Wednesday, December 7, 2011

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Occupy LA joins the wrong side of the foreclosure issue

Posted: 07 Dec 2011 02:30 AM PST

Proving they are pawns of the extreme left, the Occupy LA movement disrupts foreclosure auctions and gets on the wrong side of the foreclosure issue.

Home Address ... 110 DANBURY Ln Irvine, CA 92618
Asking Price .......  $499,000

I don't have any political ax to grind with the left. In fact, on many issues, I lean more left than right, but on the issue of giving away free houses, I think the extreme left has it wrong. In their interest in pandering for votes, they are calling up the troops in the Occupy wherever movement and sending them to foreclosure auctions to disrupt the activities. Perhaps we should just stop all foreclosures and let everyone who occupies a house to keep it, right?

Occupy L.A. takes its fight to foreclosure auction

Protesters disrupt bidding outside Norwalk courthouse on homes owned by banks and title companies with chants of 'Shame on you' and 'Banks got bailed out / We got sold out.'

By Kate Linthicum, Los Angeles Times -- December 3, 2011

Several times a week, a group of investors gathers in Norwalk to bid on homes that have been foreclosed.

The midmorning auction outside the Los Angeles County Superior Court building is a high-stakes, but usually low-key affair. On Friday, bidders sat in the sun in lawn chairs, and the auctioneer looked relaxed in a pair of baggy sweat pants.

But just as the auction was getting started, a commotion erupted from across the lawn. It was a group of protesters, marching with posters and howling an angry chant. "Banks got bailed out / We got sold out!"

The protesters are right, the banks did get bailed out, and the people doing the bailing got not much in return. However, it's quite a stretch to think that means we should be giving away free houses.

Some wore T-shirts identifying themselves as members of local labor unions. Others wore arm bands printed with "99%" — a now-famous reference that revealed a different allegiance.

Occupy L.A. may have lost its home outside City Hall this week, but protesters plan to continue the acts of civil disobedience that helped the movement capture national attention.

So that's what this is. They were looking for some other cause to gain attention. There are other causes they could go after.

Why don't they walk down to the unemployment office and demand higher unemployment benefits for a longer period of time?

Why not swarm an emergency room and demand free hospital stays for everyone?

Why not just go to the bank and demand free money from the the tellers? Why go through the hassles of signing loan papers and defaulting?

Demonstrations against the foreclosure process may be key among them, said one protester who spent nearly two months living on the City Hall lawn at Occupy L.A., and who hitched a ride to Norwalk to take part in Friday's action.

The protester, Abe, wouldn't give his last name, but said anger at the foreclosure crisis, and at banks that he believes haven't done enough to help homeowners get more favorable loans, helped draw him to Occupy in the first place.

Why would banks want to give homeowners more favorable loans? Loan modifications are not an entiltlement, and banks don't want to make them one.

Friday's protest was organized in conjunction with Good Jobs L.A., a coalition of labor unions and other community organizations. Although some within the Occupy movement have expressed fears that their protest may be co-opted by other groups — including unions — Abe said he isn't worried about that.

Abe should be very worried about that. The Occupy movement is a group of sheep waiting to be shepherded around at the whim of whatever interest group knows how to appeal to them.

"I don't think we should align with any power structure," he said. "But anyone who wants to stand in solidarity with us, we're happy to have them."

As the protesters circled the auction, the bidders drew closer so they could hear over chants of "Shame on you!"

On the auction block this day were properties from throughout the county — from Torrance to Van Nuys. Next up was a home on West 59th Place in South L.A.

The protesters booed. The bidding started. "Do I have $113,300?" the auctioneer asked. He is hired to sell the properties by the banks and title companies that own the homes.

"$115,000" said one man.

"$116,000," said


The price climbed and climbed. When it hit $130,000, protester Carlos Marroquin started shouting.

"Whose home is that? Whose home are you buying?" he yelled. "Do you know that families are breaking apart? People fought for those homes, and you guys are just taking them away."

Whose home is that? Well, if the delinquent mortgage squatter who occupies the house doesn't have any equity, then the occupant certainly doesn't own it. See Money Rentership: Housing and the New American Dream.

Whose home are you buying? The bank's, that's who.

Do you know that families are breaking apart? Do you know that families are staying together and moving into comfortable rentals?

People fought for those homes, and you guys are just taking them away. Perhaps instead of fighting for those homes, the borrowers should have paid for them instead. It would have been far more effective at keeping the property.

Marroquin, who lost his own home to foreclosure, said he speaks from experience. "It destroyed my marriage and hurt my kids," he said.

A member of Occupy L.A. since its Oct. 1 beginning, he set up a tent there and said he helped counsel 300 families facing foreclosure.

At first, bidders seemed amused by the hubbub — and the news reporters and photographers it had attracted.

"I kind of like it," one said to another. "I like crazy, though."

But as the morning wore on, and one protester held a microphone up to an amplification system, producing a deafening squeal, the bidder's patience wore down. "They're getting annoying," he said.

I imagine it was annoying. People are bidding hundreds of thousands of dollars for houses, and they want to hear the auctioneer and other bidders. Foreclosures are a serious business.

Another bidder, Mike Lalani, told protesters that the buyers were the wrong target. "Your protest is good, it's great, but it's misguided," he said. "You need to be saddened that these homes are being lost in the first place."

The auctioneer agreed: "You guys need to go higher on the food chain."

Exactly. Foreclosure is the end of the road. It is the cure to the problem of excessive debt. The borrowers should never have been given such large debt loads to begin with. The problem is at the front end of the process, not at the back end.

They have, of course. Last month, police arrested dozens of protesters in demonstrations in downtown's financial district, including one at Bank of America plaza.

At that protest and elsewhere, protesters have deployed tents — a symbol of the Occupy L.A. encampment — in their demonstrations.

A tent made an appearance Friday, when protesters offered to sell it to the bidders. A vigorous bidding war broke out. The final price: $20.

A foreclosure tent. Now that's funny.

The Occupy movement means well, and there is certainly good reason to be angry at the bankers and the privileged class living under a different set of rules. The Occupy movement may become a real political force if it doesn't degrade into a ridiculous farce.

Rental parity hits Oak Creek's Cobblestone community

I used to live in Oak Creek near this community. I looked into renting properties in there a number of times. A few years ago, rents were between $2,500 and $2,700. Today, the cost of ownership for our featured property is $2,591.

With falling prices, some buyers will need bigger savings over renting to induce them to buy, but for others, owning a home at the cost of a comparable rental will be good enough. What's amazing to me is that someone paid $675,000 back when interest rates were about 6.5%. Their cost of ownership was closer to $4,500 a month instead of the $2,591 today's buyer will face. Timing does matter. That peak buyer experienced a 6.3% annual depreciation loss. Ouch!

This property is available for sale via the MLS.
Please contact Shevy Akason, #01836707 

Home Address ... 110 DANBURY Ln Irvine, CA 92618
Asking Price .......  $499,000

Beds:  3
Baths:  2
Sq. Ft.:  1500
Property Type: Residential, Condominium
Style: Two Level, Contemporary
Year Built:  1999
Community:  Oak Creek
County:  Orange
MLS#:  P804859
Source:  CRMLS
Status:  Active
On Redfin:  1 day
Beautiful and Very Bright 3Bedroom Detached Home in Oak Creek. Largest Floor Plan in Cobblestone. Spacious Master Bedroom with Walk-in Closet, Over Sized Tub in Master Bathroom, Granite Counter and Sink Top in Kitchen and Bathrooms. Recessed Lighting Throughout. 2Car Attached Garage with Direct Access. Large Private Backyard for Relaxing and Entertaining. Low HOA Dues and Mello Roos ($622 per Year). Easy Access to 405 FWY & UCI. Walking Distance to Asso. Amenities, Restaurants and Shops. ''MOVE-IN CONDITION'' 
Proprietary commentary and analysis 

Asking Price .......  $499,000
Purchase Price … $675,000
Purchase Date .... 3/8/2007

Net Gain (Loss) .......... ($205,940)
Percent Change .......... -30.5%
Annual Appreciation … -6.3%

Cost of Home Ownership
$499,000 .......... Asking Price
$17,465 .......... 3.5% Down FHA Financing
4.02% ............... Mortgage Interest Rate
$481,535 .......... 30-Year Mortgage
$136,787 .......... Income Requirement 

$2,304 .......... Monthly Mortgage Payment 
$432 .......... Property Tax (@1.04%)
$0 .......... Special Taxes and Levies (Mello Roos)
$104 .......... Homeowners Insurance (@ 0.25%)
$554 .......... Private Mortgage Insurance
$139 .......... Homeowners Association Fees
$3,534 .......... Monthly Cash Outlays

-$358 .......... Tax Savings (% of Interest and Property Tax)
-$691 .......... Equity Hidden in Payment (Amortization)
$24 .......... Lost Income to Down Payment (net of taxes)
$82 .......... Maintenance and Replacement Reserves
$2,591 .......... Monthly Cost of Ownership 

Cash Acquisition Demands
$4,990 .......... Furnishing and Move In @1%
$4,990 .......... Closing Costs @1%
$4,815 .......... Interest Points
$17,465 .......... Down Payment
$32,260 .......... Total Cash Costs
$39,700 ............ Emergency Cash Reserves
$71,960 .......... Total Savings Needed

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