Chris Curtis's Blog

The Real Estate Market is in flux

by Chris Curtis on May.29, 2010, under As Goes California…, Banking and Finance, Fresh Perspectives, Takin’ It In The Short Sales

I know it has been several months since I have posted, honestly it has been a blood bath out there and tough to stay focused. There have been lots of changes on the Real Estate front to have been beaten up over. The saviour of the Short Sale program was supposed to be the HAFA program. I am not sure that we are any better off than we were before.

Currently I have two JP Morgan Chase (one is a legacy WaMu) Short Sale, and a Wells Fargo Short Sale with all with First and Seconds with the same institution. Nothing seems to be moving forward any quicker than they used to.

I have a new business partner and office mate, Catherine Myers. She has been working on Short Sales for the last several years. I have followed her BLOG, Contra Costa Short Sales and together we have been attempting to education the public as to how things are really going with the Big Banks. What an up hill battle! Together we have turned out to be a pretty great team.

I have some additional thoughts on the market. So here goes.

Banking: Yesterday I came across this article in DSNews. I was suprised to read that an independent credit rating company, Weiss Ratings rated the nations banks and their vulnerability to financial difficulties and possible failure. Click herefor a review of the article. Reading it was very enlightening. It makes me wonder how these large banks are going to process their shadow inventory. Given the recent history with Short Sales and the public (myself included) starting to not care about the banks financial health, they seem to have a HUGE public relations nightmare ahead for themselves.

I also found an article from another source HousingWire. I am still waiting for more information before I admit mistake or error in judgement. It appears as if the Federal Reserve leaving the MBS Market didn’t cause interest rates to climb as I previously predicted. I personally think that the credit crisis in Europe and specifically Greece, has delayed the increase in Mortgage Rates. But again, we will see. Click here to see another public apology of someone who also thought rates were going to change.

I would be curious to hear what you all think about the market too. Feel free to comment, I would love to hear that I am crazy, or not…

Share and Enjoy:

Bank Regulations, Existing Home Sales, Shadow Inventory, World Markets Leave a Comment more...

Rambling thoughts on Housing Market and What is next?

by Chris Curtis on Feb.11, 2010, under Banking and Finance, Everything About Foreclosures, Fresh Perspectives, Mortgage Notes, Uncategorized

iStock 000000874059Small Rambling thoughts on Housing Market and What is next?

I was cruising the blogs and sites today and came up with a group that really caught my attention. The first article that I read is in direct relation to a previous post of mine, “To Whom does that Fed Intend to Sell its MBS?” In the article there is several quotes from the St. Louis Fed President, James Bullard. What I thought was interesting is Mr. Bullard actually thinks that after the Economy “stabilizes” the Fed should consider asset sales. So what does that mean, our interest rates will have to jump is one thing. The other thought, who in their right mind would want to buy MBS’s now, good or bad debt, it really is irrelevant.

Then I was off to my next check, well let’s see what wisdom I can find regarding housing prices. Then I was faced with this question, “Are Home Prices Headed for a Double Dip?” I must admit, I am not normally a proponent of the Case-Schiller Index or Zillow, but what I found enlightening was some of the posted comments to the article. It seems that there is a real fear of the false bottom that myself and many of my fellow outstanding HousingStorm colleagues have been professing.

Then I looked through another one of my daily notification websites and found this article with statistics from RealtyTrac. I started to take things personally. Am I the only one that see’s that these statistics are simply a smoke and mirror’s game. We unfortunately have been challenged as a society to see the truth. Foreclosure filings may be down, but remember the Shadow Inventory is still out there and unfortunately, the only way to get through it is to get through it. Here is another version of the story about the Shadow Inventory, that I referred you to from DSNews, as presented by Boston.com the online version of the Boston Globe.

If I wasn’t feeling neurotic enough I decided to see what the MBA (Mortgage Bankers Association) had been doing to help us, as consumers and Real Estate professionals, feel better about the Housing Market. What I found was disturbing. As many of you know, and I asked a couple of posts ago, many of us are facing a real ethical question, do we or don’t we walk away. What you may not have heard is that the Commercial Real Estate market is coming apart at the seams. I found this article about what is going on with the MBA and their headquarters in Washington DC. It seems that the group that is directly involved with helping coach us through our mortgage crisis, seems to have a case of double standards.

Lastly, a little bit of “wisdom” from Timothy Geithner, now if only people could get loans from the Banks who have decided to keep it all, maybe the housing crisis could recover. It seems that we may be headed toward a path of eased credit restrictions, but only time will tell.

Share and Enjoy:

Bank Regulations, Existing Home Sales, False Bottom, Fannie Mae, Foreclosures, Housing Inventory Reports, Shadow Inventory, The Fed 1 Comment more...

Here is some more scary information about the Fed $1.25 Trillion parachute…

by Chris Curtis on Feb.04, 2010, under Banking and Finance, Fresh Perspectives, Market Movers

So I was cruising the blogs and daily financial news blasts and came across this little update to my post the other day with some additional thoughts about how quickly we are printing money and IF the Federal Reserve has a choice when it comes to stop buying MBS’s by 3/31/2010. check it out here.

Then today it was announced that the Treasury Department is printing money 24/7 just to keep up with our debt accumulation. It is estimated that by the end of 2011 we as a country will have nearly $14 Trillion dollars is debt, or almost $45,000 for every man, woman and child in the United States.

The Stock Market and the super smart investors are worried about EU Countries and their debt, what about ours? We are printing money so we don’t default, how can that be good for the value of the dollar? How can the 268 point drop in the Dow be tied to investor reaction to the 480,000 jobs lost last month. So what! What about this article about what is going on in the Hong Kong Market, we should be worried about the dollar falling faster than a rock in a lake too, shouldn’t we?

The the question becomes, if we keep printing money, how long until the World Markets figure out that we are going Bankrupt too?

Share and Enjoy:

Bank Regulations, Federal Deficit, Stock Market, World Markets Leave a Comment more...

Will Fannie and Freddie survive or just pass the buck?

by Chris Curtis on Feb.03, 2010, under Banking and Finance, Fresh Perspectives, Mortgage Notes, Real Estate Investing, Uncategorized

I have been think recently about how I should send an email to 60 Minutes, or the like, with a series of questions that we all seem to flirt with. What is happening with the Mortgage Backed Security Market?

Recently we discovered that the Federal Reserve has all but tapped out the nearly $1.3 Trillion amount for MBS (Mortgage Backed Securities) so to keep Mortgage Rates low, albeit artificially. The question starts with the Federal Reserve and how their actions have essentially kept the secondary market for mortgages working, click here to read about some recent news from the Capitol Hill.

You might wonder why you should care if the Federal Reserve is buying MBS’s? Well, essentially, if mortgages aren’t bundled into securities for investors to buy, then banks can’t or more specifically won’t lend. The problem with MBS’s now is that no one wants to buy them. If you recall, our global financial crisis was started by the realization of the worthless MBS market in the US. That may be the simplistic version, but a reality all the same. My question is this, “What happens’ when the MBS line of credit with the Federal Reserve runs out?”. There are a TON of opinions out there, mine is pretty simple, interest rates for mortgages have to go up. There is really no other alternative. For investors to find MBS’s as an attractive risk, they will want to be compensated in their return to buy the risk.

Then there is the next layer of problem which has a two part issue. The first no one except my HousingStorm colleague are seem to be discussing or maybe the article in DS News from November began to touch on it, but you should read the article form January 19th to really get nervous about what is going to happen in Nevada with Bank of America. So we have the now infamous “Shadow Inventory”, but there is another problem lurking in the shadows, Bad Debt on either the books of MI (Mortgage Insurance Companies) or Fannie, Freddie or Ginne that will be pushed back on the Originators, ie. (Bank of America, Wells Fargo, Citibank, JP Morgan Chase, Sun Trust, etc.). Here is an article I read today from MarketWatch that should make you nervous, I know it is freaking me out.

I guess I shouldn’t be surprised. Nothing seems to change. Our whole world seems to be controlled by Big Banks and Big Insurance that don’t have to follow any rules and when they are in financial trouble, from their own mis-management, we bail them out, pay Billions in bonuses and seem to be able to do very little about it. Is anyone else really fired up about the $100 Million in “retention” bonuses that are being paid out to AIG employees in the Financial Products Division? Seems they have been neck deep in the makings of this mess. A wise person once told me, the only way to get through hell is to keep going. It is a version of a famous quote from Winston Churchill. I definitely think those thoughts apply.

What appears to be the next Trillion Dollar question, is how are the banks going to get rid of the bad debt that we know is on their books and when will they process and release the inventory of properties they have in their foreclosure pipeline. Until then, any positive news and housing market stabilization or recovery is simply just smoke and mirrors.

Share and Enjoy:

Bank Regulations, False Bottom, Fannie Mae, Freddie Mac, Shadow Inventory, The Fed Leave a Comment more...

One of the most real descriptions of what could happen…

by Chris Curtis on Jan.23, 2010, under As Goes California…, Banking and Finance, Everything About Foreclosures, Mortgage Notes, What You Need To Know About Buying and Selling Real Estate

I was looking through my Blog community and this article by Jon Maddux and the debate that is looming for many of us is simple poetic. You need to read this and WATCH the video attached. It brings to light a real moral and dilemma of historic proportions.

Here is the link to the HousingStorm article: Click here

The issue that faces many of us, myself included, is this. If I let my house go now, since I am in excess of 300K undervalue for what I paid in 2005. Then I recover and let my credit recover after the foreclosure or maybe a deed in-lieu, then in approximately 2 years +/- I could rebuy the same property if not a better property for less than what my current property would be worth, through appreciation, in the same period of time given the estimate recovery time.

So here is the question. What is really going to happen? Only time will tell. Do you have an opinion, tell me what you think. Is it a moral question or a shrewd business decision? You are the only one that can answer the question for yourself.

Share and Enjoy:

Bank Regulations, Existing Home Sales, Foreclosures, New Home Sales 8 Comments more...

Here we go again, another Big Bank pays off TARP funds…

by Chris Curtis on Jan.19, 2010, under Banking and Finance, Uncategorized

It was announced recently that Citibank paid off its loan from the Federal Government. It makes you wonder if the Big Banks, BofA, Citi, JP Morgan/Chase, Wells and the kings of bonuses, Goldman Sachs, paid off the loan just so they could pay out and irresponsible compensation bonuses.

I thought about this as I read two articles. The first one is about Citibank and their paying off their TARP funds, read the article that got me thinking here.

The next article is a bit more extreme. The premise is seems sound and has a lot of additional information that caused me to think about the whole concept of bonuses as compensation in our economic system. The article seems to argue about the compensation packages of the highest paid industries, including the Federal payroll. I can’t take credit for the information. It just made me think and I thought I would share. Click here to read the article from Linda Lowell, it is an opinion with facts. Enjoy

Share and Enjoy:

Bank Regulations, Home Prices, Housing Inventory Reports Leave a Comment more...

What if we slashed mortgage principal to save more people who are under water?

by Chris Curtis on Jan.18, 2010, under Banking and Finance, Data, Data, and More Data, Fresh Perspectives, Mortgage Notes

I was reading through an online blog today with a curious premis, “Is Slashing Mortgage Principal the Answer?”. It got me to think, well how would that work? The author brings to light a debate about the physcology of the borrower who has stopped paying their mortgage and the neighbor who is working three jobs to pay his. It is an interesting question. What would you do? I am, like others in our markets, completely upside down in my own home. I bought it in December of 2005 for $815,000, my most recent Tax Assessor’s statement says my house is “worth” $570,000, if that is even accurate.

So what is the answer? I think it could work, the challenge is the largest banks and their balance sheets, how they account for loan losses or non-performing assets and the incentives the Government would have to deploy to manage the process. No matter what, the path, decisions and results will be politically un-popular. The real issue is that we will continue to have a housing crisis of historica proportions until we can true and supported lending and borrowing practice. This doesn’t take into account the ridiculous nature that banking in our country has been allowed to run. Did you see that JP Morgan Chase’s full year profits more than doubled from the year previous, to $11.7 Billion, with a net income of nearly $3.3 Billion in the 4th Quarter. Yes folks, that is Billion for a three month period of time. Read the article from American Banker here.

So what is the problem with the concept of slashing mortgage principal? It is an interesting idea. I would not be suprised if overall it would be less expensive for the Federal Government to pay for and or insure the banks against the loss of principal for worthy borrowers than what is currently going on with the various “rescue” programs. The idea of pumping more capital into the largest financial institutions has its obvious drawbacks, for one, am I the only one that is disgusted by the insane bonuses being paid to top executives. Maybe so. Check out the article from the Wall Street Journal BLOG yourself and decide. Either way, it seems like a plausable idea. Click here for the article.

Share and Enjoy:

Bank Regulations, Home Prices, Housing Inventory Reports 1 Comment more...

Are Short Sales a waste of time? A Real life nighmare…

by Chris Curtis on Jan.14, 2010, under Banking and Finance, Mortgage Notes, Takin’ It In The Short Sales, Uncategorized

I have to admit, I HATE SHORT SALES!!! What a monumental waste of time with the best intentions in mind. The largest banks have that are now getting ready to defend the nearly 90 Billion in bonuses to their executives are the worst. Citibank, Bank of America, Wells Fargo and the worst of them all, Chase (regardless if it is Wamu Chase or not) really seem to have the US Consumer by the short hairs. Let’s not even get into how crazy the math is and their formulas’ for what they will “accept”. Just read on and hope that if you are in a situation where you need to sell short, God help you if you have MI (Mortgage Insurance) on your loan.

I have a client, with who has had a really rough past year. Her mother is sick overseas, she was downsized, was fortunate to get another job- that paid less, but hey at least she is still working. Came to the conclusion that her little 1 Bedroom 1 Bath condo in Concord was never going to appreciate to the nearly $270K that she owes. The HOA in their infinite wisdom, along with the support of her fellow owners, decided to rehabilitate the complex. A simple math mistake took the assessment from 10K per unit to nearly $20K per unit. Currently the properties in her complex are selling in the high 40K to low 50K.

Our contract was submitted and received by both the first andthe Second on 9/17/09. As of today, 1/14/2010 we have yet to get an agreement from our 2nd Lien holder, Citibank. Sounds like a long time doesn’t it? Well the problem is the 2nd loan has a MI Investor. Which essentially means, the Seller is really out of luck, because the MI company calls all the shots as to “if” they will approve a short. See it all comes down to this two simple questions, “What is an acceptable loss” and “Who is going to pay?” We have had approval on the 1st with Wells since late September, early October. What is the real shame is that every day that goes by after 12/31/09, the Wells Fargo is trying to charge a per diem (daily late fee) and there isn’t any money from anyone to pay it. Wells Fargo agreed to pay the 2nd $1000, then Citibank sat on it for till the middle of December until they assigned it to a Loss Mitigation Negotiator. They also knew full well that the Wells Fargo approval was only good until 12/31/09, they had a copy of it.

Ok, enough of the rant. What I know to be true is that their is really no easy way out of this financial crisis that we have gotten ourselves into. What I also know to be true is that the above story is not unique and has been repeated several (hundred) times over across the Nation, with other Real Estate Agents trying everyday to help honest people who just need help. What I have truly lost is my faith that our Banks really act on behalf of their clients. To think, I used to be a banker.

Share and Enjoy:

Bank Regulations, Existing Home Sales 3 Comments more...

So are we ready for the next wave? It may be closer than you think…

by Chris Curtis on Oct.29, 2009, under Data, Data, and More Data, Everything About Foreclosures, Fresh Perspectives, Mortgage Notes, Real Estate Investing, What You Need To Know About Buying and Selling Real Estate

14119 7135 300x200 So are we ready for the next wave? It may be closer than you think... I was reading through some of the information that had been sent to me today and it made me think. “Are we continuing to create a “sub-prime” market”? In today’s real estate market the first time home buyer has come back in force. We have the first time home buyer’s tax credit that has helped thier cause. As a side note, I personally think that there is a good chance that it will be continued as well. So here is the delema of today, are the new loans just a government sponsored version of the now famous sub prime loans that had been driving the Foreclosure and REO crisis? I think they are, here’s why….

If you look at the total number of originations and how they are being underwritten, a HUGE percetage are being owned (eventually) by the Government sponsored investment giants of Fannie Mae, Freddie Mac or Ginnie Mae. Many of these loans are FHA loans with the Buyers’ that have as little as 3.5% skin in the game and generally have lower than “A” paper FICO scores too, say sub 660 range. So the question occurred to me, are we continuing to create an environment where now the government is guaranteeing every or nearly every loan in the market or secondary market place? What does that do to the financial markets and how will that effect mortgage rates over the long term (or even the next 5 years)? What is going to happen to our housing recovery when the Federal Reserve credit line that has artifically lowered secondary market interest rates runs out- estimated to be by years end?

Unfortunately there are more questions than answers. Here is an article from Housingwire that might make you think, don’t forget to check out the graph here.

Share and Enjoy:

Bank Regulations, Existing Home Sales, Fannie Mae, FHA, First-Time Home Buyers, Foreclosures, Freddie Mac, Tax Credits, The Fed Leave a Comment more...

It sounds like the news is leaking……

by Chris Curtis on Oct.20, 2009, under Banking and Finance, Everything About Foreclosures, Fresh Perspectives

foreclosurehouse3 1 It sounds like the news is leaking...... Sorry about being out of it for a while, but the flu season has hit my household hard. I am have really been suprised at how little information can be found in the the traditional media about the wave of Foreclosure Activity that appears to be mounting in the next several months. Several reports, including Foreclosure Radar have indicated that there is not a “shadow” inventory. I would call it semantics, but there is definitely a HUGE wage coming…

Check out this article from Housingwire.com here

It speaks to how the Economists from RBS (aka Royal Bank of Scotland) have done some math, while tracking defaults and delinquincies, they actually published their opinions of what would happen to the fragile Real Estate (so called) recovery if nearly 3 million properties hitting the market. It is worth noting that at least someone is considering what havoc is going to be or could be created if they all hit at once.

What still seems to be true is that the only way for us to get through this, is to go through it. I like what Sir Winston Churchill said, “If you are going through hell, keep going.”

Share and Enjoy:

Existing Home Sales, False Bottom, Foreclosures, New Home Sales Leave a Comment more...

« Older Entries

Chris Curtis's Blog

Breaking Down The East Bay Real Estate Market

The Real Estate Market is in flux

Rambling thoughts on Housing Market and What is next?

Here is some more scary information about the Fed $1.25 Trillion parachute…

Will Fannie and Freddie survive or just pass the buck?

One of the most real descriptions of what could happen…

Here we go again, another Big Bank pays off TARP funds…

What if we slashed mortgage principal to save more people who are under water?

Are Short Sales a waste of time? A Real life nighmare…

So are we ready for the next wave? It may be closer than you think…

It sounds like the news is leaking……

Here’s what people are saying…

Recent Posts

Archives

Tags