Nearly 50 percent of Palm Beach County mortgages underwater or dog paddling like mad

by Kim Miller

A report released today by the Santa Ana, Calif.-based CoreLogic found 44.3 percent of homes _ 147,643 _ in Palm Beach County with a mortgage are worth less than what is owed on their loans. Another 3.9 percent are nearly there.

The condition, known as negative equity, or being underwater, is even worse statewide where 46.4 percent of loans are underwater and 4 percent near negative equity.

That makes Florida third in the nation for underwater mortgages following No. 1 Nevada, which has 65 percent of homes near or already underwater, and second place Arizona with 51 percent.

Reason? PONZI SCHEME.

20 million homeowners did not gather around the dinner table one night and decide to take down the entire global economy.

Did all these “deadbeats” decide to ride “high on the hog” for a few years so they could “live above their means” just to have everything taken away?

Loss of marriage, credit, 401k, job, dignity, etc…

Yea, that’s what they signed up for.

Wake up people. This crisis is so far beyond a “deadbeat” issue. It was a PONZI SCHEME.

And, the most successful one ever perpetrated in the history of the world.

As for the core logic figures, it is actually extremely worse than portrayed.

Their numbers do not take into account of other factors as reported by Mark Hanson today…

Real (Effective) Negative Equity is a much larger problem, as it pertains to housing, than mainstream reports suggest

CoreLogic came out today with their latest monthly negative equity figure of 11.1mm borrower’s with mortgages, or 23.1%. But this number doesn’t mean much to me.

What most don’t consider is real, or effective negative equity, as it pertains to repeat buying I touched upon in the item #2.  Effective negative equity begins at the point at which the homeowner can’t sell the house and rebuy another, which requires paying a Realtor 6% on the sale and putting 10% to 20% down depending on the type of loan needed.

For example, on a Jumbo purchase in CA effective negative equity begins at 75% CLTV, which is the reason the Jumbo housing market continues to languish and will get worse.  In fact, when you lower the CA Jumbo negative equity threshold to 75% CLTV, then 64% of all mortgaged homeowners are effectively underwater.  This is also why I believe that Jumbo loans, a clear focus of banks and servicers with respect to modifications, payment plans and workouts for the past year and a half, have not even begun the pain stage that will ultimately come.

In lower house price states such as AZ and NV where it takes 6% to pay a Realtor and 10% down to move-up, down, or across, when you lower the negative equity threshold to 85%, even a greater percentage are effectively ’underwater’.

When national house prices fall another 10% to 20%, entire states will be consumed by effective negative equity putting even more pressure on real estate supply and demand fundamentals.

Bottom Line: Whether the borrower is at a 95% LTV or a 140% LTV, they are in an effective negative equity position.

So what does Mark think about where we stand now on the Foreclosure Crisis?

Where do we stand now?

In final, I am always asked about my predictions for total Foreclosures stemming from the bubble years.  And I have said the same thing for years.

In short, there have been 3.5 million foreclosures and short sales to date stemming from legacy loans.  There are presently ~7.5 million borrowers delinquent, defaulted, or in Foreclosure at present — grows by 100k to 125k per month — of which 75% to 80% will ultimately be liquidated. If another 7.5 million defaults — and modification redefaults — occur over the next three to five years then a total of 12 million to 15 million Foreclosure, short sale, and deed-in-lieu liquidations will occur, meaning we are now ~25% complete in cleansing the infamous 2003-2007 Bubble-Year’s toxic lending cesspool.

Got that? 15 MILLION foreclosures in the next 3 – 5 years.

Although I do not agree with some of Mark’s views and suggestion, these numbers are staggering.

Doesn’t that tell you something?

It was the biggest transfer of wealth the world has ever seen.

You were scammed and you better so something about it…

PONZI

~

4closureFraud.org