All Posts Tagged With: "toxic"
Foreclosures — No Worries, No Vision
The lending community will plainly tell you that foreclosures are on the rise — in part because of rising interest levels — but don’t worry. According to the party line, there’s no need for alarm because the problem is contained to subprime loans and just a few states. For example, John Robbins, Chairman of the [...]
19Sep2008 | Peter G. Miller | 0 comments | Continued
Foreclosure Numbers at New Highs: Are Toxic Loans To Blame?
Foreclosures used to be a rarity and for the most part that’s still the case. As of the second quarter of 2008 only about 2.75 percent of all loans were in the process of being foreclosed, according to the Mortgage Bankers Association. That term “in the process of being foreclosed” is important. Neither borrowers nor [...]
19Sep2008 | Peter G. Miller | 0 comments | Continued
Must Mortgages Be “Suitable” For Borrowers?
How come we have so many toxic loans? “The system is out of balance,” says Sen. Chris Dodd (D-CT), “There is a chain of responsibility that makes these abusive loans possible.” The way Washington works is that you have to read between the lines. Notice that Dodd’s core concern is not “predatory” loans or even [...]
26Aug2008 | Peter G. Miller | 0 comments | Continued
Toxic Loans & The Art of Denial
There’s an idea which has been voiced with more and more frequency and it generally goes like this: I have a toxic loan but why worry? After four years or so — just before the monthly cost of this loan doubles — I’ll just go out and get another interest-only or option ARM, begin the [...]
26Aug2008 | Peter G. Miller | 0 comments | Continued
Toxic Loans: The Coming Storm
(Presented before the Association of Real Estate License Law Officials (ARELLO), April 7, 2006, at Jacksonville, FL.) It’s been a very good century for real estate, at least so far. According to the National Association of Realtors, the typical home that sold for $139,000 in 2000 was worth $208,700 in 2005. Not only have home [...]
25Aug2008 | Peter G. Miller | 0 comments | Continued
Should We Require Lenders To Modify Toxic Loans?
Mortgage interest rates are down at this writing, well below 6 percent. In such circumstances it certainly makes sense for borrowers with exploding ARMs to refinance into stable, fixed-rate mortgages. But many such borrowers have loans where mortgage balances have grown while home values have fallen. Many toxic loans require huge prepayment penalties. Most borrowers [...]
20Aug2008 | Peter G. Miller | 0 comments | Continued
Did One Mortgage Regulator Get It Right?
For months, Sheila Bair, head of the Federal Deposit Insurance Corporation, has been saying that there’s an instant solution to the mortgage meltdown that can prevent massive numbers of foreclosures. Not a perfect solution, but a solution. Her idea? Freeze toxic loans at their original interest rates. Writing in the New York Times, Bair says [...]
20Aug2008 | Peter G. Miller | 0 comments | Continued
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