We really aren’t that sure how to greet this news, considering that we aren’t really sure that another $3 trillion in lending transactions is exactly what we need right now. But, then again, it does feel like 2005 for the first time all over again, and we’ve got that going for us. So that’s nice. And, we suppose, to the extent this is refinancing, that’s a good thing. For half of the market.
Mortgage Bankers Association boosted its forecast for 2009 home-loan originations by $800 billion to $2.78 trillion, which would make it the fourth- highest year on record.
The increase is due to the drop in fixed mortgage rates following last week’s Federal Reserve announcement that it will triple its planned purchases of mortgage-backed securities, the Washington-based trade group said.
U.S. Mortgage Lending May Reach $2.78 Trillion, Bankers Say [Bloomberg]
BUY!BUY!BUY! The Bottom is HERE! It’s all over folks, let the BULL RUN WILD!!!!!
we aren’t really sure that another $3 trillion in lending transactions is exactly what we need right now.
No, what we need right now is obviously a deflationary death spiral, and a gold standard.
Be kind, rewind.
-Blockbuster
What counterfit cash in Boston?
What’s the big deal? These are re-fi’s by credit worthy homeowners. Duh..
@2 you are right, what we need is cheap loans made to anyone with a pulse. That will bring us out of this funk. Then once everyone has ‘equity’ in their homes, they can borrow against that to buy TV’s and iphones. Prosperity for everyone.
somehow we found better borrowers in this uncertain market? meaning they are better borrowers during a recession then during an expansion? I must be an idiot, I thought we were only supposed to make loans to people that can pay back the money now. I would love to see the demographics of these new loans, income, region, etc.
What’s the deal with the “signs” Barney is complaining about? he’s about to go over his desk at someone it seems.
Last night my hedge fund friend said “they are trying to re inflate the bubbles”. He was serious when he said it cause he only had had two shots.
7=racist
Last night my hedge fund friend said “they are trying to re inflate the bubbles”. He was serious when he said this since he only had had two shots.
@6 – no, no, no, can’t you see I’m all for Sound Money? The dollar should be pegged to gold at a fixed exchange rate, and what government needs to do is sharply curtail lending.
As the great philosopher Mark “von Mises” Sanford would say, when times are bad you need to cut borrowing and cut consumer spending. That is obviously the only way out of a recession.
@8
He’s complaining about the disruption that the “pink ladies” are causing with their absurd manner of dress and their sign waving. they seem to think that a subcommittee hearing is subject to the same standards of personal conduct as a streetcorner in haight ashbury. these bored housewives need something better to do w/ their time.
the funny part is buyers are coming out of the woodwork because of this cheap mortgage money.
my neighbor got multiple offers over asking price this past weekend.
what the heck is going to happen when rates rise?
are people really this freaking stupid?
oh, yeah.
bidding up your own paper then replacing your shitty sludge with the guaranteed pipp paper…how is this not money laundering again?
Sorry, hard to pick up what is real and what is sarcasm
Where the hell do they find those garish pink clothes?
Mortgage brokers are getting a gov’t bailout. Tax their commissions 90%. Fair is fair.
@12 you dont need to cut borrowing or spending. ITS ALREADY HAPPENING. You fuckin tard. The problem is no banks are lending in any area of the economy (Homes loans, corporate, credit cards, ect…)
so clearly no one can borrow. We are frozen and need to start the engines. Unfreezing credit is part of the start.
@7 no nee dto ask for that. We already know.
@14 – um, maybe they’ll get a fixed rate mortgage and won’t be affected by future interest rate increases. Maybe they’re not so stupid. Maybe, just maybe, Americans will have learnt something from the debacle of floating-rate mortgages and won’t go down that path again.
Nah, you’re probably right. They’ll take out an interest-only negative amortizing 5/1 option ARM.
19 back to yahoo!
@10 – demographics was meant as who these borrowers may be, not literally the race of borrowers, what income, region of country, etc. my conscience is clear, is yours?
Guest@#17…
TGFD is replaying my post from and earlier DB thread. It seems appropriate here…
5 Posted by guest, Mar 23, 2009 6:25PM
TGFD is in concert with the CodePink chicks regarding the wasting of bailout dollars.
TGFD’s 8-point “Financial Resurrection Plan” would be much more acceptable to those chicks and to America than Geithner’s plan is going to be.
Besides, TGFD’s plan would actually work because it would cost no money and cause the US economy to spring into new life and freshness.
The Guy from Delaware
Proudly among the “Less than Brightest”
p.s. Last night TGFD sent my 8-Point plan to Ms. Medea Benjamin, head of the CodePink chicks. I hope she hits that tool Liddy over the head with one of those great signs.
Put the Cambodian back on his bicycle
Mortgage brokers are nothing but worthless paper pushers who come up with cute names for themselves like “Mortgage Consultant” or “Residential asset leverage engineer”.
20 – anyone who takes out an ARM in this environment is an absolute goddamn true blue retard.
The problem wont be anyone who takes out a fixed rate mortgage now – sure their payments wont rise. It’s what it means to future buyers. If you need to artificially suppress mortgage rates to bring a new marginal buyer into the market at a home’s current price – when that mortgage rate returns to normalcy who will be the marginal buyer?
Relax 10, 22 et al. I work with three people that bought homes between two and four years ago, with reasonable down payments. Two of them are in the middle of a refi.
@20…I was reading somewhere that the Treasury will own 20-25% of all FNM/FRE mortgage pools by the end of the year. That can’t possibly be good.
North Korea has said shooting down the rocket would be an act of war.”
http://tinyurl.com/ctrz8o http://tinyurl.com/brd6c
@10 = Maxine Waters.
@26 – I suppose if you’re primarily buying a home as a residence, you’ll be fine, because you’re not really all that dependent on future buyers. If everyone was buying for residential needs, there’d be a much more sustainable market in place. Now if only we could stop people from buying homes for speculation, we might get some sanity back in the market.
The idea that your home is an appropriate form of “investment” or “retirement savings” should be thoroughly discredited by now.
@19, et al
I just refinanced my jumbo loan into a 30 year fixed in the New York Metro area. The credit is there if you meet the criteria. My debt to equity ratio was appropriate. I wasn’t pulling a ton of cash out to pay off my credit cards. My property appraised above the loan amount. So like I said, if you meet the economic criteria, money is there. The banks are just being much more conservative with how they lend – Gee! Isn’t that what they are supposed to be doing?!
-Tax Chick
@7…On the trading floor we call them “Mondays”…because nobody likes Mondays
PSA: The alert was triggered by a name that was within a list of about 19,000 credit card numbers and personal information. When the person realized that thousands of credit card numbers were there for the taking on the world wide web, he tried to report it to Visa and Mastercard. Their response? None.
Again and again we hear stories of poor security leading to the compromise of thousands of credit card numbers , along with vital information. This data breach didn’t just include credit card numbers, it also offered names, addresses, expiration dates, and the CVV numbers from the backs of the credit cards.” http://tinyurl.com/clqbhv
It’s all refi’s and foreclosure purchases. You want deflation? Wait until the y/y home price numbers come out from Shiller (with da skilla).
@32 – no, it is not necessarily a good thing that finance/banking is pro-cyclical, no matter what you think about what banks are “supposed to be doing”.
TGFD got burned by “investment” real estate 20 years ago. After that, I swore to never, ever again buy another piece of real estate unless I was going to live in it. I’ve held to that pledge and have had no problems.
All residential buyers should do the same.
The Guy from Delaware
Hello Dealbreaker readers,
I work for an independent documentary production company. Our company has been contracted by MTV to produce an upcoming episode of the MTV documentary series “True Life.” This episode is titled “True Life: My Family Is Broke” and is about families who are being severely affected by the economy.
We are currently looking for families, with young adults, who are interested in participating. We are looking for young people, who appear between 14-25, who are in a family facing one of the following economic situations: someone who once made their living in the financial industry on Wall Street, someone who is part of a family facing foreclosure, someone who is part of a family who has been hurt by the downturn in the auto industry or manufacturing.
We will fully respect the privacy of anyone who is interested in speaking with us, and we would not use their story in any way until we go through a lengthy approval process. If you have any questions please feel free to contact us at any time.
If you are interested in participating or just finding out more information please contact us at: tlbrokefamily@gmail.com or 718.422.0706
Thank you.
Non banking friends are upset. They are getting 1% on their savings and yet their credit card interest rates are all above 20% now.
@39 That sucks. I mean it. Being saddled with CC debt right now must suck worse than anything.
@38 – dealbreaker readers/ballers aren’t subject to foreclosures, wideclops, or being broke. we don’t make money, we print money. dealbreaker readers are, collectively, KILLING IT.
Hello Dealbreaker readers,
I work for an independent documentary production company. Our company has been contracted by MTV to produce an upcoming episode of the MTV documentary series “True Life.” This episode is titled “True Life: My Family Is Broke” and is about families who are being severely affected by the economy.
We are currently looking for families, with young adults, who are interested in participating. We are looking for young people, who appear between 14-25, who are in a family facing one of the following economic situations: someone who once made their living in the financial industry on Wall Street, someone who is part of a family facing foreclosure, someone who is part of a family who has been hurt by the downturn in the auto industry or manufacturing.
We will fully respect the privacy of anyone who is interested in speaking with us, and we would not use their story in any way until we go through a lengthy approval process. If you have any questions please feel free to contact us at any time.
If you are interested in participating or just finding out more information please contact us at: tlbrokefamily@gmail.com or 718.422.0706
Thank you.
@38 is your job really any better than being a crack whore?
@38 is this going to be on before or after my Super Sweet 16?
Dear BrokeFamily @#38…
Try Ruth & Bernie Madoff. Ruth looks young, doesn’t she?
The Guy from Delaware
@39 – if they have money in savings why on earth are they carrying balances on their credit cards then? sounds like populist rhetoric.
Yea, I feel bad for those saddled with credit card debt. Why should they have their interest rates raised? All they did was spend money they didnt have on things they couldnt afford.
Is that so wrong?
@36 Perhaps it’s because Maxine Waters is after Goldman, but I fail to follow.
Finance/ banking is procyclical – in other words, banks are being required to increase their capital ratios because they face greater risks. This in turn requires them to lend less, which could aggravate the downturn.
I get this is troubling. But my point was that although banks are raising their capital ratios, they are still lending provided you meet certain criteria. This was in response to @19 who claimed there was no credit. Banks are tightening their lending practices – a good thing. The loose credit got us into this mess. It would be reckless and irresponsible to lend to crappy candidates who will only be back at the trough in 6 months because of foreclosure. So the process may be slow, but it will be sustainable.
-TC
#46, that was exactly my question but they all said, all, that they might need their savings and they only want to pay the minimum on the credit cards. It was a truly exasperating conversation. The balances were all well over twenty grand and they all have student loans too. They told me I was wrong to tell them to pay off their credit cards and pay down their student loans. They truly believed it was better to keep your savings and pay the debts off on a monthly basis. Some of them thought that eventually the government would bailout credit cards and student loans. They made fun of me saying “then wow would I feel stupid and they would be considered smarter”. It is difficult when you are called “banking genious” in a mocking way.
@39 – tell your friends to use their savings to pay off their CC debt
@36 Perhaps it’s because Maxine Waters is after Goldman, but I fail to follow.
Finance/ banking is procyclical – in other words, banks are being required to increase their capital ratios because they face greater risks. This in turn requires them to lend less, which could aggravate the downturn.
I get this is troubling. But my point was that although banks are raising their capital ratios, they are still lending provided you meet certain criteria. This was in response to @19 who claimed there was no credit. Banks are tightening their lending practices – a good thing. The loose credit got us into this mess. It would be reckless and irresponsible to lend to crappy candidates who will only be back at the trough in 6 months because of foreclosure. So the process may be slow, but it will be sustainable.
-TC
Banks are tightening their lending practices – a good thing.
Right now, it’s actually a bad thing. It would have been a good thing in, say, 2005. Why weren’t they observing sane lending standards back then? Finance is excessively pro-cyclical, and that actually is a problem for the broader economy. It encourages the formation of bubbles and makes recessions deeper and more painful than necessary.
47 Lets put aside for a minute the debate on whether or not its wrong. The reality is American prosperity has gotten far too dependent on this kind of behavior. Started in the Reagan 80′s, when a streak of prosperity was fueled by consumer spending financed with a huge increase in credit card debt. Then came the late 80′s crash. And so on, through to the recent housing boom and bust. The answer is too big to fit in this little box, but its def worth thinking about.
@52 – so are you proposing more exotic mortgage products to any dick or jane that walks off the street?
@48 – my comment at 52 was directed at you.
@55 – Gee, really?!
Oh my, everyone seems just a little on edge this morning. Uncle Ben appears to be losing his patience and Uncle Barney is busy yelling at everyone.
49 To be a finance genius, you need to know how to spell genius. Otherwise you’re only a regular genious.
@54 – yes, any average dick would do just fine, as long as we screen out the assholes and cunts.
hahha #58, I knew it was spelled wrong, sorry. Spelling is not my strength.
Neither TGFD nor Mrs. TGFD have ever charged something on a credit card that we cannot pay off in full when the next card bill is due.
Anyone who carries card balance(s) is asking for trouble.
TGFD’s policy…If you don’t have the money to pay for it in full, do without it until you can pay for it, or get something less expensive that you can afford.
Too bad more people don’t do the same.
The Guy from Delaware
@49 If the gov bails out all of the assholes with CC debt I will lose it. I know we’re arguing the same point but that just touched a nerve. Why is it that if you’re responsible in this country you get shit on? WHAT THE FUCK PEOPLE?
#62, A lot of regular americans think a bailout for CC and student loans is just around the bend.
@63 Aaaaaaaaaaaaaaaaaaaaaaaaaargh!
Odd, but my USAA credit card rate is still under 6% and my credit limit was just increased.
I guess it just makes sense to not borrow like a fucktard.
Of course, 30 million people like me and the economy would grind to a halt
In college you get accustomed to buying everything on your credit card and the habit is formed.
TGFD says, Wall Street’s Credit Default Swaps have become the bane of Main Street.
Geithner couldn’t even give a straight yes or no answer to Rep. Baucus (sp) when Geithner was asked if AIG paid “100 cents on the dollar” of TARP money to GS and to the two foreign banks. Baucus (sp) tried 3 times and got evasive bullshit from Geithner each time.
The CodePink chicks need to take action on this one.
The Guy from Delaware
On another site they are asking what constitutes a credit wrothy buyer/borrower. Do you guys know?
spelling counts
#69, I’ll do better, promise.
wouldn’t it be easier to just go to war?
wouldn’t it be easier to just go to war?
Banks need to be pro-cyclical in their lending practices during a downturn, because there are less worthy credits. The last thing we need is the banks’ balance sheets going further into the shitter with more non-performing loans.
Enjoy Subprime Corporate Lending:
i just read this article that discusses the cyclicality of lenders, here’s a great quote:
“During boom times, lending standards become too easy, which encourages borrowers to take on excessive risk and become a prime candidate for economic failure. This is how ‘Social Darwinism’ works. After an economic downturn ends, lenders tend to be rather cautious about their lending standards as they have most likely been recently stung by recent delinquencies on their lower quality loans in the end of the previous cycle. You might call it LIFO lending (last in, first out). The loans that were made at the beginning of the cycle, which had better higher standards to begin with, tend to withstand an economic downtown much better. ”
oh, and he wrote that in December 07.
http://www.minyanville.com/articles/Ginnie-Mae-FNM-FRE-XOM-SLB/index/a/15157
FHA loans are the new killing it!
@ 39, 46, 49
Maybe they are not so sure about their jobs, therefore, they see their savings as the financial cushion that would help them get over the period of time when they are unemployed.
Right now, IIRC, unemployment is $1000 a month, for 12 months. Add to that, from your own money, whatever amount is needed to cover your minimal living expenses for a reasonable period of time, and that’s what should be one’s “untouchable” savings(i.e., to be used only to replace loss of regular income until regular income can be restored).
I think it was Suzy Orman that was recommending people to first build up a stash of cash equivalent to 8-12 months of their income and then pay down CC debt, given the current economic conditions. And it’s the kind of advice that makes sense. I’ve been laid-off before, from a job where I thought I was untouchable, and the greatest lesson I learned from that experience was that the fear associated with losing my job was about the fact that my savings where almost non-existent(save for my 401K) and that, short of finding a job in about 6 months, I would have to start considering life-style changing alternatives(like living with my mom, versus renting my own place).
It has taken me 2 years of not touching my bonuses to get to the point where I wouldn’t panic if my job would be gone. Which made me the only one not ruffled when they announced 7 cuts at my company.
Also, if you’re not sure about the security of your job, then I can see how one would think that, if worst comes to worst, you can just pay the minimum payment on your CC, until you can get back into trying to substantially reduce the CC debt. OTOH, it must be a hefty minimum payment for a 20K CC balance, mine is just $100 for around $3500.
@ 75
Minyanville? are you part of the Fast Money/Yahoo Fin crowd, and do you work at Cantor Fitzgerald?
- “Sheisty” Lutnick
i’m no suze orman, but reducing your liabilities with your assets is a dollar-for-dollar exchange, except you’re mitigating interest expenses. if the folks in question were able to transfer their balances to 0% CC’s then, yes, keep your cash and make your minimum payments. but at 20%, i’d punt those balances as fast as I could. then if i got in a bad [lack of] job situation, i’d be able to use my available credit to carry myself instead of depleting savings, ultimately having nothing to pay down my exorbitant CC balances that are still accruing interest.
i am the king of run-on sentences, and dont care about it.