I saw a pretty amazing home offers over at Forum Meadows. Not "amazing" because they are Good Deals, but amazing because they show how terrible things have gotten in Bend, and amazing in illustrating the after-effects of copious Kool-Aid consumption.
From bend.craigslist.org:
$129990 / 3br - Finished Newer Homes-Ready Now! (Bend) (map)
Date: 2009-08-08, 8:05AM PDT
Introducing Newer Homes from 1113 - 2100 sqft at Forum Meadows in East Bend Near St Charles Hospital. There are 3 floor plans to choose from and all homes are complete and ready for occupancy.
These are well appointed homes with tile counters, solid wood floor entries, appliances, finished garages, window blinds, fenced yards, accented exteriors, landscaping and underground sprinklers. They are 2 blocks from shopping, restaraunts and movie theater.
These homes are now for steal at $200,000 below 07' listing price.
They are in better shape than any bank owned home and you will receive an answer within 2 days of your offer.
If you're tired of making rejected, competing offers on homes that need repairs, then call Nancy @ 541-480-4599 or Matt @ 541-280-9576 today for information on these clean and ready to move in homes.
These Forum Meadows shitshacks are down 63% from their original ask prices of $349,500. Remember Pollocks infamous statement about STEALING?
Oregon subdivision a ghost town
Saturday, December 22, 2007 at 12:00 AM
Buena Vista Custom Homes unloaded 141 homes last weekend in what company says was the biggest residential home auction in state history. But none of the 29 in Bend sold.
Still, in every place except Bend, the auction achieved what Pollock set out to do — get rid of expensive-to-carry housing inventory. And it gave him some cash to use on his next moves.
"The sale of the homes from the auction put us in a great position as a buyer," Pollock said in a news release. "There are some great deals to be had out there right now on lots."
Some of the Bend houses attracted bids, Higgins said, but none of the bids came close enough to meeting the reserve prices to justify finalizing sales on any of the homes, Higgins said.
"They were trying to steal them," Higgins said.
The company retained the right to reject any final bids below its unpublished reserve prices, Higgins said. It was obligated to close on any final bids that rose above that level.
Buena Vista had hoped to see bidding start at $189,000 for its 1,133-square-foot models in Bend and $229,000 on its 2,116-square-foot homes.
Original asking prices had been $349,500 and $443,950, respectively.
Tamara Christensen and her family live nearby. She had hoped the auction would work at least well enough to fill the houses with people who would landscape the bare-dirt backyards she sees out of her back windows.
But another nearby resident said she was OK with the way it is.
"I kind of like having fewer neighbors," Charlene Gossling said.
"It's quiet."
I'm not sure how many times I ranted about Pollock taking the low bids for those cracker-ass shitshacks, and being happy to get them, but it was quite a few. He's still on the RIP Hall of Shame masthead.I'm telling you folks... this thing isn't over by a long shot. THIS is where some Realtor would jump in and say something about "nowhere to go but up", or some shit. They've been saying that for 2 years. Is this UP?
It's stupid ideas like Pollocks STD-fest that'll be taking down this town for decades to come.
Speaking about Taking Down, someone (Ballzee) posted a link to the actual Cease & Desist order sent to Cracker Ass Motherfucking Butt-Fugly Patty Moss, and that shithole Fraud-U-Net Bank she whores over, Cascade Bank.
Funny, but this is yet another example of The Guy On The Street Saw It Coming YEARS Before The Lying Dumbfucks Who Are Actually Perpetrating The Fraud. This raises the question whether Moss KNEW she was blowing up CACB, or whether she is a fucking moron. I vote MORON.
So anyway, back to the order. Click the link, and read it, but I'd agree with Ballzee, it is damn "harsh":
the Bank...cease and desist from the following unsafe banking practices...
- operating with management whose policies and practices are determinetal to the Bank and jeopardize the safety of its deposits;
- operating with inadequate capital in relation to the kind and quality of assets held by the Bank;
- operating with a board of directors that which has failed to provide adequate supervision over and direction to the active management of the Bank;
- operating with inadequate loan valuation reserve;
- operating with a large volume of poor quality loans;
- operating in such a manner as to produce operating losses;
- operating with inadequate provisions for liquidity;
I mean Holy Shit! If that ain't a stinging rebuke for Moss, I don't know what is. The rest of the order is a bunch of micro-management directives about HIRING PEOPLE WHO KNOW HOW TO RUN A BANK, with the VERY OBVIOUS implication that those who are there now, DO NOT KNOW HOW TO.
One of the directives from Sheila BEAR HUG Bair, is that Mossco get Tier 1 capital up to 10%. It is not even close now:
Cascade Bancorp (Oregon) Announces Filing of Form 10-Q Quarterly Report and Financial Results for the Second Quarter of 2009
At June 30, 2009, the Company's leverage, tier 1 capital and total risked-based capital ratios were 5.19%, 6.03% and 8.87%, respectively...
FDIC also lays out how Mossy can and cannot raise money, one of which is the hilarious "raise it from the Board of Directors"! WTF! I also believe that "Begging for the money in the local lie-filled rag" is another legit money-raising avenue.
Mossy can also issue new stock... but hmmmm... that is NOT happening. I wonder why? Oh right... Wall Street would rather buy large, puss-ee (pussy?) maggots and eat them. Wall St would no more buy CACB stock than it'd rise & fly. Even CACB's largest shareholder KNOWS that this bank is DEAD & GONE, and will not give a nickel to save it.
OK, so I think Mossy & Pollock have finally earned their badge of shame on our RIP masthead.
OK, just some interesting pieces I read this week. First, I can't help but reprint the BBC piece, since it's hard with the character limits in the comments, and I think it's just a great balance to what you hear from Costa (ie 100% BULLSHIT):
Economic crash in Oregon boomtown
By Adam Brookes BBC News, Bend, Oregon
Bend, Oregon was a 21st century American boomtown. It is a beautiful place, in the high desert of central Oregon, amid mountains.
The sunshine is warm, the air crisp and filled with the scent of bitterbrush and pine. Its people are gracious, their gorgeous surroundings imbuing them with a certain American languidness.
All these attributes were - in the minds of the city's ambitious planners and businessmen - what would bring the retirees and tourists flocking to Bend. To accommodate them, a boom in housing began.
Boom and bust
The population of Bend quadrupled in under 20 years - from 20,000 to 80,000. Between 2001 and 2005, the median value of a home in Bend rose by 80%.
By 2005, work was getting underway on 700 new homes each month.
Some of the developments are stunning: houses filled with mountain light clinging to craggy hillsides.
More than 17% of the workforce was employed in construction - far higher than the national average.
In what had once been an isolated lumber and mill town, high-end restaurants and brewhouses opened. Shops selling expensive bric-a-brac bloomed. Massage therapists and hairdressers proliferated.
Downtown Bend looks like a shrine to post-millenial bijou: pricey shoes, scented candles, fancy coffee. There is even a shop specialising in beachwear - despite Bend's location in the high desert.
But when the US slumped, Bend crashed.
The value of a home fell 40% in under two years. And unemployment nearly quadrupled from around 4% two years ago to 15% in the summer of 2009.
"Everything that Bend produced relied on the credit market", says Carolyn Eagan, an economist with the Oregon Department of Employment.
"Construction materials, doors and fittings, recreational vehicles: everything depended on people being able to consume more than they could use."
Now the credit has dried up, and the building of Bend has stopped. The town is dotted with developments that got underway, and then ground to a halt.
They are desolate expanses of weeds, dust and discarded construction materials.
Homeless shelter
In downtown Bend, we met Dan Hardt. Mr Hardt used to employ 20 people hanging drywall in Bend's new homes.
He owned three houses of his own, and a boat.
He used to go on elk-hunting trips. Now it is gone - all of it.
"When the building stopped, the lifestyle went very fast," he told us.
"It's a lifestyle I don't see coming back."
Dan now lives at the Bethlehem Inn, a motel converted to an emergency homeless shelter.
"Those who were living at the at the top of the heap and who have fallen to the bottom, they don't know where to go for help, they don't know how to get that help.
There's anger and frustration and a sense of entitlement," says Corky Senecal, who heads emergency housing services for Neighbor Impact, and has 30 years experience of providing services for the poor.
"The middle class is where it's really been decimated," she says. When you lose your job in America, you will receive financial aid from the government. But it is limited.
Typically, an unemployed worker in Bend will get state benefits for a period of six months to a year. After that, as many in Bend are discovering, you are on your own.
In addition, the loss of a job frequently means the loss of health insurance and payments into retirement funds.
This limited social safety net means unemployment in America can be devastating. "It's not just the job that stops," says Dan Hardt. "Everything else stops with it."
Ms Senecal introduced us to to Randy Worrell and his 11-year-old daughter, Patty. Mr Worrell, a burly 42-year-old former firefighter, was laid off from a variety of jobs.
He has not worked since the end of last year - and his unemployment benefits have run out.
"I don't know what I will do from one day to the next," he says.
Lesson learned Neighbor Impact has put him and Patty in temporary accommodation. He will look for work, he says, for six hours a day.
And he is deeply sceptical of pronouncements emanating from Washington DC that the US economy is showing signs of recovery.
"Lately it's all, 'the economy is turning around'. No, it's not. At least it's not for us," he says. "I don't think we've even hit rock bottom yet. I think we have some way to go."
Bend, Oregon has a great deal going for it, and will, no doubt, experience some sort of recovery. The population of the city has not noticeably shrunk, which is a good sign.
But no-one expects the housing market ever to revert to its previous, ferocious levels of activity. And many will tell you they have no desire for it to do so, that Bend has learned a lesson about bubbles.
But in the US, joblessness can alter a life trajectory for ever. Seven and a half million Americans have lost their job since the start of the recession.
And unemployment's clawmarks will be visible on the face of Bend, and of the US, for a long while to come.
Some of this reporting is a little misguided (gracious?), but it is definitely not a piece you would EVER find in any Bend media outlet. It's basically an onthology and cataloging of greed and it's after-effects. Again, you will NEVER see this sort of thing from the Bully.
Another good piece I saw was from Mish:
Friday, September 04, 2009
How Overpriced Is The S&P 500?
Inquiring minds are wondering How Overpriced Is The S&P?
It's an excellent question given bulls feel the market is headed much higher while the bears feel the opposite after a remarkable 50% rally.
Let's start off with a look at the financial sector where Allowances for Loan and Lease Losses (ALLL) have plunged even though non-performing loans soar.
To understand the importance of ALLL, inquiring minds are reading a description of Allowances for Loan & Lease Losses.
Businesses try to predict, on an ongoing basis, the amount of loss in their accounts. They take periodic charges to earnings to better match losses to periods when they occurred. Banks do this as well.
They use current income, through the provision for loan and lease losses, to create and build a reserve to absorb losses. The ALLL can be increased another way.
When the bank collects on previously charged-off loans, the amount recovered goes into the ALLL. Charged-off loans decrease the ALLL.
If a bank decides it has overestimated its potential loss exposure, it can choose to reduce its ALLL and add the amount to its income. This is known as making “reverse provisions” for loan and lease losses, because the bank decreases the allowance, or reserve amount, rather than increasing the provision.
It is rare for a bank to make a reverse provision, however, because of the imprecise nature of determining an appropriate reserve. One last point to remember with respect to the reserve is that the ALLL is a general reserve.
Therefore, even if a bank analyzes and estimates the loss on each loan, the allowance is there to absorb all losses in the loan portfolio and is not specific to a particular loan. Remember that allowances for loan losses will decrease as charge offs increase. However, the above charts are in relation to non-performing loans.
Because allowances for loan losses are a direct hit to earnings, and because allowances are at ridiculously low levels, bank earnings have been wildly over-stated. Bank Profits Too Good To Be True Flashback April 16, 2009:
Wells Fargo’s Profit Looks Too Good to Be True:
Jonathan Weil What sent Wells shares soaring on April 9 was a three-page press release in which the San Francisco-based bank said it expected to report first-quarter net income of about $3 billion.
Wells disclosed few details of what was in that figure. And by pushing the stock up 32 percent that day to $19.61, investors sent a clear message: They didn’t care.
Dig below the surface of Wells’s numbers, though, and there are reasons to be wary. Here are four gimmicks to look out for when the company releases its first-quarter results on April 22:
Gimmick No. 1: Cookie-jar reserves.
Wells’s earnings may have gotten a boost from an accounting maneuver, since banned, that it used last year as part of its $12.5 billion purchase of Wachovia Corp. Specifically, Wells carried over a $7.5 billion loan-loss allowance from Wachovia’s balance sheet onto its own books -- the effect of which I’ll explain in a moment.
Once it took control of the reserve from Wachovia, Wells was free to start dipping into it to absorb new credit losses on all sorts of loans, including loans Wells had originated itself. (Think of a child raiding a cookie jar.)
The upshot is that Wells could get by with reduced provisions until the $7.5 billion is used up, boosting net income.
Another quirk: The reserve was related to $352.2 billion of Wachovia loans for which Wells was not forecasting any future credit losses, according to Wells’s annual report. Weil goes on with three other highly suspicious (at best) practices by Wells Fargo, including a balance sheet holding of $109 billion of "other assets".
Weil writes: "The footnote says the largest component was a $44.2 billion bucket that Wells labeled as “other.” Yes, that’s right: The biggest portion of “other assets” was “other.” And what did this include? The disclosure didn’t say. Neither would Bernard.
Talk about a black box. That $44.2 billion is more than Wells’s tangible common equity, even using the bank’s dodgy number. And we don’t have a clue what’s in there.
FDIC Problem Bank List Soars To 416
For a nice discussion of some of the problems facing the financial sector, please consider For FDIC, a long tunnel and little light by Rolfe Winkler at Option Armageddon.
FDIC’s problem bank list grew to 416 at the end of last quarter. These banks have $300 billion of assets.
In total, FDIC estimates the banking sector is wrestling with $332 billion worth of loans and leases on which borrowers have stopped making payments. That excludes hundreds of billions worth of underwater loans that may be current now but will ultimately default.
Many banks, including the largest ones, are likely to struggle for some time.
How Big is the B of A, and Citigroup Problem?Citigroup and Bank of America have received hundreds of billions of dollars of government support, but, precisely because of that support, they’re not on the FDIC’s list.
Adding them to it would multiply total problem assets 10 times, to $3 trillion. Asset prices aren’t going back to their highs of 2006-2007, so loans held against them will be generating losses for years.
The FDIC may raise enough cash from banks to fund depositor losses in small and medium-sized banks, but it is clear that the biggest banks are far too large for them to handle.
As a result, the government’s emergency rescue measures aren’t going away for a while. And taxpayers should expect to be writing fat bailout checks to the financial system for years to come.
America’s Japanese banks Inquiring minds are reading America’s Japanese banks also by Winkler.
A banking system loaded down with hundreds of billions of dollars worth of unrecognized bad debt — Japan in the 1990s? No, it’s the United States today. And where are American banks hiding their losses?
Among other places, in their loan portfolios. Banks have written down billions in toxic securities, but many toxic loans are still carried at close to full value. According to data published by the Federal Reserve late last year, banks are carrying $3 trillion of residential real estate loans and $1.7 trillion of commercial real estate loans on their books for a total of $4.7 trillion.
Dan Alpert at Westwood Capital thinks as much as a fifth of that total could be uncollectable. Banks argue that loans should not be marked down if they’re still “performing.”
As long as borrowers are meeting their contractual obligations, there’s no reason to take a writedown. The problem is, this gives banks an excuse to extend, amend and pretend. They can make concessions on loan terms or delay foreclosure notices, if only to maintain the fiction that borrowers will make good.
With real estate prices likely to fall, and stay, 40 percent below the peak, borrowers have a big incentive to renege on their side of the bargain. This is how we become Japan.
Emergency bailout facilities allow banks that otherwise would have failed under the weight of bad loans to hold those loans to maturity — pretending the bad ones will be paid off in full over time.
In reality, many loans will default and banks will bleed capital for years. Take commercial real estate. As the Congressional Oversight Panel has reported, few CRE loans that were originated at the peak will qualify for refinancing when they mature.
Banks can pretend they will, carrying the loans at values far above what will ever be paid back.
So what do we do? We can start by eliminating government guarantees that allow banks to avoid dealing with the problem.
As things stand, the biggest banks have no incentive to write down loans because the Federal Reserve, Federal Deposit Insurance Corporation and Treasury Department have, in effect, promised them unlimited financing to hold loans to maturity.
As the Japanese can tell you, this is just a recipe for stagnation. Thanks to a debt bubble that authorities refused to deal with decisively, that country is now entering its third consecutive lost decade.
S&P 500 Earnings Given that loan loss provisions directly affect earnings. Let's take a look a PE chart of the S&P 500 from Chart of the Day.
PE Ratio, S&P 500That chart was from earlier in the month. Nearly all companies have now reported and the PE is down to 127.43.
If that sounds preposterous you can check the S&P 500 Excel Spreadsheet right on Standards and Poors. Real vs. Operating Earnings The chart above is based on actual reported earnings.
Unfortunately it's difficult to find anyone stating P/E ratios based on actual earnings. Instead, because the media and investor bias tends towards being 100% invested 100% of the time, nearly all estimates you see are based on "operating earnings".
Barron's had an excellent article on this subject in May of 2008. It is as relevant today as it was then. Please consider What's the Real P/E Ratio? There are two main earnings numbers that Wall Street uses when discussing valuations -- "reported earnings" or "operating earnings."
Typically, the bulls use "operating earnings," and the bears use "reported earnings" because operating earnings are higher and reported earnings are lower.
Also, it makes sense for the bears to use the past 12 months of earnings because they are usually lower, and for the bulls to use forward operating earnings to help make their case.
Using the last 12 months is much more consistent, since it avoids dependence on estimates of earnings. Operating earnings exclude write-offs, while reported earnings include write-offs.
That is the only difference, but it's a difference that is getting much more important.
As recently as the early 1990s, operating and reported earnings were virtually the same. But then we entered the greatest financial mania of all time, and the earnings numbers diverged.
There were so many write-offs by companies making unwise investments and then undoing them that operating earnings grew much faster than reported earnings.
The write-offs that had been sporadic and unusual became common for many companies. Using operating earnings is now like playing in a golf tournament that doesn't count any penalty strokes for hitting the ball into a water hazard or out of bounds.
Over the past 75 years, most market peaks topped at around 20 times reported earnings, and the troughs occurred at around 10 times earnings. The financial mania of the late 1990s pushed P/Es to over 40 times reported earnings, and the following bust never brought P/Es below 18 times reported earnings.
There's more we can do to make sense of earnings: The best way to measure present earnings and future earnings is to smooth them out over long periods.
Earnings can grow at only approximately 6% a year over the long term. The trend is limited by the growth in real GDP plus inflation.
And long term, real GDP cannot grow faster than the increase in the labor force plus the increase in productivity.
If you don't accept this, look at a long-term chart and draw a 6% growth line through the earnings. It is clear that earnings sometimes rise above the line and sometimes fall below it, but earnings always revert to the 6% mean.
Going back to 1950, every instance where actual earnings rose above trend-line earnings was followed by a period where actual earnings went well below trend-line earnings.
Creative Destruction
Please bear in mind that historical long term trends are just that. Intermediate-term, it is imperative to factor in demographics, changing consumer attitudes towards debt, willingness and ability of banks to lend, overall debt levels, etc.
I have discussed consumer attitudes many time, most recently in Creative Destruction. Factors Sealing The Deflationary Fate
The five month, 50% rebound in the S&P 500 was certainly spectacular.
However, the more important question is where to from here? Take a look at Japan's "Two Lost Decades" for clues.
Creative destruction in conjunction with global wage arbitrage, changing demographics, downsizing boomers fearing retirement, changing social attitudes towards debt in every economic age group, and massive debt leverage is an extremely powerful set of forces.
Bear in mind, that set of forces will not play out over days, weeks, or months. A Schumpeterian Depression will take years, perhaps even decades to play out. Thus, deflation is an ongoing process, not a point in time event that can be staved off by massive interventions and Orwellian Proclamations "We Saved The World".
Bernanke and the Fed do not understand these concepts, nor does anyone else chanting that pending hyperinflation or massive inflation is coming right around the corner, nor do those who think new stock market is off to new highs.
In other words, almost everyone is oblivious to the true state of affairs.
How Overpriced Is The S&P?
Take another look at those charts kicking off this article. Factor in the analysis of Winkler and Weil. Factor in demographics, consumer attitudes, etc.
Factor in global wage arbitrage. Factor in loan loss provisions that have only one way to go, up. Factor in consumer debt levels, realizing that consumer spending is 70% of the economy. Do the forward earnings estimates you hear from bulls make any sense to you? They do not make sense to me.
While it's hard to put a price tag on any of those components, we can look at Japan as a model as I have suggested on many occasions and Winkler is suggesting now. If you have not yet done so, please consider Effect of Household Deleveraging on Housing, Consumption and the Stock Market.
Here is a snip pertaining to Japan, but there is much more in the article to see.
Nikkei, 28 yrsOf course some huge innovation like the internet could come along that would create enormous profits and employ millions of highly paid workers.
However, the odds of that are extremely small. Thus, the risk/reward scenarios of long term investing are awful based on fundamentals alone.
Traders however, will have many opportunities in both directions. All things considered, I suggest the S&P 500 is easily 50% overvalued based on what we know now.
That is not a prediction the S&P will be cut in half, rather it is my belief that it should be cut in half. Given that I have seen estimates as low as 200, I am not "SuperBear".
However, the reality is no one really knows what innovation is (or is not) coming, nor can anyone say for certain what valuations investors are willing to place on earnings. There are also foreign Central Bank issues to fact in.
With that in mind, the S&P could easily meander around this level for a decade while earnings catch up to what are now very poor valuation metrics.
As always, traders need to keep an open mind and not get locked into any scenario. Long-term investors will have to take what they get.
Unfortunately, I suggest those results are not likely to be very pretty.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
The title of the piece is sort of misleading because it is primarily about banking. What I think is amazing is the B of A and Citigroup chart.
These 2 banks on their own DWARF the size of the S&L problem several fold.
The number of failed institutions going down right now is quite low. But the size is incredible. And this graph doesn't even include AIG. Or Fannie. Or Freddie. Add those in, and you get a real sense that this current problem is something that will not fade away quietly.
Our government is trying to keep these companies off the FAILED board, because the incredible upset caused by just letting Lehman go (a piker in comparison) was not acceptable, and truly would have melted down the Worlds economies.
And it could still happen. I honestly do not think the US Government can recitify the situation. It's my strong belief that the bursting of the housing & credit bubble is the most important event of our lives (economically), and it's effects will be felt for decades.
And finally, I wanted to post this Oregonian piece.
Increase in Portland-area home foreclosures worries analysts
Posted by mgraves September 03, 2009 18:06PM
Portland-area foreclosure filings have begun ticking up again this summer, reversing a spring trend that showed mortgage defaults had leveled off.
County records show that the number of mortgage defaults -- the first step in a foreclosure -- rose less than 2 percent in Clackamas, Multnomah and Washington counties between the first and second quarters of 2009.
But this summer, new foreclosures are on pace to jump 9 percent in the third quarter to about 3,500 for the tri-county region, or 38 filings every day.
"We're not seeing any relief," said Sande Sivani, a consultant who researches property records and records documents for title companies. "It's going up and up and up."
The uptick comes as lenders, which months ago had put a moratorium on foreclosures, have grown more aggressive with struggling borrowers.
The housing market has seen a mild boost from bargain-hunting investors and first-time buyers chasing a federal tax credit. But the renewed interest isn't coming fast enough or broad enough for some home owners.
Double-digit unemployment and falling home values have pinched home owners between shrinking income and homes that are worth less than the mortgage debt. The position leaves them few options to avoid a default. "It's the high unemployment that's driving foreclosures," said Patrick Newport, U.S. economist with economics firm IHS Global Insight.
Banks, despite political pressure from the White House, remain reluctant to modify troubled mortgages to try to save homeowners from foreclosure. More frequently, borrowers whose mortgage fall into default are not escaping trouble.
Fitch Ratings Ltd., a credit-rating firm, examined mortgages that had been packaged into securities. The firm found that between 2000 and 2006, 45 percent of borrowers who fell behind on prime loans -- those with the best credit -- were able to "cure" their delinquency by catching up on their payments. But that cure rate has plunged to just 7 percent for prime loans.
For Alt-A loans, those with a slightly higher credit risk, the cure rate has fallen from 30 percent to 4 percent. For subprime loans, the riskiest type, the rate went from 19 percent to 5 percent.
In the three-county Portland area, Sivani said she found 800 loan modifications recorded in the first six months of the year. But, she said, her sampling found about only one in 10 were modifications tied to a delinquent mortgage.
Either way, those modifications were dwarfed by the more than 6,300 new mortgage defaults the lenders had recorded in those three counties in the same time period.
Despite Obama's calls for banks to lighten up on troubled borrowers, Newport said: "That isn't going to happen. Usually it's in the banks' interest to take the loan into foreclosure."
A July study by the Federal Reserve Bank of Boston found that lenders expect to make more money on foreclosures than from a modified loan. That's because a large percentage of borrowers historically either "cure" the delinquency on their own or they receive a loan modification, then default on the mortgage again.
By many measures, Oregon continues to fare better than the nation that's been dragged down by Arizona, California, Florida and Nevada. But in some cases, the state's woes are unmatched in its own record books.
The Mortgage Bankers Association reported recently that about 8.5 percent of Oregon mortgage holders were at least 30 days delinquent or in some stage of foreclosure during the second quarter.
For the first time in this downturn, that figure has surpassed the previous high water mark set during the 1980s recession. The second quarter figure was the state's worst since the association started keeping track in 1979.
Those looking for a brighter outlook in the next year may have a difficult time.
Barclays Capital forecasts the number of foreclosed homes for sale will peak in mid-2010 at 1.15 million, up from an estimated 688,000 as of July 1, the Wall Street Journal reported.
IHS Global Insight's this week ranked Portland as the country's sixth most overvalued housing market. The firm says the Pacific Northwest is the final region to watch the froth of the boom years burn off.
Of the 11 markets labeled overvalued, seven fall in Oregon or Washington.
Dunc, please help me do horny FRASH-DANCE in this metal crib!
I wish I had a pearl necklace instead...
Now that the Downtowners gone, where we get an hbm sandwich?
