Renters Beware

Here is an interesting story that shows renters better be aware of who they are renting from. If you are a renter, please check out House foreclosed, renters given little notice.

Following is a dialog of a person, Bobbie Dust, who no longer owns the home he is renting, still trying to collect rent from Travis (the renter).

Bobbie Dusk: "Are you paying rent today?"

Travis: Are you kidding me? We know you don't own this house anymore. We spoke to the bank. We're not stupid, we're not giving you one more nickel and as a matter of fact, you owe us $765 for the deposit and for fixing the refrigerator.

Bobbie Dusk: Are you still living in my house? If so, no one lives for free.

Travis: It's not your house. As of January 28th at 1 pm, the bank owns this house, not you.

Bobby Dusk: Contrary to what you might think, it's mine until February 29th, don't get so cocky.

It just so happens Bobby Dust was a Realtor.
The story continues....

We contacted the Greater Las Vegas Association of Realtors. It confirmed Bobbie Dust is a member. The association says in its code of ethics realtors are bound by all the rules, even in their own real estate transactions. That includes Article 1, which states that all parties should be treated with honesty.

Far off the beaten track, in the Pacific territories 60 Percent of Marianas is in Foreclosure.

SAIPAN, Northern Mariana Islands — The U.S. credit crisis has extended far out into the Pacific territories.

Sixty percent of homeowners under a 10-year-old government-backed loan program in the U.S. Commonwealth of the Northern Mariana Islands are in default on their loans, The Marianas Variety newspaper reported, citing the Marianas Public Housing Trust and the Marianas Housing Corp.

Republican Sen. Paul A. Manglona said lawmakers are alarmed by the high percentage of borrowers that are in default.

"The bottom-line is we're concerned about what will happen to these 60 percent delinquent homeowners," Manglona said. "If President Bush is doing something to help prevent foreclosures of homes in the states, what are we doing here in the CNMI?"

How To Get A Mortgage

The Sacbee is reporting Sacramento credit union battles foreclosures

We're trying to do something real," says Teresa Halleck, president and chief executive officer of Golden 1 Credit Union, the state's biggest with $6.7 billion in assets and 670,000 members.

Its "mortgage repair loan" fund offers 30-year, fixed-rate mortgages to Golden 1 members who lost their home to another lender within the past 18 months.

But it won't make a huge dent in the mortgage mess – Halleck estimates only about 50 to 75 borrowers will get these loans, which are for a maximum of $417,000.

So what does it take to get one of these loans? A job, a 20 percent down payment, debt counseling, full documentation of income and a credit score of at least 600.

Halleck acknowledges that $20 million won't go far. But she hopes it will generate "momentum" and spark other financial lenders, here and nationally, to offer similar mortgage help.

Let's Do the Math

Some 2 million borrowers are facing foreclosure. This fine program will save 50 of them at most, assuming anyone can come up with 20% down and a good FICO score. How many years will it take to save 50? Let's assume that 5,000 lenders do the same. That is a potential 250,000 homes "saved". Over how many years? And how realistic is 5,000 cooperating lenders?

The main point of this story however, is renters need to make sure who owns the house they are renting. Lawsuits over back rent are starting to appear. If you are renting or planning to rent a house, make sure you know who owns the house, and whether or not that person is delinquent before you do.

Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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