When you hear the term "foreclosure property," what comes to mind?  A dilapidated crack house in a marginal neighborhood?  If it is, be prepared to change your perceptions, because the face of foreclosure is changing.  It’s affecting upscale homes and neighborhoods to the detriment of their neighbors.  According to Wednesday’s Los Angeles Times: [Thank you L!] Houses abandoned to foreclosure are beginning to breed trouble, adding neighbors to the growing ranks of victims. Stagnant swimming pools spawn mosquitoes, which can carry the potentially deadly West Nile virus. Empty rooms lure squatters and vandals. And brown lawns and dead vegetation are…
Read more…

It’s Op-Ed Friday, and today’s likely to be a big news day.  President Bush is scheduled to discuss his subprime initiative this morning and Chairman Bernanke’s speech this morning will be micro-analyzed for any hint of the direction of interest rates. You can count on Twist to be inside with the AC cranked up and watching it all unfold, as it’s too darn hot to get out and do anything else: Phoenix on Thursday had a high temperature of 111 degrees Fahrenheit, [44C] extending the record broken on Wednesday of 29 days with at least 110 [43C] degrees F in…
Read more…

Reuters is reporting this evening: WASHINGTON, Aug 30 (Reuters) – President George W. Bush will outline reforms on Friday intended to help homeowners with subprime mortgages avoid default, a senior U.S. administration official said on Thursday. "He will also discuss reform efforts to prevent these kinds of problems from arising in the future," the official told Reuters on condition of anonymity.

Wow- if there is anyone left who thinks that what happens in housing stays in housing, here’s Forbes magazine on the potential impact of the current credit crisis on [of all things] NFL football: [The video shows up after you hit "play."]          

Mom always said to be careful what you wish for;  I guess I should have listened.  Month after month, I listened to Lereah’s spin, and wondered why on earth the NAR didn’t replace him.  I figured anybody, ANYBODY had to be better…. Now we have Lawrence Yun, and I’ve got to admit, he’s got me longing for the good old days when the spin had to at least have a finger or toe anchored in reality. For your reading "pleasure," here’s an excerpt from Yun’s housing predictions from September’s Realtor magazine. WARNING:  Do not attempt to read if you suffer…
Read more…

Reading this on Ginnie Mae today, I have to wonder if other GSEs will follow suit for other programs: The Government National Mortgage Association, known as Ginnie Mae, is eliminating the $417,000 cap on mortgages guaranteed by the Department of Veterans Affairs that are bundled together as securities and backed in turn by Ginnie Mae. The change takes effect Sept. 1, Ginnie Mae Executive Vice President Michael Frenz said in a memorandum Monday to participants in the agency’s program. That means Ginnie Mae will accept as collateral mortgage loans exceeding $417,000 that are guaranteed by Veterans Affairs. Those VA-backed loans…
Read more…

SteveC sent me the following, and has graciously given me his permission to share it: About 4 months ago a home came on the market very close to the place where we stable our horses. In fact, we ride past it every day. [This is the listing- t.] I did my due diligence and looked up the recorded documents. A fellow bought the home from his brother for $200,000 on a new loan. Within a very short period of time, he refinanced as an owner occupant with a first and second totaling $550,000. I am not sure he ever occupied…
Read more…

There’s been a lot of finger pointing lately about who’s to blame for the housing fiasco.  When, and if, an accounting is ever reasoned out, the following attitude has got to be placed near the top of the list of "Reasons Why This Happened": [Hat tip to "bkozak33" of Broker Outpost- I've edited just a bit.] My Realtor gave me a contract for a lady to buy a home for $300K. I got her aproved at a 7.25 interest only payment- with taxes and insurance $2,500.00. She told me all she can afford is $1,800.00/month.  I told her that is the…
Read more…

OK Doomers, is anyone else incensed by this comment by Senator Schumer today?  Schumer, discussing his 3-step plan to address rising foreclosures said: There’s a lot of deception that goes on and you can’t expect average folks to read the fine print and understand. It’s up to the mortgage broker. It’s up to the lender to tell them what is wrong. I’m sorry Senator, but I couldn’t disagree more.  I can see the benefit of having the fine print written more clearly, or perhaps people should be encouraged to avail themselves of legal counsel more often.  However, what borrowers really…
Read more…

If I were ever stuck somewhere like a prisoner of war camp, I think I would want to be stuck there with Lawrence Yun, chief economist of the National Association of Realtors.  He seems to be able to find the bright side of anything.  Look at the difference in these two approaches to July’s Existing Home Sales Report.  From CNBC:   Sales of existing homes dropped for a fifth straight month in July, falling to the slowest pace in nearly five years, while home prices fell for a record 12th consecutive month. The National Association of Realtors reported that sales…
Read more…

This post is by way of an appetizer. Twist is sleeping in a bit and preparing for her customary response to the new NAR numbers (and spin) expected later this morning. UPDATE: G sends the link to this cartoon (from The Big Picture blog) … Meanwhile, Doomers should brew a second cup of coffee, sit back and enjoy this gem from late 2004 [1] written by Alex Markels. It was actually his piece from yesterday [2] that first caught our eye here at Doom Castle, but then we found the earlier article and its extraordinary forecasts about things that have…
Read more…

So, here we are on the last week before Labor Day. Let’s hope both Buffy and Bubba finally get to the beach, turn off their blackberry and portable TV, and forget about the markets for a while. It has truly been an amazing summer.  

There may be a time for irony on housing bubble blogs, but this isn’t it. The news is filtering in [1] from Buncombe County in western North Carolina, and it’s pretty grim. David Kanis is a mortgage broker and branch manager of the local Ashford Mortgage Advisors brokerage. He writes a regular column for the Citizen-Times, and in today’s piece he gives us a clear-eyed view of how the entire non-conforming mortgage finance sector has essentially stopped working in and around Asheville. Last down were Jumbo mortgages, which seized up dramatically in mid-month.

I’ll let Catherine Reagor of the Arizona Republic explain it- I thought this was pretty funny, if musically painful:  

ACKNOWLEDGMENT: Don’t quite know how this fell through the cracks — Doomer G contributed critically toward the research for this post. Thanks!  (update Sunday @ 7:20PM PDT) Earlier this month, big-time short investor Kyle Bass helped blow the lid off the bond markets.[1] Now intriguing hints suggest that a new edition of his famous investor’s newsletter [2] takes aim at investor bailouts and suggests a solution [3] to America’s homeownership crisis (my emphasis in the following quote). U.S. residential real estate is the largest single-asset class in the world, worth about $27 trillion, according to Bass. A loss of just…
Read more…