Housing Woes Bring New Cry: Let Market Fall

Please note our new address - see the end of this posting for new information.

Bad news in the forecast for homeowners on Labor Day?  The New York Times prints, "Housing Woes Bring New Cry: Let Market Fall."

The unexpectedly deep plunge in home sales this summer is likely to force the Obama administration to choose between future homeowners and current ones, a predicament officials had been eager to avoid.

The Obama administration has been trying to pull a rabbit out of the hat when it comes to the falling value of American homes and poor market demand.

Over the last 18 months, the administration has rolled out just about every program it could think of to prop up the ailing housing market, using tax credits, mortgage modification programs, low interest rates, government-backed loans and other assistance intended to keep values up and delinquent borrowers out of foreclosure. The goal was to stabilize the market until a resurgent economy created new households that demanded places to live.

As mentioned elsewhere in Vested Title News, with the exception of the tax credits gimmick, these programs have not been successful.  Maybe drastic action is in order.

Some economists and analysts are now urging a dose of shock therapy that would greatly shift the benefits to future homeowners: Let the housing market crash.


When prices are lower, these experts argue, buyers will pour in, creating the elusive stability the government has spent billions upon billions trying to achieve.

 There is a lot at play here; financially and emotionally.  We've complained before about "strategic defaults" where a homeowner walks away from his home because its market value has fallen below the value of the mortgage.  And we've mentioned that every seller thinks her home is worth a million dollars when it's listed for sale.

Maybe the "shock therapy" is what is needed.

Read the full column, and let us know what you think.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Title Inc.

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 201-656-9220 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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We've moved to our new offices in Fairfield, New Jersey!

We've moved!

As of Tuesday, September 7, 2010

Vested Title Inc.'s new offices are located at

165 Passaic Avenue, Suite 101

 

Fairfield, NJ 07004

Tel 201-656-9220 - Fax 201-656-4506

E-mail vti@vested.com - http://www.vested.com/

Our telephones and fax lines will be up and running.  If not, please contact us at our email address or this alternate fax number

973-556-1628

We look forward to serving you from our new offices with the same high level of service that we have for the past 30 years.

Susan L. Kruger, President

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From Bankrate.com - Five tips on how to avoid identity theft

Five tips on how to avoid identity theft. We’ve had it happen to us and can testify how it affects your life.

“Everyone makes mistakes. After all, it's only human to goof up now and then. But if you want to protect yourself from identity theft and other financial scams, you need to play it safe, be smart and avoid simple mistakes that can expose your financial data and identity to fraudsters.”

Here are the five tips:

1. “Never carry a Social Security card, whether it's your own or your spouse's, parent's, child's or other family member's, in your wallet.”

While there’s no doubt you'll need your SS number to apply for a job, get a mortgage “most people don't need to give out their Social Security number on a day-to-day basis.”

"Another tip: Don't write a Social Security number on a scrap of paper and carry that in your wallet instead of a Social Security card. If your wallet is lost or stolen, a person of criminal intent can easily guess what those nine digits are.”

2. Don’t yak on a cell phone in public.

“Elevators, public streets, restaurants, airport terminals -- these are but a few of the public places where Linda Foley, founder of the Identity Theft Resource Center in San Diego, says a private conversation on a cell phone can be easily overheard by someone who can memorize or write down any financial information that's disclosed.”

3. Be wary of Internet friends.

“[N]ot all of the people you may encounter are who they say they are. Some of them are scammers on the prowl for information.”

"You share where you were born and when you were born, now I know where to get your birth certificate," Foley says. "I can take that and get a duplicate Social Security card and with that I can get a driver's license and with that I can get a passport and with that I can travel anywhere and be you as much as I want."

4. Keep financial information off of your resume.

Posting your resume on line?

“Never put your Social Security number, birth date, place of birth or other financial information on your resume. Be wary of scams that use e-mail messages -- "We loved your resume, and we need your Social Security number to do a background check so we can hire you," is one example -- to prey on unemployed people.”

5. Pass up that free offer in exchange for personal information.

"Be suspicious of offers that seem too good to be true, regardless of how or where they're presented. That free T-shirt may be a lure to entice you to fill out an application for a credit card that doesn't exist. Once you complete the application and get the T-shirt, those data are out of your control.”

You can read the full article on Bankrate.com.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow

Vested Title Inc. 

E-mail vti AT vested.com - www.vested.com

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From the Christian Science Monitory - Homebuyer tax credit: the scam of the century?

Posted on the Christian Science Monitor Paper Economy blogsite by SoldAtTheTop, worth publishing in full:


The Realtors backed it… the home builders backed it… the mortgage bankers backed it… virtually anyone with an financial interest in residential real estate transactions backed the Homebuyer Tax Credit (and it’s expanded extension) and now that the program is finally complete and a whole host of indicators (NAHB builder sentiment, pending home sales, existing home sales, home prices, etc.) suggest that the its effects were at best temporary, we can see fairly clearly that this policy was a scam of epic proportions benefiting few and costing many.

Reports indicate that the total credit cost could exceed $20 billion and while the cost of administration and vetting of claims is yet to be determined, it can safely be assumed to have been very costly, so what did we get for our Keynesian tax stimulus efforts?

First, it’s important to recall that early on in the program implementation it was reported that there was a massive number of fraudulently filed claims with thousands coming from inmates, children and tax preparers supposedly acting without the knowledge of filers that did not purchase homes.

Needless to say, the IRS has been busy with audits, so much so that as of June they blocked or froze over a billion dollars of claim payments.

As for properly filed claims, many of the homes purchased with the credit have already declined in value in excess of the credit’s maximum $8000 benefit (i.e. a mere 2.5% decline on a $350,000 home) leaving many unwitting home “buyers” in the cruel predicament of sinking in a quicksand of asset price deflation for simply having jumped for a slight nibble of the government’s meager tax carrot.

Finally, in trying to fully understand why the government undertook such a useless and poorly calculated program, it’s important to recognize those who truly walk away from this policy in better standing.

Realtors, home builders and mortgage bankers…. some of the most notable culprits of the housing bubble years… all walk away cleanly skimming the proceeds coming from the transactions of an estimated 2 million temporarily stimulated home purchases.

It should come as no surprise that these were the very same industry groups that worked tirelessly lobbying to enact this failed policy… it was a simple exchange… your tax dollars to their wallets.

While Washington elites likely continue to celebrate the “success” of this ludicrous policy, those opposed can at least draw some consolation from the recent refusal of NJ governor Christie’s to enact a similar program possibly indicating that public sentiment has turned against such overtly illogical and wasteful government efforts.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow

Vested Title Inc.

648 Newark Avenue, P.O. Box 6453,

Jersey City, NJ 07306

Tel 201-656-9220 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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Flood insurance program a mess

How would you like to live in home that is prone to flooding? How would you like to have it be “flooded 34 times since 1978?” Well, there is such a home, and there are more like it.

“In Wilkinson County, Miss., a home has been flooded 34 times since 1978.

“Extraordinary as the damage may be, even more extraordinary is that an insurer has paid claims every time, required no flood proofing, never raised premiums after a claim and vowed to continue insuring the house. Forever.

“The home's value is $69,900. Yet the total insurance payments are nearly 10 times that: $663,000.

“It's no surprise that the insurer faces huge financial problems.

“The insurer? The federal government.”

Billions of dollars have been paid to the owners of similar homes across the country and there is no end in sight.

Other insurers for casualties and liability are certain that the premiums collected exceed the cost of claims. But not with the federal government in charge.

“Instead it's running deeply in the red. A major reason, a USA TODAY review finds, is that the program has paid people to rebuild over and over in the nation's worst flood zones while also discounting insurance rates by up to $1 billion a year for flood-prone properties.”

In New Jersey, claim histories are not so great either.

As reported in the Asbury Park Press,

“For every dollar the National Flood Insurance Program has doled out since 1978 to repair flooded homes and businesses in New Jersey, 68 cents has been spent to repair properties that have been flooded more than once. Nearly one in seven of those properties is in Monmouth or Ocean counties.”

So, what do you think should be done? It seems that it makes sense that homes that are repeatedly subjected to floods are built where they shouldn’t be. Rather than continuing to pay claims, maybe the homeowners should be bought-out.

What do you think?

Read the entire USA Today report here.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow

Vested Title Inc.

648 Newark Avenue, P.O. Box 6453,

Jersey City, NJ 07306

Tel 201-656-9220 - Fax 201-656-4506

E-mail vti@vested.com - www.vested.com

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