Hey, the houses that played fast and loose are turned asunder but we’re still here, right?
I made a bet with my husband. We both agree that the credit markets have absorbed the blow and the expectations are already in the pricing.
I say buyers will move in and start picking up mortgage paper in the second quarter. My husband thinks it will take alittle longer, but we both think it’s all a screaming buy and buyers are licking their chops just trying to decide when to pounce.
All we need it some price support.
Remember - MOST mortgages are performing.
So, we’re picking up the pieces, licking the wounds, fixing the broken systems and moving forward into what seems like an awakened spring.
It’s not over. We’re likely to see more mergers or acquisitions but the really bad blow is over.
I think we can take the helmets off now.
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11 responses so far ↓
1 Gina Gardner // Jan 11, 2008 at 9:03 pm
My husband is an LO at Countrywide and things have been a little unsettling the last few days. We had faith in the company but the stock took a beating because Mozilo has lied so many times no one would believe that the company was viable. The B of A deal was pushed up sooner than planned because the media (knowing zero but determined to create a sensation) caused the stock to take such a beating that the deal was pushed up before Countrywide could be delisted from the stock market.
Anyway, it’s all good. The plan is that Countrywide keeps its name and branches for at least a year, and the longterm objective is to have CW take over the mortgage business (its strength) and B of A would emphasize banking. A win-win altogether and the first decent news in mortgage lending in some time. There is a light at the end here, the industry will change but if you are good at what you do you will emerge stronger (Jeff has closed just over $4 million so far this month) and be perfectly positioned while the dilettantes go wait tables or sell used cars.
The industry badly need a shakeup and that’s just what it’s getting.
2 Diane Cipa // Jan 12, 2008 at 7:37 am
Gina: Thank you so much for sharing this good news. Best wishes to you and your family.
3 Franklin // Jan 12, 2008 at 10:10 am
You are likely going to win your bet, Diane, because the upbeat trend started just before Christmas, and insiders seems to be confident about the future, regardless of more writeoffs or recession panic. All signs point to a flood of investment coming in.
4 Paul // Jan 12, 2008 at 10:39 am
OK, I hate to be a downer here, but we are going to continue in this present market until 2011. Homeowners have moved from mortgage equity withdrawal to subsidizing housing payments on credit cards. I network with attorneys and bankruptcies are on the rise. I’m also the custodian of a database of some five hundred properties with a call capture program. I talk to buyers every hour. Sellers are still in la la land and in denial. There is a disconnect between wages and prices.
So, there’s a whole lot more pain ahead. Short sales will become more and more commonplace. I’ll add that I’d be pleased to be wrong.
5 Diane Cipa // Jan 12, 2008 at 1:26 pm
I don’t think you are wrong, Paul. I think we’re talking about two different things. The demographic who relied on subprime and Alt-A are displaced and will continue to work through whatever needs to happen for them to find their new place.
I’m really talking about the secondary market and support for even prime mortgage paper. This is what we need to stabilize wholesale and our mortgage banking platform.
I think the earthquake is over and now we find and treat the wounded and start rebuilding - hopefully with the stronger values of ethics and prudence.
6 Paul // Jan 12, 2008 at 1:50 pm
Sorry Diane, my bad. I incorrectly read the “screaming buy and buyers are licking their chops just trying to decide when to pounce” sentence as homebuyers.
Incidentally, I talked to five buyers since my earlier post. None of them would have set an appt with my LO if I didn’t educate them on the short sale. They all would have hung up the phone after hearing the price. As it turned out, I successfully set five appointments for loan aps.
So I’m in the zone, Diane. I’m in the zone.
Sorry for misinterpreting your post.
7 Tim // Jan 12, 2008 at 1:56 pm
I agree with Paul. In the last run up, residential real estate prices way outpaced the ability for homeowners to afford making their payments with traditional loan products. And the lenders let this happen. It’s going to take some time for it all to shake out. And, most importantly for incomes to catch up to bring the affordabilty index in line with real demand.
8 Diane Cipa // Jan 12, 2008 at 5:56 pm
Hey, no problem.
Now, keeping my fingers crossed that I win that bet.
9 Brian Brady // Jan 12, 2008 at 11:26 pm
“We both agree that the credit markets have absorbed the blow and the expectations are already in the pricing”
That’s the best thing I’ve read all year….and…it’s true. Diane, put me down for $5 on your call.
10 Diane Cipa // Jan 13, 2008 at 8:28 am
Brian: That means a lot to me. I’ve been awaiting your comment with the hope that you would agree. Thank you!
11 David Parker // Jan 14, 2008 at 12:26 am
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