“Mish” Shedlock: California’s 90-Day Foreclosure Moratorium Will Accomplish Nothing… Supporters Disagree.
Today, the State of California imposes a 90-day moratorium on housing foreclosures under a controversial new law that many say, with the school year having ended and summer already upon us, has been put into place just in the nick of time. Others, however, are convinced that the new law is ill conceived and will accomplish nothing.
For example, Mike “Mish” Shedlock, a very well respected investment advisor who delivers economic analysis to tens of thousands through his well-known blog, Global Economic Analysis, says “this bill is no more likely to work than a bill declaring poverty to be illegal or the sky to be green.”
According to Mish:
“Home prices will bottom when they bottom, unemployment will bottom when it bottoms, and foreclosures will stop when they stop. Those are simple economic facts. The 90-day extension gives anyone sitting on the edge of walking away, as well as those wanting a reduction in principle, an incentive to stop paying their mortgage, safe and secure in the fact they cannot be thrown out of their house for another 90 days. This bill is pure idiocy and will not stop a single foreclosure. Instead, the bill will increase late pays and foreclosures. It’s an exercise of sheer stupidity.”
Others disagree completely. After reading what Mish had to say about the new law, Southern California surf legend, The Duke Vuarnet said: “Dude, just relax. You’re going to blow out your squeaker.”
“It’s a very righteous law,” says The Duke. “Summer’s here and Californians are tired of thinking about how they’re gonna’ come up with the Dead Presidents they need to stop a foreclosure. All they want is some cool waves and some tasty buds. It’s summertime bro’. You’ve got to have your priorities in order.”
Still, many in Sacramento acknowledge that the California Foreclosure Prevention Act won’t stop thousands of foreclosures from eventually happening. Since 2007, there have been more than 365,000 foreclosures in California, with many more on the horizon. Under the new law, lenders are prohibited from foreclosing on a property unless they can prove that they tried to modify the delinquent loan before foreclosing.
“Enough, Dude,” replies The Duke. “You’re starting to ruin my morning buzz. Look, 90 days from now we can all get back to being office-white and wrapped up in our economic problems, but right now, I’m headed to the ‘Bu’ (read: Malibu) where you’ll find me hangin’ at the shack and hangin’ ten out front.”
One California elected official, who asked not to be named in this article, said The Duke actually has the right take on this issue. “You have to understand, this is California in the summertime. The legislature recognizes that stopping foreclosures is important to the state’s economy and all, but that’s no reason to miss an entire summer getting tubular. The rest of the country might not understand how things are out here, but for those that remain core, this law is welcome relief.”
Bucky Moore, who is known to legions of surf groupies as “BM3,” and is the lead singer/piano player for the Balboa Blues Band, says he likes the new law well enough, but thinks it could have gone further to protect the state’s traditional summertime surfin’ safari. “I think it’s cool,” Bucky says. “But what’s up with it being only 90 days? Couldn’t they have made it cover all three months? Summer’s a lot longer than 90 days you know.”
To those who say the new law won’t accomplish anything, Greg Waddell, or G-Money to his buds in the surf club known as The Soggy Bottom Boyz, says it can’t fail. “How can it not accomplish what it’s intended to do?” says Money. “Our elected officials wanted to pass a law that would ensure that people who are going to lose their homes, don’t lose their summer at the beach too. How can that be a bad thing?”
Personally, I didn’t see the point of the new law initially, and was ready to agree with Mish that the law is beyond useless, but I have to say that I’ve come around to the surfer’s point of view.
My reasons are simple, but I do understand how some may not see the intent of the law as clearly as others. Perhaps if everybody had an ocean, across the USA. Then everybody would be surfin’, the California way. You’d see them wearing their baggies… Huarachi sandals too… tell the banks we’re surfin’… and they’ll just have to let our late payments accrue.
Fair enough? Alrighty then. Surf’s up, Dude!
Oh come on... Not a single comment? Not even from the Californians? Oh, maybe there's swell in.
I am concerned about your article; I have read California’s 90 Day Foreclosure Moratorium, Bill ABX2 7 several times and do not see where it indicates "lenders are prohibited from foreclosing on a property unless they can prove that they tried to modify the delinquent loan before foreclosing".
I did read the following: “SEC. 4. Section 2923.53 is added to the Civil Code, to read:
2923.53. (a) A mortgage loan servicer that has implemented a
comprehensive loan modification program that meets the requirements
of this section shall have the loans that it services exempted from
the provisions of Section 2923.52, upon order of the commissioner. A
comprehensive loan modification program shall include all of the
following features:”
The guidelines adapted for this bill are similar to but less stringent than those of the Making Home Affordable Modification program.
This bill also indicates that government secured loans are exempt (Freddie Fannie GSE), this is only one example of the many exemptions included I this bill.
This indicates that any lender with a modification program in place has met the requirements of this bill and will be exempt from the moratorium requirements.
I am concerned that either you or I could be providing erroneous information not in our client’s best interest.
I did read the following: “SEC. 4. Section 2923.53 is added to the Civil Code, to read:
2923.53. (a) A mortgage loan servicer that has implemented a
comprehensive loan modification program that meets the requirements
of this section shall have the loans that it services exempted from
the provisions of Section 2923.52, upon order of the commissioner. A
comprehensive loan modification program shall include all of the
following features:”
The guidelines adapted for this bill are similar to but less stringent than those of the Making Home Affordable Modification program.
This bill also indicates that government secured loans are exempt (Freddie Fannie GSE), this is only one example of the many exemptions included I this bill.
This indicates that any lender with a modification program in place has met the requirements of this bill and will be exempt from the moratorium requirements.
I am concerned that either you or I could be providing erroneous information not in our client’s best interest.
Oh Geeze... now I'm going to have to go read this obviously well written piece of legislation. Yikes... just kidding, happy to do it. Will get back to you...
While your reading I am going to Oak Street and wait on the south swell. Let me know what you find out, Thanks
the real deal is the 90 day moratorium is only lip service & not the GOOD kind either - boooooooo.
all [well not all but most -like 90%] of the foreclosing parties already have an exemption to the rule [ so it changes nothing] . they [ foreclosing banks & sevicers] dont have to modify or prove they did or even tried to modify a single loan [to get the exemption] wtf??!!
btw-they have had the [exemption] before the bill passed....hahahahaha were fukt .
mandelman [im a fan] !!!
here is the list of exempt lenders & servicers
it reads like a who's who of dirty $$$.
http://www.corp.ca.gov/FSD/CFP/pdf/ExemptList.pdf
all [well not all but most -like 90%] of the foreclosing parties already have an exemption to the rule [ so it changes nothing] . they [ foreclosing banks & sevicers] dont have to modify or prove they did or even tried to modify a single loan [to get the exemption] wtf??!!
btw-they have had the [exemption] before the bill passed....hahahahaha were fukt .
mandelman [im a fan] !!!
here is the list of exempt lenders & servicers
it reads like a who's who of dirty $$$.
http://www.corp.ca.gov/FSD/CFP/pdf/ExemptList.pdf
Freak...
Other than THANK YOU for sending me this... I don't know what to say at the moment... speechless is what I think they call this. Is it wrong for me to want to punch a hole in the wall? I'm just asking... just thinking out loud... can you email me or call me and fill me in. How did these companies get the exemption? Who knew about this? Help! I'm going to go public with this in a big way... please get in touch and fill in the blanks so can lead with this on Monday. It's Father's Day and I promised my daughter I wouldn't work all day, but she's going to a friend's house this evening so I'll be on it after dinner sometime. You can email me at mandelman@mac.com and I'll call you back or whatever you want. Again Thanks! And let's expose these dirtbags. I've had about enough, how about you?
Mandelman
hey mandelman
i'm all for tearing em a new 1 then driving my car thru that hole.
tanks dude!
freak4u at comcast .net
i'm all for tearing em a new 1 then driving my car thru that hole.
tanks dude!
freak4u at comcast .net
I'm sooo with you on that. I've started a group: People in Favor of Hitting Politicians With Sticks. You in? It might cost $5, but you get an official stick.
And I keep threatening to write "Mandelman's Guide to Destroying Your Home Before You're Forced to Leave It". Boy, does that seem to make people nervous... so I started it tonight. Enough of Mr. Nice Guy.
yea i'm with you sign me up..
i'm in a foreclosure now..
the only way i'll be taken out of MY house is in a fukin body-bag.
they picked the wrong guy to think they can just roll over me.