Hypotheek

De Diensten van de standaard & Classificaties van Armen wandelden zijn raming voor hoeveel slechte hypotheek de Investeringsbanken hun boeken zullen moeten afschrijven, hoewel het classificatiesagentschap Donderdag zei kan het eind in gezicht zijn.

S&P denkt de banken om $285 miljard in „te registreren,“ of veronderstellingen schrijven-verslaat dat hun investeringen niet meer waardevol zijn. Banken met inbegrip van Citigroup Inc (C, Fortuin 500). en Merrill Lynch & Co (MER, Fortuin 500). meer dan $150 miljard investeringen, voor een deel hebben afgeschreven omdat zij door huisleningen als onwaarschijnlijk beschouwd worden gesteund om worden terugbetaald.

De vorige raming van S&P voor schrijven-verslaat was $265 miljard.

Het classificatiesagentschap zei Wall Street meer dan halverwege door schrijven-verslaat het zal moeten registreren waarschijnlijk is. In veel gevallen, schijnt het als banken heeft afgeschreven a lot more dan de daadwerkelijke verliezen waarschijnlijk zullen zijn, bovengenoemde S&P.

Bank of Canada Governor Mark Carney said an end to the turmoil in financial markets “is not yet in sight,” though regulators should use their new understanding of the problems to craft a careful response.

“While the need to restore well-functioning markets is of paramount importance, the official sector can afford to take some time to ensure that the actions they take are appropriate,” Carney said today in a speech to the Toronto Board of Trade, followed by a news conference.

The Bank of Canada, acting alongside policy makers in the U.S. and Europe to ease a global credit shortage, on March 11 said it will lend commercial banks and brokers C$4 billion ($4 billion) for 28 days. The steps indicate the Bank of Canada, the U.S. Federal Reserve and other central banks are concerned that an exodus of investors from credit markets may deepen the global economic slowdown.

Carney, 42, gave no hint of how big the next policy move may be. The central bank cut borrowing costs on March 4 by half a point to 3.5 percent, the biggest reduction since 2001. The bank will keep its focus on the “real” economy and inflation, he also said.

Inflation pressures in Canada are “well contained,” Carney said in response to a question from the audience after his speech.

By : Gary North

An upside-down mortgage is a mortgage for which the home owner owes more on the mortgage than the home is worth.

According to a report on the CBS TV “Early Morning Show” on March 10, if house prices fall another 10% nationally, 20 million households will be in an upside-down condition.
As of the year 2000, at the last census, there were 83 million residential properties. Almost 68 million were owner-occupied. Of these 68 million properties, 67% had a first mortgage. So, about 45 million homes had mortgages.

If the 20 million figure is correct, then about 43% of all mortgage-owing households would be stuck with underwater mortgages. But this assumes conditions of 2000, before the really maniacal phase of the bubble took place.

The source of this estimate was not identified on the broadcast. It may be wildly pessimistic, but I doubt it. Millions of home owners have borrowed on their home equity since 2000. When people have sold their homes at a profit, they have moved up – more expensive homes, more debt.

Lenders will not lend money to families whose collateral is a home on which the mortgage owed exceeds the market value of the home. This will put a crimp in consumer spending. It will make the transition to a new capital structure – the recession – that much worse.

There are three other factors to consider. First, the actual sale prices of these homes will be lower than the listed prices – maybe substantially lower. It already takes almost a year to sell a home nationally. This delay period is going to get longer. Those who need to sell will take lower prices.

Second, the appraisal agencies are in panic mode, fearful of lawsuits for overinflated prices. They are cutting appraised values. This is possible for them because, with liquidity gone, homes are staying on the market far longer. Appraisers are assuming the worst regarding market value. The appraised value is the “sold today” value. That is a discounted value.

Third, it costs $50,000 to foreclose on a house. Incredible, isn’t it? The lenders made loans on the assumption that they would not have to foreclose to get the properties back. Now that assumption is seen as naïve. Owners can live rent-free simply by paying property taxes.
The recession has only just begun. The number of abandoned homes is rising.

The holders of these now-dead mortgages cannot get renters in fast enough. Weather and vandalism and crackheads are now threatening the collateral of the loans even before foreclosure.

By : Gary North

An upside-down mortgage is a mortgage for which the home owner owes more on the mortgage than the home is worth.

According to a report on the CBS TV “Early Morning Show” on March 10, if house prices fall another 10% nationally, 20 million households will be in an upside-down condition.
As of the year 2000, at the last census, there were 83 million residential properties. Almost 68 million were owner-occupied. Of these 68 million properties, 67% had a first mortgage. So, about 45 million homes had mortgages.

If the 20 million figure is correct, then about 43% of all mortgage-owing households would be stuck with underwater mortgages. But this assumes conditions of 2000, before the really maniacal phase of the bubble took place.

The source of this estimate was not identified on the broadcast. It may be wildly pessimistic, but I doubt it. Millions of home owners have borrowed on their home equity since 2000. When people have sold their homes at a profit, they have moved up – more expensive homes, more debt.

Lenders will not lend money to families whose collateral is a home on which the mortgage owed exceeds the market value of the home. This will put a crimp in consumer spending. It will make the transition to a new capital structure – the recession – that much worse.

There are three other factors to consider. First, the actual sale prices of these homes will be lower than the listed prices – maybe substantially lower. It already takes almost a year to sell a home nationally. This delay period is going to get longer. Those who need to sell will take lower prices.

Second, the appraisal agencies are in panic mode, fearful of lawsuits for overinflated prices. They are cutting appraised values. This is possible for them because, with liquidity gone, homes are staying on the market far longer. Appraisers are assuming the worst regarding market value. The appraised value is the “sold today” value. That is a discounted value.

Third, it costs $50,000 to foreclose on a house. Incredible, isn’t it? The lenders made loans on the assumption that they would not have to foreclose to get the properties back. Now that assumption is seen as naïve. Owners can live rent-free simply by paying property taxes.
The recession has only just begun. The number of abandoned homes is rising.

The holders of these now-dead mortgages cannot get renters in fast enough. Weather and vandalism and crackheads are now threatening the collateral of the loans even before foreclosure.