Comments on: Bad Real Estate Loans Hitting Local Banks http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/ News & discussion about real estate & the housing bubble in the Seattle area. Sun, 08 Nov 2009 04:04:18 -0800 http://wordpress.org/?v=2.8.5 hourly 1 By: dan http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-55611 dan Mon, 01 Sep 2008 05:06:23 +0000 http://seattlebubble.com/blog/?p=1853#comment-55611 Definitely a reflection of the economy as a whole. Not only housing prices drop but the collapse of the credit markets. banks pulling back from loans. Eventually we will ride out this problem, hopefully... http://gewdir.com<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('55611','dan',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('55611','dan','Definitely a reflection of the economy as a whole. Not only housing prices drop but the collapse of the credit markets. banks pulling back from loans. Eventually we will ride out this problem, hopefully...\r\n\r\nhttp:\/\/gewdir.com',''); return false;">Quote</a></div> Definitely a reflection of the economy as a whole. Not only housing prices drop but the collapse of the credit markets. banks pulling back from loans. Eventually we will ride out this problem, hopefully…

http://gewdir.com

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]]> By: Greg M http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46710 Greg M Tue, 22 Apr 2008 16:17:59 +0000 http://seattlebubble.com/blog/?p=1853#comment-46710 deejayoh makes a good point about how loans are different here than in Phoenix. I bought a house and lived in Phoenix for three years prior to moving here two years ago so I have a good handle on the differences in home construction. The #1 difference between Phoenix and Seattle is (like deejayoh mentioned) Phoenix houses are built by big builders. You don't get a construction loan at a bank to buy a new house in Phoenix. Instead, you sign a contract, the house gets built, and you take out a plain jane regular home mortgage to purchase your house from the builder. Here, it seems like a lot of builders require that you take out a construction loan to finance the construction of the house. Not sure about how many but I've seen that advertised a lot. So the banks around here probably do a lot more construction lending than the banks in Phoenix.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46710','Greg M',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46710','Greg M','deejayoh makes a good point about how loans are different here than in Phoenix. I bought a house and lived in Phoenix for three years prior to moving here two years ago so I have a good handle on the differences in home construction.\r\n\r\nThe #1 difference between Phoenix and Seattle is (like deejayoh mentioned) Phoenix houses are built by big builders. You don\'t get a construction loan at a bank to buy a new house in Phoenix. Instead, you sign a contract, the house gets built, and you take out a plain jane regular home mortgage to purchase your house from the builder.\r\n\r\nHere, it seems like a lot of builders require that you take out a construction loan to finance the construction of the house. Not sure about how many but I\'ve seen that advertised a lot. So the banks around here probably do a lot more construction lending than the banks in Phoenix.',''); return false;">Quote</a></div> deejayoh makes a good point about how loans are different here than in Phoenix. I bought a house and lived in Phoenix for three years prior to moving here two years ago so I have a good handle on the differences in home construction.

The #1 difference between Phoenix and Seattle is (like deejayoh mentioned) Phoenix houses are built by big builders. You don’t get a construction loan at a bank to buy a new house in Phoenix. Instead, you sign a contract, the house gets built, and you take out a plain jane regular home mortgage to purchase your house from the builder.

Here, it seems like a lot of builders require that you take out a construction loan to finance the construction of the house. Not sure about how many but I’ve seen that advertised a lot. So the banks around here probably do a lot more construction lending than the banks in Phoenix.

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]]> By: NotaBull http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46709 NotaBull Tue, 22 Apr 2008 16:17:08 +0000 http://seattlebubble.com/blog/?p=1853#comment-46709 "Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?" Frankly, yes. If you have your life savings in a small bank that isn't "too big to fail" then I would be moving it very quickly. This is not the time to have your life savings in a small bank that the government would allow to fail. Personally, I have my savings in WaMu, which some people on this site will tell you is doomed to fail. Well, that's not going to happen as it's just too big. As with Bear Stearns the fed and/or another bank would just step in and buy it for pennies. The stockholders would be screwed, but depositors would be fine, and you have FDIC insurance anyway. My advice: -Have no more than $100K in each bank ($200K for joint accounts I believe) -Split your savings evenly between large banks (e.g. HSBC, WaMu, Chase, Wells Fargo). It's so easy to transfer money around electronically these days and you can do it online. It usually only takes 3 or 4 business days to move it. So there really is no reason to only stick with one bank, especially a small one. If any of them *do* fail, you'll have FDIC insurance and the rest of your money available instantly.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46709','NotaBull',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46709','NotaBull','\"Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?\"\r\n\r\nFrankly, yes. If you have your life savings in a small bank that isn\'t \"too big to fail\" then I would be moving it very quickly. This is not the time to have your life savings in a small bank that the government would allow to fail.\r\n\r\nPersonally, I have my savings in WaMu, which some people on this site will tell you is doomed to fail. Well, that\'s not going to happen as it\'s just too big. As with Bear Stearns the fed and\/or another bank would just step in and buy it for pennies. The stockholders would be screwed, but depositors would be fine, and you have FDIC insurance anyway.\r\n\r\nMy advice:\r\n\r\n-Have no more than $100K in each bank ($200K for joint accounts I believe)\r\n-Split your savings evenly between large banks (e.g. HSBC, WaMu, Chase, Wells Fargo). \r\n\r\nIt\'s so easy to transfer money around electronically these days and you can do it online. It usually only takes 3 or 4 business days to move it. So there really is no reason to only stick with one bank, especially a small one. If any of them *do* fail, you\'ll have FDIC insurance and the rest of your money available instantly.',''); return false;">Quote</a></div> “Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?”

Frankly, yes. If you have your life savings in a small bank that isn’t “too big to fail” then I would be moving it very quickly. This is not the time to have your life savings in a small bank that the government would allow to fail.

Personally, I have my savings in WaMu, which some people on this site will tell you is doomed to fail. Well, that’s not going to happen as it’s just too big. As with Bear Stearns the fed and/or another bank would just step in and buy it for pennies. The stockholders would be screwed, but depositors would be fine, and you have FDIC insurance anyway.

My advice:

-Have no more than $100K in each bank ($200K for joint accounts I believe)
-Split your savings evenly between large banks (e.g. HSBC, WaMu, Chase, Wells Fargo).

It’s so easy to transfer money around electronically these days and you can do it online. It usually only takes 3 or 4 business days to move it. So there really is no reason to only stick with one bank, especially a small one. If any of them *do* fail, you’ll have FDIC insurance and the rest of your money available instantly.

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]]> By: TJ_98370 http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46708 TJ_98370 Tue, 22 Apr 2008 16:09:11 +0000 http://seattlebubble.com/blog/?p=1853#comment-46708 Depositer - you're good up to $100,000 per account because of FDIC.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46708','TJ_98370',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46708','TJ_98370','Depositer - you\'re good up to $100,000 per account because of FDIC.',''); return false;">Quote</a></div> Depositer – you’re good up to $100,000 per account because of FDIC.
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]]> By: Depositor http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46706 Depositor Tue, 22 Apr 2008 14:05:43 +0000 http://seattlebubble.com/blog/?p=1853#comment-46706 Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46706','Depositor',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46706','Depositor','Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?',''); return false;">Quote</a></div> Gosh, does this mean if I have my life savings in one of these banks, I should maybe think about moving it?
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]]> By: Cougar http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46705 Cougar Tue, 22 Apr 2008 14:02:38 +0000 http://seattlebubble.com/blog/?p=1853#comment-46705 OK, bad loans, foreclosure, inventory rising. This is old news. Where is the best place to get a home loan now? Competition must be fierce for a qualified homebuyer who has a credit score of over 800 and has 20% percent down. ;) What real-estate companies will survive? In tough times there tends to be more fighting among people who are pissed off or are going through hardship. That gets old too. It doesn't help with the rise in cost of basic needs such as gas and groceries. So where are some good deals out there?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46705','Cougar',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46705','Cougar','OK, bad loans, foreclosure, inventory rising. This is old news. Where is the best place to get a home loan now? Competition must be fierce for a qualified homebuyer who has a credit score of over 800 and has 20% percent down. ;) What real-estate companies will survive? In tough times there tends to be more fighting among people who are pissed off or are going through hardship. That gets old too. It doesn\'t help with the rise in cost of basic needs such as gas and groceries. So where are some good deals out there?',''); return false;">Quote</a></div> OK, bad loans, foreclosure, inventory rising. This is old news. Where is the best place to get a home loan now? Competition must be fierce for a qualified homebuyer who has a credit score of over 800 and has 20% percent down. ;) What real-estate companies will survive? In tough times there tends to be more fighting among people who are pissed off or are going through hardship. That gets old too. It doesn’t help with the rise in cost of basic needs such as gas and groceries. So where are some good deals out there?
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]]> By: Moe Ronn - Realitor® http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46704 Moe Ronn - Realitor® Tue, 22 Apr 2008 13:26:43 +0000 http://seattlebubble.com/blog/?p=1853#comment-46704 Yeah, I read the article and I've subscribed to the theory that once the unsold inventory of homes increases many will return to the rental market, thus increasing supply to meet demand and keeping prices in check. I don't quite understand how you a)didn't understand that I do understand the articel and b)think that I am a moron. I merely pointed out that rents are not skyrocketing as this article, and other articles from last year, suggest. It's REIC hype to try to scare you into making an ill-informed purchase. There is no commision on Reality. It cannot be bought or sold, merely accepted. And finally; Ubersalad, you wanna take a standardized IQ test with me sometime?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46704','Moe Ronn - Realitor®',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46704','Moe Ronn - Realitor®','Yeah, I read the article and I\'ve subscribed to the theory that once the unsold inventory of homes increases many will return to the rental market, thus increasing supply to meet demand and keeping prices in check. \r\n\r\nI don\'t quite understand how you a)didn\'t understand that I do understand the articel and b)think that I am a moron.\r\n\r\nI merely pointed out that rents are not skyrocketing as this article, and other articles from last year, suggest. It\'s REIC hype to try to scare you into making an ill-informed purchase.\r\n\r\nThere is no commision on Reality. It cannot be bought or sold, merely accepted. \r\n\r\nAnd finally; Ubersalad, you wanna take a standardized IQ test with me sometime?',''); return false;">Quote</a></div> Yeah, I read the article and I’ve subscribed to the theory that once the unsold inventory of homes increases many will return to the rental market, thus increasing supply to meet demand and keeping prices in check.

I don’t quite understand how you a)didn’t understand that I do understand the articel and b)think that I am a moron.

I merely pointed out that rents are not skyrocketing as this article, and other articles from last year, suggest. It’s REIC hype to try to scare you into making an ill-informed purchase.

There is no commision on Reality. It cannot be bought or sold, merely accepted.

And finally; Ubersalad, you wanna take a standardized IQ test with me sometime?

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]]> By: Ubersalad http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46698 Ubersalad Tue, 22 Apr 2008 06:01:06 +0000 http://seattlebubble.com/blog/?p=1853#comment-46698 he is what he calls himself, moron. sigh, I am getting slower.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46698','Ubersalad',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46698','Ubersalad','he is what he calls himself, moron. \r\n\r\nsigh, I am getting slower.',''); return false;">Quote</a></div> he is what he calls himself, moron.

sigh, I am getting slower.

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]]> By: b http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46697 b Tue, 22 Apr 2008 05:50:57 +0000 http://seattlebubble.com/blog/?p=1853#comment-46697 Moe Ronn - Did you even read that article? It says that the rates have surged due to condo conversions and lack of apartment building during the boom years. It also says that inventory of apartments and homes to rent is currently increasing. What do you think is going to happen to rent as inventory increases? Especially when investor/owner turned landlords flood the market even moreafter the summer selling season, condo conversions cease to occur and builders decide that apartments are better than condos for cash flow? We just peaked in housing and I think we are right around peak for rent as well.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46697','b',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46697','b','Moe Ronn -\r\n\r\nDid you even read that article? It says that the rates have surged due to condo conversions and lack of apartment building during the boom years. It also says that inventory of apartments and homes to rent is currently increasing. What do you think is going to happen to rent as inventory increases? Especially when investor\/owner turned landlords flood the market even moreafter the summer selling season, condo conversions cease to occur and builders decide that apartments are better than condos for cash flow? We just peaked in housing and I think we are right around peak for rent as well.',''); return false;">Quote</a></div> Moe Ronn -

Did you even read that article? It says that the rates have surged due to condo conversions and lack of apartment building during the boom years. It also says that inventory of apartments and homes to rent is currently increasing. What do you think is going to happen to rent as inventory increases? Especially when investor/owner turned landlords flood the market even moreafter the summer selling season, condo conversions cease to occur and builders decide that apartments are better than condos for cash flow? We just peaked in housing and I think we are right around peak for rent as well.

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]]> By: bitterowner http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46696 bitterowner Tue, 22 Apr 2008 05:23:51 +0000 http://seattlebubble.com/blog/?p=1853#comment-46696 You must get 3% for every dose of reality you sell.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46696','bitterowner',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46696','bitterowner','You must get 3% for every dose of reality you sell.',''); return false;">Quote</a></div> You must get 3% for every dose of reality you sell.
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]]> By: Moe Ronn - Realitor® http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46695 Moe Ronn - Realitor® Tue, 22 Apr 2008 05:15:30 +0000 http://seattlebubble.com/blog/?p=1853#comment-46695 No susidiary, I'm in a totally different business; Reality.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46695','Moe Ronn - Realitor®',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46695','Moe Ronn - Realitor®','No susidiary, I\'m in a totally different business; Reality.',''); return false;">Quote</a></div> No susidiary, I’m in a totally different business; Reality.
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]]> By: Ubersalad http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46694 Ubersalad Tue, 22 Apr 2008 04:58:52 +0000 http://seattlebubble.com/blog/?p=1853#comment-46694 Is that a subsidiary of Realtors?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46694','Ubersalad',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46694','Ubersalad','Is that a subsidiary of Realtors?',''); return false;">Quote</a></div> Is that a subsidiary of Realtors?
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]]> By: Moe Ronn - Realitor® http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46693 Moe Ronn - Realitor® Tue, 22 Apr 2008 04:46:03 +0000 http://seattlebubble.com/blog/?p=1853#comment-46693 Things might be hard to find at a reasonable price within the city, but just go out a few miles and there's plenty: http://seattle.craigslist.org/see/apa/651306721.html<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46693','Moe Ronn - Realitor®',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46693','Moe Ronn - Realitor®','Things might be hard to find at a reasonable price within the city, but just go out a few miles and there\'s plenty:\r\nhttp:\/\/seattle.craigslist.org\/see\/apa\/651306721.html',''); return false;">Quote</a></div> Things might be hard to find at a reasonable price within the city, but just go out a few miles and there’s plenty:
http://seattle.craigslist.org/see/apa/651306721.html
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]]> By: Moe Ronn - Realitor® http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46692 Moe Ronn - Realitor® Tue, 22 Apr 2008 04:38:30 +0000 http://seattlebubble.com/blog/?p=1853#comment-46692 This is off topic, but I think it's worth a post. I'm sure several have read this already: http://seattlepi.nwsource.com/local/359900_apartment21.html<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46692','Moe Ronn - Realitor®',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46692','Moe Ronn - Realitor®','This is off topic, but I think it\'s worth a post. I\'m sure several have read this already:\r\nhttp:\/\/seattlepi.nwsource.com\/local\/359900_apartment21.html',''); return false;">Quote</a></div> This is off topic, but I think it’s worth a post. I’m sure several have read this already:
http://seattlepi.nwsource.com/local/359900_apartment21.html
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]]> By: deejayoh http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46690 deejayoh Tue, 22 Apr 2008 00:39:31 +0000 http://seattlebubble.com/blog/?p=1853#comment-46690 and it looks like Frontier Bank <a href="http://money.cnn.com/news/newsfeeds/articles/marketwire/0379522.htm" rel="nofollow">releases their earnings tomorrow</a><div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46690','deejayoh',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46690','deejayoh','and it looks like Frontier Bank <a href=\"http:\/\/money.cnn.com\/news\/newsfeeds\/articles\/marketwire\/0379522.htm\" rel=\"nofollow\">releases their earnings tomorrow<\/a>',''); return false;">Quote</a></div> and it looks like Frontier Bank releases their earnings tomorrow
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]]> By: deejayoh http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46689 deejayoh Tue, 22 Apr 2008 00:29:09 +0000 http://seattlebubble.com/blog/?p=1853#comment-46689 Denny Retrograde - good article! Thanks for pointing that out. Interesting to see there is a separate article about Sterling Savings Bank <a href="http://seattle.bizjournals.com/seattle/stories/2008/04/21/daily4.html" rel="nofollow">releasing their earnings today</a> <blockquote>Sterling Financial Corp. of Spokane, one of Washington state's largest community banks, reported a sharp drop in first quarter earnings reflecting a large provision for credit losses. Sterling Financial (NASDAQ: STSA), which operates Sterling Savings Bank, said its first quarter 2008 earnings were $2.9 million, down from $22.9 million the same quarter a year ago. The bank said the drop reflects a $37.1 million provision for credit losses in the first quarter of this year. By contrast, the bank set aside $4.2 million for credit losses in the first quarter of 2007. "The higher credit provision in the first quarter reflects the unprecedented and rapid decline in the residential real estate market that continued unfolding during the course of the first quarter," said Sterling Chairman and CEO Harold Gilkey, in a statement. </blockquote><div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46689','deejayoh',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46689','deejayoh','Denny Retrograde - good article! Thanks for pointing that out.\r\n\r\nInteresting to see there is a separate article about Sterling Savings Bank <a href=\"http:\/\/seattle.bizjournals.com\/seattle\/stories\/2008\/04\/21\/daily4.html\" rel=\"nofollow\">releasing their earnings today<\/a> \r\n\r\n<blockquote>Sterling Financial Corp. of Spokane, one of Washington state\'s largest community banks, reported a sharp drop in first quarter earnings reflecting a large provision for credit losses. \r\n\r\nSterling Financial (NASDAQ: STSA), which operates Sterling Savings Bank, said its first quarter 2008 earnings were $2.9 million, down from $22.9 million the same quarter a year ago. \r\n\r\nThe bank said the drop reflects a $37.1 million provision for credit losses in the first quarter of this year. By contrast, the bank set aside $4.2 million for credit losses in the first quarter of 2007. \r\n\r\n\"The higher credit provision in the first quarter reflects the unprecedented and rapid decline in the residential real estate market that continued unfolding during the course of the first quarter,\" said Sterling Chairman and CEO Harold Gilkey, in a statement. <\/blockquote>',''); return false;">Quote</a></div> Denny Retrograde – good article! Thanks for pointing that out.

Interesting to see there is a separate article about Sterling Savings Bank releasing their earnings today

Sterling Financial Corp. of Spokane, one of Washington state’s largest community banks, reported a sharp drop in first quarter earnings reflecting a large provision for credit losses.

Sterling Financial (NASDAQ: STSA), which operates Sterling Savings Bank, said its first quarter 2008 earnings were $2.9 million, down from $22.9 million the same quarter a year ago.

The bank said the drop reflects a $37.1 million provision for credit losses in the first quarter of this year. By contrast, the bank set aside $4.2 million for credit losses in the first quarter of 2007.

“The higher credit provision in the first quarter reflects the unprecedented and rapid decline in the residential real estate market that continued unfolding during the course of the first quarter,” said Sterling Chairman and CEO Harold Gilkey, in a statement.

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]]> By: Ubersalad http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46686 Ubersalad Mon, 21 Apr 2008 23:54:47 +0000 http://seattlebubble.com/blog/?p=1853#comment-46686 All these condos will flop like no other...combination of low occupancy rate and mix used. There will a domino effect, and can't wait to see the aftermath.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46686','Ubersalad',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46686','Ubersalad','All these condos will flop like no other...combination of low occupancy rate and mix used. There will a domino effect, and can\'t wait to see the aftermath.',''); return false;">Quote</a></div> All these condos will flop like no other…combination of low occupancy rate and mix used. There will a domino effect, and can’t wait to see the aftermath.
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]]> By: Ubersalad http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46685 Ubersalad Mon, 21 Apr 2008 23:53:08 +0000 http://seattlebubble.com/blog/?p=1853#comment-46685 I remember few articles ago how people were using Homestreet and as the model lender...I guess not.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46685','Ubersalad',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46685','Ubersalad','I remember few articles ago how people were using Homestreet and as the model lender...I guess not.',''); return false;">Quote</a></div> I remember few articles ago how people were using Homestreet and as the model lender…I guess not.
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]]> By: Denny Retrograde http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46683 Denny Retrograde Mon, 21 Apr 2008 23:03:30 +0000 http://seattlebubble.com/blog/?p=1853#comment-46683 I remember the Puget Sound Business Journal did good reporting of local banks' exposure back in January. It's online now: http://www.bizjournals.com/seattle/stories/2008/01/14/story7.html?t=printable A bar chart was available in the print edition that showed reported September exposure to construction loans (home, commercial and land development) relative to average gross loans and leases: 10%: National average of all insured commercial banks 22%: First Savings Bank, Renton 31%: Washington First International Bank, Seattle 32%: Sterling Savings Bank, Spokane 34%: Cascade Bank, Everett 36%: Banner Bank, Walla Walla 41%: Horizon Bank, Bellingham 44%: HomeStreet Bank, Seattle 45%: Venture Bank, Lacey 48%: Frontier Bank, Everett and the winner: 70%: City Bank, Lynnwood<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46683','Denny Retrograde',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46683','Denny Retrograde','I remember the Puget Sound Business Journal did good reporting of local banks\' exposure back in January. It\'s online now:\r\nhttp:\/\/www.bizjournals.com\/seattle\/stories\/2008\/01\/14\/story7.html?t=printable\r\n\r\nA bar chart was available in the print edition that showed reported September exposure to construction loans (home, commercial and land development) relative to average gross loans and leases:\r\n\r\n10%: National average of all insured commercial banks\r\n22%: First Savings Bank, Renton\r\n31%: Washington First International Bank, Seattle\r\n32%: Sterling Savings Bank, Spokane\r\n34%: Cascade Bank, Everett\r\n36%: Banner Bank, Walla Walla\r\n41%: Horizon Bank, Bellingham\r\n44%: HomeStreet Bank, Seattle\r\n45%: Venture Bank, Lacey\r\n48%: Frontier Bank, Everett\r\nand the winner:\r\n70%: City Bank, Lynnwood',''); return false;">Quote</a></div> I remember the Puget Sound Business Journal did good reporting of local banks’ exposure back in January. It’s online now:
http://www.bizjournals.com/seattle/stories/2008/01/14/story7.html?t=printable

A bar chart was available in the print edition that showed reported September exposure to construction loans (home, commercial and land development) relative to average gross loans and leases:

10%: National average of all insured commercial banks
22%: First Savings Bank, Renton
31%: Washington First International Bank, Seattle
32%: Sterling Savings Bank, Spokane
34%: Cascade Bank, Everett
36%: Banner Bank, Walla Walla
41%: Horizon Bank, Bellingham
44%: HomeStreet Bank, Seattle
45%: Venture Bank, Lacey
48%: Frontier Bank, Everett
and the winner:
70%: City Bank, Lynnwood

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]]> By: Sniglet http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46682 Sniglet Mon, 21 Apr 2008 21:49:55 +0000 http://seattlebubble.com/blog/?p=1853#comment-46682 I've read a number of stories indicating how regional banks entered into riskier commercial real-estate ventures (including construction loans to developers for things like condos) over the last decade as the market for residential mortgages became far too competitive and unprofitable. These smaller banks will feel a whole world of hurt if there is a downturn in CRE. I just look at all the cranes towering over Bellevue and Seattle and cringe at the thought of what will happen to all the lenders when these high-priced condos go into fire-sale.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46682','Sniglet',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46682','Sniglet','I\'ve read a number of stories indicating how regional banks entered into riskier commercial real-estate ventures (including construction loans to developers for things like condos) over the last decade as the market for residential mortgages became far too competitive and unprofitable. These smaller banks will feel a whole world of hurt if there is a downturn in CRE.\r\n\r\nI just look at all the cranes towering over Bellevue and Seattle and cringe at the thought of what will happen to all the lenders when these high-priced condos go into fire-sale.',''); return false;">Quote</a></div> I’ve read a number of stories indicating how regional banks entered into riskier commercial real-estate ventures (including construction loans to developers for things like condos) over the last decade as the market for residential mortgages became far too competitive and unprofitable. These smaller banks will feel a whole world of hurt if there is a downturn in CRE.

I just look at all the cranes towering over Bellevue and Seattle and cringe at the thought of what will happen to all the lenders when these high-priced condos go into fire-sale.

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]]> By: TJ_98370 http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46681 TJ_98370 Mon, 21 Apr 2008 20:48:39 +0000 http://seattlebubble.com/blog/?p=1853#comment-46681 Yes, Westsound Bank has been in local Kitsap County news rather often lately –

Westsound Bank reaches agreement with feds

Apr 09 2008

BREMERTON

WSB Financial Group recently reported that Westsound Bank, its sole operating subsidiary, has signed an agreement with the Federal Deposit Insurance Corporation and the Washington Department of Finance to enter into a cease and desist order which primarily addresses the bank’s past lending practices and the company is implementing a comprehensive plan to achieve full compliance……

——————————————————-

New Westsound CEO Ready to Put Troubled Bank Back on Track Tuesday,

April 15, 2008

BREMERTON

Westsound Bank’s holding company announced Tuesday that a Bellevue banker has agreed to become its new president and chief executive officer……..

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Also, more late breaking news in the fascinating Kitsap real estate market –

Business Spotlight: Condos Are Sold, Sold, Sold

April 20, 2008

BREMERTON

All 28 of the remaining luxury condos at The 400 waterfront development sold at an auction Sunday, with none reaching the original asking price and most for not much more than the minimum bid.

The public auction was held at the Kitsap Conference Center in downtown Bremerton on Sunday.

And at least one buyer said his winning bid for a one-bedroom with a view of Manette didn’t meet the minimum amount the seller would accept, or the “reserve.” Although Matt Weber of Bremerton bid the highest in the call-and-response, pledging $225,000 for a unit that originally went for $337,000, it’s not certain he will actually get to buy the condo. Bidding on Weber’s unit started at $159,000.

“There’s a lot of people walking around saying they didn’t meet the reserve,” he said. “We’ll see what happens.”…..

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]]> By: FreedomLover http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46680 FreedomLover Mon, 21 Apr 2008 20:13:57 +0000 http://seattlebubble.com/blog/?p=1853#comment-46680 Hmm apparently if you can provide 20% down, you're just fine in getting a decent loan. That's what I did 2 years ago on my condo.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46680','FreedomLover',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46680','FreedomLover','Hmm apparently if you can provide 20% down, you\'re just fine in getting a decent loan. That\'s what I did 2 years ago on my condo.',''); return false;">Quote</a></div> Hmm apparently if you can provide 20% down, you’re just fine in getting a decent loan. That’s what I did 2 years ago on my condo.
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]]> By: Mr. Snappy http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46678 Mr. Snappy Mon, 21 Apr 2008 20:05:44 +0000 http://seattlebubble.com/blog/?p=1853#comment-46678 Sterling is one that is in major trouble. I saw the Novemeber 07' construction status report before I left in December. Total construction loan portfolio.... around $2.5 billion. Here's the nasty part. They had on the books at that time over $650 million in construction loans that were 100% funds disbursed, with 100% complete projects, but only around $73 million dollars paid back. That's really, really bad, and their increased loan loss provision should be at least $100 million. This is for both single family homes, and some multifamily homes. This doesn't include all the condo projects, and CRE they have through their subsidiary Intervest. As far as Frontier goes, I know they are into a local builder here in Eastern Washington for about $6 million. That guy cut his staff from 150+ down to 4 people last month, and is sitting on about 100+ homes right now. Another bank that will feel some pain is Banner. Lots of SFR construction loans in the Boise area.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46678','Mr. Snappy',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46678','Mr. Snappy','Sterling is one that is in major trouble. I saw the Novemeber 07\' construction status report before I left in December. Total construction loan portfolio.... around $2.5 billion. Here\'s the nasty part. They had on the books at that time over $650 million in construction loans that were 100% funds disbursed, with 100% complete projects, but only around $73 million dollars paid back. That\'s really, really bad, and their increased loan loss provision should be at least $100 million. This is for both single family homes, and some multifamily homes. This doesn\'t include all the condo projects, and CRE they have through their subsidiary Intervest. As far as Frontier goes, I know they are into a local builder here in Eastern Washington for about $6 million. That guy cut his staff from 150+ down to 4 people last month, and is sitting on about 100+ homes right now. Another bank that will feel some pain is Banner. Lots of SFR construction loans in the Boise area.',''); return false;">Quote</a></div> Sterling is one that is in major trouble. I saw the Novemeber 07′ construction status report before I left in December. Total construction loan portfolio…. around $2.5 billion. Here’s the nasty part. They had on the books at that time over $650 million in construction loans that were 100% funds disbursed, with 100% complete projects, but only around $73 million dollars paid back. That’s really, really bad, and their increased loan loss provision should be at least $100 million. This is for both single family homes, and some multifamily homes. This doesn’t include all the condo projects, and CRE they have through their subsidiary Intervest. As far as Frontier goes, I know they are into a local builder here in Eastern Washington for about $6 million. That guy cut his staff from 150+ down to 4 people last month, and is sitting on about 100+ homes right now. Another bank that will feel some pain is Banner. Lots of SFR construction loans in the Boise area.
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]]> By: S-Crow http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46675 S-Crow Mon, 21 Apr 2008 19:20:41 +0000 http://seattlebubble.com/blog/?p=1853#comment-46675 It appeared that there was no commentary in the Seattle Times nor Puget Sound Business Journal regarding Frontier Bank. I did see Cascade Bank, but to leave out one of the more significant players in CRE and builder/development lending such as Frontier Bank is perplexing.<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46675','S-Crow',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46675','S-Crow','It appeared that there was no commentary in the Seattle Times nor Puget Sound Business Journal regarding Frontier Bank. \r\n\r\nI did see Cascade Bank, but to leave out one of the more significant players in CRE and builder\/development lending such as Frontier Bank is perplexing.',''); return false;">Quote</a></div> It appeared that there was no commentary in the Seattle Times nor Puget Sound Business Journal regarding Frontier Bank.

I did see Cascade Bank, but to leave out one of the more significant players in CRE and builder/development lending such as Frontier Bank is perplexing.

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]]> By: Locust http://seattlebubble.com/blog/2008/04/21/bad-real-estate-loans-hitting-local-banks/#comment-46671 Locust Mon, 21 Apr 2008 18:38:55 +0000 http://seattlebubble.com/blog/?p=1853#comment-46671 I believe this report about changes in the condo lending market was also rather ominous: http://seattletimes.nwsource.com/html/realestate/2004359322_harney20.html How can they sell all those Seattle and Bellevue condo tower units if nobody can get a loan?<div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('46671','Locust',''); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('46671','Locust','I believe this report about changes in the condo lending market was also rather ominous:\r\n\r\nhttp:\/\/seattletimes.nwsource.com\/html\/realestate\/2004359322_harney20.html\r\n\r\nHow can they sell all those Seattle and Bellevue condo tower units if nobody can get a loan?',''); return false;">Quote</a></div> I believe this report about changes in the condo lending market was also rather ominous:

http://seattletimes.nwsource.com/html/realestate/2004359322_harney20.html

How can they sell all those Seattle and Bellevue condo tower units if nobody can get a loan?

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