Well, bobby joe, those “grown-ups” were there. They created it all deliberately, knowing darn well what they were doing. I’ve looked at historical data. There’s never EVER been rates like those! On the other hand, there have been “creative” mortgages just like these. When? Just before the Great Depression… This sick game’s been going on forever and we’re just the peons in it. Well, some are actively participating out of greed, trying to synchronize their moves with the official sick moves and get some crumbs from the pie.

I do feel for the people who were deceived, though. It’s not a crime to be uneducated, not so savvy, not speaking the language well enough, etc. You work hard, you want to have a home. Their only mistake was believing in the system and in the integrity of the lenders. Those poor folks were mislead and deceived deliberately.

@Ryan

You may very well be right, Ryan… My opinion of First Magnus is based entirely on the MSM, which is not something to be trusted at all.

And the inventory in Tucson is climbing up again… http://www.paperdinero.com/Inventory.aspx And the 2-year ARMs haven’t even reset yet.

“…getting your clock cleaned on this HUGE equity bubble that is the stock market…”

I’m not savvy enough to play the shorts or options puts/calls. I’m long in every position. I have a not so insignificant cash position as well… have you seen the FOREX today?

The bears are going to be their own worst enemy as this thing unwinds. Everyone knows what they are doing. 90% of Beazer home stock is in a short postion as of this morning. Hedgeies still have huge cash positions that could whack the shorts in the head. They had better play both sides (cap the up / downside) or they will go broke very quickly.

In the long run, we are all going to feel the pain.

8 months? ZThe bubble bloggers have been screaming panic for the last 3-3.5 years! (Given enough time any possibility comes to fruition ;p)

@concerned
First Magnus wasn’t pushing exotic loans. They were a *fairly* conservative lender. Everyone knew sub prime would be the first victim of the turndown. First Magnus didn’t seem like a likely contender to go insolvent.

@Bobby Joe again…

If you’re getting your clock cleaned on this HUGE equity bubble that is the stock market… maybe you should just throw your money under your mattress.

Thank you for the response, I agree. We have refused to take some listings, we have refused to help some buyers spend more than they could obviously afford.

In five years of helping people buy and sell their homes not a single one is in forclosure or ever will be in foreclosure.

We only work with reputable lenders and we have never and will never help people get subprime loans, because if they need a subprime loan they don’t qualify to buy a home for that amount.

Yes there were terribly unscrupulous Mortgage brokers and companies. And where were the regulators to stop such practices?

Barbara and I have spent our entire real estate carriers doing exactly what you are saying, advising counseling and helping people make good decisions on home buying and selling purchases.

But we couldn’t represent all of the buyers, and ultimately the responsibility has to go back to the people that signed the papers. They took on the debt knowing they couldn’t or wouldn’t be able to pay it.

Just today the Arizona Daily Star reported.

“Bad credit has supplanted terrorism as the gravest immediate risk threatening the economy, a key national research group reported today.”

Throwing the baby out with the bath does nothing to help the thousands of people that do manage their personal finances and want or need to buy a home.

Yes I feel like the person walking the beach throwing star fish back in the ocean when asked If I really think it makes a difference. Yes it makes a difference to the ones thown back in.

But the ultimate insult is being shot at then accused of killing all the ones you can’t throw back in because they choose to beach themselves with poor finaincial decisions and unwillingness to take personal responsibility for their own bad financial decisions.

I’ve owned 8 homes so far in my lifetime. And I sacrified and went without so I could pay for those homes. No Cell Phones, no TV, no cable, no video games, no new cars, no truck, no atv’s , no campers, no boats, no eating out, no loans for cars, no going to movies, no vacations, sacrifice and lots of it so I could own a home.

Yes, I know you aren’t slamming me personally, thank you : ). I’m frustrated over this whole mess as well, and when I read articles in the Sunday paper declaring people that make tremendously stupid financial decisions “VICTIMS” it makes we want to vomit. Everybody’s a victim, no one is reponsible. Someone else charged their credit cards, someone else ran up the cell phone bill, someone else bought the video games, tvs, clothes, new cars, boats, campers, ATV’s, Trucks, vacations, DVD players, MP3 players on and on adnausium. Someone else made them sign those loan papers when the deal was changed at the last minute. . .

The Mortgage fraud is being weeded out, I hope. People that never should have been offered a loan in the first place can’t get one NOW.
And why did the Mortgage industry get to this point. Wall Street, speculators, investors, greed, greed, greed, not location, location, location.

But there are still people that have worked hard, paid their bills, and are financially responsible that need housing. And Barbara and I will continue to help families make good financial decisions when purchasing a home.

There are people gaming the system from every angle, Mortgage fraud, Buyers trying to steal properties, sellers trying to get way more than their homes are worth, real estate agents doing a better job of representing their own interest than the interests of their clients, these unfortunately we will always have with us.

We are in this business because there is a need for qualified Realtors which practice with honesty and integrity helping as many people as possible through what can be a very traumatic time.

My time has to be spent here, I don’t have time to rail against the corrupt system which in the end will come down. There are plenty to carry that message, there are two few representing honesty, integrity, and quality of service, this is where I choose to make my stand.

I am painfully aware of the corruption and the weakness in this country and its economy. But as quoted earlier

“Bad credit has supplanted terrorism as the gravest immediate risk threatening the economy today.”

Get some rest, tomorrow will be a better day there are more star fish to put back in the sea.

If I sound a bit perturbed at the RE industry as a whole, its because I am.

I’m saying that the bubble was created with a myriad of factors. The biggest “contributing” factors were;

1) Loose lending policies coupled to exotic terms of Mortgage companies.

2) The cheer leading of the NAR® with copious amounts of messages like; Buy now or be priced out forever!, They are not making more land! and We see no end to the level of appreciation.

3) Speculators driving prices up while getting cash on the back-end; fraud.

4) People on all levels making foolish financial decisions.

Everyone that participated in the bubble is culpable to a degree. The grown-ups IN CHARGE of the money, should have took a step back and said; “time out, this is crazy… we should stop this madness!” NO ONE DID THAT!

I think the lenders should have told the people that were buying the property; “Look, this is financial suicide… I really, really, don’t think you can handle the payments if the market takes a turn for the worse… why don’t you wait until you can truly afford a home.”

Instead, the lenders operated “boiler rooms” where they pimped out loans by the truck load. They used no or low doc loans to game the system’s checks and balances. Its coming back to haunt them in a bad way.

Most Real Estate agents just turned their heads while all of this was going on. “hey, I got to eat and provide a living for my family.”

I understand the motivation. I know everyone has bills to pay and mouths to feed. Like I said… We needed a grown-up to stand up and shout; “THIS IS CRAZY!, NADA MAS!!!!”

It is what is it is at this point. We ALL will have to take the lumps for this one… even if we shouted from the sidelines. That makes me mad to a degree.

I’ve never owned a home. I have never participated in the Housing market. Now I’m getting my clock cleaned in my meager long term retirement investments and I’m facing a recession that I had no part in creating and knew was wrong from the get go. Can you understand where I’m coming from?

Dave, I hope that you know that I’m not slamming you personally. Are you guilty? I don’t know, only you can make that call. I thank your effort here and willingness for a clean debate.

Ok, so say I take a step back, what does that mean? Don’t sell a buyer a home they want to buy? Don’t list a home a seller wants to sell?

Where do I step back? Am I to lecture buyers and sellers that can’t buy or they can’t sell because they don’t understand the “Big Picture”?

Frankly you lost me with this one. What is it that local realtors are to do to step back. In what way is helping individual families buy and sell homes “Short-sighted”.

It sounds almost like you think Mortgage companies and Realtors somehow have ruined the national economy by some how subliminally forcing people to sign paperwork and take on debt they had no way of paying off.

Like I said, you lost me, with this one.

I understand the you are focused on the Tucson market and what is happening right now. That is what got us into this mess in the first place… not you entirely. But the short-sightedness of everyone in the RE industry from top to bottom. They just focused on what was happening right there and then.

No one took a step back to have a gander at the big-picture. No one cared to see how it would play out in the long run. And now we have what we have.

The same short-sightedness is going to make this thing a whole lot more painful than is has to be as well. The fact is, Tucson Real Estate is 100% linked to the Global, US and local economy.

You are going to find in the coming months that, “location, location, location” is an unsupported theory that a drunk NAR® economist thought up during the boom. Location is irrelevant for those that can see the big picture. Why?

1) Financing is a “root” level operation that has no location bias.

2) Price is a function of financing; Not the other way around.

3) Value is a measurement of the irrational behavior of consumers and subject to change at any time.

4) Supply and demand must be obeyed at all times.

5) WAGES MUST SUPPORT THE FINANCING.

That’s understandable, Dave.;-) We don’t blame you for it.:-) I can certainly understand anybody’s hesitance to discuss it in a public forum and it may not matter so much for your business either, but it does matter for a lot of people’s individual situations and decisions. Only that the more I research it, the more horrible headaches I get…:-( Wish I never opened that can of worms.

Oh, I think I understand. But the real issue here isn’t real estate or the housing industry, or mortgage for that matter. The real issue is the Wall Street and the prostitution of almost every business in America to its demands and greed.

This little mishap with the Mortgage industry is just the tip of the iceburg.

But this is all way beyond the scope of this blog or post. I don’t write or care to write about global markets, or even US markets and economy. Just what is happening right now in Tucson Real Estate. I’m not focused on “The Big Picture”.

I truly believe this is where our difference lies.

“The garbage heap in Mortgage has been growing for sometime. It is too bad it has taken so long to say “something stinks” and then instead of dealing with it in a sane manner, it is panic reaction.”

I still don’t think you fully realize what is going on in the market. You will understand, I have no doubt… soon.