Comments on: Countrywide Plans To Attempt To Refinance $16 Billion In ARM’s http://thephoenixagents.com/countrywide-plans-to-attempt-to-refinance-16-billion-in-arms/ Chris Butterworth - sharing thoughts on real estate (and everything else.) Sun, 13 May 2012 07:46:19 +0000 hourly 1 http://wordpress.org/?v=3.1 By: Steve Nicks http://thephoenixagents.com/countrywide-plans-to-attempt-to-refinance-16-billion-in-arms/comment-page-1/#comment-262 Steve Nicks Wed, 24 Oct 2007 04:01:07 +0000 http://www.butterhomes.com/blog/index.php/countrywide-plans-to-attempt-to-refinance-16-billion-in-arms/#comment-262 Whatever the motivation, you're exactly right. The less bank-owned homes on the resale market, the better. From what we've seen in the past couple of weeks, it's going to be the bank-owned properties that drive values down. A typical homeowner trying to sell his/her home properly advised will most likely attempt to keep the home priced just below market value. The bank, however, come in at sometimes hundreds of thousands of dollars below market value looking to unload the property immediately. The typical homeowner just doesn't have it in them to compete with that in most cases. Whatever the motivation, you’re exactly right. The less bank-owned homes on the resale market, the better. From what we’ve seen in the past couple of weeks, it’s going to be the bank-owned properties that drive values down. A typical homeowner trying to sell his/her home properly advised will most likely attempt to keep the home priced just below market value. The bank, however, come in at sometimes hundreds of thousands of dollars below market value looking to unload the property immediately. The typical homeowner just doesn’t have it in them to compete with that in most cases.

]]> By: Chris Butterworth http://thephoenixagents.com/countrywide-plans-to-attempt-to-refinance-16-billion-in-arms/comment-page-1/#comment-261 Chris Butterworth Tue, 23 Oct 2007 21:02:09 +0000 http://www.butterhomes.com/blog/index.php/countrywide-plans-to-attempt-to-refinance-16-billion-in-arms/#comment-261 That sounds like good news - lower payments means less defaults, which means fewer displaced families, fewer families needing rentals (keeps rent rates in check), and fewer bank-owned properties on the resale market (helps to keep prices from free-falling.) Good for Countrywide. That said, I don't think this is being done from the goodness of Countrywide's heart. I haven't done any math to support this, but they probably feel that keeping someone in their home at 7% is more profitable than raising their rate to 8.5% and then getting the home back 6 months later, where they'll lose tens of thousands of dollars when they re-sell it... So maybe this is a win-win, where Countrywide will make more money long-term by helping consumers in the short term...? What a novel idea! That sounds like good news – lower payments means less defaults, which means fewer displaced families, fewer families needing rentals (keeps rent rates in check), and fewer bank-owned properties on the resale market (helps to keep prices from free-falling.) Good for Countrywide.

That said, I don’t think this is being done from the goodness of Countrywide’s heart. I haven’t done any math to support this, but they probably feel that keeping someone in their home at 7% is more profitable than raising their rate to 8.5% and then getting the home back 6 months later, where they’ll lose tens of thousands of dollars when they re-sell it…

So maybe this is a win-win, where Countrywide will make more money long-term by helping consumers in the short term…? What a novel idea!

]]>