MarkM said:zzyzzx said: .... Median home sales prices sometimes exaggerate swings in market activity. A year ago, median home sales prices in California continued to show price gains, even though the market downturn had begun. At the time, the collapse of sub-prime lending had the effect of freezing the lower end of the market. With fewer sales of less expensive homes, the market was dominated by sales at higher price points, and median sales prices showed gains.

The opposite appears to be happening now, as lower-priced foreclosed homes come onto the market, increasing sales at lower price points, while the market for more expensive homes has slowed dramatically.Hey, haven't checked in here for a few months & this caught my eye when I did. Is that guy (forget his ID) still around that lives in SF and kept insisting that house prices in CA were still going up gangbusters because media sale price kept rising, what does he have to say about this now? I tried like a half dozen times to explain to him the same thing this article is saying in the excerpt above, but he always just responded by insulting me.

cameron2003 I think it was?

Hi Mark-

No it wasnt me who insulted you, please go back and review the insults you hurled at me. By the way, I have posted the last few months that median price is now down in the bay area, especially inland parts...just as I had predicted all along...

Have any of you guys watched "My House is Worth What?" on HGTV? I caught an episode tonight that just cracked me up!! Some couple purchased an $800K house in Las Vegas in 2006 and then pumped another ~$400K of improvement into it. The real estate agent then proceeded to tell them that their house is now worth $1.5 million! What a joke!

sammy1224 said:Have any of you guys watched "My House is Worth What?" on HGTV? I caught an episode tonight that just cracked me up!! Some couple purchased an $800K house in Las Vegas in 2006 and then pumped another ~$400K of improvement into it. The real estate agent then proceeded to tell them that their house is now worth $1.5 million! What a joke!
At least it's easy to tell whether it's a re-run or a new episode.

handyguy said:There is another program called Flip This House.
There are actually two more programs... one is called "Flip This House" and one is called "Flip That House".. one is on TLC and the other is on AandE, I believe.. both good shows IMHO

Mortgage Bankers Association get hit by the mortgage crisis

Karma maybe?

clyde_frog said:vrb747 said:Option ARMs start exploding 2010-2011,

Keep calling a bottom, oh wise ones ! This fool is going to wait

if my ARM reset today it would 'explode' from 5.125% to 4.25%. thanks ben b.At the risk of feeding a troll.... Do you care to explain how your ARM would be at 4.25%? What index are you using and what's your spread? Also, who is carrying this loan? It's hard for me to believe that an ARM after a reset will have a lower rate than a 30 yr fixed. Please check with your bank and get back to us.

Maybe you meant to say that if you were to get an ARM today that your rate would be 4.25%.

winter said:samko said:clyde_frog said:if my ARM reset today it would 'explode' from 5.125% to 4.25%. thanks ben b.At the risk of feeding a troll.... Do you care to explain how your ARM would be at 4.25%? What index are you using and what's your spread? Also, who is carrying this loan? It's hard for me to believe that an ARM after a reset will have a lower rate than a 30 yr fixed. Please check with your bank and get back to us.I don't know about clyde_frog's ARM but why are you surprised that an ARM reset rate right now would be lower than a 30-year fixed?

ING uses 1-year LIBOR for their ARM index:

This week 2.66
Month ago 2.58
Year ago 5.23

You don't think its possible to have a 1.5% margin?
I agree, Winter. If my 5/1 ING arm were to reset today, the rate would be 4.125% (1yr CMT + 2.5 on first reset, rounded to nearest eighth).

samko said:clyde_frog said:vrb747 said:Option ARMs start exploding 2010-2011,

Keep calling a bottom, oh wise ones ! This fool is going to wait

if my ARM reset today it would 'explode' from 5.125% to 4.25%. thanks ben b.At the risk of feeding a troll.... Do you care to explain how your ARM would be at 4.25%? What index are you using and what's your spread? Also, who is carrying this loan? It's hard for me to believe that an ARM after a reset will have a lower rate than a 30 yr fixed. Please check with your bank and get back to us.

Maybe you meant to say that if you were to get an ARM today that your rate would be 4.25%.

The mechanics of an Option ARM loan are being lost in this discussion. You basically get to pick your payment from one of several options, the cheapest of which doesn't even cover the interest on the loan. Sure you can also choose to pay P&I as one of the choices, but if you could afford to do that why not get a fixed rate loan?

So the worry is not what the rate is on the loan, it's that after racking up less than interest-only payments people owe more than the original loan balance. Eventually the payment will adjust to be amortizing, meaning that you have to pay both principal and interest - this is where the huge jump in monthly payment will come from. It has nothing to do with rates - they could be 0% and the payment would still jump dramatically because you're acutally paying the loan off instead of building the loan balance.

The "good" news is that many people in these loans will probably suffer the same fate as late vintage subprime loans, and default before the payment even goes up. This would make the pain in 2010+ a bit less bad by pulling it in to the near term.

bradman said: <snip>
Is this something I can fight to get my 8K back (10K premium paid – 2K builder already agreed to pay)? Does the builder is accountable for the contract we both signed to build the home on the original lot?

Thanks

Sounds like you ought to consult a real estate lawyer. If it was me, I'd ask for all my money back, and cancel the whole thing. Not the type of outfit I would want to deal with.

newlin99 said:What does your contract say about this?

Green for you. To add to that.. read your contract. If it says nothing about this sort of situation, then tell the builder to F off, and request all your money back. Seeing as how most are struggling these days (unless you're perhaps in the midwest), they will likely try and play hardball. In this case, getting a lawyer should resolve the situation quickly. Best of luck.