Comments on BLOG.FranklyRealty.com: Freeze Interest Rates? Bankruptcy to Profit?

This is a great real estate blog. I hope that you...

2008-01-03T00:03:00.000-05:00

This is a great real estate blog. I hope that you will keep it going. Hey, did you hear that Donald Trump is going to have all celebrities on his show next season. WOW!God Bless!Elmo Real Estate Professional

By "market rate" I meant what it costs for banks t...

2007-12-13T17:10:00.000-05:00

By "market rate" I meant what it costs for banks to borrow money from the gov or other large banks (< 5% I'd guess). I don't really understand it that well myself but from some of the analysis that I've read it seems the contracts attached to some of these mortgage backed securities specify a floor interest rate that the loans cannot drop below but give the mortgage servicer flexibility to modify

Hey Andrew,Who pays for it?The 7-8% rates were sol...

2007-12-12T18:01:00.000-05:00

Hey Andrew,Who pays for it?The 7-8% rates were sold off already to investors expecting in their calculations to get over 10% due to the risk associated with the loans.So somebody has to pay those people. Either the gov writes a check or the banks eat it. I understand if you are saying that this is better for banks vs “everyone” foreclosing, but if that was the case, the BANKs would have done

I think you're misunderstanding who this "freeze" ...

2007-12-12T17:35:00.000-05:00

I think you're misunderstanding who this "freeze" applies to. Calculated Risk has had some great analysis on the rate freeze:http://calculatedrisk.blogspot.com/2007/12/ten-things-to-know-about-freeze.htmlThe targets are people in 2/28 and 3/27 subprime arms resetting in 2008+. Fico less than 660 and LTV greater than 97%. Their above market "teaser" rates of around 7-8% are going to be fixed for 5

Tom (you can just call me Tchaka), it seems that w...

2007-12-11T17:07:00.000-05:00

Tom (you can just call me Tchaka), it seems that we are defining 'teaser' differently. I agree with your assessment that you've described and how we got where we are (admittedly, I already knew that), but I don't consider a 2/28 or 3/27 to be teasers. Those are ARMs and fall rightfully within the definition of an ARM. An example of a teaser is say......a HELOC that's Prime + 0.25% whereby the

does anyone have thoughts on what borrowing rates ...

2007-12-11T12:14:00.000-05:00

does anyone have thoughts on what borrowing rates will be after this shakes out? would risk premiums adjust after banks' burn wounds are fully accounted for? the FedGov staying out of this suits my bias. if the banks want to realize trillions in losses by foreclosing on the 1.7 million people or the MBS/CDO holders want to realize complete losses by liquidating and suing the banks for

Frank, thanks. I'm considering getting a blog of ...

2007-12-11T08:08:00.000-05:00

Frank, thanks. I'm considering getting a blog of my own up and running, but I need to find the time. Also, a lot of these loans that are the target of this plan ARE no/low doc loans. Scary. tchaka owen, teaser rates coupled with low or no doc loan underwriting for sub-prime mortgages are exactly how we got to in the mess we are in today. The majority of the paper that is defaulting today was

Tom, can you provide any examples of teaser rates ...

2007-12-10T23:36:00.000-05:00

Tom, can you provide any examples of teaser rates on Subprime loans? I don't recall any that would be in effect this long.

Great work on this Frank. Keep it up.As bad as th...

2007-12-10T22:39:00.000-05:00

Great work on this Frank. Keep it up.As bad as this is...this can not be the last stage. This does nothing to resolve the rise in foreclosures which was to be the focus of this bailout. We are going to see more disturbing ideas in the near future is my guess.

Hey Thomas,Thanks for your input. That sounds like...

2007-12-10T20:15:00.000-05:00

Hey Thomas,Thanks for your input. That sounds like a brilliant idea. Sure, somebody got a loan with a "no doc," but these subsidies shouldn't be "no doc" handouts.Great idea. Make even those that bought with a NO DOC show proof of their income when they got the loan. That little requirement would start to weed out the FEW that did NOT overexaggerate their income.Thomas, when are we going to get

tchaka owen, two points: 1) There certainly were t...

2007-12-10T19:27:00.000-05:00

tchaka owen, two points: 1) There certainly were teaser rates on sub-prime ARMs. 2) The rate freeze is not an effort to allow borrowers to realize capital gains so much as it is an effort to stabilize the real estate market from a glut of foreclosures that would exacerbate current economic problems, including, but not limited to: defaults on CMOs/CDOs, further price deflation of real property

Frank, I do not believe that anyone will benefit f...

2007-12-10T15:36:00.000-05:00

Frank, I do not believe that anyone will benefit from a 'teaser' rate. The 2% rates you describe are from option-ARMs and many of those in foreclosure were Subprime borrowers (thus elimating option-ARMs). Of those in trouble who did get Option ARMs, are currently paying at 2% and are trouble, I'm not sure how the government is dealing with them. Perhaps they'll allow a refinance into a

Hi Frank, thanks for the post! It will be interes...

2007-12-10T12:30:00.002-05:00

Hi Frank, thanks for the post! It will be interesting to see how this all works out. So many things to consider!

Frank,I share your concern...the fed 'monkeying' w...

2007-12-10T12:30:00.001-05:00

Frank,I share your concern...the fed 'monkeying' with rates is scary...and are these mortgages assumable!!! Thanks, Fran

Few people? This article says 1.2 Million peopleht...

2007-12-10T12:30:00.000-05:00

Few people? This article says 1.2 Million peoplehttp://money.cnn.com/2007/12/07/real_estate/freeze_fairness.moneymag/index.htm

This link suggests the freeze would aim to only he...

2007-12-10T12:29:00.003-05:00

This link suggests the freeze would aim to only help a few people and the government would not be involved. I don't think there is going to be any "free money" for anyone...www.breitbart.com/article.php?id=D8TC48RG0&show_article=1

I'm sorry, I still am not smart enough to understa...

2007-12-10T12:29:00.002-05:00

I'm sorry, I still am not smart enough to understand this program. You have to be current on your mortgage, but have a score under 660? And if their rate is frozen for 5 years, their payment stays the same. But if they have by chance maxed out all of their other credit scores in order to get their score low enough, and if they are on a fixed income, as most Americans are, and the cost of living

I can't see this rate freezing flying, and I do ag...

2007-12-10T12:29:00.001-05:00

I can't see this rate freezing flying, and I do agree that any subsidies need to be paid back if there is equity in the home within a certain time period. I smell another scam.

Very interesting Frank. This rate freezing proposa...

2007-12-10T12:29:00.000-05:00

Very interesting Frank. This rate freezing proposal has so many negative scenarios attached to it it is mindboggling. I had not thought of this one before. A valid concern for sure.