LOL......oh big difference. Their real estate has flourished!!

RPV has been doing pretty well actually.

It's coming back.

You're right. No difference between prime CA coastal properties and Vegas. LOL.

How is it any good for 2+2 to have someones personal finance issues broadcast all over it.

Its not, think it is also a gross invasion of privacy.

Dislike this thread.

why would he? he doesn't owe anyone here an explanation, it's his personal business

Can't believe this thread has lasted this long with out one "confirmed busto". I guess it's out of respect for one of NVG's favorite sons. Nobody wants to believe it.

I'm surprised but I think you are correct. Depending on what period of time we're looking at. Definitely doing great in comparison with other California areas. Vs. America in the last 5 years they've done terribly. The last 10 years great. So who knows? http://www.neighborhoodscout.com/ca/...-verdes/rates/

I agree

I blame Joe Sebok

This sums up my thoughts on the thread as well.

This is all public record. Not an invasion of privacy at all.

If you bought houses in Las Vegas for cash, you would have lost hundreds of thousands of dollars in value when the market collapsed. It would have been a disastrous choice. By contrast, if you borrowed money to purchase the homes, you could simply let the bank foreclose on them and be out very little money.

Also, by using leverage you are able to buy a lot more properties which gives you a lot more upside with little risk. The main risk is that your credit score could get shot, but in Barry's case, or your own (considering you pay cash for everything) that really shouldn't be that big of a deal. Prior to the mortgage crisis banks were just giving away mortgages. People were getting loans for 100% of value or more and the banks weren't asking for proof of anything. It was like getting staked for high stakes poker but if you lost you would never have to pay your backer. If you didn't take advantage of this then sorry bro that's on you.

Lots of things are in the public records.. I doubt anyone wants to be scrutinized. He is a celebrity of sorts, and will be subjected to some scrutiny, but people can take things beyond the limits of good taste.

Chances are this foreclosure was just a strategic default and it says nothing about his overall financial health. I know lots of people who simply stopped making payments and let the properties go..

and I dunno if anyone already mentioned it, but a couple years ago he said he no longer donates half (?) his tournament winnings to charity. Can't recall exactly why..

Yeah.. that is a good analogy. But suppose everyone actually did that. What would it do to the high-stakes poker economy? Pretty much destroy it, is my guess.
As a society, it can be a long term mistake to take advantage of some things..

I will always view the housing bubble as a financial mania.. a disease of the mind. Houses instead of tulips. Banks, wall street, private investors, local governments, union and school trust funds managers. Everyone got sucked in.

For those who don't really understand the Foreclosure process here is basically what happens based on a hypothetical Barry Greenstein example.

House worth $3.8M is suddenly worth $1.5M due to market downturn.

House which used to cost $22K per month in mortgages now would cost $9K per month. Buyer wants out and can't short sell but stops paying for 1 year. House is foreclosed and buyer pockets $264K in missed mortgage payments.

Now typically what happens is the 1st mortgage takes back the house and sells for $1.5M and usually at that point the first mortgage bank eats the loss and sends a 1099 for the difference. This creates a tax hit unless it is a primary residence where the tax loss is not an issue due to recent laws that forgive it. Sometimes the first will collect but it is unusual.

The Second mortgage is usually left holding the bag. In this case if BG owes ~$600K (paid some of the second off already through regular payments). Typically this mortgage is sold to a 3rd party collections agency for a few percent and it is easy to negotiate a settlement with the 3rd party collections agencies for ~10%. BG settles for ~60-80K which he pays for using the $264K he pocketed and then rents a place for 9K per month which is just as nice as the place he gave up. He then has ~18mo of freerolled living in that new place from what he saved in missed payments.

So in this case BG gets a big credit score hit, can't buy prop in his name again for 7 years (unless he buys it for cash) but saves ~2.5 yrs of free living costs and gets rid of $2M of useless debt plus a massive monthly payment in his name.

Its actually a huge financial win for BG and I would expect nothing less from a man who basically wins at life.

zero

yeah zero sum is right, it can be +EV to freeroll all that mortgage.

The price is never getting to where it was before anyway.

Are you saying that even if someone "can afford" to pay back the mortgage no one will ask him to do that? And the bank will just "eat the loss"?

A mortgage contract puts the house as the collateral.
If the bank did its job correctly, there won't be any loss when someone defaults on the loan. (the bank sells the house and recovers all the money they were owed.)

Don't worry....they just up the atm fee a quarter and we all eat the loss.

In the uK it works differently. The mortgage holder is still stuck for any loss after the sale. The bank still ups the charges natch but they use this to pay huge fines to the US for Libor rate fixing and laundering billions in drug money.....

FTP re open so he can just get a loan from there. Sorry couldn't resist.

Probably the right financial choice from what I understand of the Las vegas housing market.

Actually it's in Palos Verdes, Ca, not LV..... but I just took a peek and home values in that area have fallen another 5.64% in the last 12 months.

edit.. there's more than one palos verdes..

RANCHO PALOS VERDES -5.64%
Palos Verdes Peninsula Area 2.33%
Palos Verdes Estates 28.25%

(palos verdes also includes something called "Rolling Hills" and "Rolling Hills Estates", or maybe just "The Hill".., but no info on them. I gather they have a great ocean view.)

But according to the link in the OP, this home is in Rancho Palos Verdes..

Like the ghost of unpaid ftp loans?????

That's not a good analogy.

Backers are speculating that the horse would cash and then profit from a percentage of the winnings.

The banks are not into real estate speculation. It's not like the bank was going to get a share of the gains if you later sold the house for a profit.

Sebok will get to the bottom of this, and report back any day now.