Stock Market: The Thread

[Slegnaac]

10 hours ago, Brandon said:

I get a bunch of housing data and analytics, but no one cared about it so I stopped posting it regarding trends and where the market is at and headed.

All that free government Covid money has a consequence.

Very happy I refinanced when I did. 

[katie]

Same I’m under 3%

[Tank]

For you, @Brandon

[katie]

29 minutes ago, Tank said:

For you, @Brandon

My mom went to high school with and was friends with one of them 

[Tank]

12 minutes ago, katie said:

My mom went to high school with and was friends with one of them 

Please tell me it was Kurt Fuller.

[Lhalo]

BOE raise rates. DJIA below 30k.

[Jason]

8 hours ago, Tank said:

For you, @Brandon

Rex Kwon Do top right 

[katie]

8 hours ago, Tank said:

Please tell me it was Kurt Fuller.

Billy Fichtner

[Brandon]

16 hours ago, Slegnaac said:

Very happy I refinanced when I did. 

Dude, I think about you all the time when I get the rate sheets. In the past two years there were two big drops or peaks and we got one of them and it makes me happy.....and I was able to do it for free!!!

Here is a rate sheet from today. Mind anyone looking at this, this is not what banks offer and this is also a raw rate sheet before any bank packs in their margin, fees, etc. I have been on vacation since November and haven't priced out a loan since, but imagine I'm around 5.5% and almost every other bank in the country is over 6%. Really insane and impeccable timing @Slegnaac

[Brandon]

15 hours ago, Tank said:

For you, @Brandon

Still one of my favorite threads. AO coming through in the clutch.

[tdawg87]

16 hours ago, Tank said:

For you, @Brandon

Whomst the fuck doesn't know Jimmy Smits?

[Redondo]

56 minutes ago, tdawg87 said:

Whomst the fuck doesn't know Jimmy Smits?

I thought most here watched NYPD Blues

[Brandon]

8 minutes ago, Redondo said:

I thought most here watched NYPD Blues

I’m only 40 and not a grandmother.

[Blarg]

18 hours ago, katie said:

Same I’m under 3%

I'm paid off for the last three years. Now it's just utilities and taxes. 

[Brandon]

While no one in their right mind thinks about mortgage rates on a daily basis (but I bet you think about that house payment) a broker buddy of mine just shared this and I thought it did a good job of simplifying what’s going in that sector. While there is absolute chaos on Wall Street, mortgage rates have actually dropped quite a bit the last two days. If one was curious as to why or how that happened I think this dude did a good job of explaining it so that even a plumber could understand it.

https://www.tiktok.com/t/ZTdw3wdNW/?k=1

[Blarg]

17 hours ago, Tank said:

For you, @Brandon

In order to not seem too racist they only included one black actor so Sam Rubin didn't look like a complete jackass calling them all Lawrence Fishburne.  

[T.G.]

On 6/16/2022 at 3:46 PM, Redondo said:

I thought most here watched NYPD Blues

How about L.A. Law?

[Redondo]

1 hour ago, True Grich said:

How about L.A. Law?

Never watched it

[Tank]

7 hours ago, Redondo said:

Never watched it

The best reason to watch that show was Susan Dey.

[Slegnaac]

3 hours ago, Tank said:

The best reason to watch that show was Susan Dey.

Come on get happy!

[gotbeer]

@Brandon  Is it just me, or wasn't this how the last housing meltdown started by people getting ARM's and their rates going through the roof?  

Demand for adjustable-rate mortgages surges, as interest rates make biggest jump in 13 years

[Catwhoshatinthehat]

Subprime lending definitely played a part.  Mortgages of all types were grouped into CDOs that initially paid a high rate of return but over time various institutions got more creative with the CDOs due to little or no regulation because money was being made.  Normally the mortgages of varying types would have a low default correlation as you wouldn't expected more qualified buyers to find themselves in a situation similar to less qualified buyers while the tranches in CDOs reflected this belief.  When the bottom fell out and housing prices crashed even the "safe" tranches in CDOs got hammered because more qualified buyers watched their equity get wiped out and lost jobs.  At it's peak before the crash subprime lending supposedly represented ~21% of the mortgage originations which was double the amount a few years before.  Plenty of blame to go around and hopefully we won't see history repeat itself but if it does I hope the government stays out of it. 

 

[Brandon]

1 hour ago, gotbeer said:

@Brandon  Is it just me, or wasn't this how the last housing meltdown started by people getting ARM's and their rates going through the roof?  

Demand for adjustable-rate mortgages surges, as interest rates make biggest jump in 13 years

Ooooffff. I've been staring at this for awhile and don't have a short or easy answer to this. If any of you read this all, cheers. If not, cool. I get it, Joe Blow doesn't care about this shit and it's easier or more entertaining to argue why Joe Maddon was fired. I get it.

The short and simple answer is no.

I should preface that I didn't read the article, but just by the wording can tell and can try to explain from 22 years of experience.

There is a perfect place and person for ARM's or adjustable rate mortgages. It was never my bread and butter and while I've done them, to me and after doing the math, it equates to two types:

1) The real investor that wants to have more cash flow. Owning a multi unit where unit 1,2,3, and 4 pay $1000 a month and wanting to keep the mortgage payment to a minimum to allow for excess cash or investing opportunities makes sense.

2) John and Samantha own a home and Samantha just got a new job in Boston. They need to sell their home and relocate in two years. I'd give them a 3/1 arm or adjustable because it will give them the lowest mortgage payment possible in three years while they sell the home in two.

So there is a time and a place for these mortgages. Another thing to consider and factor is, at least for me, is "no shit". Over the past two years rates hit an all-time low. In simple terms, all of your cookie cutter mortgages where Tom is a construction worker and Mary is a teacher and fit into the simple conforming loans backed by Fannie Mae and Freddie Mac have been done. Only because he gave me a shout out and mentioned it here, I did Slegnacs loan last year and I think Katie said she is below 3%, those people are good for the rest of their lives unless rates drop below where they are. So the only loans or applications being had at the moment are these types of loans because they were underserved while we all did the Slegnac and Katie loans. So the click bait type of article doesn't do it for me.

I'm 40 and basically retired at this point. I haven't ran a credit report or took an application since November, I believe. However, I still get reports and see more cash-out loans (what else do you want to do with your wild home appreciation in the past 5-7 years?), but mainly these underserved niche products and loans....ARM's, "doctor loans" self-employed, DSCR, etc. are what's on the market because we already did 80% of the homeowner population (I made this number up), so of course those applications and numbers are up.

 

Now, to answer another part of your question, that's not what caused the crash and Cat kind of touched on it. I also thought the movie "The Big Short" or something like that did a good job of breaking it down into simple terms, but the movie was really about Christian Bale's character and the creation of derivatives. I've followed and watched a lot about Michael Burry because he saw what I did, but did the analytics and had the balls to pull the trigger and bet against these mortgages, known as derivatives.

I'm not not political, so please leave that stuff out, but here is what happened and why.

In 1994 Bill Clinton signed a bill called The Community Reinvestment Act. The crux and simplification of the bill was simply to allow more minorities to own homes in the United States, plain and simple. To do so, our GSE's (government sponsored entities) known as Fannie Mae and Freddie Mac were told to relax their guidelines to allow these people to be able to buy homes.

The fucking flood gates opened.

The funny thing is I saw this happen for the first time in the early 2000's before I was in mortgages and doing real estate. I remember a lesbian couple coming in and saying, "Hi! we'd like to look for a new home and here is our bank's pre-approval letter!" I said great and start pulling up properties within the $750k price range of the letter and while getting to know them asked what they did and they said they were both teachers. While I'm not a mathematician I was able to think, "How can they afford this house?".....granted I've done loans for various teachers, one a prominent professor at a SEC school and in that case something like that would make sense, but not regular elementary teachers. No disrespect, just simply numbers.

Ironically, I was doing compliance during the boom and fall. I would get the loan package come across my desk where it was hand written, "I, Jose Ramierz, am a janitor at Brookside Elementary School and make $150k a year" signed and dated with a bank approval attached. Now, my job was to make sure my families bank wasn't on the hook should this loan go south. If you are thinking, "Well Brandon, couldn't you stop this?!?!" Even though I knew the loans were bogus there are discrimination and Federal Housing laws that don't allow me to say anything. If a bank approves you and says "Yes!!" it's actually illegal for me to even persuade you that this isn't the right loan for you. I've even skirted the laws over the years telling people to not work with me or to not do certain loans.

To try and be simple and wrap this up, the main thing with the entire collapse was that these no doc and risky loans were packaged as A paper, meaning top of the top. Your 401k from you employer, your hedge fund, your IRA were all invested in these as performing portfolios yield profit and these bogus "packages" were sold as quality, can't miss stocks. When the stripper from Miami couldn't afford the 3rd home payment anymore and the loan defaulted the trickle down effect started at the top with Wall Street.

So to circle back, ARM's aren't bad, but they were used in a way to be bad and also because everyone is either dumb, ignorant, or uneducated thought they could pay these interest only loans or ARM's and ride off in the sunset.

I put a lot of the blame on the customer for trying to pay for shit they couldn't afford. I put a lot of the blame on banks for offering these products in the first place. I also put a lot of the blame on people in my position that offered these products to people knowing they were bad so that they could go to Mesa in their Ferrari (like that Cals?).
 

I having been doing seven things at once today and coming back to this. I hope it wasn't too much, educates, and isn't too spastic. More than happy to answer any questions, etc.

[Lhalo]

On 6/16/2022 at 2:49 PM, tdawg87 said:

Whomst the fuck doesn't know Jimmy Smits?

I wish DowningRules still posted here. He would regale us with behind the scenes stories of how Jimmy Smits banged an actress and didn't tip the valet on the first season of Miami Vice or some shit like that.

[tdawg87]

Just now, Lhalo said:

I wish DowningRules still posted here. He would regale us with behind the scenes stories of how Jimmy Smits banged an actress and didn't tip the valet on the first season of Miami Vice or some shit like that.

That's the shit we all need right now.