BoatBanter.com - View Single Post - There's just nothing quite like capitalism

HK

wrote:
On Wed, 30 Jan 2008 16:20:56 -0500, HK wrote:

Lots of those upside down loans, at least out here, were speculators.
Counting on a 20% / year growth. A few out here are stuck with 5+ houses.

Good. They ought to be stuck, but good.

the problem is that a lot of them really don't have much money in the
game and they just walked away leaving that long list of banks holding
useless paper and a house they can't sell. The 60 minutes piece
pointed out these loans were consolidated so many times it is hard to
figure out exactly who actually does own any given house in
forclosure. As I said before, big builders were getting huge blocks of
money from fund operators and they lent it out through their in house
mortgage company. The fund holds all the paper but the individual
investors have a hard time sorting them out when the fund fails.

Sure it is a problem, but the multi-house buying speculators should pay
a penalty in addition losing the little bit of money they "invested" in
hopes of using borrowed money to make a killing. Perhaps that penalty
will merely be being forced into personal bankruptcy.