‘Seriously Underwater’ Home Mortgages Tick Up Across the US

[corbe]

‘Seriously Underwater’ Home Mortgages Tick Up Across the US

Alex Tanzi
Wed, May 8, 2024, 11:01 PM CDT

(Bloomberg) -- Roughly one in 37 homes are now considered seriously underwater in the US and that share is much higher across a swath of southern states, according to data out Thursday.

Nationally, 2.7% of homes carried loan balances at least 25% more than their market value in the first few months of the year. That’s up from 2.6% in the previous quarter, according to the first-quarter 2024 US Home Equity & Underwater Report from ATTOM, a real estate data firm.

While the share of these homes is ticking up, it remains much lower than before the pandemic, when the rate was more than twice as high.

Mortgages can generally become seriously underwater when someone overpays for a home, or when it is purchased with a small downpayment that doesn’t provide a sufficient buffer if the property falls in value.

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https://finance.yahoo.com/news/seriously-underwater-home-mortgages-tick-040100261.html

[roamer_1]

You ain't seen nothing yet. They tell me my crappy little cabin is worth a quarter million bucks now.

That's just crazy talk. Folks can't afford to buy. especially young folks.

No wonder they're living in ditches.

[Kamaji]

Mortgages can also become underwater when valuations drop.

[Wingnut]

I see a big buying opportunity like in 08 and 09.  As our user "retread" said this was the Bush crash but while O'Bummer the Joo hater came to office.

[banddag]

I see a big buying opportunity like in 08 and 09.  As our user "retread" said this was the Bush crash but while O'Bummer the Joo hater came to office.

Major cracks in subprime market started in 2006.Housing crash started in March 2007. By end of 2007, early 2008 it was full blown. Lehman Bros  collapsed Sept 2008 , 2 months before the Presidential election.

Obama had nothing to do with the housing collapse no matter how much you outright lie about it and try to fool guillable people with revisionist bullsheet
Yes, this collapse happened under the W  Presidency and warnings about subprime were circulating as early as 2005

I know this because my dad built spec homes and I was warning him in 2005-2006 major problems were coming down the pike after talking with very smart  banker friends who knew their stuff.

My dad built his last spec home somewhere that n late 2005 or early Spring 2006

[corbe]

                 Real Culprit

[Wingnut]

                 Real Culprit

Yup,  The gay guy did it!  Barney Frank.

[corbe]

   If I'm not mistaken GWB and his Admiration knew the Fanny, Freddy and Sally $hit was about to hit the proverbial fan and that a$$hole stopped the Legislation, probably blackmail.

[DB]

Obama had nothing to do with the housing collapse no matter how much you outright lie about it and try to fool guillable people with revisionist bullsheet
Yes, this collapse happened under the W  Presidency and warnings about subprime were circulating as early as 2005

Nice rebuttal to an argument no one made...

[LMAO]

Obama had nothing to do with the housing collapse no matter how much you outright lie about it and try to fool guillable people with revisionist bullsheet

Not necessarily true


Reno and Holder also encouraged civil-rights lawyers like Obama to file local lending-bias cases against banks.

The next year, Obama led a class-action suit against Citibank on behalf of several Chicago minorities who claimed they were rejected for home loans because of the color of their skin. It was one of 11 such suits filed against the financial giant in Chicago and New York in the 1990s.

As first reported in Paul Sperry's "The Great American Bank Robbery," the plaintiffs' claim lacked merit. Factors other than race figured in the bank's decision to turn them down for loans.

One of Obama's clients had "inadequate collateral" and "an incomplete application," while another had "delinquent credit obligations and other adverse credit history."

Obama argued such facts miss the point: that Citibank's neutral underwriting criteria may have adversely impacted his clients as a class of people. He demanded it turn over loan files from the entire Chicago metro area to prove it regularly engaged in a pattern of discrimination.

The court didn't award him the files. But Citibank eventually settled, despite the weak case. Under the 1998 settlement, Citibank vowed to pay the alleged victims $1.4 million and launch a program to boost home lending to poor blacks in the metro area.

In the run-up to the crisis, Citibank underwrote thousands of shaky subprime mortgages to satisfy the court in Obama's case. Defaults were common. When home prices collapsed, most of the loans went bust.

His lead African-American client, Selma Buycks-Roberson, who was denied a loan due to bad credit and low income, got her mortgage only to default on it years later.

She got a foreclosure notice in 2008, according to The Daily Caller website, along with many of her Chicago neighbors.

By putting them on the hook for loans they couldn't pay, Obama did them no favors. Blacks have been hit hardest by foreclosures. But what does Obama care? The Caller reports he pocketed at least $23,000 from the Citibank case.

Today, he blames the devastating wealth drain in black communities on subprime mortgages. He says "greedy," "predatory" lenders tricked poor minorities into paying higher fees and interest rates.

But Obama was for subprime loans before he was against them. "Subprime loans started off as a good idea," he said as those loans began to sour in 2007.

His closest economic advisers also promoted subprime lending. Several months earlier, Chicago pal Austan Goolsbee, who later became his top economist, sang the praises of subprime loans in a New York Times column. He argued they allowed poor blacks "access to mortgages."

One of Obama's top bank regulators, Gary Gensler, once bragged that thanks to subprime mortgages, banks made home loans to minorities at "twice the rate" they made to other borrowers, according to "Bank Robbery." "A subprime loan is a good option when the alternative is no access to credit," he said years before the crisis.

Obama hasn't learned from his mistakes.

Far from it, IBD has learned the mammoth credit watchdog agency he created (with input from NPA radicals) will dust off Clinton's 1994 minority lending guidelines to crack down on stingy lenders. And he's ordered Holder, now acting as his attorney general, to prosecute banks that don't open branches in blighted urban areas.

Not only has Obama scapegoated banks for the crisis he helped cause, he's exploited minority suffering to continue reckless policies that hurt those he claims to champion.



https://www.investors.com/politics/editorials/fingerprints-of-obama-on-subprime-foreclosure-crisis/

[banddag]

Nice rebuttal to an argument no one made...

Wingnut made a comment earlier in the week Obama was responsible for the housing collapse on another thread.

[libertybele]

Wingnut made a comment earlier in the week Obama was responsible for the housing collapse on another thread.

Uh oh @Wingnut you're in trouble now.

[DCPatriot]

Wingnut made a comment earlier in the week Obama was responsible for the housing collapse on another thread.

The housing market and keeping the banks/mortgage bankers afloat happened in 2006-2008, during GWB's administration.

This was a direct result of Clinton Administration inserting themselves into the boardrooms, demanding "no doc" and "stated income"...aka "LIAR LOANS", which gave buyers the ability to qualify for mortgage loans by circumventing the standard 28/36% and 33/38% typical income to debt ratios in qualifying for 30 years loans.

Janet Reno herself told Bank of America they would crawl up their ass with auditors unless they began to give out loans to people who couldn't actually afford them.

We had illegal residents buying homes where they would rent out bedrooms to their co-workers on the jobs...which was fine and dandy as long as homes were selling.

Once the market crashed because the number of under-water resales grew, the banks dragged their feet figuring out how to accept "short sales"...sales where the sellers were under-water on the HUD-1 settlement sheet.

Again, the banks were bailed out by the stroke of a pen.