are nationalised?
So basically, these bankers (with a "W") make historically obscene amounts of money through unethical practices and now they begin to make a loss, the tax payers have to pay for it?
Go Bush.
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| Originally posted by DJ RANN On a serious note, what the shit is going on with government bailouts? I know the arguments for it: it will affect the average person, the trickledown etc. But WTF? So profits are privatised and losses are nationalised? So basically, these bankers (with a "W") make historically obscene amounts of money through unethical practices and now they begin to make a loss, the tax payers have to pay for it? Go Bush. |
U.S. Drafts Sweeping Plan to Fight Credit Crisis
[This is the cover story in Friday�s WSJ.]
http://online.wsj.com/article/SB122177442732653979.html
�SEPTEMBER 19, 2008
By DEBORAH SOLOMON and DAMIAN PALETTA
WASHINGTON -- The federal government is working on a sweeping series of programs that would represent perhaps the biggest intervention in financial markets since the 1930s, embracing the need for a comprehensive approach to the financial crisis after a series of ad hoc rescues.
At the center of the potential plan is a mechanism that would take bad assets off the balance sheets of financial companies, said people familiar with the matter, a device that echoes similar moves taken in past financial crises. The size of the entity could reach hundreds of billions of dollars, one person said.
Another proposal would be the creation of federal insurance for investors in money-market mutual funds, coverage akin to the insurance that currently safeguards bank deposits. The move is designed to stem an outflow of funds as consumers start to worry about even the safest of investments, a sign of how the crisis is spreading to Main Street. There is $3.4 trillion in money-market funds outstanding.
In addition, the Securities and Exchange Commission is set to propose a temporary ban on short-selling. It's not clear how broadly the ban might extend, but it could apply only to financial stocks.
Details of the plan were still being worked out Thursday night and could be delivered to Congress in "hours," said Senate Majority Leader Harry Reid of Nevada.
The administration had been taking a patchwork approach to the financial crisis, putting out fires as they ignited. The new moves represent an effort to take a more systematic approach, after a spiral of bad debts, credit downgrades and tumbling stocks brought down venerable names from investment bank Lehman Brothers Holdings Inc. to insurance giant American International Group Inc. Banks have grown unwilling to lend to one another, a sign of extreme stress, because financial markets work only when institutions have faith in each other's ability to meet their obligations.
�The flurry of moves under discussion may bring the markets some breathing room, but it isn't clear whether they will amount to a long-term solution to the complex financial problems sweeping the market.
"The market wants to see a more systemic solution that doesn't leave us wondering day after day about the next institution that's the weakest link in the chain," said former Fed Board member Laurence Meyer, vice chairman of Macroeconomic Advisers, an economic research firm.
Treasury Department officials have studied a structure to buy up distressed assets for weeks, but have been reluctant to ask Congress for such authority unless they were certain it could get approved. The intensified market turmoil may have changed that political calculus, even with less than two months left until the November elections.
A big question still to be answered is how the government will value the assets it takes onto its books. One possible avenue could be some sort of auction facility, so that the government would not have to be involved in negotiating asset values with companies. Financial companies would likely take big losses.
Bush met with Treasury Secretary Henry Paulson, Securities and Exchange Commission Chairman Christopher Cox and Federal Reserve Chairman Ben Bernanke for 45 minutes Thursday to discuss "the serious conditions in our financial markets," said White House spokesman Tony Fratto.
Messrs. Paulson, Cox and Bernanke later addressed Congressional leaders Thursday evening on their proposals. At the meeting, Mr. Bernanke began by laying out the severity of the crisis. Mr. Paulson "made the sale," said a top congressional aide.
House Financial Services Committee Chairman Barney Frank, the Massachusetts Democrat, said his panel could hold a vote on the package as soon as Wednesday.
"They said they would like legislation to do it, and there was virtually unanimous agreement that there would be legislation to do it," said Mr. Frank.
In a news conference after the meeting, Mr. Paulson described his effort as "an approach to deal with the systemic risk and the stresses in our capital markets." The "comprehensive" solution would deal with the souring real-estate and other illiquid assets at the heart of the financial crisis, he said.
Exactly how such an entity might be structured isn't yet clear. The possible plan is not expected to mirror the Resolution Trust Corp., which was used from 1989 to 1995 during the savings and loan crisis to hold and sell off the assets of failed banks. Rather, a new entity might purchase assets at a steep discount from solvent financial institutions and eventually sell them back into the market.
The program may look more like the Reconstruction Finance Corporation, a Depression-era relief program formed in 1932 by President Hoover that tried to inject liquidity into the market by giving loans to banks and other businesses.
According to a top congressional aide, the Treasury department wants authority to either control the program or have it be a separate division of the government.
A series of veteran policy makers, including former Treasury Secretary Lawrence Summers and former Fed Chief Paul Volcker, has pushed in recent weeks for such a government agency that would attempt a comprehensive solution to the markets crisis.
The idea would be to steady the market so that investors regain confidence in financial institutions and resume conducting business normally with them.
"By stepping in here and getting the markets to function again, the government could deliver the Sunday punch to this financial turmoil," said former Comptroller of the Currency Eugene Ludwig, who is now chief executive of Promontory Financial Group, and a big proponent for the idea. "By taking the first step and making a market the new government entity could take fear out of marketplace," he added.
The Colbert Report September 18th, 2008
Stephen Colbert is such comedy:
"...look i believe these guys should be able to speculate and do anything they want, make as much money as they want, in any way that they want, and when things go bad we should help them out -- so they can do it again later!"
John Stewart was classic last night with his clip of george dubya saying on july 15th when speaking about the gov 'we should not be bailing out any private sector corporations' and showing brand new clips of all the bailouts.....
PS. Kiss another est. $500B in this gov 'rescue' plan to buy all the bad loans and clear up all the bank's balance sheets. Total combined gov bailouts are approaching $1Trillion.
print lots of money -> buy all the soiled tp on wall street -> hand the bill to the taxpayers -> ban them from short selling -> artificially price the entire financial market -> cut taxes for the guys who started this mess -> inflate money the middle and lower class use for basic necessities... it must be nice to be able to take huge risks with other people's money and collect the winnings but pass the losings on to the public. isn't fascism fun? how about four more years!? 
And you have people calling Obama "socialist"
FUN FACT: RIGHT HERE, RIGHT NOW GUYS 
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| Originally posted by DJ RANN On a serious note, what the shit is going on with government bailouts? |
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| Sun., Sept. 21, 2008 Paulson: We can�t wait for regulatory reform. Treasury secretary calls for immediate passage of $700 billion bank bailout. WASHINGTON - The federal government stepped in with an emergency bailout of collapsing financial institutions on Wall Street last week because it could not wait for regulatory agencies to sort through the �crisis situation,� Treasury Secretary Henry Paulson said Sunday. �Financial institutions [were] clogged with illiquid loans,� Paulson said in an interview on NBC�s �Meet the Press,� effectively freezing credit markets and choking off money to keep Wall Street humming. �This is an urgent matter, and we need to move quickly,� Paulson said in urging Congress to immediately approve the Bush administration�s request for sweeping authority to bypass regulatory agencies and directly take over the bad mortgages and mortgage-backed securities. The Bush administration estimated that its plan, the biggest government bailout since the Great Depression, would cost $700 billion. Financial analysts said it could cost as much as $1 trillion, but Paulson maintained that the final bill would be much smaller. The projected price tag �is not an expenditure,� Paulson said. The bad loans �will be held and then they will be resold at some time.� �The cost won�t be anything like the cost of buying up these assets [because] these costs will come back� when they are sold off, he said. Stability first, then long-term repairs Democrats in Congress accepted that swift action was needed but insisted that any legislation should include significant regulatory reform and protection for middle-class homeowners, especially tougher restrictions on foreclosures and an expansion of jobless benefits. Paulson agreed that government regulations should be overhauled but said the immediate need was �authority to move very quickly,� and he called on lawmakers to pass the bailout this week. �Here we�re preventing failure,� Paulson said. �Once we get this stabilized, there�s a lot we can talk about in reform.� He added: �This is not something that we wanted to do. This was something that was very necessary.� link |
ugh this country is fucked. Impossibly fucked.
ALMOST ARMAGEDDON
MARKETS WERE 500 TRADES FROM A MELTDOWN
NYPOST
The market was 500 trades away from Armageddon on Thursday, traders inside two large custodial banks tell The Post.
Had the Treasury and Fed not quickly stepped into the fray that morning with a quick $105 billion injection of liquidity, the Dow could have collapsed to the 8,300-level - a 22 percent decline! - while the clang of the opening bell was still echoing around the cavernous exchange floor.
According to traders, who spoke on the condition of anonymity, money market funds were inundated with $500 billion in sell orders prior to the opening. The total money-market capitalization was roughly $4 trillion that morning.
The panicked selling was directly linked to the seizing up of the credit markets - including a $52 billion constriction in commercial paper - and the rumors of additional money market funds "breaking the buck," or dropping below $1 net asset value.
The Fed's dramatic $105 billion liquidity injection on Thursday (pre-market) was just enough to keep key institutional accounts from following through on the sell orders and starting a stampede of cash that could have brought large tracts of the US economy to a halt.
While many depositors treat money market accounts as fancy savings accounts, they are different. Banks buy a variety of short-term debt, including commercial paper, with the assets. It is an important distinction because banks use the $1.7 trillion commercial-paper market to fund their credit card operations and car finance companies use it to move autos.
Without commercial paper, "factories would have to shut down, people would lose their jobs and there would be an effect on the real economy," Paul Schott Stevens, of the Investment Company Institute, told the Wall Street Journal.
Cracks started to show in money market accounts late Tuesday when shares in one fund, the Reserve Primary Fund - which touted itself as super safe - fell below the golden $1 a share level. It had purchased what it thought was safe Lehman bonds, never dreaming they could default - which they did 24 hours earlier when the 158-year-old investment bank filed Chapter 11.
By Wednesday, banks sensed a run on their accounts. They started stockpiling cash in anticipation of withdrawals.
Banks, which usually keep an average of $2 billion in excess reserves earmarked for withdrawals, pumped that up to an astounding $90 billion by Wednesday, Lou Crandall, chief economist at Wrighton ICAP, told The Journal.
And for good reason. By the close of business on Wednesday, $144.5 billion - a record - had been withdrawn. How much money was taken out of money market funds the prior week? Roughly $7.1 billion, according to AMG Data Services.
By Thursday, that level, fed by the incredible volume of sell orders pouring in from institutional investors like pension funds and sovereign funds, had grown to $100 billion. It was still not enough to stem the tidal wave.
The banks knew something drastic had to be done. So did Paulson.
The injection of capital into the market was followed up by calls from Treasury Secretary Hank Paulson to major money market players like Bank of New York Mellon and State Street in Boston informing them that federal money was in the market and they should tell their clients the Feds would be back with a plan to stem the constriction in the credit market.
Paulson knew the $105 billion injection was not a real solution. A broader, more radical answer was needed.
Hours after Paulson made his round of calls to calm the industry, word leaked out that an added $1 trillion bailout of banks was being readied. Investors cheered. At about 3 p.m., news of the plans was filtering up and down Wall Street, fueling a 700-point advance in the Dow Jones industrial average through 4 p.m. Friday.
By that time, Paulson had announced the plan. It included insurance on money market accounts, a move that started in quiet Thursday morning, when the former Goldman Sachs executive saved the country from a paralyzing meltdown.
[email protected]
http://www.nypost.com/seven/0921200...ddon_130110.htm
how inevitable is a "depression" from occurring at this point?
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| Originally posted by 72hrpartyanimal how inevitable is a "depression" from occurring at this point? |
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