I found the following article about strategic defaults in today's Los Angeles Times. It sheds some realistic light on this sector of our crisis. What I find most interesting is that there are actually less strategic defaults than most people have previously thought. In that Southern California has one of the largest losses of equity in the country, it will be interesting to see how this segment recovers.

 Click here to read the full Los Angeles Times article.

Nostalgia is a good thing. One of the things about nostalgia is that it tends to come back around. See if you remember these gems:

1. Homes had owners in them
2. Cash offers were accepted...quickly
3. Listing agents lived in the same city as their listing
4. Asset managers were guys that handled money, not homes
5. When someone said REO, you first thought of a great rock band of the '80's
6. Short sale negotiators didn't exist
7. Fannie & Freddie were funny names of companies most people never heard of
8. Purchase contracts got a Counter Offer, not a bank addendum
9. Voice mails were returned
10. You bought cars and cattle at an auction

Ahhhhh the good old days. I think we've all kind of forgotten that these all applied less than four years ago.As long as we learn the lessons of excess, they will come around again.  This crazy market will settle (not as in "for less than full balance"..but as in "down") and normalcy will return. Feel free to add any others you may fondly remember.

In the mean time, I'm going to listen to Ridin' The Storm Out, comb the hair I no longer have with my Goodie brush, watch football without the annoying fantasy stats that constantly scroll along the bottom of my T.V., and know that the asset managers from Chase & B of A will once again need to update their resumes.

As our market continues to calm, Southern California is seeing the beginning of home appreciation again. Are things all better now? Of course not. And there are those who will say it's only a temporary spike. Or others that will some how blame The First Time Buyer Tax Credit Extension for skewing the numbers. Personally, I am glad to find and share good news. We have forgotten that a large part of any market's decline or rise is based on emotion and confidence. Headlines have a way of building on themselves either way. So please take a moment and click the link below:

Southern California home prices edge upward again in October -- latimes.com

In re-blogging Gregg's post, I did get his permission first. The reason for re-blogging is the importance of repealing HVCC. This is Andrew Cuomo's law that has stymied the ability to get accurate,cost effective appraisals.

The more places this blog appears, the better. Please take the time to click on the links that will direct you to your U.S. Senators, and let them know you want HVCC repealed.

Ladies and Gentlemen.... Professor Palmer here. Welcome to my class:

Head Scratching 101; An Abbreviated History Of Short Sale Lenders.

Because today is the first day of class, I'd like to get a better feel for all those in attendance by giving you a pop quiz!! So here goes.

Q: If you were an existing 1st mortgage on a short sale property that is worth $425,000 (value as determined by a BPO you ordered four months ago),vacant,county land, 30% of the home not built to code, on septic would you:

A: Jump at an all cash offer that not only paid your your entire amount of $425,000, but also agreed to give the subordinate lien $19,000 to liquidate

B: String out the entire process so the acre of custom landscaping withered and burned to a crisp in the California sun while vandals broke in and stole the appliances

C: Do B above, and then at the last minute turn down the entire short sale package that you've had for 6 months because  you feel the seller made too much money in 2008 & you thought the subordinate lien was getting too much money from the buyer, subsequently foreclose on said vacant property while  the larger home next door goes into foreclosure,and THEN list said property that your own BPO showed was worth $425,000 for.......$675,000!!! Here's a hint: That's what your balance is.

If you answered A please report to the kindergarten class down the hall.

If you answered C you get your letterman's jacket, diploma and a hearty Attaboy from me.

Yep...Welcome to the wacky, wonderful world of Guaranty Bank, now Compass Bank. Kind of ironic isn't it, Compass Bank? But that's what happened. If any of you have to deal with them in any fashion, you might want to talk to my hairy assistant, Tiny, above. At least you'll be prepared for all the head scratching you're about to incur.

For those of you old enough to remember Whitney Houston singing The Star Spangled Banner during The Super Bowl, it's one of the versions you never forget. For those of you that might never have seen it, take a moment and watch this clip:

As a hobby, I referee high school basketball. More than all the other privileges it allows me, the single greatest is that at least 35-40 times a season, I get to stand with a gym full of people, proudly face our flag and listen to a rendition of The National Anthem. To this very day and after all these years, I STILL get goose bumps every time. It doesn't matter if the singer is a 6 year old singing totally off key, or the recorded version of the video above. If this video doesn't evoke some kind of reaction from you, especially on Veteran's Day,don't check your pulse. It's a bit too late.

The extension of The First Time Buyers Tax Credit is now here. There are a lot of questions as to what may/may no be included. The National Association of Home Builders has put together a rather helpful site. I found this after watching a Think Big, Work Small video this morning. Here's the link for the Q &A:

There are many that are on either side of Home Buyer Tax Credit debate. As I've stated here, I am for it. While I'm not usually in favor of subsidies, this market is far from usual. The inherent difference in this credit is that it doesn't just fall into a black hole, a la TARP. Buyers do buy in part because of this credit. Once in a home, they need contractors, appliances, etc. For once, I do have to take the side of my more liberal brethren.

Some people are in favor of the extension of the  Home Buyer Tax Credit, and some are not. I completely understand varying view points on "stimulus" money. "Stimulus", by the way, may be the single most over used word of this decade.

Anyway, let me say that I am for the Homebuyer Tax Credit. Let me also say that by no means am I a tax & spender. BUT this stimulus is already working. People ARE buying homes. So people DO hire contractors, go to Home Depot, buy carpet and so on. Of all the corporate, dead end, counter productive bail out funds being tossed around, THIS one actually works.

Now here's where my math gets juuuuuust a tad fuzzy. In other blog responses here,and in other articles, I keep hearing the following: " The Homebuyer Tax credit will cost taxpayers $48,000 per home!!"  Really??? Seriously?? I looked it up today on Google (gotta' love Google) and there are approximately 138,000,000 taxpayers in the U.S.  So if my math is correct, it looks like this: 138,000,000(taxpayers)x$48,000(cost per taxpayer)= $6,624,000,000,000. That's 6 trillion  dollars. The thing I find ironic, is it's always the same figure of $48,000. Either there is an entire math discipline that has discovered a new absolute that I'm completely in the dark on (then again, I'm trying to help my 14 yr old daughter with geometry, so that's entirely feasible), or a "talking point" is being given way too much credibility. I'd love for someone to come up with the actual equation that they are basing the $48,000 figure on.

One thing tossing out numbers without warrant is guaranteed to do. And that is mute the benefits of a program that is actually doing what it was intended to do...spark home buying interest again.