Gaming of the System

AngeloDS on Twitter says:

An automated valuation model is a powerful tool when used properly. They should always be developed and/or fine-tuned under the supervision of domain experts (Appraisers). Otherwise they are a disaster waiting to happen.

don says:

What does The borrower’s income have to do with the appraisal process MABEE the 1031 exchange might the issue with the item of “boot”

Baggins says:

https://webcache.googleusercontent.com/search?q=cache:WroLxvIA2JEJ:https://www.bloomberg.com/opinion/articles/2020-09-25/mortgage-refinancing-boom-due-to-automated-appraisals+&cd=1&hl=en&ct=clnk&gl=us
In case you hit the privacy blocker wall. Same article cached on google.

Place all the risk on taxpayers, and all the reward with private companies. What could go wrong? The GSE’s are only public per se. They are private financial institutions which benefit first receivers of money most, with a side benefit to the individual whom is the second receiver of the fiat money if a loan is issued. The entire public body takes on all the risk through a distributed burden, aka; taxpayer backing (with an increasing cumulative effect.) Getting a loan is not a constitutional right, it is an earned privilege. Fiduciary responsibility. In the absence of gse’s we’d see more sensible and more restrictive lending policies, risk assignment based on individual merit and accountability, rather than calculations of group pooled risk and loss. With GSE’s, the taxpayer becomes the insurer.

The pontifications on industry correction for better mortgage practices with less risk are mostly lip service. What would be wrong with stopping all cash out offerings for primary mortgages and scooting all cash out requests to helocs or lein based signatory loans with naturally shorter term lengths? Oh yes, we would not want anyone getting in the way of big lending and their direct long term mainline access to monetize peoples entire equity stack. Imagine a system where nobody would have to reset the 15 or 30 year clock except for a better rate. This would have a lasting effect on a wide range of economic behaviors especially the consumers willingness to take on new debt, provide disincentive to use the home like an atm. Leveraging property for cash is an original form of predatory lending. You want a loan? I want your most valuable asset. Sign here.

Don’t kid yourself, lenders love cash out refinances. It stacks on significant interest amortization over time as the clock restarts and puts the lender in control of your property interests. Consumers are inundated with the industry buzzwords and mantras; we’ll make it simple, easy access, increased convenience, automation. In realty though, those advancements which remove tedious and often costly bureaucracy are of primary benefit to the lender and not the consumer. It is the bureaucracy and red tape which keeps land and home ownership in place, which allows fee simple ownership, holding swindlers at bay.

Refried refi’s. Tricking consumers into only reviewing monthly costs without considering cash equivalency over the entire term of amortized interest. Not clearly describing and not clearly disclosing the actual cash equivalent multiplier in borrower disclosure. If only they had a clearer understanding that the monthly savings results in significant out of pocket costs increase over term. If they understood that by leveraging that debt into a 30 year new mortgage, they’ve actually increased the total cost of that debt by a multiplier which is likely 2x or more. That $100k house actually costs you $200k over term and if you roll your debt in there, oh billy! Lenders have no real motivation to reform the system. More debt equals more profit. More monetary extension means more taxes as the taxation is the recapture mechanism to manage an infinite stream of fiat currency. It keeps the show going. Consumers lose twice for every government loan issued with federal reserve currency.

Meanwhile just keep everyone arguing about waivers, avm’s, automation, middle men, racism, spilled coffee, whatever they go for. Under no circumstances will we focus on the real issue, which is that government should get out of the business of providing lending and insurance. Or one could just audit and abolish the fed to stop the first receivers of fiat money from having this unethically allocated monetary leverage. The root cause of the problem persists, the federal reserve. Want to talk elections? It’s been over a 100 years and the American people are still waiting for our chance to vote if we want the Federal Reserve in the first place.

Julio E. Sune, Jr says:

ANOTHER LINK FOR THE AFOREMENTIONED SUBJECT

https://ml-implode.com/staticnews/2020-09-29_CMBSAppraisalsShowAtrociousValueLossInHospitalityRetailCMBSWITHF.html

CMBS Posts Record Delinquency Rate
Fed, Treasury Extend CMBS-Eligible TALF
CMBS TALF May Bring New Issue in November: Sources
Wells Fargo CMBS Servicer Ratings Fall on Management Concern
COVID fallout: Pressure Builds For A CMBS Bailout

CMBS Appraisals Show ‘Atrocious’ Value Loss In Hospitality, Retail CMBS (WITH FRAUDULENT ECHOES OF ’08)

2020-09-29 — bisnow.com

“”The numbers themselves are atrocious,” PineBridge Investments portfolio manager Gunter Seeger told FT. “A [nearly] 30% markdown in appraisals pretty much across the board is horrific.”… The issue may also be more complex than an equation of properties losing value in a bad economy. A Securities and Exchange Commission whistleblower complaint in May alleged that financial institutions like Wells Fargo and Deutsche Bank had been systematically and fraudulently inflating the value of properties in CMBS loan packages — behavior strikingly similar to what precipitated the subprime mortgage crisis that collapsed the housing market in 2008.”