Nightmare Mortgages

[sickdsm]

Just as american farmers are preying on poor farmers in the developing world by accepting government agricultural subsidies...

Heh, just poking your sensibilities with a stick.

Seriously tho',
Rolling over your house every few years is far from "preying" on younger couples.

It simply provides a supply of housing for what is demanded by the market.

You would prefer that younger couples NOT be allowed to buy houses? (confused)

American farmers are at the back if not still behind all of Europe when it comes to subsidies. There's a reason why subsidies are going down worldwide, its to give America, where workers work harder, an advantage over Europe. But youre talking about about developing countries, right? Tell me what technology fee the south african farmer is paying Monsanto for that super-duper drought tolerant corn hybrid? Tell me what BRAZIL, where there destroying the rain forest to provide a mecca for soybeans, what there seed costs are for roundup ready soybeans?


Same as a bushel of harvested beans, where in america its 6 times the amount. Tell me the consequences of planting a tech. patenented bean?

Nothing in Brazil.

In the US? Its cheaper NOT to combine a field of beans thats around $300 an acre than to pay the fine.


We'll touch more on that when your in tune, dare i start mentioning the HUGE chunk that CRP payments make up of "subsidies" when in reality there appeasing enviromentalists and hurting the active farmer.


But if your making a profit, at the expense of a younger couple, whats the difference than someone who buys/sells one hundred prop. a year for profit? Its OK to make money if it was a home and not a house?


Whether you leave that case of pop under the cart at the checkout line or your a CEO of Enron, stealing is still stealing, right?


So if rolling over your house to a younger couple for a profit isn't preying, how many times in ten years IS? Don't they have to willingly sign anyway?


If the AMOUNT of time you do something makes you have a guilty coinscence, are you any better?


Coming from someone who wants to be able to make a tidy sum from foreclosed property nonetheless. You sound like a late night infomercial directed at the Wal-Mart crowd.

[Nbadan]

Foreclosures ed in August
Rising payments on adjustable-rate mortgages contribute to 53% jump in foreclosures.
By Les Christie, CNNMoney.com staff writer
September 13 2006: 2:45 PM EDT

NEW YORK (CNNMoney.com) -- With real estate markets slowing and mortgage rates well above levels of recent years, times are getting tougher for homeowners - the number of homes entering into some stage of foreclosure is surging, according to a survey released Wednesday.

In August, 115,292 properties entered into foreclosure, according to RealtyTrac, an online marketplace for foreclosure sales. That was 24 percent above the level in July and 53 percent higher than a year earlier.

* Nevada: Up 255%

* California: Up 160%

* Florida: Up 62%

It was the second highest monthly foreclosure total of the year; in February, 117,151 properties entered foreclosure.

Some of the bellwether real estate market states are among the leading foreclosure markets. Florida, had more than 16,533 properties in foreclosure in August. That led all states and was 50 percent higher than in July and 62 percent higher than in August 2005.

California foreclosures are increasing at an even faster annual rate, up 160 percent since last year to 12,506. And the formerly red-hot Nevada market recorded a e of 24 percent compared with July and a whopping 255 percent increase from August 2005.

Rick Sharga, RealtyTrac's vice president of marketing, says the rising foreclosure numbers are in part the result of rising monthly payments on adjustable-rate mortgages, which have a low introductory interest rate that heads higher after an initial period.

"Usually, foreclosures are a lagging [market] indicator," he says. "But we've never had a situation like this with adjustable-rate mortgages amounting to $400 billion to $500 billion coming up for adjustment over the rest of the year."

For a homeowner with a 5/1 ARM (an adjustable rate loan with an initial fixed rate for five years that then adjusts annually) that's now resetting, the adjustment could add at least two percentage points to the interest rate. That could send the payment on a $200,000 loan up from about $950 a month closer to $1,200.

CNN Money

Sit, save and wait.

[RandomGuy]

Florida is in for a massive real estate bust, and insurance companies cease to write hurricane insurance for the state.

[RandomGuy]

American farmers are at the back if not still behind all of Europe when it comes to subsidies. There's a reason why subsidies are going down worldwide, its to give America, where workers work harder, an advantage over Europe. But youre talking about about developing countries, right? Tell me what technology fee the south african farmer is paying Monsanto for that super-duper drought tolerant corn hybrid? Tell me what BRAZIL, where there destroying the rain forest to provide a mecca for soybeans, what there seed costs are for roundup ready soybeans?


Same as a bushel of harvested beans, where in america its 6 times the amount. Tell me the consequences of planting a tech. patenented bean?

Nothing in Brazil.

In the US? Its cheaper NOT to combine a field of beans thats around $300 an acre than to pay the fine.


We'll touch more on that when your in tune, dare i start mentioning the HUGE chunk that CRP payments make up of "subsidies" when in reality there appeasing enviromentalists and hurting the active farmer.


But if your making a profit, at the expense of a younger couple, whats the difference than someone who buys/sells one hundred prop. a year for profit? Its OK to make money if it was a home and not a house?


Whether you leave that case of pop under the cart at the checkout line or your a CEO of Enron, stealing is still stealing, right?


So if rolling over your house to a younger couple for a profit isn't preying, how many times in ten years IS? Don't they have to willingly sign anyway?


If the AMOUNT of time you do something makes you have a guilty coinscence, are you any better?


Coming from someone who wants to be able to make a tidy sum from foreclosed property nonetheless. You sound like a late night infomercial directed at the Wal-Mart crowd.

Since we are on the topic, of taking advantage of people, aren't you taking advantage of farmers in developing countries by accepting money at all?

The average african farmer can't hope to get a millionth what the average american farmer gets from his government.

Just because the Europeans are doing it, doesn't make it right.

[sickdsm]

Coming from the same guy who loves shopping at Wal Mart and readily admits to buying whatever cheapest, even if it means not buying ethanol, Do i really care? I at least admit it but to act as if those farmers aren't getting some honey out of the american honeypot is rediculous. Mark my words, thanks to the Peace Corps and other groups, americans will eventually teach others to farm and be in direct competion in the future. But as it stands, i'm not competing against foreign farmers. American agriculture is but the individual isn't, unless he's stupid.

Double crop prices and what happans? We all come out ahead......for a few years. Land prices/rent will skyrocket, seed, fert, spray, etc. will all increase as well.


You don't have to be faster than the tiger, just faster than your buddy.


You on the other hand fail to address your hypocrisy.

[smeagol]

America's outrageous subsidies to farmers are unjustifiable.

[velik_m]

America's outrageous subsidies to farmers are unjustifiable.

Europe's also. It's one of the things i hate most about EU.

[smeagol]

Europe's also. It's one of the things i hate most about EU.

When it comes to subsidies, Europeans are worst than the Americans, especially the French and the German.

[boutons_]

Individual farmers in Europe very often don't receive the money, and many in France are very poor. The money mostly goes to agri-business, which of course kicks back money to the polticians.

ie, not really different from the USA, which is becoming more European in its forms of ins utionalized corruption. ie, the adolescent USA is "growing up" to be like Old Europe.

[johnsmith]

Individual farmers in Europe very often don't receive the money, and many in France are very poor. The money mostly goes to agri-business, which of course kicks back money to the polticians.

ie, not really different from the USA, which is becoming more European in its forms of ins utionalized corruption. ie, the adolescent USA is "growing up" to be like Old Europe.

Seriously, why do you hate it here so much?

[sickdsm]

Individual farmers in Europe very often don't receive the money, and many in France are very poor. The money mostly goes to agri-business, which of course kicks back money to the polticians.

ie, not really different from the USA, which is becoming more European in its forms of ins utionalized corruption. ie, the adolescent USA is "growing up" to be like Old Europe.

Then why do you procede to blame the individual?

[RandomGuy]

Coming from the same guy who loves shopping at Wal Mart and readily admits to buying whatever cheapest, even if it means not buying ethanol, Do i really care? I at least admit it but to act as if those farmers aren't getting some honey out of the american honeypot is rediculous. Mark my words, thanks to the Peace Corps and other groups, americans will eventually teach others to farm and be in direct competion in the future. But as it stands, i'm not competing against foreign farmers. American agriculture is but the individual isn't, unless he's stupid.

Double crop prices and what happans? We all come out ahead......for a few years. Land prices/rent will skyrocket, seed, fert, spray, etc. will all increase as well.


You don't have to be faster than the tiger, just faster than your buddy.


You on the other hand fail to address your hypocrisy.

Eliminating food subsidies would not make food more expensive.

It would simply make the costs more direct, and mean that farmers would in the end have more money.

Let the market set the price, and instead of the government taxing people, taking out overhead costs, then redistributing the money to farmers, the money would then go directly to the farmers who could produce the product the cheapest. Globalization at it's finest.

[sickdsm]

You're delusional. Higher prices would mean quicker paths to all corporate farms, much like the hog and milk industry has seen. Now that its all big industry, milk production has become a strictly corporate affair, and that means lower overhead, tighter margins, which in turn push out the remaining private parties faster and it just snowballs from there.


In other words, higher prices lead to lower prices in a hurry.

Cargill, ADM, Continental only care about profits, what makes you think that hamburger wouldn't go to $10 a lb?

Wouldn't that redistributing money that your'e talking about be much like you defaulting on your credit card and that company taking it from the next guy? Even more hypocrisy......

[Nbadan]

higher prices lead to lower prices in a hurry.

Only on goods that have a subs ute or generic equivalent. For instance, there is no subs ute for gasoline in a majority of cars on the road and having to take 'alternative means' of transportation for most people is inconvienient, so demand for gas is inelastic, up to a point. So people pay the high prices and cut back on spending on other things.

[Nbadan]

Eliminating food subsidies would not make food more expensive.

Eliminating all food subsidies would also likely lead to a world-wide food shortage. I'm no fan of subsidies, but I'm also no fan of a country that can't feed itself.

[sickdsm]

Only on goods that have a subs ute or generic equivalent. For instance, there is no subs ute for gasoline in a majority of cars on the road and having to take 'alternative means' of transportation for most people is inconvienient, so demand for gas is inelastic, up to a point. So people pay the high prices and cut back on spending on other things.

My point was that if profit is there for the taking, eventually enough people will involve themselves. The cattle industry does this regularly, people are still getting "back into" beef cows, the market will then adjust downward, folks start selling off there cattle and when the supply dips low enough the cylce starts over again. Cattle is unique to crops in that it doesn't take THAT much to get started, you aren't in alot of compe ion for land yet it takes a few years to reap your first reward.


Crops you are either involved or not. Once you get out, you're not getting back into the game.

[smeagol]

Eliminating all food subsidies would also likely lead to a world-wide food shortage. I'm no fan of subsidies, but I'm also no fan of a country that can't feed itself.

blah, blah, blah and ing blah.

Why? Because farmers in the developed world would stop producing?

That is a ing joke!

The developing world can make enough food to keep us all fat and happy.

[smeagol]

My point was that if profit is there for the taking, eventually enough people will involve themselves. The cattle industry does this regularly, people are still getting "back into" beef cows, the market will then adjust downward, folks start selling off there cattle and when the supply dips low enough the cylce starts over again. Cattle is unique to crops in that it doesn't take THAT much to get started, you aren't in alot of compe ion for land yet it takes a few years to reap your first reward.


Crops you are either involved or not. Once you get out, you're not getting back into the game.

I don't get it. So, why apply subsidies to the ineficient farmers, then?

[velik_m]

blah, blah, blah and ing blah.

Why? Because farmers in the developed world would stop producing?

That is a ing joke!

The developing world can make enough food to keep us all fat and happy.

i agree. on top of that, as long as there are subsidies on farming in developed countries, the undeveloped countries will import food, as it's actually cheaper to do so, than grow their own. We are wasting a lot of money to make sure "our" food is cheaper than that of 3rd world countries. That money could be more usefully spent elsewhere.

It is however true, that abolishing subsidies would wipe out slovenian farmers, as even the biggest farms here hardly qualify as small farms in other countries. There is no way our farmes would be able to compete on the open market.

[RandomGuy]

Eliminating all food subsidies would also likely lead to a world-wide food shortage. I'm no fan of subsidies, but I'm also no fan of a country that can't feed itself.

No it wouldn't.

I would lead to a LOT more people getting into the farming business, and a LOT more farmers in developing countries able to make a decent living.

Since most developing economies are primarily agrarian, policies that hurt farmers, hurt the poorest of the poor.

[RandomGuy]

i agree. on top of that, as long as there are subsidies on farming in developed countries, the undeveloped countries will import food, as it's actually cheaper to do so, than grow their own. We are wasting a lot of money to make sure "our" food is cheaper than that of 3rd world countries. That money could be more usefully spent elsewhere.

It is however true, that abolishing subsidies would wipe out slovenian farmers, as even the biggest farms here hardly qualify as small farms in other countries. There is no way our farmes would be able to compete on the open market.

It wouldn't wipe out your farmers, it would help them.

Does your government have as much money to give to your farmers as the US government does?

If your farmers could suddenly get more money for their crops, would they then have to depend on your government at all?

If the small farmers made more money, would they be able to afford new things that would help them produce more, like a new cow, or a few extra chickens, or a new tractor, or more fertilizer?

MMMM, economics...

[RandomGuy]

Getting back to the original topic of the thread:

Foreclosures ed in August
Rising payments on adjustable-rate mortgages contribute to 53% jump in foreclosures.
By Les Christie, CNNMoney.com staff writerSeptember 15 2006: 8:17 AM EDT


NEW YORK (CNNMoney.com) -- With real estate markets slowing and mortgage rates well above levels of recent years, times are getting tougher for homeowners - the number of homes entering into some stage of foreclosure is surging, according to a survey released Wednesday.

In August, 115,292 properties entered into foreclosure, according to RealtyTrac, an online marketplace for foreclosure sales. That was 24 percent above the level in July and 53 percent higher than a year earlier.

...

It was the second highest monthly foreclosure total of the year; in February, 117,151 properties entered foreclosure.

Some of the bellwether real estate market states are among the leading foreclosure markets. Florida, had more than 16,533 properties in foreclosure in August. That led all states and was 50 percent higher than in July and 62 percent higher than in August 2005.

...

Rick Sharga, RealtyTrac's vice president of marketing, says the rising foreclosure numbers are in part the result of rising monthly payments on adjustable-rate mortgages, which have a low introductory interest rate that heads higher after an initial period.

....

"Usually, foreclosures are a lagging [market] indicator," he says. "But we've never had a situation like this with adjustable-rate mortgages amounting to $400 billion to $500 billion coming up for adjustment over the rest of the year."

For a homeowner with a 5/1 ARM (an adjustable rate loan with an initial fixed rate for five years that then adjusts annually) that's now resetting, the adjustment could add at least two percentage points to the interest rate. That could send the payment on a $200,000 loan up from about $950 a month closer to $1,200.

These exotic mortgages, which have been issued by lenders at much higher numbers the past few years, default at a higher rate than do fixed-rate mortgages. And sub-prime loans, which are much more common than in the past, have a higher default rate as well.

But, Sharga says, "The real wild card is the nature of the loans themselves. Historically, ARMs were underwritten pretty conservatively. There has been a loosening of standards with lower credit worthiness and smaller down payments."

Underlying causes
Homeowners are also in Dutch because of underlying economic conditions. Many of the worst hit markets, such as in the Midwest, are in areas hard hit by layoffs or other economic ills.

When housing markets were hot, homeowners could often avoid default through two ready made options, according to Sharga: They could sell to a ready market or they could use the increase through appreciation in their equity to refinance their homes. Increasingly, both those options are evaporating.

Contrary to what many consumers may believe, lenders are not anxious to foreclose on homes and put families out on the streets. Foreclosures tend to be money losers for lenders and are done mostly as a last resort.

Sharga says lenders are beginning to recognize that a problem is brewing and are taking steps to address it. They are much more amenable to a short sale, for example, in which they accept a low-ball, cash bid early in the default process that may not even cover their mortgage, in order to avoid a larger loss later. That can help homeowners by preserving their credit scores and easing their transitions into the rental market.

"Lenders say they're looking for ways to work with homeowners in trouble," reports Sharga. "So for homeowners looking at a default situation, the sooner they talk to their lender - and see what options are available - the better."

[bolded text for emphasis--RG]

[velik_m]

It wouldn't wipe out your farmers, it would help them.

Does your government have as much money to give to your farmers as the US government does?

If your farmers could suddenly get more money for their crops, would they then have to depend on your government at all?

If the small farmers made more money, would they be able to afford new things that would help them produce more, like a new cow, or a few extra chickens, or a new tractor, or more fertilizer?

MMMM, economics...

how do you figure they would get more money? The farmers have new tractors and plenty of fertilezer (<-goverement help!) to work with their micro-farms. Economics? how about economics of scale? average slovenian farm is 1/5th(!!!) of average European farm. (lets not even compare them to american) , more than half of them is smaller than 2ha* and almost 70% smaller than 5ha (and don't asume that the land is in one piece).
Trust me, open market would wipe them out.

* 1 hectare = 2.47105381 acres

[RandomGuy]

how do you figure they would get more money? The farmers have new tractors and plenty of fertilezer (<-goverement help!) to work with their micro-farms. Economics? how about economics of scale? average slovenian farm is 1/5th(!!!) of average European farm. (lets not even compare them to american) , more than half of them is smaller than 2ha* and almost 70% smaller than 5ha (and don't asume that the land is in one piece).
Trust me, open market would wipe them out.

* 1 hectare = 2.47105381 acres

Not really.

IF all farm subsidies ceased immediately, farmers in countries that have high relative costs of production will be forced to compete with farmers in Slovenia who can produce food cheaper than in say, Britain or Germany.

It isn't about "efficiency" of production, it is about market efficiency.

A US farmer has to pay taxes on land, buy feedstock and grain at prices (in dollar terms) that make it hard for them to compete with developing countries.

Example:
Farmer in America gets $1,000 for a certain amount of grain that he sells in America. He can turn around and buy a certain amount of goods in the US.

Question:
How much stuff in Slovenia could a farmer buy with $1,000? More or less than a US farmer?

You talk about "efficiency" but there are different types of efficiency in economic terms.

Per farmer (labor hour), the US farmer is massively more efficient, but per dollar of capital, the Slovenian farmer is massively more efficient.

In the end the one that has a higher overall efficiency will be the one that can produce a unit of grain cheaper.

[velik_m]

so our farmers will be wiped out by hungarian and polish farmers, not american...

p.s. prices here are not that far off from yours (in fact cars, gass, computers, books, home appliances... are more expensive, food&drinks, health care and education are cheaper though).