Underwater Homes Officially Reported at 25% of ALL HOMES

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EDITOR’S QUESTION: Just what do they expect these people to do? The actual number of underwater homes  is now approaching 20 million or 40% of all homes — again because of the way they measure it, leaving out things that directly affect the actual price paid and the proceeds of sale. If they think that people are going to sign modifications (i.e., new mortgages waiving all defensive rights against the fraud perpetrated upon them) they better think in terms of reality — who would agree to owe $400,000 on property that is worth $150,000?

I don’t care what you do to the interest rate. The principal MUST be corrected to reflect the reality of the transaction when it first occurred — but that would mean acknowledging appraisal fraud, which would allow people to sue for punitive damages, compensatory damages etc. The only alternative is to use present fair market value which is even lower.

In order for the megabanks to prevail they need your house with you out of it.  In order for the economy to recover, you need to stay in your house, recover any home taken from you so far, and recover at least part of the meager wealth you had before this giant fraud began. No modification plan publicly discussed allows for that to happen. They say that is the goal but it isn’t — not without principal correction to true market value when the loan transaction occurred.

Number Of Underwater Mortgages Rises As More Homeowners Fall Behind

DEREK KRAVITZ 03/ 8/11 01:40 PM AP

Underwater Mortagages
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WASHINGTON — The number of Americans who owe more on their mortgages than their homes are worth rose at the end of last year, preventing many people from selling their homes in an already weak housing market.

About 11.1 million households, or 23.1 percent of all mortgaged homes, were underwater in the October-December quarter, according to report released Tuesday by housing data firm CoreLogic. That’s up from 22.5 percent, or 10.8 million households, in the July-September quarter.

The number of underwater mortgages had fallen in the previous three quarters. But that was mostly because more homes had fallen into foreclosure.

Underwater mortgages typically rise when home prices fall. Home prices in December hit their lowest point since the housing bust in 11 of 20 major U.S. metro areas. In a healthy housing market, about 5 percent of homeowners are underwater.

Roughly two-thirds of homeowners in Nevada with a mortgage had negative home equity, the worst in the country. Arizona, Florida, Michigan and California were next, with up to 50 percent of homeowners with mortgages in those states underwater.

Oklahoma had the smallest percentage of underwater homeowners in the October-December quarter, at 5.8 percent. Only nine states recorded percentages less than 10 percent.

In addition to the more than 11 million households that are underwater, another 2.4 million homeowners are nearing that point.

When a mortgage is underwater, the homeowner often can’t qualify for mortgage refinancing and has little recourse but to continue making payments in hopes the property eventually regains its value.

The slide in home prices began stabilizing last year. But prices are expected to continue falling in many markets due to still-high levels of foreclosure and unemployment.

18 Responses

  1. THE A MAN,

    Yes. But, you have powerful people on the other side who are supposedly trying to save our deeply failing economy. And, the only ones with power to influence government and Congress is those in position to do so – and that is not the victims. Thus, have to always be one step ahead — call their bluff. Corner them.

  2. Another B@llSh@t arguement are paying or not paying. The Question should be. Are you a victim of Fraud or are you not a victim of Fraud?

    This is how Women victims of rape were treated up until a few years ago.

    Did you wear a mini dress? Did you enjoy the Sex?



  3. PJ,

    You are right.. Property taxes must be brought down. And, confiscation property tax liens are a big problem. Does anyone really think the servicer is paying all delinquent loan payments and property taxes, and in many cases homeowners insurance — to the trustee/trust???

    The biggest problem as to resolution of so many homes underwater is that banks – such as BofA – invoke the moral hazard issue. That is– helping victims stay in their homes by principal reduction would offend those that are paying their mortgage loan.

    First, I am paying — and I am NOT offended — and believe this is the only right thing to do.

    Second, to resolve the moral hazard issue, Congress should revisit Bankruptcy reform. Twice Congress voted down BK reform that would allow BK judges to restructure home loans (would love to have a list of representatives that said no to this).

    Certainly, not everyone would run to file for BK – it is an option of last resort – and is a black mark. There would be no “moral hazard” — if the only option to victims is BK.

    Professor Levitin promoted BK reform heavily to Congress. Again, Congress ignored – but that was at a time when Congress anticipated that servicers would voluntarily modify – and Congress did not anticipate 25% of homes now underwater.

    Of course, with BK reform the actual creditor MUST be identified. And, with any principal reduction, a new contract must be drawn up – with the current creditor identified.

    There is a reason why banks refuse to do principal reductions — they do not want to identify the current creditor. .

  4. speaking of underwater homes—Japan has some real underwater homes.

    8.9 earthquake and aftershocks in the 6.7 range and tsunamis with fire on top of the water

    I’m praying for them…

    sort of make sour probs trivial

  5. Cheryl
    what state did notary purport to be commissioned in?

    it of course would depend on your state notarial laws (where the notary was licensed or commissoned in) and other state laws.

    this could be very very important if you are in non-judicial foreclosure state.

    it certainly does not seem like any doc would be valid & legal if notarized by somebody who was a fake notary

    why would they even try to do that–unless desperate

    and examine what the document was for—–if it was like an assignment of mortgage or deed—-
    then a fraudulent transfer based on notary fraud

    best to consult an attorney if possible

  6. That’s right editor. Now 25% of the home mortgages are under, anybody that bought or refinanced during the 2000’s it was a trap to get monthly payments for 30 years, a toll booth for investors and banks. Hey, you signed and agreed, not our fault. What mortgages are not assigned properly in land records, doesn’t matter, you signed and agreed. The goal was to give you a home and you are now supposed to make the monthly payments, you agreed you can afford it. Right? If no monthly payments, we foreclose. What’s the problem? Oh, your house is underwater, not our fault. It’s the free market, right.

    Hoodwinked. Took.

    It goes like this. Lets say you sell an item on Ebay for $10.00. Somebody buys it. You ship it and he gets it. Buyer says he received but item does not work. You reply return item and I will replace or refund. Buyer returns item, you look over and it is not the same item you sent but you can’t prove it. So you are worried about your feedback. So you can either send another good item or give buyer a refund. BUT, buyer returned an exact item only it was a bad one he had. He just switched your good one for his bad one. So, if you ship him a good one again, he now gets two for the price of one. If you refund him, he gets a free one. Either case you loose, and he wins.

    Do you understand? Your refinances and home mortgages have been switched, but you agreed. Why on earth do a loan mod on same principal balance?

  7. Abby or anyone –

    Do you know if mortgage notarizations are valid and legal if the notary was unlicensed and title co. and notary were fined by the State for not having a license? Thanks.






  9. Is it possible for 2 homeowners who are underwater to just switch houses? You know, I take over yours and you take over mine.
    The way I see it is why not play the game the same way the banks have been doing?
    Probably could sign off with Satisfaction of Mortgages being recorded and making the banks back off.
    At least on paper, like a MERS assignment?
    No money needs to change hands, just like a MERS assignment, but the paper work is changed. Then the banks would have to deal with the new owners or find them. But have no reason to touch the new owners because they didn’t sign the original promissory note. Or am I wrong?
    That seems to be what they have been doing thru MERS, just shifting ownership from one party to another and not bothering to record anything until After 2007.
    I’ve been trying to track chain of titles and it’s one hell of a headache! And that’s only with what has been recorded.
    It jsut seems that so many rules have been broken or altered or ignored that only those who play by the rules get screwed!
    They took us for billions, all we want are our homes!

  10. Under water now, but yet still appraised with property tax burdens at “Bubble High’s” . These people are being slammed on all sides… as are the people that never had any skin in this game, due to appraisal fraud during the go go years!
    Next round of confiscation property tax liens!

  11. BOA has never tried to straightened things out. They falsify records on the mortgages. I know. I have all the proof in the documents. Just because BOA says they have done 800,000 mods does that mean it is true? Why doesn’t BOA show their proof. I asked for discovery and never got it. Why it that. If they have nothing to hide, show the proof.`

  12. Off topic, but does anyone have any updates on the recent three law firms (in Florida, one of the was Kahane & Associates in Plantation Florida), under investigation by the Florida Attorney General’s Office (economic crimes division)?

  13. I would like to know how we can prove the fraudsters obtained insurance against default. How would they receive times the face value of the loan?
    The Borrowers and investors need to contact each other. I am sure we could work it out. Why do some banks deny , deny and deny. like Wells Fargo?? BOA is trying to straiten things out?
    Racine WI

  14. According to the FED, the foreclosures were justified. In another words the loans were designed to fail and the neighborhoods were designed to deflate while the innocent pay for the crime. The FED and their gang of dirty bastards need to get a life.

  15. No complaints , nothing wrong with foreclosure :


  16. This says it all: The innocent are punished and the guilty go free.


    Thanks to Phil Graham, Bill Clinton, and Greenspan. You and your gang of Banksters have punished millions and yet no one has gone to jail. If there is any judge out there that does not understand fraud then they below in jail as well. How many more of the innocent do you plan to punish ?

  17. Does anyone have the purchase agreements for Citi and ABN? if so reply on how I can get them.

  18. Glad this is a topic as this is something judges ignore and the banks are allowed to skate through since they ignored all under writing standards including the collateral values of each home. Again nothing but calculated deceit. Capital Hill could care less about the little people who put them in office and fund their guaranteed pensions. Most judges are asleep at the wheel. Maybe time for all citizens to move to another country. If this is the case there will be no capital hill and judges will not have to rule on the issues. They will have to find a real job to survive.

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