Discussion on July's Issue of The Niche Report... Bringing

Schumpeter Reincarnate Joined: 24 May 2008 Posts: 49993

http://mandelman.ml-implode.co.....eila-bair/

Dud? Joined: 10 Jul 2009 Posts: 4

Martin, your June comments were great. But you miss the mark on FDIC mods because you overlook some critical details.

The PV of the house is not the current FMV. Properly implemented, there are substantial discounts applied before the foreclosure is compared to the mod. This results in a much higher % of mods being accepted. (Remember, Sheila Bair testified that she thought 75% of Indy Mac defaults could be successful mods.)

Actual example, bank estimated FMV of my client's home at 600k. After doing FDIC mod analysis, they estimated net foreclosure value was 410k, over 30% less. PV of mod was greater, so mod approved... at 2%! And that was a non-owner. The FDIC model works!