amoeba's Account Talk

[justbizness45]

That's why even though I had my a@@ handed to me today I think I will cut and run and live with the loss. I can't see an upside. Thanks for the look into your crystal ball.

 

[mojo]

Foreclosures will hit 3 million this year; and there will be no write-downs of principal bcz we don't want anyone to get them

I agree with you on the forclosures but what do you mean by "no write-downs because we don't want anyone to get them"?

I will be giving mine back to the bank and I'm prime 750+ not subprime or alt-a. My street is like a ghost town. Only one other owner occupied home besides mine. The rest are forclosures from investors. I'm upside down over 150k not including the 50k I put down 4+ years ago. The housing situation is going to get much worse in some areas. I've never dafaulted on a loan, this will be a 1st. I've tried talking to the lein holder American Servicing Co. , what a waste of time. Oh well like you said.....

"We hicks don't want your bailout - we like foreclosures - we didn't put any money down anyway; why would we give a hoot about re-working a $400,000 loan on a house that's worth $200,000; when we can live there for freefor 6-8 months during foreclosure proceedings, leave, and buy the same house 25 months later for $180,000 using the FHA. You gotta be kidding me."

This is what brought down my neighborhood. I'm one of the last holdouts but there is not much point in hanging on at this point.

Thanks for the encouragment to move to G on Friday.

Take care

 

[alevin]

I will be giving mine back to the bank and I'm prime 750+ not subprime or alt-a. I'm upside down over 150k not including the 50k I put down 4+ years ago. I've never dafaulted on a loan, this will be a 1st. I've tried talking to the lein holder American Servicing Co. , I'm one of the last holdouts but there is not much point in hanging on at this point.

mojo, I feel for you. You were set up into an impossible situation, no fallback position if anything went wrong. A few years ago, there was a strong possibility that I'd have to move into a housing market 3x higher than my current one, based on probability of job transfer due to forecasted downsizing of my position at the time. Everywhere I looked, that I'd have wanted to live, I was priced out of the housing market after being a homeowner already for 10 years in lower markets.

The only out I saw in those unliveable markets was to become a renter again or buy a trailer and become trailer people again like I was in my mid 20s (it was feeling like it was going to be deja vu 20 years down the road, wondering if I'd made ANY financial progress in my life in 20 years time). For me, I didn't have to come to grips with that sense of financial defeat, since my job here did not phase out after all, so I'm one of the lucky ones. Will be thinking of you, take care.

 

[mojo]

Well ultimately I am responsible for my situation.

I have a job that pays me well and a great family. I feel very fortunate considering the state of our nation.

 

[amoeba]

I agree with you on the forclosures but what do you mean by "no write-downs because we don't want anyone to get them"?


Take care

MoJo:

I'm a straight talker so this is not personal. It's a matter of fairness and sound economic and lending policy. There is not a black and white, I agree, but a continuum of personal financial situations; the commonality among all of them is that everyone lost net worth - the fact that this causes some to have to move does not create or rise to the level of such poverty or dispair that it should involve particular government intervention, especially at the $200,000 per case instance. There are alot of things that can be done with this sort of money; all it does is prevent one family from renting (not the end of the world), for two years (under current law). The benefit is simply not worth the expense.

We = voting majority and the banks. Writing down principal would be like giving away free money. Not only is it fundamentally unfair to give it away to some but not all, but those who did not get it are being penalized for their better management of finances.

Which brings up another thing, the elimination of taxes on forgiveness of debt for short sales.....think that's an incentive to stay? (NOT)

If anyone wants people to stay in houses, they need DISINCENTIVES to bail:

a) ditch this 2 year home free FHA loan provision; that'll make people think a couple more times before not paying;

b) bring back the tax on debt forgiveness on short sales.

By the way, just about anyone who owns property lost money; by example, a co-worker of mine bought a house 2 years ago for ~$680,000, it is now worth ~$500,000; it took a combined 20 years of savings, two sold houses, and two incomes to afford that house - the difference is he put down $470,000 in cash, and borrowed another $230,000 (needed back yard work). His investment is as unprofitable as yours, the only difference being the amount of downpayment. It would be fundamentally unfair to forgive, or write down, your debt - when he has to assume his.

Well - that's the best I can do - and I am extremely impressed with your acceptance of responsibility; you do not blame me, or the bank, or the lender. It is a bad economy for all. I don't intend to make it worse with colorful writing. But it is the truth as I understand it.

Best wishes.

 

[mojo]

I don't take it personally. I agree with you economically. I don't think there should be any bailouts and let the chips fall.

My point is really the same as yours. It is now more beneficial for the once responsible to be irresponsible, banks, business, individuals, etc. This is a very bad place to be.

My responsibility to the lender is to pay them back or forfeit the collateral/home on the loan. Soon I will most likely forfeit the collateral. It would be in the interest of the lien holder to lower my principal to the amount the larger house next door was auctioned off for but they don't agree so...
My story is long but in the end I have done the best I can with a bad situation and tried to act responsibly. People like me and you I assume can't or won't continue to carry the weight of the irresponsible, it's getting to heavy.

I don't want or expect a bailout but it makes me sick to my stomach to see all that taxpayer money being doled out to the most irresponsible banks, companies, people etc. and not even being accounted for.

The American people have just elected a strait-up socialist. This crisis will be used to grab as much power as possible. Why would anyone expect anything different.

What we are going through now is just the beginning of hard. Our whole economic system is one big Madoff ponzi scheme at this point. If he had a printing press he'd still be doing fine.

Take care

 

[Birchtree]

Mojo,

Just thought I'd weigh in - if I were upside down on my mortgage I would keep paying my mortgage and using the tax deduction. A house is only an asset just like a stock portfolio and both will appreciate and also depreciate as the market conditions change. Your home will again gain in market value it will just take time. I'd sit tight just like I'm doing in my portfolio - yesterday I gave back $75K in devaluation and am feeling fortunate because I thought it would be even worse.

 

[Steadygain]

Mojo,
First of all - please know we are really hurting for you and YOU ARE NOT ALONE.

You bought your home - probably a very nice one - at a time when housing dominated everything and were caught up in the mess. People are going to need homes in the future and even though things look very bleak at the moment THINGS WILL TURN AROUND and the value of your home will go up and more than likely the houses around you will become occupied.

If you can possibly make your payments...maybe even refinance to a 4.5% Loan...you'd probably be way better off in the long run. Unfortunately you may have bought the house when it cost an 8 year projected cost (the value of a house usually goes up quite a bit over the years). My house has more than doubled in value in 12 years. So I guess I'm saying the odds are - over the years you'll more than likely make a good profit if you maintain your residence over the next 10 to 15 years.

Whatever happens - we feel for you - it's like a family here so when you hurt we all hurt.

 

[350zCommTech]

I don't take it personally. I agree with you economically. I don't think there should be any bailouts and let the chips fall.

My point is really the same as yours. It is now more beneficial for the once responsible to be irresponsible, banks, business, individuals, etc. This is a very bad place to be.

My responsibility to the lender is to pay them back or forfeit the collateral/home on the loan. Soon I will most likely forfeit the collateral. It would be in the interest of the lien holder to lower my principal to the amount the larger house next door was auctioned off for but they don't agree so...

If you're upside down by 150-200K, the decision should be a financial one that is best for you and your family. If the lender does not want to work with you, **** them. On a non-recourse loan, you can give them back the keys and just walk. When every scumbag in the world is getting a bailout, don't be the responsible guy that is left holding the bag.

I'm sure you know the answer to this question. In 3-4 years, what will the value of your house be?

I'm not advocating that everybody walks, but that the decision should be a financial decision.

 

[Warrenlm]

Couple other points to consider. Past doling out has been to fatcats and bigwigs. Now the next big dole out:

http://appropriations.house.gov/pdf/PressSummary01-15-09.pdf

Also, people walking away can get an FHA loan in 2 years (after 6 months free rent). One only has to guess at the price of homes 2.5 years from now. 90+% of mortgagors are paying as agreed but a lot of others are getting well in this time of free money. Enough that it's not responsible to be responsible.

 

[mojo]

I don't mean to come off as some sad case LOL. Thanks for the encouragment and thoughtful responses. This is a great mb with great people.

 

[amoeba]

Couple other points to consider. Past doling out has been to fatcats and bigwigs. Now the next big dole out:

http://appropriations.house.gov/pdf/PressSummary01-15-09.pdf

Also, people walking away can get an FHA loan in 2 years (after 6 months free rent). One only has to guess at the price of homes 2.5 years from now. 90+% of mortgagors are paying as agreed but a lot of others are getting well in this time of free money. Enough that it's not responsible to be responsible.

My guess is alot of people walking away and/or shortsailing, causing home prices to decline further, and buying back same or similar in 2 years on an FHA loan at a much lower principal. So why would you or steadygain, or anyone else hang onto that albatross for 10-15 years and pay out the nose, when you could have 1/3-1/2 less of a payment just for renting for 2 years. No Biggie. Another economic completely legal decision - and nobody is talking about changing it.

 

[amoeba]

sumbeech: I declare....I peaked out on the tracker at #12 yesterday, now down to #46 or so, back below the flipping G fund. OK....you got me, market.....took me to the cleaners with 4 days of decline in F fund write after I accumulated. I will get it back and then some.

I looked back at other fluctuations in the F-fund and this is not unique, but unusual recently (which makes it expected?). I pared back - if it goes up tomorrow I will look at it as cashing in, if it goes down a fifth straight day, well - - - I may just wait a while to mix things up. There were 4 straight down months in the F-fund last year but I thought we were past that (guess not).

Bottom line - G-fund doesn't excite me, although more exciting than losing money.

 

[justbizness45]

sumbeech: I declare....I peaked out on the tracker at #12 yesterday, now down to #46 or so, back below the flipping G fund. OK....you got me, market.....took me to the cleaners with 4 days of decline in F fund write after I accumulated. I will get it back and then some.

I looked back at other fluctuations in the F-fund and this is not unique, but unusual recently (which makes it expected?). I pared back - if it goes up tomorrow I will look at it as cashing in, if it goes down a fifth straight day, well - - - I may just wait a while to mix things up. There were 4 straight down months in the F-fund last year but I thought we were past that (guess not).

Bottom line - G-fund doesn't excite me, although more exciting than losing money.

F has been oversold for some time. I'm not surprised by it going down some. That said I would be in right now if I had stuck to my plan. I set up my contribution to go to F so I will be able to <1% IFT in the rest of the month real world. When the market starts tanking again and it will; where will people be putting their money? F may spike up again at least until the bond market dislocates. That is a real possibility so I will limit my exposure to minimum but still play a little.

 

[amoeba]

Aaaaaarrrrrrrrrrggggggggggghhhhhhhhhhhh:

5th straight day of spanking my f-fund;

it hurts!!!!!!

 

[350zCommTech]

Aaaaaarrrrrrrrrrggggggggggghhhhhhhhhhhh:

5th straight day of spanking my f-fund;

it hurts!!!!!!

Have you read my recent postings on bonds and the F fund?

 

[Frixxxx]

Have you read my recent postings on bonds and the F fund?

Isn't that where you said to get out?????

USD on the rise baby!

 

[350zCommTech]

Isn't that where you said to get out?????

USD on the rise baby!

Yes, I've been saying that for the last few days. I would sell on any bounce in the F fund.

 

[justbizness45]

I posted this on the F Fund page but it applies to your discussion. 61.2% in mortgages and Treasury Securities:

http://www6.ingretirementplans.com/custom/540.pdf

The Fund is NOT FDIC insured, is NOT an obligation or deposit of, or guaranteed by Barclays Global Investors or its affiliates, and involves investment risk, including possible loss of principal. An investment in this trust is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other government agency. While the trust's investment objective includes the preservation of capital, it is possible to lose money by investing in the trust.​

The Fund will not use defensive strategies, such as temporarily moving assets to cash or purchasing other
financial instruments, to protect against potential market declines. Instead, the Fund will remain fully invested in debt securities.​

[FONT=Arial,Bold]

Asset Allocation​

Treasury 22.4
Agencies 9.3
Finance 8.6
Industrial 9.3
Utility 2.0
Non-US Corp 3.6
Taxable Muni 0.2
ABS 0.8
Mortgages 38.8​

CMBS 5.0

I wonder how long they can hold those mortgage securities before accepting the loss?
[/FONT]

 

[Boghie]

Uuuugggghhhh - The 'F Fund' is cr@p too...

Don't like the 'G Fund' because our brothers in the Treasury will be lookin to 'borrow' some funds to fill up trucks with hyper inflated money next month.

Kinda obvious that the C/S/I funds ain't the place to be until FDR Jr. tells us about his Newer Deal.

I was worried about the 'F Fund'. Kinda scared that the fund's description told me that it contains 45% in asset-backed securities. Um. Ick. Yuk. Me thinks I have been hearign about Asset-Backed Securities in the news for a while.

Otherwise known as 'Toxic Assets'.

Now, JB comes out and slams my last Hope

Change.

Hope.