What the economic numbers don't say.
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LT4 VETTE, You have a good head on your sholders, paying yourself is always better than borrowing. Years ago the rule of thumb was the cost of your car should exceed your annual income and your house should not exceed three times your annual earnings. Still makes sense to me since I'm retired.
Originally Posted By: dave munson
Because the rich are too greedy and stupid enough to provide the money thinking that when the middle class can't pay, they can just enslave them?
You can't possibly believe this.
Because the rich are too greedy and stupid enough to provide the money thinking that when the middle class can't pay, they can just enslave them?
You can't possibly believe this.
getting 7 credit cards and maxing them out. foreclosing on a house. I call it legalize stealing. why go through the trouble of robbing people at gunpoint? when you can get just get credit card with high limits, get cash from the atm, and buy a ton of stuff for free. just pay the mininum balance every month. then bam, don't pay them no more, and file bankruptcy on all 70k bucks of it. you'll get the stuff for free without paying hardly anything at all. America, what a great country.
A lot of these happens because the banks want to hide the true debt. Here the banks would not sell at a very low price, they would remove the listing and only sell when the price is right, even if it means they are not getting mortgage payment. The reason I think has to do with not wanting to pull down the market value of all their bad loan holding and have to shore up capital due to the lowered loan valuation vs deposit ratio.
Cars were the same, many manufactures would loosen up loan requirement because they needed to sell cars in the depression, because the risk is lower than shutting down the line, or in the case of some foreign conglomerates, they shift the risk to loan side and let the bank / government policy subsidize the car sales as a loop hole around dumping. The government having 0% target interest means a few bad loans at 7% would still be more profitable than 0% at home.
Cars were the same, many manufactures would loosen up loan requirement because they needed to sell cars in the depression, because the risk is lower than shutting down the line, or in the case of some foreign conglomerates, they shift the risk to loan side and let the bank / government policy subsidize the car sales as a loop hole around dumping. The government having 0% target interest means a few bad loans at 7% would still be more profitable than 0% at home.
Originally Posted By: Bob Woods
Now days FDIC pays the lender to service in default morgages so that to most of us it looks like they are losing when in reality they turn a profit at the expense of the taxpayer
I think first of all the share holder of the debt holder loses the most. When banks are bailed out most of the share holder values are wiped clean, when that isn't sufficient, the FDIC or government organization jump in to bail to avoid trickle down damage (yes, trickle down doesn't only work on profit, but loses as well).
The wrong thing is, that those earning commission (and the one masking the risk with FINANCIAL ENGINEERING) rather than share holder were not losing anything because they have no skins in the game. Other than a few dog and pony show lawsuit they aren't punished. If they have to lose just as much they would not take on crazy risk for the commission.
Now days FDIC pays the lender to service in default morgages so that to most of us it looks like they are losing when in reality they turn a profit at the expense of the taxpayer
I think first of all the share holder of the debt holder loses the most. When banks are bailed out most of the share holder values are wiped clean, when that isn't sufficient, the FDIC or government organization jump in to bail to avoid trickle down damage (yes, trickle down doesn't only work on profit, but loses as well).
The wrong thing is, that those earning commission (and the one masking the risk with FINANCIAL ENGINEERING) rather than share holder were not losing anything because they have no skins in the game. Other than a few dog and pony show lawsuit they aren't punished. If they have to lose just as much they would not take on crazy risk for the commission.
On an individual level, the simple solution is simple: Do not spend more than you earn.
On the federal level, pass a balanced budget amendment that requires all line items accounted for. The current off-budget, unfunded liabilities, such as Medicare and Social Security, are strangling the country.
Pass a national sales tax.
Term limits. Six years for Senate and for Congress.
On the federal level, pass a balanced budget amendment that requires all line items accounted for. The current off-budget, unfunded liabilities, such as Medicare and Social Security, are strangling the country.
Pass a national sales tax.
Term limits. Six years for Senate and for Congress.
Originally Posted By: Al
You can't possibly believe this.
The definition of economic slavery is a condition that a person finds themselves in when the totality of their wages only allows them to pay the interest payments on their accumulated debt.
Yes Al. It's a bit winded but...
Two major acts primary:
* The Credit CARD Act of 2009
* The 2005 Bankruptcy Abuse and Buyer Safety Act
... these two acts combined make it very difficult when you get in financial trouble. There is no way out other than paying off your debt on credit cards or and bk will not forgive loans.
Now add to this some really incredibly stupid organizations that provided housing loans that on average are high risk. Next another financial bubble that seemingly increases the value of the housing and provides incentives to refinance and take money out. Now they are rich and but the loan + 2nd mortgage is beyond high risk. What happened next was that the housing market collapsed.
Today, those stuck in this can not pay everyone. They can't sell the house (under water). They can't get rid of the cars (two jobs and they live too far from their work). They can't sell the stuff (they don't have any stuff to sell anymore). And they can't pay all the bills. They wasted the money they took out of their house (housing improvements mostly). And in BK they will still have to pay all their debts. At this point, they can't pay off their debt but can pay the interest. This -is- the definition of economic slavery. Tada.
Now the last addition. Remember. Today almost 1 in 10 are unemployed. Almost 3 in 10 are under-employed.
With a job loss the only way out is to stop paying the mortgage. The time between when they stop paying and are evicted is the only breather they will have. Even then, you still have all the small debts. And by the laws of this country, will still have to pay whatever loss there is for the house.
I don't feel sorry for the bank. I won't blame the person for taking the loan either. The height of stupidity was the 2nd mortgages on over-valued houses. I remember my bank sent me stuff where all I had to do was to sign and I would get a 2nd mortgage so I can't blame anyone for taking the money. One little signature and I would get (big echo voice) one hundred thousand dollars. I thought it was stupid. Millions of people did not and signed.
I have a few acres, peaceful apple orchard, Nice house, Good well, Shaded by trees, 4 seasons, Breathtaking view, Beautiful wife, good kids, playful dogs and protective cats. I must be rich.
You can't possibly believe this.
The definition of economic slavery is a condition that a person finds themselves in when the totality of their wages only allows them to pay the interest payments on their accumulated debt.
Yes Al. It's a bit winded but...
Two major acts primary:
* The Credit CARD Act of 2009
* The 2005 Bankruptcy Abuse and Buyer Safety Act
... these two acts combined make it very difficult when you get in financial trouble. There is no way out other than paying off your debt on credit cards or and bk will not forgive loans.
Now add to this some really incredibly stupid organizations that provided housing loans that on average are high risk. Next another financial bubble that seemingly increases the value of the housing and provides incentives to refinance and take money out. Now they are rich and but the loan + 2nd mortgage is beyond high risk. What happened next was that the housing market collapsed.
Today, those stuck in this can not pay everyone. They can't sell the house (under water). They can't get rid of the cars (two jobs and they live too far from their work). They can't sell the stuff (they don't have any stuff to sell anymore). And they can't pay all the bills. They wasted the money they took out of their house (housing improvements mostly). And in BK they will still have to pay all their debts. At this point, they can't pay off their debt but can pay the interest. This -is- the definition of economic slavery. Tada.
Now the last addition. Remember. Today almost 1 in 10 are unemployed. Almost 3 in 10 are under-employed.
With a job loss the only way out is to stop paying the mortgage. The time between when they stop paying and are evicted is the only breather they will have. Even then, you still have all the small debts. And by the laws of this country, will still have to pay whatever loss there is for the house.
I don't feel sorry for the bank. I won't blame the person for taking the loan either. The height of stupidity was the 2nd mortgages on over-valued houses. I remember my bank sent me stuff where all I had to do was to sign and I would get a 2nd mortgage so I can't blame anyone for taking the money. One little signature and I would get (big echo voice) one hundred thousand dollars. I thought it was stupid. Millions of people did not and signed.
I have a few acres, peaceful apple orchard, Nice house, Good well, Shaded by trees, 4 seasons, Breathtaking view, Beautiful wife, good kids, playful dogs and protective cats. I must be rich.
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Originally Posted By: PandaBear
A lot of these happens because the banks want to hide the true debt. Here the banks would not sell at a very low price, they would remove the listing and only sell when the price is right, even if it means they are not getting mortgage payment. The reason I think has to do with not wanting to pull down the market value of all their bad loan holding and have to shore up capital due to the lowered loan valuation vs deposit ratio.
Cars were the same, many manufactures would loosen up loan requirement because they needed to sell cars in the depression, because the risk is lower than shutting down the line, or in the case of some foreign conglomerates, they shift the risk to loan side and let the bank / government policy subsidize the car sales as a loop hole around dumping. The government having 0% target interest means a few bad loans at 7% would still be more profitable than 0% at home.
This is exactly what's going on. The holder of the note gets to report an overvalued asset.I just hope the note holder isn't borrowing against it, otherwise the keerap will hit the fan twice as hard this time around. If someone would like me to explain how this happened in the dot com bubble, I'd be happy to.
A lot of these happens because the banks want to hide the true debt. Here the banks would not sell at a very low price, they would remove the listing and only sell when the price is right, even if it means they are not getting mortgage payment. The reason I think has to do with not wanting to pull down the market value of all their bad loan holding and have to shore up capital due to the lowered loan valuation vs deposit ratio.
Cars were the same, many manufactures would loosen up loan requirement because they needed to sell cars in the depression, because the risk is lower than shutting down the line, or in the case of some foreign conglomerates, they shift the risk to loan side and let the bank / government policy subsidize the car sales as a loop hole around dumping. The government having 0% target interest means a few bad loans at 7% would still be more profitable than 0% at home.
This is exactly what's going on. The holder of the note gets to report an overvalued asset.I just hope the note holder isn't borrowing against it, otherwise the keerap will hit the fan twice as hard this time around. If someone would like me to explain how this happened in the dot com bubble, I'd be happy to.
Originally Posted By: FowVay
I'd rather be poor and pay my way in life than to leave my debt burden on someone else's shoulder.
Shrugging one's responsibilities is hardly what I'd call a gem in the rough. We've become a deadbeat society unfortunately regardless of how it's sugar coated.
Amen, brother. Amen.
I'd rather be poor and pay my way in life than to leave my debt burden on someone else's shoulder.
Shrugging one's responsibilities is hardly what I'd call a gem in the rough. We've become a deadbeat society unfortunately regardless of how it's sugar coated.
Amen, brother. Amen.
Originally Posted By: dave munson
Two major acts primary:
* The Credit CARD Act of 2009
* The 2005 Bankruptcy Abuse and Buyer Safety Act
I know a family that one partner files for bankruptcy every 7 years. The last time (2010) 200K in credit cards and 75k in other expenses went away. They live like kings (mega trips several times/year), both work and they have a 300K house. Don't feed me this nonsense.
I have personally seen the paperwork bc his ex is my daughter who lost 28K in settlement money.
He claimed his only assets were a tent and some fishing poles. His wife theoretically owns all of the assets.
Two major acts primary:
* The Credit CARD Act of 2009
* The 2005 Bankruptcy Abuse and Buyer Safety Act
I know a family that one partner files for bankruptcy every 7 years. The last time (2010) 200K in credit cards and 75k in other expenses went away. They live like kings (mega trips several times/year), both work and they have a 300K house. Don't feed me this nonsense.
I have personally seen the paperwork bc his ex is my daughter who lost 28K in settlement money.
He claimed his only assets were a tent and some fishing poles. His wife theoretically owns all of the assets.
I admit that I don't see how people can take out a loan and then default and not feel a little guilty about it. However I do believe that especially in the housing market fiasco that more of the blame goes on the banks, realtors and appraisers. When I was looking the banker and the realtors were pushing hard to go a lot higher than what I wanted. Afterall I could always sell and make a killing since the real estate always goes up right? Appraisal value wasn't a problem, they knew the ones that would make sure the appraisal would come out high enough so that basically you weren't putting money down. At one time you could depend on a banker to tell you that you weren't qualified and you needed to do this, this and this to get in the game. Realtors advertise that you need their experience and knowledge to prevent making a mistake, but they were the ones pushing people into houses they couldn't afford and they knew it.
Originally Posted By: 65cuda
I admit that I don't see how people can take out a loan and then default and not feel a little guilty about it. However I do believe that especially in the housing market fiasco that more of the blame goes on the banks, realtors and appraisers. When I was looking the banker and the realtors were pushing hard to go a lot higher than what I wanted. Afterall I could always sell and make a killing since the real estate always goes up right? Appraisal value wasn't a problem, they knew the ones that would make sure the appraisal would come out high enough so that basically you weren't putting money down. At one time you could depend on a banker to tell you that you weren't qualified and you needed to do this, this and this to get in the game. Realtors advertise that you need their experience and knowledge to prevent making a mistake, but they were the ones pushing people into houses they couldn't afford and they knew it.
Pushing people into houses they could not afford? It's still their choice. Our realtor said we could get a bigger house. We said NO. The mortgage people said we could get cash back at closing. We said NO. The mortgage company sent us mailings to refinance and cash out equity we said NO. Companies sent us mailings for home equity lines of credit. I ran them through the shredder. After 8 years my mortgage is over half paid off. The choice belongs to the people signing the paperwork. You can always say NO.
I admit that I don't see how people can take out a loan and then default and not feel a little guilty about it. However I do believe that especially in the housing market fiasco that more of the blame goes on the banks, realtors and appraisers. When I was looking the banker and the realtors were pushing hard to go a lot higher than what I wanted. Afterall I could always sell and make a killing since the real estate always goes up right? Appraisal value wasn't a problem, they knew the ones that would make sure the appraisal would come out high enough so that basically you weren't putting money down. At one time you could depend on a banker to tell you that you weren't qualified and you needed to do this, this and this to get in the game. Realtors advertise that you need their experience and knowledge to prevent making a mistake, but they were the ones pushing people into houses they couldn't afford and they knew it.
Pushing people into houses they could not afford? It's still their choice. Our realtor said we could get a bigger house. We said NO. The mortgage people said we could get cash back at closing. We said NO. The mortgage company sent us mailings to refinance and cash out equity we said NO. Companies sent us mailings for home equity lines of credit. I ran them through the shredder. After 8 years my mortgage is over half paid off. The choice belongs to the people signing the paperwork. You can always say NO.
Sorry 125, but it is the realtors and bankers that were doing the pushing that they knew was bad deals. Most people expect to get sound advice from a professional and realtors even advertise it. Yes you can always say NO, but many take the talks that the people that they were paying for advice from and it didn't help that we were having all these flip your house shows on TV that made it look like money in the bank. I can tell my doctor NO also, but for the most part I and most others will take their professional advice on what to do. This can go for the mechanic, plumber and about any other field you can think of. All the talk of the people could have said NO does is make excuses for the ones that were ripping people off and making a profit off of it.
Sorry 65 but I'm not buying that many of the people you mention don't have enough common sense to KNOW that something is wrong with the advice a so called professional is giving them. Of course there probably are a few that are too dull to know but I'm certain that GREED had ALMOST everything to do with these folks getting in over their head.
They were greedy and should still have to pay the price. Most of em KNEW BETTER.
They were greedy and should still have to pay the price. Most of em KNEW BETTER.
So a person that buys a house maybe once every several years is going to be more knowledgeable than banks and realtors that do it every day? You know that they knew that they were the greedy ones. But I guess you are saying that most people won't believe professionals like doctors, lawyers, mechanics and so on right? I'm not saying that many of them weren't being greedy also, but they weren't the ones having the sales line of how you can afford it and we can make it work for you and oh by the way we'll fudge a little on the quals and fudge a little and get the appraisal to work. Bottom line is that if the realtors and bankers had done their job these people wouldn't have been put in this position.
Originally Posted By: 65cuda
So a person that buys a house maybe once every several years is going to be more knowledgeable than banks and realtors that do it every day? Bottom line is that if the realtors and bankers had done their job these people wouldn't have been put in this position.
These same people would be tricked by "Bozo the Clown"
How difficult is is to make sure you know many years you are paying "X" interest per month ?? Seems simple to me but then again maybe my great grandfather was A Einstein.
So a person that buys a house maybe once every several years is going to be more knowledgeable than banks and realtors that do it every day? Bottom line is that if the realtors and bankers had done their job these people wouldn't have been put in this position.
These same people would be tricked by "Bozo the Clown"
How difficult is is to make sure you know many years you are paying "X" interest per month ?? Seems simple to me but then again maybe my great grandfather was A Einstein.
Originally Posted By: Al
Originally Posted By: 65cuda
So a person that buys a house maybe once every several years is going to be more knowledgeable than banks and realtors that do it every day? Bottom line is that if the realtors and bankers had done their job these people wouldn't have been put in this position.
These same people would be tricked by "Bozo the Clown"
How difficult is is to make sure you know many years you are paying "X" interest per month ?? Seems simple to me but then again maybe my great grandfather was A Einstein.
You're right. These people are called renters. They should have stayed renting and they're probably back renting now.
Originally Posted By: 65cuda
So a person that buys a house maybe once every several years is going to be more knowledgeable than banks and realtors that do it every day? Bottom line is that if the realtors and bankers had done their job these people wouldn't have been put in this position.
These same people would be tricked by "Bozo the Clown"
How difficult is is to make sure you know many years you are paying "X" interest per month ?? Seems simple to me but then again maybe my great grandfather was A Einstein.
You're right. These people are called renters. They should have stayed renting and they're probably back renting now.
If the people were Bozo's then what does that make the realtors and bankers that also were signing these papers? Look I'm not saying that the buyers weren't at fault to an extent, but I am saying that when you are being told by professionals that you would expect to be getting sound advice from you sometimes will get overwhelmed. All I basically see is people dumping on the buyers, but giving the ones that knew what they were doing a free pass. Seems to me if you want to claim people should be able to say NO then you should certainly expect the professionals to not only say NO, but also not go along with these scams.
Originally Posted By: 65cuda
If the people were Bozo's then what does that make the realtors and bankers that also were signing these papers? Look I'm not saying that the buyers weren't at fault to an extent, but I am saying that when you are being told by professionals that you would expect to be getting sound advice from you sometimes will get overwhelmed. All I basically see is people dumping on the buyers, but giving the ones that knew what they were doing a free pass. Seems to me if you want to claim people should be able to say NO then you should certainly expect the professionals to not only say NO, but also not go along with these scams.
+1 I think at my credit union, if the mortgage officer was signing off on mortgage applications like many I've read about, they would've fired long before the recession hit...
I think also the lack of financial education in high school is a shame. Maybe the financial giants lobby to prevent this as alot of their business would disappear?
If the people were Bozo's then what does that make the realtors and bankers that also were signing these papers? Look I'm not saying that the buyers weren't at fault to an extent, but I am saying that when you are being told by professionals that you would expect to be getting sound advice from you sometimes will get overwhelmed. All I basically see is people dumping on the buyers, but giving the ones that knew what they were doing a free pass. Seems to me if you want to claim people should be able to say NO then you should certainly expect the professionals to not only say NO, but also not go along with these scams.
+1 I think at my credit union, if the mortgage officer was signing off on mortgage applications like many I've read about, they would've fired long before the recession hit...
I think also the lack of financial education in high school is a shame. Maybe the financial giants lobby to prevent this as alot of their business would disappear?
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