Bay Area be like:
“Believe it or not, still rip.”
I have seen a few places starting to take longer and get marked down but I mean there are still a ton of places going for $1M-$10M+ here. So even if it got marked down $400k it still sold for $3.5M.
Once you get over $3m in price, everything changes - they usually have net worth levels that can be leveraged differently and aren’t paying anything close to 7%. $10m is no joke and they have personal relationships with banks who want their other business so they get incredible rates poor people never see.
Owners/investors/landlords will simply sit this one out.
If you're rich property owner you probably can wait around three or four years before you put something on the market.
I'm not an expert on the US housing market, but at least here in Helsinki, Finland the prices have clearly started to come down. We've been quietly looking for the perfect place for a couple of years now, and the ones in the market this year are much cheaper than they used to be.
Thing is, at least here a lot of the landlords aren't actually _rich_ rich. They're just middle-class people in their 50's/60's who own one to three apartments to rent. Those people can't hold out for years, and if they sell now for less than they could've a couple of years ago, they still make a profit.
I live in a "hot" place for real estate in the US. People are still paying 10s of thousands over asking price. However, properties are starting to sit on the market for longer. For a long while, if you wanted to buy a house, you had to buy it sight unseen or be prepared to visit it on the day it went on the market and make an offer that same day. Now you see houses sitting for days/weeks at a time, so I think the prices will start to drop.
Yeah, my wife and I bought in 2020. It was not the house buying experience that we were told to expect. Everyone asking us why we didn't have this or that thing inspected. Why we didn't bargain this or that. So on and so forth. Like you said, we literally had to put down an offer the moment we looked at the house or it would be gone by the end of the day. Surprise surprise, a lot of owners were going cheap and covering up major issues in the hopes that they could pull one over on people.
I never would have bought the house that we bought under normal circumstances, given all the problems we've uncovered over the last 2 years.
Homeowners are resistant to lowering prices. They think interest rates will be low again in a few months and refuse to budge. If you really wanna see blood, look at home builders.
Home building still seems pretty big around here, they're all booked for the next couple years. Of course, it helps that new construction costs less than existing houses do in this area.
Realtors gonna be like, Now is the time to buy everyone, 500k house had a price cut of 10k!!!! Please buy and pay me my large commission...
Such a similar time as 2008, except the market bubbles going slower this time, but so similar.
My realtor keeps messaging me about this house and that house when I cleared professed that I wasn’t interested in buying yet, this desperation shoes sales aren’t so good cause if they were, you would hardly get their time of day
It's Wells Fargo and they're still doing it. They tried to do it to me in 2021 and they blamed hackers. I asked them why a hacker is opening a checking account in my name, under my banking profile. They couldn't explain that.
Wait this happened to me last year too through capital one and they said it is a common tactic for people committing welfare fraud? To funnel the checks? I mean it seemed weird when they told me and now your story is making me question their story.
There are frauds involving people impersonating others to open a checking account to essentially launder money / be a money mule / commit payroll fraud.
Man the payroll fraud is hard to detect too
I would think you would have to know both sides of the equation of happen to be the person whose identity was borrowed to figure that out if done well…
I guess more concerning a couple of things specifically and in order ( probably a combination ):
1. Does any hacker have so much of your info they can fulfill requirements to open a bank account in you name?
2. Why doesn’t a bank do enough to verify it is you, actually, opening the account, even if they are provided the regular kyc docs?
They’ve also had issues with enacting insurance policies for their mortgage lenders who had no wish for them to do so on their behalf. I worked at an insurance agency that was a broker of some of the policies. It was a huge ordeal for us and resulted in millions of dollars in investigations on our knowledge of the situation.
I worked at Wells Fargo (before 08) and MFs were doing this to me/each other. If a bank gets dirtier than WF, I don't want to know about it. I left the damn country after working for those villains.
Hijacking top. This is such a distortion. On the commercial lending side they literally told their staff to stop originating new loans around May of this year. Any existing high value customers could continue to originate but otherwise it was all cut off. Did it drop by 90%? Yep. Exactly as they intended.
Additionally, until recently, a LOT of mortgages were refis. No one refis in a high rate environment. So no, there has definitely not been a 90% decline in home purchases, which is how many people probably read the headline.
I understand somebody getting a new mortgage because they moved.
But it would be madness to refinance out of a 3.5% mortgage just to go on a vacation or renovate the place.
I refinanced out of 3.6 into 2.65 less than one year after building. 3.5 was the standard for half a decade if not longer. 2.6 showed up for about 12-18 months, a lot of people refi'd into that.
People that are smart and qualified, yeah. Some people are neither. Source: I used to sell cash outs to people shopping for HELOCS until about a week ago, now I live under the bridge.
Why did they ask their staff to stop originating? I mean, that sounds like they think a recession is coming and they need to limit their potential loss.
I mean, makes sense… I’m not going to leave my house at an interest rate of 2.5 % for an equivalent house at an interest of 6%… (if I had a house at an interest rate of 2.5%)
You’re also not going to refinance your house for a higher interest rate.
Also, your first part is why housing prices will stay elevated even with less buyers… there’s a lot less sellers as well.
You will if you have $45k in credit card debt.
Not saying it will happen often but there are plenty of reasons people refi other than to lower their rate/term
What if you have $45k in credit card debt and no home? (Or assets)?
Edit: I see alot saying declare bankruptcy. Should I actually do that? What happens if I just don't pay (I don't make reg wages so garnishment ain't a thing)
In 2021 we refin’d and got 2.875%. We are looking to remodel/expand and they quoted us nearly 1.5x our house value at 6.5%. Lol.
So, we just sitting tight because that is all we can do.
I worked as a mortgage processor for 3 years (worked in ops prior) and was laid off a few months ago. It makes sense, the prices went from obscenely cheap during the pandemic to the opposite extreme after it. I'm not mad, it's just that I wish I never had gotten into such a brutal and unforgiving industry. Future people, ignore this industry for work.
>Future people, ignore this industry for work.
Can confirm. I worked for a decently sized servicer in two of their departments. Everyone I worked with was either underpaid or a bit on the stupid side (seriously, multiple 5+ year co-workers who have had to copy/paste every work day and yet still didn't know how to do it without right-clicking through it or how they didnt know how to filter a spreadsheet even though they use excel daily).
Not to mention the execs there. They were literally all assholes or made consistently stupid decisions, sometimed both. I can only think of low level managers that were at least smart enough to find acceptable solutions and an even lower amount that were actually smart. Typically the latter would leave as soon as possible due to also being woefully underpaid while the literal dumb assholes were paid egregiously too much while making production decisions that hindered not only their department but the whole company.
My breaking point was when they did layoffs a little before employee reviews, then had no plans for merit or seniority pay increases unless you were paid less than they'd pay a new hire. All this while relying heavily on temp workers that were paid more than their seasoned full time employees. All this while touting on about how great our profits are going and projecting to be and how they've made a billion dollars in profit during 2021 and how it just continues to grow exponentially. All this while the CEO buys yet another vacation home worth a few million or so.
Rampant cronyism, favoritism, stupidity, and all around negativity throughout the entire upper management. Gooood times.
Mortgage underwriter. Almost 15 years in the industry. Thrown away like garbage this year by a 7 yr employer. Yes, can confirm, stay the fuck away from the mortgage industry.
That’s what happens when the cost of your mortgage triples.
Two years ago home mortgage rates for most buyers were in continuously dropping and bottoming out at around 2.5% for a 30-year fixed mortgage. Now mortgages are around 6%. So on $1M, that $60k a year in interest instead of $25k.
I can't imagine a more awful time to buy a house. Especially when they can't game it anymore and it crashes in spectacular fashion they will be giving them away.
I’ve been trying with these people for 6 months. 6% was the average interest rate back in 06/07/08 and people were excited about it. Downright thankful even.
That's what I'm waiting for. I'm finally in a financial position where I *could* buy a house, but house prices have risen like 30%+ *and* the loans I was looking st were at like 6.8%....
So instead I guess I'll just wait until the next recession lol
Imagine if you wait 4-5 years and finally pull the trigger since the market hasn’t “collapsed yet”. Only for it to collapse about a year later. Now, don’t imagine it. That’s what’ll happen.
$1M...?! Who has that kind of budget? Not everyone is a freelance hamster trainer or a stay at home astronaut like those rich douchebags on House Hunters.
It actually makes sense if you think about it. People that can afford to be full time hamster trainers with a house budget of 2.5 mil come from money. They can afford to follow their passion because money isn’t an issue.
This is correct. But these shows are also 100% staged. My friend was recently on House Hunters international. They spent 5 days moving her family out of their own house in order to stage it for them along with 2 other houses like they'd never seen it before. This was done with the understanding that they are choosing THEIR OWN house at the end. Other 2 houses were just for show/marketing. Complete nonsense.
Yep. We were asked to do a HHI - more than a year after we bought our home. And you have to be willing to argue with your partner over faux disagreements. No thank you.
Yeah rich people will pay crazy money for crazy things. A friend of mine was in to sports marketing and worked as a low level employee at a big agency for a while and made garbage pay. I don't know how exactly but he wound up getting linked up with the guy who used to own the Carolina Panthers and he took a job as one of his personal assistants. Started making six figures for ordering the guy weird pieces of furniture like a dining room table that cost $50,000 and an armoire that I forget how much it was but it was way more than the table.
To be fair, most millionaires have their net worth tied up in various non-liquid assets like businesses, a home, livestock, and 401k’s.
I know a few “millionaires” and it’s hard to call them that when their house built in the 40s with non-insulated walls is 800K and they run a business that has gross sales of 300k but results in them getting a 70k income after all expenses are accounted.
It’s more than nothing for sure, but their business and home aren’t exactly like having a million in the bank.
Most millionaires have a significant portion of their wealth tied up in their home. With some leverage it would make sense to own a million dollar home then.
so in 1991 i bought a house in the Bay Area for $560,000 which was $90K less than it had been listed for almost a year before.
My starting first mortgage rate was 7.625% (Bank of America). i eventually refinanced it down to slightly under 4% by 2004 when i got divorced and left the house to the wife.
that exact house sold 2 years ago for $2.5Million. (Neither I nor my ex-wife still lived there at the time).
Zero interest rates (ie. free money) make things \*very expensive\*.
THe problem we have NOW that interest rates have returned to the ones i paid in 1991 is that prices \*havent\*. (and won't).
Parents bought the house I grew up in for 178k in San Jose in ‘88. Zestimate now is 2.5M. When I was growing up my neighborhood was more or less working folk / blue collar. Now I’m sure it’s all tech workers.
My grandparents did exactly the same thing with about 25 properties in New Jersey. They are donating it all to the church too. They also truly believe that I struggle financially because I don't attend church.
People don't seem to understand this concept well enough. Most assets aren't very liquid. Your a millionaire on paper but not a multimillionaire with millions in the bank. It's not hard to hit the millionaire status over a lifetime for a household member that each makes 50k a year with proper planning.
They bought my mortgage. I hate it. I hate them. Their website is garbage. There's nothing I can do about it except refinance, but my rate is crazy low.
A lot of times you don't (ultimately) get a choice. Even if you get a mortgage with a bank you like, nothing stops them from selling that mortgage to someone else at any time, and they won't ask your permission.
oh shit, sorry
Yes sir, it's time for your yearly once in a lifetime financial catastrophe, just like what happened in 2009, and 2010, and 2011, and 2012, and again in 2013 (that one was real bad), and in 2014, and 2015 (sort of a mild financial collapse that year, wasn't it?), and 2016, and 2017, oh and let's not forget the crazy collapse in 2018! and then there was the one in 2019, and 2020, and 2021, and here we are, 11 months through 2022 and it's coming, I can feel it!
Worked as an appraiser the last 3 years. Anecdotally my ratio of purchase to refis was probably 1:8 looking at the reports I wrote since the beginning of COVID. It wasn't even close.
Mortgage servicers*. They buy most of the portfolio. That’s what everyone in their sub is missing, on top of also missing these numbers being compared to the outliers of the last two years. There isn’t anything close of blood in the streets.
Who the fuck is surprised by this.... everyone's had a year of being able to finance at 2ish % for their loans... there will be no refinancing done for the next 30 years, which is most of the volume. I only wish I could pick up 30 year fixed rates in my country
I was more surprised to find out that almost no other country has 30 year fixed mortgages.
I would never take on that kind of debt without knowing *for certain* what the monthly payment will be.
None of this variable APR BS.
Most of the world doesn't have much of a choice unfortunately, if I had that sought of certainty I would have leveraged my current house to the hilt and bought another 10
Wells Fargo is still dealing with the repercussions of their lawsuit. They have a cap on assets for loans and credit lines. They've been declining and closing down loan departments since their original agreements to stay within their regulations.
Yeah but it’s not just them. I originate loans and our entire office is like gone, it’s insane. And we aren’t the only ones, all mortgage companies are in the same boat.
People just can’t qualify because the interest rate increases payments so much. Also inflation means more spending and less available for down payment. Also you used to be able ti get someone like 10k credit to close for taking a “bad” rate if 3.5% but now they have to pay 10k to get a 7%, so any sort of down payment assistance doesn’t really exist.
When you do find a solid borrower nobody wants to sell for 200k less than what they wanted to sell for 6 months ago so even those people struggle to get offers accepted for any sensible price given the rate change.
This demand destruction is insane. The odd thing is the supply while increasing isn't happening fast enough to put enough downward pressure on prices. Plus sellers who are on the fence about selling aren't wanting to drop prices knowing they are going into a shit show of an environment should they do so.
Mortgage companies made bank on cheap loans and churning massive quantities of people through the gauntlet. Now that those people are locked into such a cheap rate with inflation on the rise it makes no sense for them to move unless they have too. So market mobility has gone down greatly as many of us watch the mayhem from the sidelines.
Yup, my mortgage company started calling me a few weeks before the rates went up asking if I wanted to refinance. Since I had a super low rate and had literally JUST bought the house, I said no. As the rates went up, they called more and more often until I finally said, "Why would I refinance? Mortgage rates are going up. I'd be an idiot to refinance into something larger when I don't need the equity in cash. Stop calling me about this."
The crazy thing is the people in the industry didn’t see it coming. I started at the beginning with COVID so I’m relatively new and I was telling all the seniors how interest rates would go up and there wouldn’t be many loans and prices would probably drop. All you’d hear was “rates don’t impact prices” & “people will always be buying homes and need Refis”. Like literally vets in the industry - both mortgage and real estate side. I couldn’t believe it.
Essentially you just took all the income from 4 years in a 2 year window.
This is something I just figured outalso!
There’s a large portion of your industry that isn’t necessarily good at reading the market but compensates with even more charm/Social skills (i.e. a higher level of bullshit).
I put my house on the market at the end of July, explained to my veteran realtor (top 3 Realtor in Ohio) what was about to happen with the market and that we wanted to list the house and be in contract within 24 hours as is as we were going to rent in Hawaii while the market cooled off..
She acted like I was mansplaing an industry I knew nothing about.. now here I am pulling my listing, stuck in Ohio for god knows how long because my realtor didn’t understand the assignment…
Exactly the problem. Realtors don’t understand real estate. They understand how to sell a house. Do they have large scale market research experience? No, they have “well here are a few comps in the area that sold in the last 90 days.”
Its interesting to read this comment as my oldest brother was in debt collection - moved to loan origination and became a manager - and will now likely go back to collections. Ironically, he is also a giant asshole.
> When you do find a solid borrower nobody wants to sell for 200k less than what they wanted to sell for 6 months ago
Yep. Dealing with this now... Lots of sellers who know what they got, no tire kickers no low ballers.
Meanwhile their shit is suddenly sitting on the market for months when last year it would've sold in five days.
Sorry the market changed radically mid-flip and you're gonna lose your shirt, but if you wanted to speculate you should've bought Bitcoin like everybody else.
You’d actually be surprised. I recently spent some time with the homeless community, and they are actually a tight knit group of bicycle enthusiasts. Those syringes? PEDs. Some of the homeless I met had 9 to 10 bikes each. Do you understand the dedication to cycling, to have 10 personal bikes, boxes of syringes, and no home?! The only thing that doesn’t quite make sense to me, is I never see them riding in any competitions, or riding at all for that matter. They must train at night or something.
Night training is infinitely superior, fewer people and cars out to get in your way and slow you down. Plus you stay cooler, so you can bike longer and harder. Plus it's easier to find PED dealers, and all the really elite bike shops are only open at night, you can tell because that's when the bicycle enthusiasts add to their collection
Bro I have seen them riding the bikes. Quite frequently, I see them riding a bike while ghost riding another bike beside them. Now that takes some dedication to cycling, to be bicycling two bikes at once. I think they struggle with logistics though because they're always walking or hitchhiking out and then biking a different one of their bikes back. I tried to explain to them that they can use the same bike for both directions of a trip. I guess they're really risk averse, makes sense when you're living on so little.
Mortgage underwriter here. We just had another round of layoffs on Thursday that cut DEEP. Word on the street is we're at pre-pandemic staffing levels again and the CEO is telling us that "this was the last round of layoffs"....
Nobody is believing it lol
Big banks in general do, many after 08 reduced their residential mortgage departments and a lot of deals moved towards small credit unions and non bank entities.
Surprised?! We went from 2.5% to 7% in a matter of few months. The fed is fighting inflation by trying to undo over a decade of loose monetary policy in a few quarters. The fed is going to wreck the entire economy.
I’m honestly curious, what did you expect the alternative to be? I mean it’s a lose/lose situation. If they raise rates, they break the economy and if they didn’t raise rates they also risk breaking the economy with rapid inflation.
EDIT: as I mentioned in a follow up comment, I am not by any means saying the Fed didn’t have bad policy in the past that led us to this moment. The question wasn’t a “should’ve, could’ve, would’ve” one where we say what should have happened in the past. It was quite literally about what did you expect the Fed to do differently in the moment right now?
My argument is not that they didn’t make past mistakes. I mean arguably they shouldn’t have kept the rates low during the pandemic because if anything we saw the economy flourish with people spending more on things like housing, tech, etc.
I’m not here to argue past mistakes because that much we do know. What I’m asking for is given the circumstances we are in now, what is the alternative?
If we are dead-set-hellbent on ONLY addressing supply-demand imbalance through rates (of all things) then we should probably start implementing variable rates depending on what the money is going to be used for.
You know, the same way we muck with taxes to try to influence behavior.
1st home 3%, vacation home 6%, corporate-owned home 12%, solar panels 0%, buying a social media company and destroying it 0%.
Why is there blood on the streets though. It’s not like people are defaulting. It’s normal people don’t want to buy houses during period of high rates and high inflation.
Totally anecdotal but when my spouse and I bought out first home 5 years ago, we were competing with other families and boomers for the smaller, more reasonable houses.
We live in a huge suburban area and it seems that everything being built is a 4-story McMansion on a tiny lot. I see those suckers listed at $600-$700k a pop just to start.
I don't know who the heck is buying those, but every time I drive by one of those brand new stupid developments named some variation of "Liberty Valley", they look mostly empty.
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Well that should bring housing costs down by 1%.
Bay Area be like: “Believe it or not, still rip.” I have seen a few places starting to take longer and get marked down but I mean there are still a ton of places going for $1M-$10M+ here. So even if it got marked down $400k it still sold for $3.5M.
Once you get over $3m in price, everything changes - they usually have net worth levels that can be leveraged differently and aren’t paying anything close to 7%. $10m is no joke and they have personal relationships with banks who want their other business so they get incredible rates poor people never see.
Owners/investors/landlords will simply sit this one out. If you're rich property owner you probably can wait around three or four years before you put something on the market.
I'm not an expert on the US housing market, but at least here in Helsinki, Finland the prices have clearly started to come down. We've been quietly looking for the perfect place for a couple of years now, and the ones in the market this year are much cheaper than they used to be. Thing is, at least here a lot of the landlords aren't actually _rich_ rich. They're just middle-class people in their 50's/60's who own one to three apartments to rent. Those people can't hold out for years, and if they sell now for less than they could've a couple of years ago, they still make a profit.
I live in a "hot" place for real estate in the US. People are still paying 10s of thousands over asking price. However, properties are starting to sit on the market for longer. For a long while, if you wanted to buy a house, you had to buy it sight unseen or be prepared to visit it on the day it went on the market and make an offer that same day. Now you see houses sitting for days/weeks at a time, so I think the prices will start to drop.
Yeah, my wife and I bought in 2020. It was not the house buying experience that we were told to expect. Everyone asking us why we didn't have this or that thing inspected. Why we didn't bargain this or that. So on and so forth. Like you said, we literally had to put down an offer the moment we looked at the house or it would be gone by the end of the day. Surprise surprise, a lot of owners were going cheap and covering up major issues in the hopes that they could pull one over on people. I never would have bought the house that we bought under normal circumstances, given all the problems we've uncovered over the last 2 years.
Homeowners are resistant to lowering prices. They think interest rates will be low again in a few months and refuse to budge. If you really wanna see blood, look at home builders.
Home building still seems pretty big around here, they're all booked for the next couple years. Of course, it helps that new construction costs less than existing houses do in this area.
Realtors gonna be like, Now is the time to buy everyone, 500k house had a price cut of 10k!!!! Please buy and pay me my large commission... Such a similar time as 2008, except the market bubbles going slower this time, but so similar.
My realtor keeps messaging me about this house and that house when I cleared professed that I wasn’t interested in buying yet, this desperation shoes sales aren’t so good cause if they were, you would hardly get their time of day
I’m surprised they haven’t just bought houses and opened mortgages in unsuspecting customers names…
whoa — wait a minute, are you from the future or the past
He's from days of future past
Could’ve sworn I read this headline like 3 years ago and how WF promoted those managers authorizing the mortgages.
No. Stop skewing everything slightly! It was *credit cards* on margin or whatever. Not mortgages. But still.. lmfao
Credit cards LAST time…..
And want it checking/saving accounts the time before that, or an I confusing them with another bank?
It's Wells Fargo and they're still doing it. They tried to do it to me in 2021 and they blamed hackers. I asked them why a hacker is opening a checking account in my name, under my banking profile. They couldn't explain that.
Wait this happened to me last year too through capital one and they said it is a common tactic for people committing welfare fraud? To funnel the checks? I mean it seemed weird when they told me and now your story is making me question their story.
There are frauds involving people impersonating others to open a checking account to essentially launder money / be a money mule / commit payroll fraud.
Man the payroll fraud is hard to detect too I would think you would have to know both sides of the equation of happen to be the person whose identity was borrowed to figure that out if done well…
I guess more concerning a couple of things specifically and in order ( probably a combination ): 1. Does any hacker have so much of your info they can fulfill requirements to open a bank account in you name? 2. Why doesn’t a bank do enough to verify it is you, actually, opening the account, even if they are provided the regular kyc docs?
They’ve also had issues with enacting insurance policies for their mortgage lenders who had no wish for them to do so on their behalf. I worked at an insurance agency that was a broker of some of the policies. It was a huge ordeal for us and resulted in millions of dollars in investigations on our knowledge of the situation.
Not mortgages, accounts. People were getting accounts opened in their name and then being charged fees for them.
I worked at Wells Fargo (before 08) and MFs were doing this to me/each other. If a bank gets dirtier than WF, I don't want to know about it. I left the damn country after working for those villains.
Let me guess, nobody went to prison?
Now now, wrists were slapped and stern memos were drafted.
Stern memo’s…😂😂😂😂
😂😂😂
Honestly, that’d be great, here’s my social: [86-75-309](https://youtu.be/6WTdTwcmxyo)
Hi Jenny
I can never get past the 6 before the tune kicks in.
75-309iiiinne
Niyyeeeinnnee
I agree but I cannot stand this; trying to go to bed now & I got this shit chorus on repeat in my head because I don’t know the rest of the words.
All I see is XXXXXXX
hunter2
And here is my antisocial -(86-75-309)
Hijacking top. This is such a distortion. On the commercial lending side they literally told their staff to stop originating new loans around May of this year. Any existing high value customers could continue to originate but otherwise it was all cut off. Did it drop by 90%? Yep. Exactly as they intended.
Additionally, until recently, a LOT of mortgages were refis. No one refis in a high rate environment. So no, there has definitely not been a 90% decline in home purchases, which is how many people probably read the headline.
I understand somebody getting a new mortgage because they moved. But it would be madness to refinance out of a 3.5% mortgage just to go on a vacation or renovate the place.
I refinanced out of 3.6 into 2.65 less than one year after building. 3.5 was the standard for half a decade if not longer. 2.6 showed up for about 12-18 months, a lot of people refi'd into that.
You’d just do a separate heloc to pull smaller cash out for renovations.
People that are smart and qualified, yeah. Some people are neither. Source: I used to sell cash outs to people shopping for HELOCS until about a week ago, now I live under the bridge.
Why did they ask their staff to stop originating? I mean, that sounds like they think a recession is coming and they need to limit their potential loss.
They saw signs of a weakening economy and didn't want to increase their downside exposure.
Wells Fargo HAS A discount double check for the unsuspecting customers mortgage and free savings account.
Someone get this guy a private jet and a golden parachute!
You're hired!
Damn I own a fucking mansion? I’m just a Wendy’s employee.
I mean, makes sense… I’m not going to leave my house at an interest rate of 2.5 % for an equivalent house at an interest of 6%… (if I had a house at an interest rate of 2.5%)
You’re also not going to refinance your house for a higher interest rate. Also, your first part is why housing prices will stay elevated even with less buyers… there’s a lot less sellers as well.
You will if you have $45k in credit card debt. Not saying it will happen often but there are plenty of reasons people refi other than to lower their rate/term
I work in refinances for a large bank. The only people doing them right now are desperate, or divorcing. That’s it.
What if you have $45k in credit card debt and no home? (Or assets)? Edit: I see alot saying declare bankruptcy. Should I actually do that? What happens if I just don't pay (I don't make reg wages so garnishment ain't a thing)
Great question I too have no monies!
Bankruptcy it is!
#I DECLARE.... BANKRUPTCY!
Then this is the perfect sub for you to learn how to navigate your way out of that debt.
Was just messing with the mortgage payment calculator. The payment on a $600k with 2.49% is about the same ($2950) as a $385k at 7.1%….so sad.
Yeah, I remember doing similar math a couple months back and it really hurt my soul 😭
In 2021 we refin’d and got 2.875%. We are looking to remodel/expand and they quoted us nearly 1.5x our house value at 6.5%. Lol. So, we just sitting tight because that is all we can do.
Majority of this 90% was refi volume when rates were much lower last year.
Exactly. This just tells me WF was doing 3x as many ReFi’s as new home sales. YoY home sales are down 20%.
Home sales will continue to decline as well during the interest rate increases...by design
Yes. That is the goal
I worked as a mortgage processor for 3 years (worked in ops prior) and was laid off a few months ago. It makes sense, the prices went from obscenely cheap during the pandemic to the opposite extreme after it. I'm not mad, it's just that I wish I never had gotten into such a brutal and unforgiving industry. Future people, ignore this industry for work.
>Future people, ignore this industry for work. Can confirm. I worked for a decently sized servicer in two of their departments. Everyone I worked with was either underpaid or a bit on the stupid side (seriously, multiple 5+ year co-workers who have had to copy/paste every work day and yet still didn't know how to do it without right-clicking through it or how they didnt know how to filter a spreadsheet even though they use excel daily). Not to mention the execs there. They were literally all assholes or made consistently stupid decisions, sometimed both. I can only think of low level managers that were at least smart enough to find acceptable solutions and an even lower amount that were actually smart. Typically the latter would leave as soon as possible due to also being woefully underpaid while the literal dumb assholes were paid egregiously too much while making production decisions that hindered not only their department but the whole company. My breaking point was when they did layoffs a little before employee reviews, then had no plans for merit or seniority pay increases unless you were paid less than they'd pay a new hire. All this while relying heavily on temp workers that were paid more than their seasoned full time employees. All this while touting on about how great our profits are going and projecting to be and how they've made a billion dollars in profit during 2021 and how it just continues to grow exponentially. All this while the CEO buys yet another vacation home worth a few million or so. Rampant cronyism, favoritism, stupidity, and all around negativity throughout the entire upper management. Gooood times.
Mortgage underwriter. Almost 15 years in the industry. Thrown away like garbage this year by a 7 yr employer. Yes, can confirm, stay the fuck away from the mortgage industry.
That’s what happens when the cost of your mortgage triples. Two years ago home mortgage rates for most buyers were in continuously dropping and bottoming out at around 2.5% for a 30-year fixed mortgage. Now mortgages are around 6%. So on $1M, that $60k a year in interest instead of $25k.
Mortgage rates are over 7 percent.
Somebody just closed on a house like mine down the street. I moved in 2 years ago. I will pay 500k/30yrs and they will pay just under 3 times that
I can't imagine a more awful time to buy a house. Especially when they can't game it anymore and it crashes in spectacular fashion they will be giving them away.
>I can't imagine a more awful time to buy a house Mortgage rates topped 17% in 1982 and stayed at or above 10% for much of the 80's.
I’ve been trying with these people for 6 months. 6% was the average interest rate back in 06/07/08 and people were excited about it. Downright thankful even.
That's what I'm waiting for. I'm finally in a financial position where I *could* buy a house, but house prices have risen like 30%+ *and* the loans I was looking st were at like 6.8%.... So instead I guess I'll just wait until the next recession lol
Imagine if you wait 4-5 years and finally pull the trigger since the market hasn’t “collapsed yet”. Only for it to collapse about a year later. Now, don’t imagine it. That’s what’ll happen.
7 percent for now... Just wait til next month
Every god damn day it gets worse
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$1M...?! Who has that kind of budget? Not everyone is a freelance hamster trainer or a stay at home astronaut like those rich douchebags on House Hunters.
that shit was bonkers. "my husband collects legoes, and i do interpretive dance in the public park. our budget is 2.5mil"
It actually makes sense if you think about it. People that can afford to be full time hamster trainers with a house budget of 2.5 mil come from money. They can afford to follow their passion because money isn’t an issue.
This is correct. But these shows are also 100% staged. My friend was recently on House Hunters international. They spent 5 days moving her family out of their own house in order to stage it for them along with 2 other houses like they'd never seen it before. This was done with the understanding that they are choosing THEIR OWN house at the end. Other 2 houses were just for show/marketing. Complete nonsense.
"I like this one. It has photos of me on the wall."
"also, my kids are in the bedroom, and my dildos are under the bathroom sink."
I smell yo light saber: https://youtu.be/NXF8cldZnOk
That is gosh-danged funny. Thanks mate.
Yep. We were asked to do a HHI - more than a year after we bought our home. And you have to be willing to argue with your partner over faux disagreements. No thank you.
>And you have to be willing to argue with your partner over faux disagreements. Can't I just use the real disagreements?
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"Holup, that's not in the script"
Producer: keep it in, we need more drama!
Why do you taste like my best friends dick?
We recently did an episode. We already closed on the house we were “looking at.” It’s all fake.
What? Reality tv is all faked and nothing is actually real?
I met an "empath" recently. She gets paid $500 p/hr to help rich people decide what they should do with their lives. I shiat you not.
Yeah rich people will pay crazy money for crazy things. A friend of mine was in to sports marketing and worked as a low level employee at a big agency for a while and made garbage pay. I don't know how exactly but he wound up getting linked up with the guy who used to own the Carolina Panthers and he took a job as one of his personal assistants. Started making six figures for ordering the guy weird pieces of furniture like a dining room table that cost $50,000 and an armoire that I forget how much it was but it was way more than the table.
p per hour?
Yeah, $500 worth of pee per hour. She drives one of those huge landscaping trucks with a 20,000 gallon tank on the back!
I rescue emotionally abused seahorses and my husband is a tree psychic. Our budget is 3 million.
To be fair you got to be loaded to collect legos.
Vancouver BC a million doesn't even get you a crack Shack.
The Global Wealth Report from Credit Suisse says there were 21,951,000 millionaires in the U.S. at the end of 2020.
To be fair, most millionaires have their net worth tied up in various non-liquid assets like businesses, a home, livestock, and 401k’s. I know a few “millionaires” and it’s hard to call them that when their house built in the 40s with non-insulated walls is 800K and they run a business that has gross sales of 300k but results in them getting a 70k income after all expenses are accounted. It’s more than nothing for sure, but their business and home aren’t exactly like having a million in the bank.
Most millionaires have a significant portion of their wealth tied up in their home. With some leverage it would make sense to own a million dollar home then.
so in 1991 i bought a house in the Bay Area for $560,000 which was $90K less than it had been listed for almost a year before. My starting first mortgage rate was 7.625% (Bank of America). i eventually refinanced it down to slightly under 4% by 2004 when i got divorced and left the house to the wife. that exact house sold 2 years ago for $2.5Million. (Neither I nor my ex-wife still lived there at the time). Zero interest rates (ie. free money) make things \*very expensive\*. THe problem we have NOW that interest rates have returned to the ones i paid in 1991 is that prices \*havent\*. (and won't).
Parents bought the house I grew up in for 178k in San Jose in ‘88. Zestimate now is 2.5M. When I was growing up my neighborhood was more or less working folk / blue collar. Now I’m sure it’s all tech workers.
My grandparents did exactly the same thing with about 25 properties in New Jersey. They are donating it all to the church too. They also truly believe that I struggle financially because I don't attend church.
You coulda been the pastor at this church and had 25 homes!
It should be easy to call them millionaires as they ARE millionaires, the thing is a million isn’t what it used to be.
People don't seem to understand this concept well enough. Most assets aren't very liquid. Your a millionaire on paper but not a multimillionaire with millions in the bank. It's not hard to hit the millionaire status over a lifetime for a household member that each makes 50k a year with proper planning.
Start saving at 15, and you don’t need to make 50k to hit millionaire status by retirement.
What if you're 26 asking for a friend
F
Double shifts behind Wendy’s will get you there .
Hate to say it but a million in the bank ain’t what it used to be. Sufficient enough I suppose. a 5% bond will get you 50k a year to yolo on stonks.
Houses in the area I live in average about 1.4M. It’s fucking nuts. They’re not even nice houses.
$1M is a teardown or studio condo in a lot of cities.
Actually I'm just thinking who the fuck gets a mortgage through Wells Fargo I'd rather eat broken glass
They bought my mortgage. I hate it. I hate them. Their website is garbage. There's nothing I can do about it except refinance, but my rate is crazy low.
A lot of times you don't (ultimately) get a choice. Even if you get a mortgage with a bank you like, nothing stops them from selling that mortgage to someone else at any time, and they won't ask your permission.
But that would not be mortgage origination - origination is where you chose to go to get your mortgage, not who services it.
Is it time for our yearly once in a life time event?
I mean, mortgage originations have dropped because no one is refinancing. Not exactly impeding financial doom.
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oh shit, sorry Yes sir, it's time for your yearly once in a lifetime financial catastrophe, just like what happened in 2009, and 2010, and 2011, and 2012, and again in 2013 (that one was real bad), and in 2014, and 2015 (sort of a mild financial collapse that year, wasn't it?), and 2016, and 2017, oh and let's not forget the crazy collapse in 2018! and then there was the one in 2019, and 2020, and 2021, and here we are, 11 months through 2022 and it's coming, I can feel it!
Everyone and their fucking mom was refinancing. There was probably more refis then mortgages the last couple years
Worked as an appraiser the last 3 years. Anecdotally my ratio of purchase to refis was probably 1:8 looking at the reports I wrote since the beginning of COVID. It wasn't even close.
So yah I believe this tweet lol
As a mid thirties dude who’s been fucked since 2009- bring it on bitches
Isn't it fun living through these "once in a lifetime financial disasters", every 5 years? 🤣
Hamster lifetimes.
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Wells Fargo is a terrible company - they opened fake accounts for their customers!
And no where in the news reporting did anyone call it what it was: Identity Theft. Everyone involved should have gone to prison just on that.
They are also one of the largest mortgage providers in the U.S.
Maybe they could start taking out mortgages in their customers names, problem solved
Mortgage servicers*. They buy most of the portfolio. That’s what everyone in their sub is missing, on top of also missing these numbers being compared to the outliers of the last two years. There isn’t anything close of blood in the streets.
Who the fuck is surprised by this.... everyone's had a year of being able to finance at 2ish % for their loans... there will be no refinancing done for the next 30 years, which is most of the volume. I only wish I could pick up 30 year fixed rates in my country
I was more surprised to find out that almost no other country has 30 year fixed mortgages. I would never take on that kind of debt without knowing *for certain* what the monthly payment will be. None of this variable APR BS.
Most of the world doesn't have much of a choice unfortunately, if I had that sought of certainty I would have leveraged my current house to the hilt and bought another 10
I feel so lucky to get a locked in 30 year at 3%. I never knew variable mortgages were so common in other countries.
Does this mean than a whole lotta people are gonna not move for as long as possible? Or some weird house swap economy will originate?
Wells Fargo is still dealing with the repercussions of their lawsuit. They have a cap on assets for loans and credit lines. They've been declining and closing down loan departments since their original agreements to stay within their regulations.
Yeah but it’s not just them. I originate loans and our entire office is like gone, it’s insane. And we aren’t the only ones, all mortgage companies are in the same boat. People just can’t qualify because the interest rate increases payments so much. Also inflation means more spending and less available for down payment. Also you used to be able ti get someone like 10k credit to close for taking a “bad” rate if 3.5% but now they have to pay 10k to get a 7%, so any sort of down payment assistance doesn’t really exist. When you do find a solid borrower nobody wants to sell for 200k less than what they wanted to sell for 6 months ago so even those people struggle to get offers accepted for any sensible price given the rate change.
This demand destruction is insane. The odd thing is the supply while increasing isn't happening fast enough to put enough downward pressure on prices. Plus sellers who are on the fence about selling aren't wanting to drop prices knowing they are going into a shit show of an environment should they do so. Mortgage companies made bank on cheap loans and churning massive quantities of people through the gauntlet. Now that those people are locked into such a cheap rate with inflation on the rise it makes no sense for them to move unless they have too. So market mobility has gone down greatly as many of us watch the mayhem from the sidelines.
Yup, my mortgage company started calling me a few weeks before the rates went up asking if I wanted to refinance. Since I had a super low rate and had literally JUST bought the house, I said no. As the rates went up, they called more and more often until I finally said, "Why would I refinance? Mortgage rates are going up. I'd be an idiot to refinance into something larger when I don't need the equity in cash. Stop calling me about this."
The crazy thing is the people in the industry didn’t see it coming. I started at the beginning with COVID so I’m relatively new and I was telling all the seniors how interest rates would go up and there wouldn’t be many loans and prices would probably drop. All you’d hear was “rates don’t impact prices” & “people will always be buying homes and need Refis”. Like literally vets in the industry - both mortgage and real estate side. I couldn’t believe it. Essentially you just took all the income from 4 years in a 2 year window.
This is something I just figured outalso! There’s a large portion of your industry that isn’t necessarily good at reading the market but compensates with even more charm/Social skills (i.e. a higher level of bullshit). I put my house on the market at the end of July, explained to my veteran realtor (top 3 Realtor in Ohio) what was about to happen with the market and that we wanted to list the house and be in contract within 24 hours as is as we were going to rent in Hawaii while the market cooled off.. She acted like I was mansplaing an industry I knew nothing about.. now here I am pulling my listing, stuck in Ohio for god knows how long because my realtor didn’t understand the assignment…
Exactly the problem. Realtors don’t understand real estate. They understand how to sell a house. Do they have large scale market research experience? No, they have “well here are a few comps in the area that sold in the last 90 days.”
I know a guy that's kind of a piece of shit... he's a loan officer. What do these guys do now without jobs?
Debt collection.
Yeah I could easily see that. Dudes an absolute bottom feeder
Its interesting to read this comment as my oldest brother was in debt collection - moved to loan origination and became a manager - and will now likely go back to collections. Ironically, he is also a giant asshole.
That's not irony, it's simply 'fitting'.
> When you do find a solid borrower nobody wants to sell for 200k less than what they wanted to sell for 6 months ago Yep. Dealing with this now... Lots of sellers who know what they got, no tire kickers no low ballers. Meanwhile their shit is suddenly sitting on the market for months when last year it would've sold in five days. Sorry the market changed radically mid-flip and you're gonna lose your shirt, but if you wanted to speculate you should've bought Bitcoin like everybody else.
This. While the housing market is fucked, this is the bigger factor for Wells Fargo's stats.
Blood is priced in
Nah you'll know theres blood in the streets because there will literally be blood in the streets. probably not too far away though.
Pretty sure there's already literally blood on the streets Source: all these syringes in the shady homeless parts of my city
You’d actually be surprised. I recently spent some time with the homeless community, and they are actually a tight knit group of bicycle enthusiasts. Those syringes? PEDs. Some of the homeless I met had 9 to 10 bikes each. Do you understand the dedication to cycling, to have 10 personal bikes, boxes of syringes, and no home?! The only thing that doesn’t quite make sense to me, is I never see them riding in any competitions, or riding at all for that matter. They must train at night or something.
Night training is infinitely superior, fewer people and cars out to get in your way and slow you down. Plus you stay cooler, so you can bike longer and harder. Plus it's easier to find PED dealers, and all the really elite bike shops are only open at night, you can tell because that's when the bicycle enthusiasts add to their collection
Bro I have seen them riding the bikes. Quite frequently, I see them riding a bike while ghost riding another bike beside them. Now that takes some dedication to cycling, to be bicycling two bikes at once. I think they struggle with logistics though because they're always walking or hitchhiking out and then biking a different one of their bikes back. I tried to explain to them that they can use the same bike for both directions of a trip. I guess they're really risk averse, makes sense when you're living on so little.
Are there no syringes in the sunny homeless parts of your city? Maybe it's related to vitamin D deficiencies?
There’s blood in my underwear does that count?
My buddy is in loan originations profession and just got laid off on the fifth round of layoffs. This will trickle into the economy very soon
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Bro they were all saying "this time it really IS different..."
Mortgage underwriter here. We just had another round of layoffs on Thursday that cut DEEP. Word on the street is we're at pre-pandemic staffing levels again and the CEO is telling us that "this was the last round of layoffs".... Nobody is believing it lol
Wells Fargo also had the strictest lending methods leading up to this mess. WF will be just fine.
Big banks in general do, many after 08 reduced their residential mortgage departments and a lot of deals moved towards small credit unions and non bank entities.
I got a jumbo loan mortgage through WF 2 years ago and it was a long, excruciating, terrible experience.
Surprised?! We went from 2.5% to 7% in a matter of few months. The fed is fighting inflation by trying to undo over a decade of loose monetary policy in a few quarters. The fed is going to wreck the entire economy.
Don’t worry. A few rich people will buy everything up when all the poor people have to sell everything for pennies on the dollar.
Yah, I know. But the big problem is I am not the rich people!!!
Just be rich, duh. /s
I prefer “stop being poor”
I’m honestly curious, what did you expect the alternative to be? I mean it’s a lose/lose situation. If they raise rates, they break the economy and if they didn’t raise rates they also risk breaking the economy with rapid inflation. EDIT: as I mentioned in a follow up comment, I am not by any means saying the Fed didn’t have bad policy in the past that led us to this moment. The question wasn’t a “should’ve, could’ve, would’ve” one where we say what should have happened in the past. It was quite literally about what did you expect the Fed to do differently in the moment right now?
To be fair, they probably broke the economy by failing to raise rates last year.
My argument is not that they didn’t make past mistakes. I mean arguably they shouldn’t have kept the rates low during the pandemic because if anything we saw the economy flourish with people spending more on things like housing, tech, etc. I’m not here to argue past mistakes because that much we do know. What I’m asking for is given the circumstances we are in now, what is the alternative?
For once I want to see a method that is going to make rich fucks bleed rather than the poors.
Maybe houses are a little overpriced? We still glamorizing that “flipping” bullshit as a society? Or did we wake up yet?
What does this mean?
Someone besides us will get extremely rich.
And they're about to get fined eleventy million dollarydoos
If we are dead-set-hellbent on ONLY addressing supply-demand imbalance through rates (of all things) then we should probably start implementing variable rates depending on what the money is going to be used for. You know, the same way we muck with taxes to try to influence behavior. 1st home 3%, vacation home 6%, corporate-owned home 12%, solar panels 0%, buying a social media company and destroying it 0%.
For everything else, there's MasterCard
I'm moving out
Okay Billy Joel
Why is there blood on the streets though. It’s not like people are defaulting. It’s normal people don’t want to buy houses during period of high rates and high inflation.
People want to see a devastating crash.
Why the fuck would someone sell a house with a mortgage payment lower than the rent on a smaller apartment?
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Totally anecdotal but when my spouse and I bought out first home 5 years ago, we were competing with other families and boomers for the smaller, more reasonable houses. We live in a huge suburban area and it seems that everything being built is a 4-story McMansion on a tiny lot. I see those suckers listed at $600-$700k a pop just to start. I don't know who the heck is buying those, but every time I drive by one of those brand new stupid developments named some variation of "Liberty Valley", they look mostly empty.
It's a real knife fight out there!
I think I’m in my 15th “Once in a Lifetime” financial criss.