01-02-2010, 01:17 PM
I have been monitoring some foreclosure forums where people are talking to each other. Many people stopped making payments a year ago. Their time is up. On island, a friend of a friend has not made a condo payment in two years. I guess the bank doesn't want to pay the HOA fees as it's a very high end condo with big fees. VERY FEW of the stories on the foreclosure forums involve reset rates. Most are either people who lost their jobs or had medical costs who could no longer afford existing payments. Others were people who always planned to sell their homes but found them underwater on value and stopped making payments as throwing good money after bad.
The HAMP situation (the Obama program) that was designed to help homeowners did not have enough teeth to do the job. What it did was create a lot of jobs for people to process applications. It took a good six months before the lenders began to get a handle on what if any modifications the investors were willing to approve, and they are STILL working through that with thousands and thousands of applications. Meanwhile, people got the word that they would not help you if you were making payments. So they stopped, as they were broke anyway. Now when they finally get denied they are set to be foreclosed on basically any time the bank decides to move on it. It all depends on the investors balancing between not getting payments and having REO properties on their books, and flooding the market with REO. The banks don't want to maintain the properties, but if there's any sign of the values going up, they are poised to foreclose on many properties and recover their investment.
The HAMP situation (the Obama program) that was designed to help homeowners did not have enough teeth to do the job. What it did was create a lot of jobs for people to process applications. It took a good six months before the lenders began to get a handle on what if any modifications the investors were willing to approve, and they are STILL working through that with thousands and thousands of applications. Meanwhile, people got the word that they would not help you if you were making payments. So they stopped, as they were broke anyway. Now when they finally get denied they are set to be foreclosed on basically any time the bank decides to move on it. It all depends on the investors balancing between not getting payments and having REO properties on their books, and flooding the market with REO. The banks don't want to maintain the properties, but if there's any sign of the values going up, they are poised to foreclose on many properties and recover their investment.