tag:blogger.com,1999:blog-29618513.post8778683534750274594..comments2023-09-13T09:59:36.013+01:00Comments on snowflake5: The problem of the American non-recourse mortgagesnowflake5http://www.blogger.com/profile/14700425293614182769noreply@blogger.comBlogger19125tag:blogger.com,1999:blog-29618513.post-32082800425350320592011-05-27T11:25:01.220+01:002011-05-27T11:25:01.220+01:00Conchscooter we must have the same bank. Governmen...Conchscooter we must have the same bank. Government gave the bank a 25 billion incentive to take over my original bank. I am in Nevada --My Homes value has dropped 65%. I made the mistake of putting over 40% down.My home is approximately worth my original deposit. If the house went up 10 % a year (Impossible)_ it would take about 30 years to break even - The banks want you to Foreclosure as the Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-31520827761976724442011-01-29T23:04:04.543+00:002011-01-29T23:04:04.543+00:00Multiple Large Corporations walk away from Commerc...Multiple Large Corporations walk away from Commercial Real ventures that are losing Money.<br /><br />CEO's & Co. boards have a fiduciary duty to their shareholders to make $ and dump losers.<br /><br />Why is it admirable for them to walk away to save share holder value but terrible for the little guy to do the same.<br /><br />The banks are screwing the little guy with guilt.<br /><br /Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-42121644354498357472010-03-27T00:20:29.035+00:002010-03-27T00:20:29.035+00:00There's plenty of blame to go around beyond Ba...There's plenty of blame to go around beyond Bankers. Significant blame resides with: the manner of enforcement of the Community Redevelopment Act; Congressional and Administration pressure on banks to fund unworthy applicants; Congressional and Administration pressure placed on GSEs Fannie Mae and Freddie Mac to buy (fund) mortgages of those with no assets, no income, no credit score; and Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-74543545272016067312009-11-07T07:25:06.230+00:002009-11-07T07:25:06.230+00:00Non recourse loans should have helped prevent thi...Non recourse loans should have helped prevent this melt down. If the lenders had taken seriously the threat of borrowers walking away the bankers would have considered more carefully to whom they were lending. As it is the banks here on the US lent money willy nilly to anyone they could persuade to take the loans and they didn't give a dman if the loans were recourse or non. They sold the Conchscooterhttps://www.blogger.com/profile/08016331487463993200noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-65553836595145797062009-10-14T16:17:09.442+01:002009-10-14T16:17:09.442+01:00When I bought my home I had never heard of Recours...When I bought my home I had never heard of Recourse or Non-Recourse. The lender didn't tell me about it and I didn't know to ask. The idea that a lender would tell a customer that if they can't repay the loan not to worry, just send back the keys and you're off the hook is insane. And I don't know of anyone that bought a home with the idea that if it suddenly lost value Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-40248516508759887852009-05-05T20:15:00.000+01:002009-05-05T20:15:00.000+01:00Hi,
Very interesting column and debate. Would you...Hi,<br /><br />Very interesting column and debate. Would you mind indicating where you found the data on the number of states in which non-recourse loans were available and on the percentage of defaults?Thanks in advance!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-13549436704729746612009-04-07T09:34:00.000+01:002009-04-07T09:34:00.000+01:00Hey snowflake5, could you please indicate where yo...Hey snowflake5, could you please indicate where you got the information of the non-recourse mortgages from? Thank you in advance!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-25594220555059414022009-03-22T13:20:00.000+00:002009-03-22T13:20:00.000+00:00http://www.fsa.gov.uk/pages/Library/Communication/...http://www.fsa.gov.uk/pages/Library/Communication/Speeches/2009/0318_at.shtmlAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-69470414201536335642009-03-20T21:33:00.000+00:002009-03-20T21:33:00.000+00:00Anonymous - buying a home is a risk. Everyone know...Anonymous - buying a home is a risk. Everyone knows that, you don't even need that high an IQ to realise that . Adults shouldn't go into it thinking they should be allowed to default. It's no good trying to say, I'm an imbecile, I didn't know what I was doing, it the bankers fault for lending. The genuinely ill are protected by law (no court would rule against someone mentally ill who took out a snowflake5https://www.blogger.com/profile/14700425293614182769noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-65451584700982146332009-03-20T00:51:00.000+00:002009-03-20T00:51:00.000+00:00Walking away from your family home, neighbours and...Walking away from your family home, neighbours and community is something you would do willingly given half a chance? You think these people are thieves? <BR/><BR/>How can it be a form of theft when banks value the property, keep the deeds, effectively own the house and rent it to you and get the house back if you don’t pay - as agreed in the contract?<BR/><BR/>Recourse or non-recourse, we have Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-11458223973245361442009-03-19T14:48:00.000+00:002009-03-19T14:48:00.000+00:00Anonymous - if recourse loans truly "encourage a b...Anonymous - if recourse loans truly "encourage a bank to lend", then why is it that the worst of the lending took place in <B>non-recourse</B> states like California, Nevada and Florida? <BR/><BR/>There are two parties to a loan, the borrower and the lender. <I>Both</I> are responsible. A non-recourse situation allows a borrower to be reckless knowing that they can walk away from their situation,snowflake5https://www.blogger.com/profile/14700425293614182769noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-1556028927282702762009-03-19T04:03:00.000+00:002009-03-19T04:03:00.000+00:00I agree with anon and would go further to state th...I agree with anon and would go further to state that recourse loans are unethical. Recourse loans encourage a bank to lend even when all the information available internally to the institution points towards a future of sustained declines in prices. They will simply increase deposit payments and relax in the knowledge the borrower is legally bound to repay the loan whether they have a house or Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-58130330162615004432009-02-03T20:18:00.000+00:002009-02-03T20:18:00.000+00:00Anonymous - any system where a borrower feels it's...Anonymous - any system where a borrower feels it's in their interests to default in certain circumstances, and indeed they they take out loans on the basis of "heads I win, tails you lose" is bad.<BR/><BR/>The point of the UK recourse mortgage is that borrowers know they have to repay debts even when house prices fall - so they make the effort to do so, and defaults are thus lower than in Americasnowflake5https://www.blogger.com/profile/14700425293614182769noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-4694899264014041372009-01-31T23:11:00.000+00:002009-01-31T23:11:00.000+00:00'No more boom and bust''Britain is best placed to ...'No more boom and bust'<BR/><BR/>'Britain is best placed to face the recession'<BR/><BR/>'British jobs for British workers'<BR/><BR/>Is there anyone left in the country that believes or indeed listens to anything that comes out of our great leader's mouth?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-70153428865889425802009-01-31T16:46:00.000+00:002009-01-31T16:46:00.000+00:00There was a time on our country when borrowers who...There was a time on our country when borrowers who defaulted on loans went to prison. Perhaps that was not such a bad idea. <BR/><BR/>It is wrong to say that people who default on a mortgage are victims of financial institutions. Americans are not that stupid. They know exactly what they are doing when the take out a mortgage, and who they are screwing by walking away from one.Rick Ferrihttps://www.blogger.com/profile/02875722518949909857noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-31293747740129241792009-01-30T12:23:00.000+00:002009-01-30T12:23:00.000+00:00Snowflake, is your argument seriously that it is a...Snowflake, is your argument seriously that it is a bad idea because not many places do it? It's illogical for a progressive to use that argument, since progressive policy is by definition to advance niche ideas into orthodoxy.<BR/><BR/>Paternity leave and gay equal-rights dont exist in most places. Are they a bad idea too?<BR/><BR/>Re <I>"it's ok to borrow as if the house price drops you can justAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-28470615883447776722009-01-28T23:26:00.000+00:002009-01-28T23:26:00.000+00:00To the first anonymous comment - yes if our financ...To the first anonymous comment - yes if our financial institutions had stuck to lending to domestic households and business they wouldn't be in this mess. BUT, I wouldn't go as far as claiming that it's wrong to want to buy your own home (actually it's the prudent thing to do, as you don't want to face retirement on a fixed income and rents rising each year). <BR/><BR/>You also talk about the "snowflake5https://www.blogger.com/profile/14700425293614182769noreply@blogger.comtag:blogger.com,1999:blog-29618513.post-83424145392214497872009-01-25T15:09:00.000+00:002009-01-25T15:09:00.000+00:00The principle of the non-recourse mortgage is a go...The principle of the non-recourse mortgage is a good one - it transfers the risk from the inexperienced customer onto the experienced and wise bank. Most progressives should support this kind of thing.<BR/><BR/>In a rational world, non-recourse mortgages cause banks to lend much more sensibly, as they will pay heavily for making stupid loans. However, in the US, banks just didnt give a shit, and Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-29618513.post-33030267523328184412009-01-23T15:39:00.000+00:002009-01-23T15:39:00.000+00:00Look, it does not matter how you spin it, our fina...Look, it does not matter how you spin it, our financial institutions were willing and able participents in this whole sorry episode of greed and dishonesty.<BR/><BR/>The idiotic middle classes have spent the last twenty five years voting for property bubbles, cheap credit and cheap imports, our economic performance is today judged on how much we spend on foreign crap in the high street, not on Anonymousnoreply@blogger.com