On Mon, Mar 21, 2011 at 10:29 AM, Wojtek S <wsoko52 at gmail.com> wrote:
> [WS:] But are not most contracts written in such a way that the
> homeowner owes the mortgage regardless of his/her equity (if any)?
> For example, you buy a house for $300k, of which 80% ($240k) is
> mortgaged. The market flops, you lose your job, the house is
> foreclosed and sells for $200k. You still owe $40k plus legal costs,
> penalties and what not.
>
> PS Thanks for the reference, i ordered the book.
>
> Wojtek
>
>
> On Sun, Mar 20, 2011 at 10:15 PM, Andy <andy274 at gmail.com> wrote:
> > So I just finished Eugene Linden's Winds of Change, on how climate
> > change effects civilizations past and present. He doesn't make a
> > super-strong case for ancient civilizations -- probably because so far
> > there isn't a super-strong case to be made -- and he leans heavily on
> > Mike Davis's work on El Nino precipitating famine around the Indian
> > Ocean in the late 19th century. He does make a cogent if brief case
> > for how it can complicate our current situation. Not bad overall.
> > But what really surprised me was in his account of the American
> > southwest, where regional climate prediction tends to line up moreso
> > than most places, forecasting drought:
> >
> > [quote]
> >
> > In Southern California, many homeowners have very little equity at
> > risk because banks have been willing to finance nearly all the costs
> > of buying homes. Will banks continue to do so if prices start to
> > stall, or if insurance companies balk at insuring homes in high-risk
> > areas? And what would happen to the banking system if banks become
> > suddenly saddled with a huge increase in non-performing mortgages and
> > unsalable properties possessed through foreclosure? With no cushion
> > and no buyers, foreclosures would quickly propagate back up through
> > the financial system. Because mortgages have been sliced and diced
> > into so many derivatives, the crisis could quickly become systemic as
> > investors fled markets.
> >
> > [end quote]
> >
> > The book is copyrighted 2006.
> >
> > --
> > Andy
> > ___________________________________
> > http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
> >
>
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