COVID and the housing market

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raginduck said:
Is that an actual ‘case study’ or a possible scenario?
Cash calls to maintain LTV are very rare.
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It's a specific situation instead of a bunch of specific situations averaged out. Ideally they keep up payments and the bank lets the percentages ride, especially in an unstable market.

Decades ago I saw similar situation develop in a townhouse complex. Engineers found deterioration with a tab of millions. All owners were told to go to the bank for $20K each. A lot of owners were underwater due to the recession and said let the place rot.

Obviously owners with good equity saw things differently.

45 years ago we lost a deal on a house we really wanted because our offer was conditional. In our case it was the best thing that could have happened as we would have been caught renewing at 22% in the early 1980's rate rampage.
 
The private lender thing is by far the scariest . Good friends father is a private mortgage lender , my good friend has three rental houses in Kitchener . Guess how he got rental houses for a way under market price? Hint , Dad foreclosed on idiots , doesn’t want to be a landlord so junior buys the houses . It’s a dirty business but pretty lucrative.


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crankcall said:
The private lender thing is by far the scariest . Good friends father is a private mortgage lender , my good friend has three rental houses in Kitchener . Guess how he got rental houses for a way under market price? Hint , Dad foreclosed on idiots , doesn’t want to be a landlord so junior buys the houses . It’s a dirty business but pretty lucrative.


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That's not only dirty - it’s a very dangerous game, and highly illegal. Canadian courts are hostile to lenders who engage in non arms length power of sale transactions, and punish lender if they can’t demonstrate they carried out their duty to protect the borrower and other creditors.

Lenders risk having the sale reversed back to the original owner + generous damages, not only from the home owner, but from other creditors too. CRA also revalues most of these transactions for tax purposes, putting the lender on the hook for FMV adjustments.
 
crankcall said:
The private lender thing is by far the scariest . Good friends father is a private mortgage lender , my good friend has three rental houses in Kitchener . Guess how he got rental houses for a way under market price? Hint , Dad foreclosed on idiots , doesn’t want to be a landlord so junior buys the houses . It’s a dirty business but pretty lucrative.


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Good and bad. If the borrowers were over their heads because they were greedy flippers they get to see the backlash and IMO, tough luck. You gambled and lost.

More sympathy to those just wanting to get a foothold in the market.

The non-arms length part is also a gamble if pursued but home losers aren't usually flush with cash to pay for lawyers. I'd have trouble sleeping at night.
 
I would hazard a guess the unfortunates they have dealt with couldn’t hire a second year student let alone an actual lawyer . Two kinds of people , those that understand compound interest and those that pay it .


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My algorithms keep feeding me posts and opinions by a chubby mortgage broker, usually painting a bleak picture of doom, gloom and nasty doings.

Isn't that counter productive for him?
 
nobbie48 said:
My algorithms keep feeding me posts and opinions by a chubby mortgage broker, usually painting a bleak picture of doom, gloom and nasty doings.

Isn't that counter productive for him?
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Ron Butler? Some of his videos are a bit funny, I find most annoying.

EDIT:
As for is it productive? I know his name. That's a plus for him. I wouldn't call him because I love what he is doing though. That's a minus. I think the over/under varies for each person. As an aggregate, I suspect he thinks it helps him. If I was picking clients, those that worshiped an angry foul-mouthed dude would not be high on my list.
 
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GreyGhost said:
Ron Butler? Some of his videos are a bit funny, I find most annoying.

EDIT:
As for is it productive? I know his name. That's a plus for him. I wouldn't call him because I love what he is doing though. That's a minus. I think the over/under varies for each person. As an aggregate, I suspect he thinks it helps him. If I was picking clients, those that worshiped an angry foul-mouthed dude would not be high on my list.
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When people are looking for money, their standards go out the window.
 
The “mortgage finder” guys with catchy ads are about one step up from the payday loan guys . They exist because there is a market , it’s sleazy, but desperate people do unfortunate things .


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nobbie48 said:
Good and bad. If the borrowers were over their heads because they were greedy flippers they get to see the backlash and IMO, tough luck. You gambled and lost.

More sympathy to those just wanting to get a foothold in the market.

The non-arms length part is also a gamble if pursued but home losers aren't usually flush with cash to pay for lawyers. I'd have trouble sleeping at night.
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Our old realtor did this on the regular. 'Interest only payments' to flippers and if they missed X payments, he bought the house for a stupidly low price.

Dirty business, but if you know how to play it...VERY lucrative.

He's still active in the Mississauga area, and his son is in on the game also. He tried to get me to sign up (even offered to pay for my real estate license) but I felt dirty just talking to him.
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