Real Estate Blog - Realty-Trac -Drowning in the Toxic waste dump of Foreclosures....is there an end or is this just the begining?

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Realty-Trac -Drowning in the Toxic waste dump of Foreclosures....is there an end or is this just the begining?

Realty-Trac -Drowning in the Toxic waste dump of Foreclosures....is there an end or is this just the begining?

I just woke up and while I was sipping my first cup of java...I came across yet more news about our struggling Real Estate Market. This one seemed to add more fuel to the fire.

I've been asked this question by my friends....clients and even from strangers off the streets.

Yahoo News just published this news story >>> Foreclosures jump 57 percent in last 12 months 1 hr and 48 minutes ago. It talks about Florida...Nevada and California taking the lead in this never ending story. A quote from Rick Sharga, vice president of marketing at RealtyTrac, based in Irvine, California, said in the interview "What we're really looking at is ongoing fallout from people overextending themselves to buy homes they couldn't afford and using highly toxic loan products to get into the houses in the first place."

That's definately a new way to put it...now we are calling those type of loan products...."toxic".

There has to be a solution but I believe people just made a very big mistake and now most of them unfortunately are paying for it. My question is why would anyone get approved for a loan to make one of the largest purchases in their lives if they can't even afford to pay their $50 a month cell phone bill?

There has to be hope and there has to be a better solution........Let's find it.

For more information please contact Neal The Real Deal Bloom-CRS-Realtor® /Remax Hometown

2500 Weston Road ,Suite 103

Weston FL 33331

(954)608-5556

Posted by Neal Bloom-Realtor ® Assoc.-CRS-Weston FL on 04/15/2008 06:35 AM

Comments (27)

realty trac, toxic waste, dump, foreclosures, only the begining

Originally posted at: Weston Florida Real Estate Blog, Neal"The Real Deal"Bloom : Realty-Trac -Drowning in the Toxic waste dump of Foreclosures....is there an end or is this just the begining?

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27 Comments on Realty-Trac -Drowning in the Toxic waste dump of Foreclosures....is there an end or is this just the begining?

APR

2008

Great Post. It seems these crazy loans made sense to some lenders when the myth prevailed that real property prices will always rise. Now that we learned - again - that this is never so, it might lay the foundation for a more thoughful approach for years to come. Thanks, Rick.

Well said. The loan approval and appraisal process is still one that baffles me. Thanks for the post.

Neal - I think just because your approved for a loan doesn't mean that you have to use every last penny on it. I think the buyer really needs to look at the monthly payments. They need to come up with a payment that they can really afford and are going to be comfortable with. Forget what the bank said they are willing to lend them.

Neal thanks for posting such a timely post. The foreclosure rate is frightening and there is no quick fix. While I'm not an accountant or a economist who could have some answers, just like many other Realtors, I am someone who sees the heartache and break in those statistics. How sad for our economy, our cities and towns but most of all for our citizens.

I saw it on Rueters this morning too. Congratulations on your CRS. Who knows when it will end, in my area the foreclosed properties are getting multiple offers.

Neal, Wouldn't it be great if the media picked up on some of the good news? There are still the occasional multiple offers here. Things are moving, more slowly yes, but still moving. In the 23 years I've been in the business this is I think the 3rd time the market hit a slump but I think it's the first time it was prodded along by the media. They started a few years ago talking about the bubble bursting and just kept writing and until we are where we are. We had a meeting with a mortgage guy at the office and he was saying how "we", meaning the Realtors and the mortgage business created all of these foreclosures and short-sales. I raised my hand and told him that "we" didn't do anything. The mortgage industry decided that it was okay for people to finance 100% of a luxury home. "We" benefited, sure. But "we" didn't create this mess. "We" are just trying our best to clean it up.

Rick,

The blind consumer will now have to put on those glasses to see where they went wrong

Lynn,

I'm wondering what people were thinking.

Robert,

I agree with you to a point. I agree that you shouldn't have to use all your money up front but unless you lose your job....you shouldn't over extend yourself either just to get into a home and then not be able to keep making your payments. There were some very good programs out there but then there were probably more bad than good and the record shows.

Gail,

It is frightening and I just wish there were better solutions...I don't see our current solutions as the answer...I'd love to hear some success stories with these new plans.

Missy,

Even if there are multiple offers it still doesn't mean the banks mitigation departments are helping by taking their time giving you an answer and then the answer isn't always what the buyer wants to hear and that's why no one wants to buy them unless they are prepared to tie up their money waiting.

Susan,

I personally think that everyone ...the buyers...the sellers..the mortgage brokers...the banks...the Realtors(R) all have some fault in it. The government too as they just let all this happen and turned the other cheek.

Neal - Again, I've stated it before and while it's wonderful (tongue in cheek) to point fingers, it does little good when everybody's ducking. I'll let others banter back and forth about who's to blame, I will just try to step up and hope to be even a small part of the solution.

Jason,

Exactly.....I'm just wondering how many just wanted to put food on their table but take away from many families who are left out in the cold...but in the true sense mostly all parties involved are to blame...I'm just hoping regardless...let's find a better solution.

Neal - Rick from RealtyTrac has been on my list for a while... This guy is profiting heavily from the high rate of foreclosures... A lot of people bought homes that they could never afford or refinanced to buy "luxury items" they couldn't afford because they thought their homes would continuing to increase in value.

Debbie,

I never met or spoke to the man...I couldn't tell you more than the fact the article came from Yahoo news and I provided the story link for people to read....I can't tell you what he does behind the scenes. May I ask what list and why?

To me the bigger question is why they were approved for a mortgage, when they were left without enough money to pay their phone bill? I think the problem was not the types of mortgages, it was the loose approvals for folks that should not have been in the loans.

Randy,

I forgot that you would most likely chime in on a sensitive subject as we both know it is for both of us...I think after they were offering all these wonderful programs....people jumped at the chance of owning their own property without any money down...almost like assign and drive t the car dealer...accept the flippers took advantage of giving false information ans some just plain went over their heads. It was an easy way for some to get approved with little information...plus I'm sure there were also legitimate ones who bought but unfortunately lost their jobs and any income to pay the loan payments. Too much speculation on watching the market go up...now we can't even catch it as it goes down daily.

Neal count me in as one who isn't into pointing fingers, but trying to find a solution. You have a valid argument that all of us....everyone, has some small piece in this mess whether we did anything or not. But now let's keep working to fix it and try to help mitigate the damage that has been done.

Neal, I was just on RealtyTrac a couple of day ago checking out foreclosures in my areas. There were so many I got tired of scrolling through the pages!!!! If you really want to get the full scope fo foreclosures log on to countrywide.com and check out their properties for sale. It's ugly out there and it's getting worse. We ain't seen nothin'yet!!!

Kathy,

I don't want to stir any controversy but it's true....buyers are responsible for their own actions and so is the MB,LO,Realtors,sellers,title co's...everyone that did something turned a deaf ear and now claim it's not.

BB,

I have been on that Countrywide sight as much as you...I'm always looking at those so called deals. I just hope they make it easier for the consumer who really wants to buy a place to live so they might as well give the home to a person in need instead of loading their desks up with more paperwork and unsellable homes. The need to really be more proactive in responding too.

Neal- Oh hey I'm not afraid of controversy, and neither are you.....but it just gets depressing thinking of all the people that caused this mess, and so much of it was a lack of ethics or greed. It just doesn't do me any good to dwell on it, but hey, I have been know to give a piece of my mind every now and then :) :)

As you stated so many people have suffered, and are suffering, and just as many claim no responsibility.....agreed. But what to do now, that's the million dollar question!

Neil good question, but in a society like ours that is driven by wants, common sense does not prevail. All that matters is they want it and that is all that matters.

APR

2008

lalaalalalalal - I am so sick of the finger pointing - it is what it is and this too shall pass and we will talk about the days when -

Hi Neal... my 2 cents on this... Re "why would anyone get approved for a loan to make one of the largest purchases in their lives if they can't even afford to pay their $50 a month cell phone bill?"...

No kidding. From a consumer's point of view, when I see all the news, stories and talk of government bailouts, the first thing that pops into my head is really???

Does that mean the next time I make a stupid investment in the stock market, start a biz project that loses $$$ or buy gold just before it's inevitable downturn... will the government reimbursement me for my bad judgment? Duh!

The one thing I rarely if ever see is talk about the borrower's responsibility for taking out loans they couldn't afford in the first place at a time when anyone with 1/2 a clue could see the real estate market bubble had to burst.

Toxic loans (by this definition) is people buying "investment" properties and then sending them back to the bank when they aren't prepared to hold for the long term. Toxic means people lie as being owner occupied to get conforming rates and no money down. Toxic is when the government makes that deficiency judgment go buh bye.

It's the perfect storm.

Kathy,

There are always questions we can't answer but maybe they need to really pinpoint the real facts instead of always finding the place to lay blame.

George,

Impulse shopping...it looks good so why not buy it now and pay later.

Thesa,

I hope we can look back 20 yrs later and laugh about it instead of crying about it.

Marti,

I have hear stories of the borrowers telling their MB to fudge the numbers and what the own and do for a living...do you think that's their responsibility?..I do but it's also the MB who let's it slide and if the Realtor(R) knows then they are a part of it too..same goes for title and anyone else involved including the seller.

Renee,

I just mentioned a similar thing in my comment to Marti above yours...it's true

In your response to Marti: I absolutely believe it is part of their responsibility to verify verify verify. Now that's what they have to do and real investors are getting penalized by having to put even larger than the "norm" downs down. Unfortunately I don't think those MB's are in business to have to do the extra work anymore!

Renee,

Please tell us how you really feel:)

APR

2008

Neal-I am with Thesa. We have to find a way to move on in our minds.

Midori,

I'm more sorry for the fortunate ones who can sell and not have to sell short...their the ones also suffering from lack of buyer activity. Some of my listings are priced so right that the agents specifically ask me if it's as a short sale and I tell them no...maybe it's just priced right to sell and they are starting to do so.

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