On the Brink of Losing the house-and down payment.........waaaaa f-ing waaaaaaaa!!!

Receptionist  +   Kitchen Manager  =    $585K house?????????????????

 

I don't feel sorry for this couple.   They don't deserve a bail out or a work out.   They were stupid and losing their home will be there stupid tax!!!  

 

 

I DON"T THINK SO!!!!!!

 

 

I have said this time and again folks, it is time for people to take their places back to where they socially belong.   The girl working at Walmart shouldn't be expecting to afford a $500K house.   We are going back to where a person making $100K will feel like they have made it and can buy a house that isn't a crap shack.   

If I was elected, I'd pass legislation to fast track foreclosures.  Yay price discovery!

Arghh!!  A lender approved the loan and a "home owner" took the risk.  It is never so simple as to say one party is responsible, they were both foolish.

The goverment should refi the house so they can afford it!!!!!!      EVERYONE comes out better off if they do!!!!!!!!!

As a responsible home owner and TAX payer, tell me why MY tax money should do that?

OMG, we made over $100K a year and we financed $280K with a house payment of $2K a month and these people are currently paying $2,658 a month for their house....what are the odds they made over $100K combined in those professions!!!!

 

Let's do some simple math.......$100K a year equates to $3,846 for each pay period (every 2wks).   For ease, let's take a one month snapshot:   $7,692  Gross.   With taxes likely $5,400 ish (not incuding any health insurance cost or 401K contribution).   Why could it make sense even with 20% down for someone to pay HALF their income to a mortgage payment?   The laon officer who passed approved their loan package should be hunted down and fined for approving and putting this loan through.....these peope should go back tobeing homeowners of a "smaller house".     

 

BMFPitt: Price Discovery........The Act of Discovering what the value of money is (ie: $50K income does not equal $500K house)??????

Supercub,it will cost home owner equity if they don't!!!   It will cost MORE OF OUR TAX MONEY IF THEY  DON'T!!!!!!!!!!

Toner: try to speak more clearly????   What says you?

Patience LC, he's looking it up in his play book.  :)

Can we please blame those who need to be blamed? Lenders, brokers, real estate agents... These people saved up a 20% down payment, which is now gone. There are millions of people just like them. All that money went into the lenders pockets- never to be seen again. The market was manipulated by Greenspan, greedy investors, and bit players that were looking out for a paycheck.

 

Did these people make a mistake? Yes. And they are actually paying for it. But who is getting away with a slap on the wrist??? THAT is the travesty, not whether or not we force lenders to renegotiate these loans (which SHOULD happen, and is the only way we will stabilize). If lenders reworked these loans to where the owners can afford them, say good bye to short sales and foreclosures- two of the main things that are bringing down any market. Prices need to fall more, and they will, but they will do so without the blight foreclosure brings.

 

I don't know why I feel so compassionate toward these people. Experience I guess. If you have a question, ask. There is a lot of misinformation out there that I am sure feeds the fire of 'let's hate the consumer. They got us into this mess.'

Also, no one predicted that oil and gas prices would double in two years. I'm sure that when people qualified, even if they were on the 'cusp', they said 'eh, let's do it!'. Big mistake, obviously. Paying $500/month for gas and $1100/month for heating oil takes it's toll. But, that's what you get when lenders use 'gross income'.

 

PS- I have always asked 'what payment are you comfortable with, and we'll work backwards' but I am the exception to the rule. Most of us are trained to take someone's GROSS income and expenses and come up with a 'max loan amount'. Professionals are supposed to advise, correct? We are supposed to 'know better'. Many did not do their jobs, and that is costing many families everything they worked hard for. Have a little respect and compassion- not everyone was just out for a quick buck, they just got caught up in the 'ownership society', 'Movin' Up', whirlwind.

These people saved up a 20% down payment, which is now gone.

 

No they didn't.  They sold their old (affordable) house at the peak of the bubble.  They got a loan they could never have afforded under any optimistic scenario other than continuation of impossible levels of appreciation.  They got what they deserve.  Hopefully they will serve as an example to future generations.

 

Did these people make a mistake? Yes. And they are actually paying for it. But who is getting away with a slap on the wrist???

 

No slap on the wrist.  They're getting $700 billion, and a stern talking to.

 

THAT is the travesty, not whether or not we force lenders to renegotiate these loans (which SHOULD happen, and is the only way we will stabilize).

 

Stable at 40% off today's prices.  When the government forces reworking of private contracts, interest rates go to 25%.  Which would do wonders for my down payment.

 

Paying $500/month for gas and $1100/month for heating oil takes it's toll.

 

Do you keep your thermostat at 90?

bmf- all I am saying is that consumers are usually "taken advantage of", in any other instance, yet in this situation they are vilified. Chalk that up to PR guys on television and on the radio blaming everyone BUT the banks. Also, in regards to the down payment- if it was equity from the sale of their previous home, call it what you want.

 

PS- I know people who paid $1100/month last year during the winter. Did they keep their thermostats at 90? I think not, but would have to ask.

 

Jen:  these people don't deserve sympathy or money or a writedown. If this couple had purchased a nicer home at perhaps $350K they would likely not be in this pickle, but they tried to grab the brass ring and the ring was obviously too hot for them.  Did a loan officer dupe them, perhaps, but they were two blue collar workers purchasing a home that was clearly way above them......what part of that seemed otay even to them.      The loan officers told me repeatedly we could purchased up to $800K......we looked at our income and saw that there was smoke and mirrors going on there.   I bought a home well beneath my means, put 20%, and lost it all when I had to sell at the wrong time.......what did I do, I put my big girl panties on and got over it.   If you start helping people like this couple then what help should I have gotten, should there be some protection like the FDIC to protect my down payment and give it back to me should there be any loss in equity?   No, then these people are not entitled to any thing either.  

 

 

These idiots deserve to get tossed out on the street.  Absolutely ZERO sympathy.  Anybody that's calling for them to be "saved" needs to grow the eff up and realize that we're supposed to be adults, and if adults cannot keep their greed at bay and end up buying houses at ten times their yearly income, they deserve NOTHING.  Lucky idiots get to walk away from all that debt.

lady- but you admit that the house was way over-priced to begin with, so they could have 'afforded' it without the smoke and mirrors, if the market had not risen so dramatically, no? Basically, these loans were created to feed into the 'affordability' scheme. The houses were overpriced, so how can people afford them? Lower rates, introductory rates, negative amortization etc... And what did those loans do? flood the market even more and drive houses up even further. All I am saying is that the 'smart people with the MBA's' should have known better, not mom and pop down the street. Advertising works for a reason- people don't look into things. Kudos to you for doing so, but you are the exception to the rule. Millions of people bought into it hook, line and sinker.

 

Mom n Pop had been homeowners, and should have known better than buying a house at presumably ten times their income.  Screw them.

The loans created an opportunity for the homes to appreciate faster, indeed there was a market that got out of wack.  If this couple's home is now worth $400K that is still a purty dang nice house where they purchased; regardless they have been living in a house that was still beyond them.  Sure the houses were overpriced as were plasma tvs when they first came out, but some lemmons bought them at $10K and others waited and bought them at $2K (either cause the price came down or they saved up).   The difference is if that person who bought the plasma for $10K could actually afford it or someone who financed that $10K on a cc (does he get a refund if the price of the tv goes down while he is still paying his debt on it?  NO SO WHY IS A HOME ANY DIFFERENT!!!!   I bet this couple is the kind that buys their furnishing at a rent-to-own center cause they think they are paying less by paying $10 a month, even though they pay that for 10 years and pay 100X more to by the same item they could have waited a year to buy and saved so much.  There will always be this type of ignorance, but why oh why must we save these people from themselves?  Just because someone is ignorant is no reason to punish the rest of us for their stupidity, even if it was at the hands of a scrupulous lender--if your that stupid to get had then you sort of had it coming.     

 

I bought my second home with an 80/20 but I also bought a home that was 3X my income so regardless I could have afforded that home.  Different story if I bought 8X my income, right?  

lady- absolutely. I see where you are coming from, but I get more annoyed at the fact that we are shelling out 700+ billion dollars to the people thst got us into the mess, and making it so that everyone's anger is actually placed on the wrong people. Greed and ignorance make people do stupid things, no argument there. But who's actions have proven to be more costly? Those of the consumers? or those of Greenspan, politicians, and 'investors'?

 

I kind of think home-buying classes should be mandatory, and instead of 'wood shop' in high school, a course on the proper use of credit, and simple economics would be of much better use.

If we force our children to endure several years of PE classes where they never even break a sweat, we darn well better be putting them in econ/finance classes by their senior year.  The level of stupid is unsustainable for a system this complex to continue.

 

That said, it is completely false that the $700 billion is going to the bad guys.  Shady lenders are going out of business and are being stalked by the FBI.  I don't like this bailout, but I'm not sophisticated enough to argue that it isn't necessary.  I'm just really effing sick of hearing WAAAAHHHH BOOOHOOOOO for the idiot homeowners.  Toss.  Their.  Asses.  Into.  The.  Street.

klarek- where do your "callouses" come from? Perfect behavior on your part? Or anger born from misinformation?

Not a day goes by that NPR or the Washington Post puts out some sob story of idiots that are in danger of losing their houses.   Two weeks ago, everybody was reporting on the poor lady who chained herself to her house of twenty years that was being foreclosed upon.  Then it was discovered that she sucked out some half a mil in equity through numerous refinances.

 

These sob stories almost always come with the quote "When is the govt going to help me out?"  And I just want to kill these people.

And don't accuse me of being misinformed when you type drivel such as "we are shelling out 700+ billion dollars to the people thst got us into the mess"

 

Idiot.

Idiot you say?

 

That's a classy way to end a conversation. You would get so much further with people if you weren't so condescending and childish. Once again, you have lost your point because you have chosen to be simplistic and petty. Good show, Klarek.

Who said I was ending the conversation?  You've yet to tell me how I am misinformed. 

The bailout is to help keep the flow of money going: lender can lend so buyer can buy.....the  cycle continues, but hopefully with more oversight and foresight not to let this nightmare cycle re-create itself.   The bailout isn't for and shouldn't be to keep people in their homes that they can not afford or can't afford the reset on the loan.  If the bank agrees to rework the loan and takes a loss then that is up to the bank and they alone should take the loss.   The banks made out in the past few years just like many homeowners who cashed out their equity.......if neither saw the rainy day coming then there is no sympathy.  Wanting to help them just to sustain the current status quo prices is just pure insanity, if you do that then a person making an avg wage will indeed never be able to own a home with conventional financing: if that is what you want Jen it is to serve your profession and not your fellow man.   If a homeowner is underwater and can still afford their home then they have to stay put, should they move they must come join me and take a loss.   If you have a reset coming and can't afford it: you took a gamble and lost!  

 

 

IMHO owning a home is not a right. These folks were happy enough living in their 585K house on a a double blue collar salary. They felt good about everything while it was working out, but now that things aren't working out they want to blame everyone else and get free money. Sorry, no.

While they were living the high life in their half a MILLION dollar home, I was in a moldy rental waiting for the market to return to something closer to normal with my family. I will not spend one penny to keep them in their half a MILLION dollar house. I refuse to support people that feel entitled to anything that doesn't belong to them including my tax money.

I don't think klarek is heartless as you suggest nor am I, but we are both offended at being expected to bailout the irresponsible. I was prudent as a buyer. I will receive no government benefit for my sacrifice because I didn't buy badly enough. No I do not feel sorry for these people. If you can't afford it, I do not feel sorry for you and I will not help you keep it.

I guess we're all just too cold and mean-spirited.  After all, avoiding over-leveraging yourself and buying a house ten times your salary is now elevated to "not being perfect".  Free half million dollar homes for every selfish, less-than-perfect person out there.  Those "perfect" people that were responsible get to subsidize their idiot neighbors' houses.  Because everybody should own their own home!

Nor is owning a home the American Dream:  remember it was freedom of religion, being able to speek freely, and pursue happiness.

If my income changed and I could no longer afford my rental what would I do??? I WOULD MOVE TO A CHEAPER PLACE!!!!  Why is it that an "owner" can't do the same, even if that means a loss of "their" money or a home?    Can't pay the car payment loose the car?  Can't afford to pay on that ring you bought your sweetie: it goes back in the box!    Why is a home being treated so differently?  Explain that to me!!!!!!

Someone on my street is in pre-foreclosure.......no houses are for sale on my street....what are they waiting for?  Bank bailout?   They haven't even tried to sell the house......cold and mean spirted, heck yes I am..........I have no pity for them either. 

 

I have a buy threshold on everything I purchase: I won't buy a box of Froot Loops unless it is less than $2.50 a box or less.....there are cars I would never pay $75k for but I see many of my neighbors think they are worth it.   Just because someone else thinks it -doesn't make it so!!  The market is becoming more real again, get used to it.