NY Times: Lenders are creating glut of foreclosed homes

By ERIC DASH
Published: May 22, 2011


EL MIRAGE, Ariz. — The nation’s biggest banks and mortgage lenders have steadily amassed real estate empires, acquiring a glut of foreclosed homes that threatens to deepen the housing slump and create a further drag on the economic recovery.

All told, they own more than 872,000 homes as a result of the groundswell in foreclosures, almost twice as many as when the financial crisis began in 2007, according to RealtyTrac, a real estate data provider. In addition, they are in the process of foreclosing on an additional one million homes and are poised to take possession of several million more in the years ahead.

Five years after the housing market started teetering, economists now worry that the rise in lender-owned homes could create another vicious circle, in which the growing inventory of distressed property further depresses home values and leads to even more distressed sales. With the spring home-selling season under way, real estate prices have been declining across the country in recent months.

“It remains a heavy weight on the banking system,” said Mark Zandi, the chief economist of Moody’s Analytics. “Housing prices are falling, and they are going to fall some more.” .............(more)

The complete piece is at: http://www.nytimes.com/2011/05/23/business/economy/23glut.html?_r=1&hp

Its ridiculous. Try to get a loan. The unfettered bailout was a pathetic display of faith in an institution dominated by greed.

Did anyone go to jail ? Nope... and their fingers are still in the pie. It is obnoxious to see what the execs from fannie and freddie got while hiding the meltdown.

Shameful. Yet they still whisper in Obama's ear. At least Dodd is bowing out. No way he wants to face any more questions on his banking involvement and support. I lost a tremendous amount of respect for him.

They have all been bought and sold. Top down.

But the property taxes increased $1200 this year.

This isn't going to work.

Don

getting their taxes reduced.. It may be worth a try.

And after they were done with all that their taxes still didn't go down.

They were just out another $500.

The appraisers like it though.

Don

Between 250-350: for an average home

like yours have sold for way less, that alone should tell the story.:(

perhaps if all of you (and more) called a local newspaper, maybe they would shine a light on the problem..

It can't hurt to squeak some wheels:)

are your town council meetings public? If dozens of people started showing up to complain, maybe they would pay attention.

If taxes are based on the sales price, it's not fair to punish people who are staying put and to reward interlopers who snap up cheap houses to use for rentals (which sometimes depresses values even more)

Where they overpriced then too?

until then, houses were usually affordable (modest) for people in their mid-30's..people with stable careers/futures and 20% to put down.

The wild gyrations of the credit markets & wall street casinos captured too many people who were too eager to borrow.

People used to save up the 20% down, and interest was high, so people did not over spend, and they stayed put to pay the house off..

Since the late 80's houses became "investments" to be "borrowed against"... and the prices escalated

or even come close. I'm no economist, but how does that make it worth "what it should be" ? :shrug:

It's now just a matter of them telling me what date I have to vacate the house by.

I stopped my mortgage payments to GMAC in October when they refused a short sale offer. I'm planning to move before the leaves fall again anyway, but I've spoken to people whose houses haven't been foreclosed on for over 2 years since they stopped payments.

That when individual concerns act in what they see as their best immediate economic interest, the cumulative result is to injure the system containing them, harming not only everyone else, but eventually even themselves....

Funny thing is a lot of us seen this coming but no one wanted to listen.

Chickens are coming home to roost.

Don

to their rich friends who will pay cash & probably figure in some kickback-y treats for the ones who find them the "best" houses to buy.

They will rent them out and wait for the next bubble & then make a bundle. In the meantime, they will use them for tax write-offs and for crashpads for their offspring..

During the Depression, my grandfather almost bought this place for $5k because he had cash.. He chose to not buy it because he honestly didn't know what he would do with it.

It's now on the National Registry of Historic Buildings

capialism. The only ones who REALLY get hurt during the busts are the small scale investors. The big guys have enough left after it busts to swoop in and buy real assets for pennies from the bankrupted. They can THEN create ANOTHER boom and make another killing.

It's the way the SYSTEM funnels money and assets upwards.

be allowed to make housing purchases for a while. They helped bring down the economy with their manipulation of the housing market. The big banks obviously cannot be trusted with such responsibility.