jinjimbob
Troy Mcclure
join:2001-11-13
| reply to dogma
Re: California; More Leaving, Less Coming
said by dogma  :Found this article in the L.A. Times yesterday: » www.latimes.com/business/la-fi-o···ll.storyBasically, voodoo economics on Meth smoked in a well seasoned crack pipe...otherwise known as "pay option" mortgage loans. Here one can get a $300K no-down loan (or even worse, a re-fi or HeLOC) for about $1000/Mo. You have the "option" of paying an absolute minimum...for a while. Of course in 4 years, the payment automatically jumps to almost $3000/Mo. And more than likely, the $300K principal would then be $350K. Think only an idiot would go for such a scam? Think again; said by L.A. Times :
In the first eight months of 2006, even as the real estate market began to weaken amid fears of a downturn, the appeal increased again. Nearly 1 in 3 California loan applicants are now choosing them. The state boasts about 580,000 active pay option mortgages, about half the U.S. total.
The article features this 56-year old guy (I imagine there are at least 2 million Californians in this same situation) that lives in Corona who blew almost $200K in re-fi's over the years...and now it's time to pay the piper. If he sold his house today, he would need to bring about $35K to the closing, which he doesn't have, and then he would be homeless, without a dime to his name. Of course, he blames it on 9/11 and his loan broker. Wow, that guy was an idiot with his head in the clouds.
"Comparable homes in his neighborhood fetch more than $400,000. With fresh paint and a few repairs, Hertzberg could probably sell his place for $275,000 more than he paid.
He would see little of that, however, because he's already seen so much. Over the years he has taken out $190,000 in cash through refinancings.
Hertzberg's home equity paid off his credit cards, financed trips around the world that allowed him to indulge his passion for photography, bought a $32,000 Toyota Avalon and enabled some lousy investments." |
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deadmeat
Premium
join:2003-03-21
Sonoma, CA | reply to Lovehound
Your people? Who the hell are you? Moses?  |
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Lovehound
join:2005-08-18
Northridge, CA
| reply to mhy
said by mhy :People arriving = illegals That could have something to do with legals leaving. It's a factor in my case.
California is presently about 33 percent Latino, and I suspect Los Angeles County is nearing the 50 percent level. Of course most of them are here legally, just Americans of Latino descent, but there are significant numbers of illegals and they contribute significantly to the loss of quality of life--a motivating factor causing many of us to want to leave.
When you think of Los Angeles, consider Miami. That's what Los Angeles will be like in 20 years. Miami but with hills.
I don't want to be in a minority. And I don't blame Latinos for wanting to be a majority one bit. It's self interest for all of us. We want to be with our own kind. Los Angeles and California are going to be for Latinos if the present trend continues. |
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Bill
Light Up The Halo
Premium,VIP
join:2001-12-09
clubs: | reply to dogma
Does this surprise anyone? |
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mhy
join:2000-08-25
Los Angeles, CA | reply to deadmeat
People arriving = illegals |
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Lovehound
join:2005-08-18
Northridge, CA
| reply to dogma
Just making a joke dude.
Seriously, I plan to leave CA in the next several years when I retire, to get away from the traffic, crime, hassle, prices, all the negative things associated with living in a major city. To be fair there are good things here that won't be available in the place I'll probably move to (somewhere in the Southwest) such as shopping, entertainment, wide variety of ethnic restaurants and markets, etc.
I like the outdoors and I'll move to some place with plenty of hiking, fishing, nature photography, 4x4 exploring, etc. What I can't get on the Internet I'll do without.
I'd leave now but it's difficult to near impossible to get work in my profession (electronic engineering) except in L.A. or other similarly large cities. |
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deadmeat
Premium
join:2003-03-21
Sonoma, CA | reply to dogma
People leaving = quitters. |
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dogma
Premium
join:2002-08-15
Boulder City, NV | reply to Lovehound
...dude |
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Lovehound
join:2005-08-18
Northridge, CA | reply to dogma
I've been coming less since 1998 too. I can appreciate that statistic. Well actually I don't . . .   |
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SOLdesign
Did I drink a shot of Irrational Whore?
Premium
join:2002-07-29
Woodland Hills, CA | reply to dogma
we too are plotting an escape... |
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Bloominite
Premium
join:2004-04-17
clubs:
 ·DSL EXTREME
| reply to vincejr
said by vincejr :said by CurtesyFlush :said by dogma :Perhaps I am just getting old? I'll drink to that. You're about 3 years away from spending your days down at the barber shop cussin and discussin the same old shit with Grady and Rollo. Lamont'll be there too, he's getting old. Grady went feet up some time back. » www.deadoraliveinfo.com/dead.nsf···+Whitman Grady was another famous Fontuckian:
»www.the-cape.com/the_cape/whit/biograph.htm |
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aztecnology
O Rly?
Premium
join:2003-02-12
Murrieta, CA
 ·Verizon FIOS
| reply to dogma
said by dogma :Of course, he blames it on 9/11 and his loan broker. Don't forget his acumen with dotcom stocks and his brilliant move into equities...  |
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dogma
Premium
join:2002-08-15
Boulder City, NV
| reply to jig
Found this article in the L.A. Times yesterday:
»www.latimes.com/business/la-fi-o···ll.story
Basically, voodoo economics on Meth smoked in a well seasoned crack pipe...otherwise known as "pay option" mortgage loans. Here one can get a $300K no-down loan (or even worse, a re-fi or HeLOC) for about $1000/Mo. You have the "option" of paying an absolute minimum...for a while. Of course in 4 years, the payment automatically jumps to almost $3000/Mo. And more than likely, the $300K principal would then be $350K.
Think only an idiot would go for such a scam? Think again;
said by L.A. Times :
In the first eight months of 2006, even as the real estate market began to weaken amid fears of a downturn, the appeal increased again. Nearly 1 in 3 California loan applicants are now choosing them. The state boasts about 580,000 active pay option mortgages, about half the U.S. total.
The article features this 56-year old guy (I imagine there are at least 2 million Californians in this same situation) that lives in Corona who blew almost $200K in re-fi's over the years...and now it's time to pay the piper. If he sold his house today, he would need to bring about $35K to the closing, which he doesn't have, and then he would be homeless, without a dime to his name.
Of course, he blames it on 9/11 and his loan broker. |
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Ptomaine
And thus begins the web
join:2003-04-07
Beaver Dam, WI
| reply to dogma
I'm one of the statistics. I've been a Wisconsin resident for six weeks now. Come and join me. The weather is great. 
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All the best freaks are here.Please stop staring at me! |
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dogma
Premium
join:2002-08-15
Boulder City, NV
| reply to jig
said by jig :...jobs opening up, hirings going on. ...i think there are a bunch of us with cash waiting for the housing market to drop a bit... ...the fools with super huge mortgage payments won't be defaulting as much as you'd hope. ...40% might be what the 2mill and above will drop, i doubt anything below 1.5 will drop ...i don't see the arizona retirees beating those numbers. Depends on what kind of jobs will be coming online. The $12 - $20/Hr variety will not support today's average home mortgage, even with hocus-pocus loan packages.
The "fools" don't have super huge mortgage payments now, but as those negative-amortizing interest-only-teaser-rate-no-doc-stated-income loans reset, like aztecnology suggested, things may become rather ugly. Especially with the new BK laws, which are equivalent to debtors jail, without the bars. A 40% decline may be conservative.
The wildcard in this deck may be newer, even more bizarre loan programs of NegAm-IntOnly 50-60 Year re-fi programs that bail these "fools" out. But they will never own, or accrue equity in the property...so it will be like perpetual renting with the ability to remodel. (Mortgage lenders are learning from the credit card companies that it's much more profitable to keep consumer-bots in everlasting-debt)
said by Bloominite :Maybe CA will see a turnaround and again become as nice a place to live as it used to be, but I don't see it happening. The infrastructure is busting at the seams, social services are overburdened and the people best suited to correct and fund the much needed improvements are bailing out in droves. I would tend to agree. It's more of a brain drain. |
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vincejr
join:2005-06-15
Los Angeles, CA
| reply to CurtesyFlush
said by CurtesyFlush :said by dogma :Perhaps I am just getting old? I'll drink to that. You're about 3 years away from spending your days down at the barber shop cussin and discussin the same old shit with Grady and Rollo. Lamont'll be there too, he's getting old. Grady went feet up some time back. »www.deadoraliveinfo.com/dead.nsf···+Whitman |
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Bloominite
Premium
join:2004-04-17
clubs:
·DSL EXTREME
| reply to dogma
said by dogma :A few of us here are actively plotting a "jail break", and I know this topic has been visited before. How much more imported poverty can California absorb and do any of you agree with these current findings? You can count my wife and I among those plotting an escape. We actually built a house in Arizona a few years ago and would have been gone long ago if my grandmother didn't need our help to stay out of the convalescent home.
I'm a 52 year-old native Californian and willing to bet that 70-80% of the people I grew up with here in SoCal have moved to other states. My bro and I are here, but both my sisters left and only 1 first cousin (out of 16) is still here. With few exceptions, my friends and family that have left have been the brightest, those with the best educations and earning the highest incomes.
When my dad (also a native) died last year, he was the last of his siblings living in CA as his 3 brothers has moved to AZ and NV. My mom is also the last of her family here and she's leaving at the 1st of the year when she makes her big move to San Ignacio, Baja Sur.
Maybe CA will see a turnaround and again become as nice a place to live as it used to be, but I don't see it happening. The infrastructure is busting at the seams, social services are overburdened and the people best suited to correct and fund the much needed improvements are bailing out in droves. |
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aztecnology
O Rly?
Premium
join:2003-02-12
Murrieta, CA
·Verizon FIOS
| reply to Bloominite
said by Bloominite :If the past is any indicator, any increase in interest rates for newly initiated mortgages will also trigger a drop in selling price to compensate for the higher rate. That's a good point, it will be interesting to see what the Fed does today, and how it will affect mortgage rates. I think a lot of places are hitting 2004 pricing right now, if rates tick up and the rate of foreclosure stays constant, then there's no question that we'll be looking at early 2003 prices...
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"Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:|:. Say no to the IRS Yes to the Fair Tax |
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Bloominite
Premium
join:2004-04-17
clubs:
·DSL EXTREME
| reply to aztecnology
If the past is any indicator, any increase in interest rates for newly initiated mortgages will also trigger a drop in selling price to compensate for the higher rate. There was an extreme example of that occurring when mortgage interest rates shot up at the tale end of the 70s. The pool of potential home buyers are, for the most part, classic payment buyers whose budget can only withstand a predetermined monthly payment and the selling prices will adjust downward when rates go up just as they adjusted upward when the rates fell.
I'm of the opinion that most people who bought homes over the last 2 years or so paid too much for them and within a year, we'll see prices settle back to where they were in 03 or 04. |
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aztecnology
O Rly?
Premium
join:2003-02-12
Murrieta, CA
·Verizon FIOS
| reply to dogma
Depending on the local market, many areas have already been shaved 10-15-20%, I think another 10-15-20% decline is in order over the next 2 years.
A big key will be when the banks/reo's actually start dropping their prices, right now they are still pricing very aggressivly in the market. As the foreclosure's/reo's keep adding up the lenders will have no choice but to be more proactive in leaning out their balance sheets. This along with the builders/developers that will continue to build housing to move land, because they can still eek out a profit giving $100k in incentives and upgrades, the combination of these two forces will continue to put the squeeze on prices.
Did I forget to mention ARM resets of a trillion dollars coming due this year, for over extendened house atm using mcmansion dwelling exurbanites...
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"Independent thinkers tend to ALWAYS have someone not agreeing with them. It's The non-thinkers that always come in legions." John Callari .:|:. Say no to the IRS Yes to the Fair Tax |
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