[mEDITate-OR:
not see&read two critical reports on foreclosures AND on 2nd mortgages...
To fully understand what is true about 2nd mortgages...
and where they fit into the foreclosure/modification process...
you WILL need to read these two articles.
The first article tells U.S. that The Big Banks WERE holding back on foreclosures.
and that now they are not - the flood gates are open.
That means there are, and will be many more, additional foreclosed properties added to the RE economy.
The second article is one of the best explanations of where the 2nd are, and who is servicing them.
What that tell U.S. is that not do The Big Bank control most of the 2nd mortgages...
but, they also control most of the RE servicing.
Which means that they COULD have solved/addressed the RE crisis IF they had wanted to.
From the testimony, not just, given it is clear that they do NOT want to do it.
Two significant points:
first, IF they addressed the underwater RE loans they made to U.S..., they would have to write off/down not only the lost RE values, but also the 2nd mortgages that they also hold.
IF they did that, they would be required to raise their "capital"..., which they are doing - note their profit reports for the 1st Q.
what we believe they ARE doing is making as much "cash"/profits as they can..., anyway they can do it...
so that when, not if, they have to address the RE and 2nd mortgage losses, they have the funds, in house (no pun intended) to do it.
second, what we thought was a major problem - that the diffused ownership of the securitized ARM mortgages was preventing the modification of those dead zone - 2002-6, and sand states - Cal, Nev, Fla & AZ, underwater RE loans.
is not totally true.
Bcuz, the Big Banks not only MADE many of those RE loans, but they also "service" them.
What that means is that many, but not all, securitized packaged RE loans, simply cannot be modified..., bcuz there is nobody to talk to.
AND
that many more than we thought there were are RE loans serviced by the Big Banks, who simply do not WANT to modify them, even thought they could.
We are talking Trillions here.
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Thursday, April 15, 2010
by CalculatedRisk on 4/15/2010 08:54:00 AM
were reported on 932,234 properties in the first quarter, a 7 percent increase from the previous quarter and a 16 percent increase from the first quarter of 2009. One in every 138 U.S. housing units received a foreclosure filing during the quarter.
Foreclosure filings were reported on 367,056 properties in March, an increase of nearly 19 percent from the previous month, an increase of nearly 8 percent from March 2009 and the highest monthly total since RealtyTrac began issuing its report in January 2005.
“This subtle shift in the numbers pushed REOs to the highest quarterly total we’ve ever seen in our report and may be further evidence that lenders are starting to make a dent in the backlog of distressed inventory that has built up over the last year as foreclosure prevention programs and processing delays slowed down the normal foreclosure timeline.”
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Wednesday, April 14, 2010
by CalculatedRisk on 4/14/2010 11:06:00 PM
Here is what Chase said about its Home Equity (second) mortgage portfolio:
Chase owns about $131 billion in Home Equity loans and lines as of February 28, 2010.
Chase owns about $131 billion in Home Equity loans and lines as of February 28, 2010.
• Approximately $25 billion are home equity loans and $106 billion are home equity lines of credit.
• Approximately $33 billion are in first lien position and $98 billion in second lien position.
• 5% of Chase’s home equity portfolio is 30 days or more delinquent. Total home equity line, home equity loan, first lien and second lien delinquency rates are within two percentage points of the overall total.
• About 50% of the total Chase second lien portfolio is underwater, and 95% of this portfolio is performing (less than 60 days past due). 30% of second lien mortgages have combined loan-to-value ratios over 125% and 94% of this portfolio is performing.
• For $40 billion of Chase-owned second lien mortgages, Chase also services a first lien mortgage:• 92% of these first lien mortgages are performing.• About 10% of Chase’s total serviced portfolio of first lien mortgage loans has a Chase-owned second lien.
• 28% of these first lien mortgages are by themselves underwater (loan- to-value ratio of over 100%).
• 45% of first lien mortgages have a combined loan- to-value ratio of over 100%.
• Our best estimate is that about 20% of Chase serviced first lien mortgages may have a second lien from another lender and about 70% do not have a second lien.
| 12/31/2009 | Delinquency Stats: Q4/09 | |||||
|---|---|---|---|---|---|---|
| Company Name | Number of Loans Serviced1 | 30-day | 60-day | 90+-day | In Foreclosure | Total Past Due |
| Bank of America | 14,011,029 | 3.4% | 1.7% | 6.5% | 3.3% | 14.8% |
| Wells Fargo | 12,168,836 | 2.4% | 1.2% | 3.5% | 1.9% | 9.0% |
| Chase | 9,689,312 | 3.0% | 1.4% | 4.6% | 3.2% | 12.2% |
| CitiMortgage, Inc. | 5,118,563 | 2.3% | 1.4% | 4.9% | 1.7% | 10.4% |
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