Real Home of Genius: Irvine California and the Home Equity ...

by drhousingbubble

Deadline on his request for additional information .  This information should give us deeper insight in to what option ARM lenders have been doing to remedy the approaching tsunami.  It is likely that not much has been done.  Wells Fargo is attempting to remedy the issue by converting Pick-a-Pay loans to interest only loans.  It is yet to be seen how well this is going to workout or what other lenders are doing.

For all the recovery talk, housing is still seeing massive amounts of foreclosures.  On Thursday we saw the 8 consecutive month of 300,000+ foreclosure filings:

In other words, homeowners are still losing homes at a record pace.  The stock market might like this but the vast majority of Americans must be wondering why a stock market is up 60 percent when foreclosures are sky high, unemployment is still increasing, and the U.S. dollar is on a progressive state downward.  The stock market is defying all rules of logic with high price to earnings ratios and ignoring market fundamentals.  Yet in the last two decades, economic fundamentals were after thoughts with two enormous bubbles in technology and housing.

FHA Going Broke

FHA loans were never intended to become a giant part of the mortgage market.  Don’t tell that to California.  Take for example last month’s data that shows for Southern California, 36 percent of all homes purchased were financed with FHA insured loans.  Since FHA only requires 3.5 percent down, FHA insured loans have replaced the Alt-A and option ARMs as the new leverage product for those with miniscule down payments.  Surely this move has done wonders for the FHA right?

“( WaPo ) As of Sept. 30, those reserves had an estimated value of $3.6 billion, a sharp drop from the $12.9 billion available a year earlier, the audit found. The current total represents...