View Full Version : How is this legal?
trappernana
03-02-10, 10:12
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars! That's F*CKING criminal.Why do we tolerate this? It's the same with cars,a 20,000 car will cost 35,000. I have no problem with loan companies making a profit but this is ridiculous. These people should be boiled in oil. They are the reason my family is loosing our house. The b*#tards are foreclosing and I can't do a F-ing thing. WHAT? The Gov. They turned us down!!:mad:
dirksterg30
03-02-10, 10:20
I'm not sure what you're ranting about. Didn't you agree to those terms when you bought the house? If so, you really have nothing to complain about.
next time save up then ?
I never had loans and such till I got married and wanted a nicer place
I signed the loan papers I took responsibility for my actions I hate paying loans but again no body put a gun to my head and said do this !!!!
so to me its part of the hey they lent my the money to do this and gave me half a lifetime to pay it off
would you loan your friend your car and say bring it back in 5-7 years no problem ?
Mo_Zam_Beek
03-02-10, 10:35
They are the reason my family is loosing our house.
No they are not.
Good luck
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars! That's F*CKING criminal.Why do we tolerate this? It's the same with cars,a 20,000 car will cost 35,000. I have no problem with loan companies making a profit but this is ridiculous. These people should be boiled in oil. They are the reason my family is loosing our house. The b*#tards are foreclosing and I can't do a F-ing thing. WHAT? The Gov. They turned us down!!:mad:
Yeah! Down with free markets! Down with personal responsibility! Down with capitalism! ****ing bastards!
Agreed with the fact that you signed the papers. Oh, and it'll only cost you that much if you only make the minimum payments. We will have cut off about 80k from our loan by simply paying more than the minimum payment each month.
Look at it another way, without the loan, you'd be renting, and renting is like throwing money into can and lighting it on fire.
Welcome to the reality of long-term compounded interest.
You can be its master, or its slave.
Every time I see a 60 year mortgage toted on HGTV or some other similar home buying show, I die a little inside.
Edit: What terms did you agree to anyway? A 30-year mortgage at today's rates doesn't come out to $500k.
Outlander Systems
03-02-10, 10:56
*Some terms and conditions may apply
Usury, it's considered a massive sin by most of the Middle-Eastern religions, FWIW.
That being said, it is what it is. You gotta pay to play.
The wife and I have taken a liking to Dave Ramsey. ;)
I made sure I was debt-free when we got married, and I haven't had a CC since, nor do I want one. I'd love to be able to charge a new BCM mid-length, or swipe the plastic on the POF Gen III lower I've been eyeballing for a year; instead I just stick some cash in an envelope, and buy my goodies when I've got the loot. This way, when I get it, it's mine, and instead of figuring out where that next payment is going to come from, I get to worry about whether or not Grant's got the LPK I'm looking for in-stock. It's made me more cautious with purchases, and the thrill of the hunt is more rewarding.
We're in the process of sucking it up, taking the hard medicine, and blasting hers like poppers. Everytime one's paid off, out come the shears.
I personally won't buy anything on credit, house exempted, unless I can come up with at least half. Cars, motorcycles, etc.
Buy what you can afford. That's what typically gets folks into a pickle. If you can't afford it now, be patient until you can afford it.
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars! That's F*CKING criminal.Why do we tolerate this? It's the same with cars,a 20,000 car will cost 35,000. I have no problem with loan companies making a profit but this is ridiculous. These people should be boiled in oil. They are the reason my family is loosing our house. The b*#tards are foreclosing and I can't do a F-ing thing. WHAT? The Gov. They turned us down!!:mad:
I'm no banker, but the loan calculator says 35k for a 20k car would be a ~25% APR on a 5yr loan. I know there's people who will sign on for that, but...
On the mortgage, 500k for a 199k house is ~7.5%. There are much better interest rates to be had, but some will have to pay that much.
Making an extra mortgage payment on your prinicpal every year, or adding $100-150 each month, can take years off your loan. Doing so on a 199k loan, for 30yrs, at 6%, is a ~6 year gain.
It isn't criminal, it's capitalism. If you wanted my money for 5 years, or 30 years, I'd want a real return, too.
Now, if you want to take about criminal/predatory loan practices, there's title and payday loans.
Outlander Systems
03-02-10, 11:07
What I find greasy is the concept of fractional-reserve banking, but I'm not gonna go there. That's what makes the situation different from me or Skintop lending you the cash, and expecting a return. The banksters are getting a return on fluff'ed up, notional bullshit, that doesn't even really exist.
That being said, again, you've gotta pay to play. As much as I think the international bankers are a bunch of slimebags, I personally don't have enough cash on hand to buy a house outright, so, I gotta pay to play.
As an aside, as difficult for me as it is to not blame the banksters for the economic mess we're in, I blame Joe Q. Sixpack, for buying more house than he needs, under the wishful thinking that by the time the loan reset, he'd have doubled the value of his home. This sort of Jiminy Cricket bullshit is laughable. Housing had to implode, because real-estate was outstripping wages by an ungodly margin.
Living beyond our means, buying more than we can afford, keeping up with the Kardashians is what's responsible for what's happened. Last year my boss made $97,000. He lives in a $100,000 house. That's what I call making prudent decisions.
You don't want the banks to control your life? Don't let 'em.
You agreed to borrow their money. No one made you sign the papers. Think of it this way. Would you loan someone 100-200k for 30 years unless it were worth your time? The only person to blame is the person who over leveraged themselves into buying a 20k car and a 200k house. Perhaps a 15k car and a 150k house would have been more affordable? I'm not trying to kick you while you're down, but you can't blame others for living beyond your means.
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars! That's F*CKING criminal.Why do we tolerate this? It's the same with cars,a 20,000 car will cost 35,000. I have no problem with loan companies making a profit but this is ridiculous. These people should be boiled in oil. They are the reason my family is loosing our house. The b*#tards are foreclosing and I can't do a F-ing thing. WHAT? The Gov. They turned us down!!:mad:
I agree with you. Fractional reserve banking is total BS. Its like printing money, only worse. I remember remarking to my wife 5 years ago that something had to give when the house of cards would finally collapse
What I find greasy is the concept of fractional-reserve banking, but I'm not gonna go there. That's what makes the situation different from me or Skintop lending you the cash, and expecting a return. The banksters are getting a return on fluff'ed up, notional bullshit, that doesn't even really exist.
That being said, again, you've gotta pay to play. As much as I think the international bankers are a bunch of slimebags, I personally don't have enough cash on hand to buy a house outright, so, I gotta pay to play.
As an aside, as difficult for me as it is to not blame the banksters for the economic mess we're in, I blame Joe Q. Sixpack, for buying more house than he needs, under the wishful thinking that by the time the loan reset, he'd have doubled the value of his home. This sort of Jiminy Cricket bullshit is laughable. Housing had to implode, because real-estate was outstripping wages by an ungodly margin.
Living beyond our means, buying more than we can afford, keeping up with the Kardashians is what's responsible for what's happened. Last year my boss made $97,000. He lives in a $100,000 house. That's what I call making prudent decisions.
You don't want the banks to control your life? Don't let 'em.
cannarella
03-02-10, 11:33
*Some terms and conditions may apply
The wife and I have taken a liking to Dave Ramsey. ;)
+1 for Dave Ramsey. Did FPU and now see the light. Recommend it for all. Get control of your finances and you then have control of your life.
I blame Joe Q. Sixpack, for buying more house than he needs, under the wishful thinking that by the time the loan reset, he'd have doubled the value of his home. This sort of Jiminy Cricket bullshit is laughable. Housing had to implode, because real-estate was outstripping wages by an ungodly margin.
Living beyond our means, buying more than we can afford, keeping up with the Kardashians is what's responsible for what's happened. Last year my boss made $97,000. He lives in a $100,000 house. That's what I call making prudent decisions.
A-****ing-men.
Every time I see some $30k/year guy driving around in a leased $60k car and going home to a $300k condo on the beach I think "you should be locked up LONG before any banker that 'conned' you into all that shit".
My first townhouse, bought just at the start of the upswing, cost 150% percent of what my fiance (at the time) and I made a year. I wanted 1:1 but the shitbags had already started living above their means and inflating prices. I sold that and rented for 5 years waiting for the crash, and now that the crash is here I'm happily shopping. Unfortunately things crashed harder than they should have, and now there's the whole "may not have a job in a month" problem to contend with, not to mention lenders being more than a little apprehensive thanks to the shitbags. :mad:
Outlander Systems
03-02-10, 11:36
+1 for Dave Ramsey. Did FPU and now see the light. Recommend it for all. Get control of your finances and you then have control of your life.
There's a certain liberation in being in control of your own financial destiny.
I mean, there ain't no getting around taxes, so we don't even need to debate that course, but debt is something you do have control over.
I hope, and God knows I have, everyone can come out of this financial mess having learned some lessons.
My most valued lesson: take nothing for granted.
cannarella
03-02-10, 11:42
There's a certain liberation in not being in control of your own financial destiny.
In not being in control? I am sure this has to be a typo. Not being in control is what causes stress. That's why so many divorces are about money.
There's a certain liberation in not being in control of your own financial destiny.
I mean, there ain't no getting around taxes, so we don't even need to debate that course, but debt is something you do have control over.
I hope, and God knows I have, everyone can come out of this financial mess having learned some lessons.
My most valued lesson: take nothing for granted.
Well said while I hate to see good people suffer I personally have never been in a better financial state bad economy or not it still boils down to don't spend more than you make and don't spend all that you make you gotta leave something left over for SHTF type scenarios that goes for everything not just active shooters or disasters
thopkins22
03-02-10, 11:53
Every time I see some $30k/year guy driving around in a leased $60k car and going home to a $300k condo on the beach I think "you should be locked up LONG before any banker that 'conned' you into all that shit".
Boom. Houston has had it easy compared to most of the country, but we have a bunch of thirty thousand dollar millionaires who created some great buying opportunities as well.
Outlander Systems
03-02-10, 12:01
In not being in control? I am sure this has to be a typo. Not being in control is what causes stress. That's why so many divorces are about money.
Definite typo.
Outlander Systems
03-02-10, 12:01
A-****ing-men.
Every time I see some $30k/year guy driving around in a leased $60k car and going home to a $300k condo on the beach I think "you should be locked up LONG before any banker that 'conned' you into all that shit".
My first townhouse, bought just at the start of the upswing, cost 150% percent of what my fiance (at the time) and I made a year. I wanted 1:1 but the shitbags had already started living above their means and inflating prices. I sold that and rented for 5 years waiting for the crash, and now that the crash is here I'm happily shopping. Unfortunately things crashed harder than they should have, and now there's the whole "may not have a job in a month" problem to contend with, not to mention lenders being more than a little apprehensive thanks to the shitbags. :mad:
Ezzackly!
Whenever I wonder how people afford that craziness, I'm reminded of my old friend credit.
I can technically afford a new truck, and I would love one. I sold my bike in '03 for 5K, bought a '94 Ranger for 2K, and swore I'd be happier than a pig in poop, if it lasted 'til '04. Well, seven years later that damned thing refuses to die. I think, oil changes aside, I installed a new alternator and had to replace a $10 relay. When my buddies are home on leave, they're shocked that I'm still driving the world's lamest ride.
The wife and I bought our first home in May '09. The irony of the situation is that we were in a bidding war over it in March of '08, after the bank seized it. There were some serious fixer-upper issues going on, and we didn't care because the price was 50k less than everything else in the neighborhood. A "flipper" beat us out, and sat on it for 14 months, and fixed everything. Nice guy even tore out the old concrete patio that was cracked, and put a new one in. Even put sheetrock up in the garage. Replaced the hardwoods, and put up some really fancy crown moulding. The best part, is that, after all that, we paid less than we offered during the bidding war.
If you're shopping, my advice, good or bad since it's highly speculative, is dependent upon what sort of down payment you're looking at. If you're sporting some cash for a sizeable down payment, I'd recommend holding out, since I believe interest rates will eventually move up, which will further kick the dog snot out of real estate prices. If you're not rocking serious scratch for a down payment, there'll eventually be a tipping point between those two issues (price/vs interest rates), which would be, in my opinion, the iron in need of striking.
I don't know about your industry, but the Civil Engineering/Land Surveying field has been kicked squarely in the nutz. I've been on a 20-hour a week furlough since October, and we've had several huge contracts awarded that are just waiting for a kickoff.
If I hadn't been prudent/nuked my CCs, and the wife and I hadn't bought at/below our means, we'd be up the creek without a paddle. We could've easily afforded way more house, but we didn't need way more house.
The downside to marriage is that I wanted a house about 30k less than the one we're in that, was for all intents-and-purposes, was a borderline dump. Bigger yard, basement, and within 100 yds. from Lake Allatoona. That whole testosterone thing will make you sacrifice house nice for yard nice. ;)
Here's my recipe for not keeping up with the Jones':
Navigating Collapse's Cookie-Factor:
Say, I could buy an E350 Benz, which looks to my redneck eyeballs a LOT like a Civic. Or I could buy the Civic.
What is my incentive for that additional payment? The reliability isn't drastically different. As far as I'm concerned they look the same, only the E350's got a pretty fancy grille. So, what is my incentive. Ahhhhh, esteem.
Okay, if my "friends" associate with me because of my car, I need new buddies.
But, I wanna look successful, God-Damnit! I'm getting the Benz.
No one, not even the local cop, is going to pull me over, and give me a cookie for making that decision. If I don't get a ****in' cookie for spending almost enough to buy three Civics instead, then what is the point?
I'm too utilitarian and redneck with vehicles to see the luxury in fancy dancery.
(NavCol's Cookie-Factor doesn't apply to AR-15s. You're getting way more mileage for a minimal price difference, if at all, between a solid-make and low-tier, un-staked, non-parkerized under the FSB, junk ;))
When I was into sportbikes I was constantly harangued by riding buds that I needed a bigger bike (650cc was apparently for chicks). Dude, I'm sorry but I'm not likely to break 120 on the road, and I don't race, so I'm straight, thanks. I could have honestly gotten by with a 250.
[/endrant]
Outlander Systems
03-02-10, 12:10
...thirty thousand dollar millionaires...
Wisdom, in spades. I love it. If that's not going into my catch-phrase lexicon, I don't know what is.
Belmont31R
03-02-10, 12:13
Its a cycle.
You pay that much for a house but if you didn't you wouldn't get paid as much and our economy would be a lot smaller than it is.
You pay the money to the bank, and the bank has more money to lend to other people. That "lent" money goes into the economy so someone can open up a business, and that business employs people who maybe spend their money with your company.
Very few businesses actually start out without getting a loan from a bank. Even large companies are lent money to expand, and then they use the profits from their expansion to pay back the bank.
So yeah we could all pay far less to the bank but then we wouldn't get paid as much, and the economy would barely grow.
The part where it becomes "bad" is when people borrow more than they can afford to pay back. Believe it or not banks don't want to have people stiff them on a loan. What happened with the mortgage crisis is a mixture of bad lending by middle men, overzealous investing of these bad loans by a few HUGE financial companies, and forced relaxed lending standards. The progressives have been hammering banks and politicians for decades to get loans to poor people, and that is a big part of this. Some greedy ass financial guys got around and decided to turn mortgages into investments. When all these people who bought more than they could afford got into trouble it turned those investments bad, and it collapsed the economy. 2 things would have prevented it. Far stricter lending standards (like they used to be), and not turning mortgages into investments. The banks would be a lot healthier, and our investments would be a lot more stable. Turning mortgages into investments is a good idea until a housing bubble pops, and then they all turn to shit because they become saturated with mortgages that are not being paid on, and sold for far less than their initial worth.
And if you put more money down, and pay off the house quicker you will pay FAR LESS in interest than just doing the minimum down payment and minimum monthly payment.
.............., but we have a bunch of thirty thousand dollar millionaires.................
All hat, no cows! It is great to see the high level of personal responsibility is these replies. Seriously!
Outlander Systems
03-02-10, 12:15
Its a cycle.
You pay that much for a house but if you didn't you wouldn't get paid as much and our economy would be a lot smaller than it is.
You pay the money to the bank, and the bank has more money to lend to other people. That "lent" money goes into the economy so someone can open up a business, and that business employs people who maybe spend their money with your company.
Very few businesses actually start out without getting a loan from a bank. Even large companies are lent money to expand, and then they use the profits from their expansion to pay back the bank.
So yeah we could all pay far less to the bank but then we wouldn't get paid as much, and the economy would barely grow.
The part where it becomes "bad" is when people borrow more than they can afford to pay back. Believe it or not banks don't want to have people stiff them on a loan. What happened with the mortgage crisis is a mixture of bad lending by middle men, overzealous investing of these bad loans by a few HUGE financial companies, and forced relaxed lending standards. The progressives have been hammering banks and politicians for decades to get loans to poor people, and that is a big part of this. Some greedy ass financial guys got around and decided to turn mortgages into investments. When all these people who bought more than they could afford got into trouble it turned those investments bad, and it collapsed the economy. 2 things would have prevented it. Far stricter lending standards (like they used to be), and not turning mortgages into investments. The banks would be a lot healthier, and our investments would be a lot more stable. Turning mortgages into investments is a good idea until a housing bubble pops, and then they all turn to shit because they become saturated with mortgages that are not being paid on, and sold for far less than their initial worth.
And if you put more money down, and pay off the house quicker you will pay FAR LESS in interest than just doing the minimum down payment and minimum monthly payment.
And, yes, it's that simple.
Why does the media waste so much time with these overblown, loquacious windbags, who want to make it sound like rocket surgery?
Vote Belmont for CNN's new financial correspondent.
....my family is loosing our house.
Has something changed since the home was purchased that has led to you not being able to make the mortgage payments? Lose your job or something like that?
Outlander Systems
03-02-10, 12:25
Yup. Meanwhile, most people who are actually wealthy drive 10-year-old cars and you'd never know how much they were worth. I wonder how they got to be wealthy...
My wife's Aunt and Uncle are millionaires. Drive a Camry and an Outback.
Yup. Meanwhile, most people who are actually wealthy drive 10-year-old cars and you'd never know how much they were worth. I wonder how they got to be wealthy...
It isn't how much you make, it is how much you keep!
Belmont31R
03-02-10, 12:50
It isn't how much you make, it is how much you keep!
You can be poor and make a million dollars a year if you spend it all, and take on debt.
Look at Michael Jackson. He was in the top 1/10th percentile of income, and died millions in the hole.
CarlosDJackal
03-02-10, 12:51
I'm sorry that the original poster is experiencing hard times. But despite what obama, pelosi, and the other dumboKrats/hypocrites may believe; banks are not in existence to provide charity. They were created to provide a service (savings, checks, loans, etc) FOR PROFIT.
When I was looking to buy my first house back in 2001, I was approved for a $250k loan and came across houses that were just under $200k that I really liked. I ended up buying one for $125k because I knew that I could afford the payments.
Would I like to have gotten a much nicer house? Yup!! Just like I recently looked into buying a BMW but just could not justify the sticker price and knew that I would be hard-pressed to make the payments.
As someone posted before; the morons who purchased $300k houses and $60k cars on their $30k annual salary is what caused the housing crash because they defaulted on their loans in droves. The stupid Government never should have passed a law that not only allowed, but encouraged those types of loans in the first place. JM2CW.
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars!
Part of this is due to the time vaue of money. A dollar today buys a dollar worth of goods......but 10, 20, or 30 years from now that dollar will buy less. Same deal if you put money in an investment. If you have $1 invested today, you would not be happy with that being only $1 ten years from now.
In other countries, they build a single room house. When they can afford it, they build another room onto it.
And all this talk about looking at lending to see if the economy is picking up... I say that less lending is a sign of our economy picking up the pieces and pulling itself together. The government wants you to borrow. It's the modern day slavery.
trappernana
03-02-10, 15:55
You guys rock!!!!! You guys need to come over and help me find that $ 30,000 truck. It must be hiding under all of that rust on my 97' Wrangler that I payed off in 2000.HEY maybe theres mansion under our dirt floor basement, 1200square ft. home built in 1854.I've had a job since 1984, never unemployed. An unexpected broken back didn't help anything. You guys that don't see this is wrong anyway you lookat it are the problem. Enjoy your silver spoons.
You guys rock!!!!! You guys need to come over and help me find that $ 30,000 truck. It must be hiding under all of that rust on my 97' Wrangler that I payed off in 2000.HEY maybe theres mansion under our dirt floor basement, 1200square ft. home built in 1854.I've had a job since 1984, never unemployed. An unexpected broken back didn't help anything. You guys that don't see this is wrong anyway you lookat it are the problem. Enjoy your silver spoons.
Hey while I understand that injuries life or what have ya may happen and while I do feel bad that you are losing your home it is not the banks fault yes they could choose to work with but by no means is that their responsibility if they choose not to work with you that is their choice and they are within their rights you agreed to it when you bought your house so man up take your lumps get better and move on whining and crying about it doesn't change whats happened or going to happen
i, for one, am in agreement with you...the banking industry should be boiled in oil...the gov't saddled millions of people with mortgages that they never would be able to afford just to give some that new homeowner feeling...sorry, that's not what this country needed...the flippers were making tens of thousands of dollars on these quick turn around loans etc...these loans were forced on banks and the consumer...
my sister in law lost her house last summer, but as i told my wife, she bought a house she couldn't afford because her builder talked her into an adjustable rate mortgage...she had been in her house for 6 or 7 years...then the bills come calling taxes went up and she's filing bankruptcy...but it is ultimately the consumer that has to foot the bill to pay the mortgage, not the gov't, not the bank, and definately NOT the TAXPAYERS!!!
it sucks to be in a foreclosure situation but the banks are not handing out TARP money, they are sitting on it while it collects interest and then paying it back to the gov't...then they tell the media, see, we are paying all of this money back PLUS interest!!! just to look good on tv...it's a scam and we the taxpayers let it go on...
trappernana
03-02-10, 16:10
Whining!?...no thats my daughter who keeps asking she can play softball. Hey I'm done
+1 for Dave Ramsey. Did FPU and now see the light. Recommend it for all. Get control of your finances and you then have control of your life.
We did the Dave Ramsey plan too and there is NO WAY I'll borrow again unless its for a different house. I travel but don't have nor want a credit card. I have been saving for months and finally got the chance to pick up a used Aimpoint M3 (Thanks again evilmonkey on the EE) and it felt so good! That's a big change from the "just stack it onto the credit card" mentality that I used to have. Saving is a virtue, try it, you'll like it!!!:D
Whining!?...no thats my daughter who keeps asking she can play softball. Hey I'm done
I can offer you help and suggest that you PM me. Understand your situation very well from two perspectives. Up to you, but I would be willing to help.
...the gov't saddled millions of people with mortgages that they never would be able to afford just to give some that new homeowner feeling...
Yep, it is always someone else's fault. Come on, nobody forced anybody to buy a house they couldn't afford.
Whining!?...no thats my daughter who keeps asking she can play softball. Hey I'm done
Trappernana, sometimes things happen that we can't control and we end up in such a deep hole that seems, and maybe actually is, unending. I was in just such a hole 4 1/2 years ago. I lost a business that I had started and when it was closed, I was on the hook for just under $380,000.00. And no job.
I did the only thing that I could do: cried out to God to show me what to do... within the year, we were debt free, had the 6 month emergency fund set up and a new job. I didn't deserve it in anyway at all. I guess God wanted my attention and for me to trust Him to handle things and Man oh Man, He did!
My prayers go for you and your family that God will show you His love for you...
I'm aligned with many here. My wife and I make a lot of money. We have ford edge we bought used, and a ten year old toyota tacoma with no options. We live a small house in a nice neighborhood. And we save a lot. It's good to live beneath your means.
That aside: To the original poster. One of the ways I make my living is through owning rental properties (the other is as a CIO/CSO). Add 20-50 bucks to every month's payment, and pay twice a month (as in pay half your mortgage plus a little extra every 15 days) and you will cut an enormous amount of principal and interest off, and shorten the life of the loan by eight or ten years. Get smart.
And the interest rates they use are NOT out of control. They're set by various market forces like cost of capital, some measure of risk, etc.
It really is amazing to me the way people throw money around. I have several younger enlisted guys on my team who have bought Harley Davidsons in the last year - must be no recession for the Active Duty guys! It KILLS me when guys come to me BEGGING to be put on a mission somewhere "tax free" so they can use the "extra" money to pay off motorcycles, HUGE trucks, etc.
I'm a GS14, with LEAP. My wife drives a paid-off mini-van. Our new car is a $18K Kia Soul that gets 30 MPG for her primary around-town driving and my use on weekends. One of the biggest reasons for selecting the vehicle we did is we got 36 months 0% interest on it - and we're going to pay it off in that period. I'd LOVE to have a big Ford F150 SuperCrew 4x4 King Ranch - but, I have a family to feed and clothe...
WRT the OP, I'm sorry for your economic troubles, I really am. I wish I could wave a magic wand and hit "reset" on all the housing issues we have in this country. But, having said that, I'm renting a house here in Tampa because I could see the writing on the wall when we moved here; and realized the housing market was still in a death spiral... I'm confused about how anyone can blame the banks for lending them money they asked for.
Regards,
Kevin
Belmont31R
03-02-10, 17:46
It really is amazing to me the way people throw money around. I have several younger enlisted guys on my team who have bought Harley Davidsons in the last year - must be no recession for the Active Duty guys! It KILLS me when guys come to me BEGGING to be put on a mission somewhere "tax free" so they can use the "extra" money to pay off motorcycles, HUGE trucks, etc.
I'm a GS14, with LEAP. My wife drives a paid-off mini-van. Our new car is a $18K Kia Soul that gets 30 MPG for her primary around-town driving and my use on weekends. One of the biggest reasons for selecting the vehicle we did is we got 36 months 0% interest on it - and we're going to pay it off in that period. I'd LOVE to have a big Ford F150 SuperCrew 4x4 King Ranch - but, I have a family to feed and clothe...
WRT the OP, I'm sorry for your economic troubles, I really am. I wish I could wave a magic wand and hit "reset" on all the housing issues we have in this country. But, having said that, I'm renting a house here in Tampa because I could see the writing on the wall when we moved here; and realized the housing market was still in a death spiral... I'm confused about how anyone can blame the banks for lending them money they asked for.
Regards,
Kevin
You should meet my neighbors who just bought a brand new Suburban because they thought their Tahoe didn't have enough room. Family of 3 and 1 dog....:rolleyes:
They are the reason my family is loosing our house.
See you later!
Yep, it is always someone else's fault. Come on, nobody forced anybody to buy a house they couldn't afford.
the gov't opened up loans that they and the applicants BOTH knew they could not afford...there are plenty of scumbag real estate agents, mortgage brokers, appraisers, and bankers that are willing to take these high risk people because the banks know they will NEVER EVER lose money on a home...they will keep selling the mortgage to another entity and revolve the circus of bad debt to another company and write that bad debt off...then the next one writes that debt off, and the next and, you get the picture...
dirtbag real estate agents(READ ALL R/E AGENTS) ask you for your earning statements and will rarely show homes in the "lower" end of your buying power...they will use whatever tactic necessary to get their 12% and don't give a flyin' rats ass about you after you sign that closing paperwork...how many people actually read their entire contract, i can tell you that i didn't read every word...i've bought two homes and i can honestly understand some people's gripes, i have some of my own...but, i also had a 30 yr mortgage locked down and i am doing pretty well...real estate agents will tell you anything you want to hear to close the deal, they're USED/NEW HOME SALESPEOPLE...just like a car salesperson, they are all dirtbags...they are just trying to get by on your 12% commission...
that entire section of the "economy" belongs right at the bottom of the ocean with the child molesting preachers, the scumbag ambulance chasing attorneys, the malpracticing doctors, the lying dirtbag politicians...need i go on??? yeah, it sucks that people are going through this stuff...but, they are having their arms twisted, their ears whispered into that it'll be ok, and their significant others telling them, "daddy, i sure do like this house"...
yeah, nobody is twisting an arm...:rolleyes:
I do not understand how you did not know what the total payments on the house would be before you bought it. It is on one of the first few pages you sign, tells you the rate, loan amount, interest payments and TOTAL payments. You must not of had a problem with it when you were taking their money, but now are accusing the bank of illegal activity.
Belmont31R
03-02-10, 19:34
the gov't opened up loans that they and the applicants BOTH knew they could not afford...there are plenty of scumbag real estate agents, mortgage brokers, appraisers, and bankers that are willing to take these high risk people because the banks know they will NEVER EVER lose money on a home...they will keep selling the mortgage to another entity and revolve the circus of bad debt to another company and write that bad debt off...then the next one writes that debt off, and the next and, you get the picture...
dirtbag real estate agents(READ ALL R/E AGENTS) ask you for your earning statements and will rarely show homes in the "lower" end of your buying power...they will use whatever tactic necessary to get their 12% and don't give a flyin' rats ass about you after you sign that closing paperwork...how many people actually read their entire contract, i can tell you that i didn't read every word...i've bought two homes and i can honestly understand some people's gripes, i have some of my own...but, i also had a 30 yr mortgage locked down and i am doing pretty well...real estate agents will tell you anything you want to hear to close the deal, they're USED/NEW HOME SALESPEOPLE...just like a car salesperson, they are all dirtbags...they are just trying to get by on your 12% commission...
that entire section of the "economy" belongs right at the bottom of the ocean with the child molesting preachers, the scumbag ambulance chasing attorneys, the malpracticing doctors, the lying dirtbag politicians...need i go on??? yeah, it sucks that people are going through this stuff...but, they are having their arms twisted, their ears whispered into that it'll be ok, and their significant others telling them, "daddy, i sure do like this house"...
yeah, nobody is twisting an arm...:rolleyes:
The greatest responsibility is on the buyer.
Yeah the agents will show you pricey homes. They are working on commission, and the more expensive a house they sell the more they make. It doesn't take a rocket science to figure this out.
It also doesn't take a brain surgeon to look at someones income, and see a $2500 mortgage when you bring home 5k a month isn't a smart idea. 25% at the most, and that should be in a stable job paying extra on the house.
The American dream used to be having a house...now its a mcmansion with brand new SUV's in the driveway, huge tv's all over the house, 30k a year college for the kids, etc. Simple fact is people do not want to live within their means.
Its too easy to just say no the sales people. Their job is to get you to sign the line, and your job as a CONSUMER is to make smart decisions and purchases.
You should meet my neighbors who just bought a brand new Suburban because they thought their Tahoe didn't have enough room. Family of 3 and 1 dog....:rolleyes:
i am a family of 4 and 1 dog...we bought a suburban last year too...wife hasn't had a new car since aug '00...her 4runner has 158K miles on it and is the much smaller and older version...we wanted the extra room for trips too, i can understand their point...we bought the suburban in jan, we missed the obamalama tax credit, and purchased her new suv for less than we paid for the
4runner 10 years ago...to me, a smart money move...she didn't need a new car, we could just afford to get it and get the payments over with in 4 yrs...we could've run the 4runner for another 100K miles, but we chose to get another suv and keep the 4runner...
i have an '07 avalanche also that i took out a whopping $92/month loan for 4 yrs and a grand total of $4K that will be paid for in dec '10...we drive our vehicles about 8K miles/yr...yeah, i didn't NEED a new car, i could afford one and i would rather pay one off when i don't NEED one than get screwed at a dealership when i do need one...
if you don't know someone's financial situation, it's nothing more than hypocritical judgement to comment on their NEEDS/WANTS...
Alpha Sierra
03-02-10, 19:46
You guys rock!!!!! You guys need to come over and help me find that $ 30,000 truck. It must be hiding under all of that rust on my 97' Wrangler that I payed off in 2000.HEY maybe theres mansion under our dirt floor basement, 1200square ft. home built in 1854.I've had a job since 1984, never unemployed. An unexpected broken back didn't help anything. You guys that don't see this is wrong anyway you lookat it are the problem. Enjoy your silver spoons.
You're way the **** out of line here.
You have NO right to anything you cannot pay or afford. If you had a humble attitude people would step up to the plate to help.
But no. You think you are OWED something. Yes you are, a big F-U.
I do not understand how you did not know what the total payments on the house would be before you bought it. It is on one of the first few pages you sign, tells you the rate, loan amount, interest payments and TOTAL payments. You must not of had a problem with it when you were taking their money, but now are accusing the bank of illegal activity.
loansharks, ever hear of them??? the only reason they're illegal is because the gov't doesn't have a hand in their moneymaking scheme...to me, it's the exact same thing except the gov't backs freddie mac/fannie mae...
i guess that back in the days of buying a $100K home w/2500 sq ft was great to be in...but reality has stepped in to most buyers just about anywhere in the US...i live on the I-64 corridor in "central" wv and you won't find a single wide trailer for under $50K(yeah, i'm sure SOMEBODY will find one just to prove me wrong)...my boss moved here from jax, fl and shit his pants when he looked at real estate here...and the suburb of dc in the eastern panhandle is even more grossly inflated than here!!!
Alpha Sierra
03-02-10, 19:49
the gov't opened up loans that they and the applicants BOTH knew they could not afford...there are plenty of scumbag real estate agents, mortgage brokers, appraisers, and bankers that are willing to take these high risk people because the banks know they will NEVER EVER lose money on a home...they will keep selling the mortgage to another entity and revolve the circus of bad debt to another company and write that bad debt off...then the next one writes that debt off, and the next and, you get the picture...
dirtbag real estate agents(READ ALL R/E AGENTS) ask you for your earning statements and will rarely show homes in the "lower" end of your buying power...they will use whatever tactic necessary to get their 12% and don't give a flyin' rats ass about you after you sign that closing paperwork...how many people actually read their entire contract, i can tell you that i didn't read every word...i've bought two homes and i can honestly understand some people's gripes, i have some of my own...but, i also had a 30 yr mortgage locked down and i am doing pretty well...real estate agents will tell you anything you want to hear to close the deal, they're USED/NEW HOME SALESPEOPLE...just like a car salesperson, they are all dirtbags...they are just trying to get by on your 12% commission...
that entire section of the "economy" belongs right at the bottom of the ocean with the child molesting preachers, the scumbag ambulance chasing attorneys, the malpracticing doctors, the lying dirtbag politicians...need i go on??? yeah, it sucks that people are going through this stuff...but, they are having their arms twisted, their ears whispered into that it'll be ok, and their significant others telling them, "daddy, i sure do like this house"...
yeah, nobody is twisting an arm...:rolleyes:
Bullshit. You, and they, signed the bottom line.
G-D I hate ****ing whiners that are financially stupid and ignorant.
Did you think this was a GAME? Did you think you were NOT responsible for what you signed?
No f-ing pity from me for ANY of you.
It is my understanding that real estate agents only make like 6% if they are the listing agent, and like half if they didnt list it. Any agent that would ask me for my earning statements would be instantly told that it is none of their business, and I would find someone else. My bank approved me for a mortgage before I ever went to an agent, and I told him what I wanted to pay for a house. After the first day of the agent wasting my time with houses I didnt want he printed me out all the listings around my price range and I went looking myself. I got a foreclosure for $12k less than the agent said I could get it for.
Don Robison
03-02-10, 19:51
You're way the **** out of line here.
You have NO right to anything you cannot pay or afford. If you had a humble attitude people would step up to the plate to help.
But no. You think you are OWED something. Yes you are, a big F-U.
Bad shit happens to many people; what matters is how they handle it. You can cry and bitch that it's the fault of someone else or you can hit it head on, accept it and fix it.
Alpha Sierra
03-02-10, 19:52
loansharks, ever hear of them??? the only reason they're illegal is because the gov't doesn't have a hand in their moneymaking scheme...to me, it's the exact same thing except the gov't backs freddie mac/fannie mae...
i guess that back in the days of buying a $100K home w/2500 sq ft was great to be in...but reality has stepped in to most buyers just about anywhere in the US...i live on the I-64 corridor in "central" wv and you won't find a single wide trailer for under $50K(yeah, i'm sure SOMEBODY will find one just to prove me wrong)...my boss moved here from jax, fl and shit his pants when he looked at real estate here...and the suburb of dc in the eastern panhandle is even more grossly inflated than here!!!
Grow up. Your whining is unmanly.
You guys rock!!!!! You guys need to come over and help me find that $ 30,000 truck. It must be hiding under all of that rust on my 97' Wrangler that I payed off in 2000.HEY maybe theres mansion under our dirt floor basement, 1200square ft. home built in 1854.I've had a job since 1984, never unemployed. An unexpected broken back didn't help anything. You guys that don't see this is wrong anyway you lookat it are the problem. Enjoy your silver spoons.
Wait a minute. You bought a1200 sqft home with a dirt sub-basement built in 1854 for $199,000.00? Sorry bud, but that just sounds like crazy town talkin'! Where the hell do you live where 156 year old home costs that much? It'd better have some historical value or sit on some huge mineral rights!
Sorry about your problems, but man, that's just an insane crazy price for that kind of home! Let alone the monster interest rate you got.
You're way the **** out of line here.
You have NO right to anything you cannot pay or afford. If you had a humble attitude people would step up to the plate to help.
But no. You think you are OWED something. Yes you are, a big F-U.
i don't see where the guy is out of line venting his opinion and how he feels, and who are you to judge??? the guy is frustrated...as a worker and taxpayer, he feels that he lost his way and isn't given a break...loan modifications aren't even being moved on by the banks...i don't blame him, although i wouldn't air my misfortune on this board with all of the "holier than thou's"
there are plenty of dirtbags on LIFETIME assistance(READ WELFARE/SSI/etc) that are running around buying their smokes, driving that $30K pickup, sitting on their asses at home collecting a check while this guy is out working and paying taxes and gets his home pulled out from under him and people want to jump his shit...i'm not defending the guy at all, some people are dumbasses with their money, some made bad decisions and others never expected to lose their jobs(that's why they were able to qualify for the loan)...
damn, i hope that the "holier than thou's" have enough in their savings to avoid foreclosure of that $100K house if you lose your jobs...maybe when this guy gets back on his feet and one of you loses your job, he can buy your foreclosure...now that's some irony!!!:rolleyes:
Grow up. Your whining is unmanly.
i've got enough unmanly for you to choke on...
I do not understand how you did not know what the total payments on the house would be before you bought it. It is on one of the first few pages you sign, tells you the rate, loan amount, interest payments and TOTAL payments. You must not of had a problem with it when you were taking their money, but now are accusing the bank of illegal activity.
ahh, a statement i can finally agree with...the truth in lending statement...the guy could've lost his job and is venting because now he's losing his house...i don't know what his situation is, i just know i wouldn't want to be there...
The OP isnt complaining about losing his job, he is accusing the bank of illegal activity because they lent him money. I guess the OP doesnt understand that after 30 years the house should be worth around what he paid for it even with all the interest. If not well that isnt the banks fault either.
i don't know what his financial situation is as i stated before...there is quite a following of people of the belief that mortgages and all that interest should be illegal...in my opinion, i do agree that the interest charges are a huge factor in buying a home...i remember my first home was $162K and my wife and i saw that paperwork with a 30 yr balance of $400K+, it is an eye opener for sure...but there is nothing you or i can do about that, is there???
There are plenty of ways around it. Buy a house that doesnt cost as much, I paid $62k for my house. Or live in a tiny one room apartment for 15 years and save every penny until you can afford to pay cash for a house.
Belmont31R
03-02-10, 20:36
i don't know what his financial situation is as i stated before...there is quite a following of people of the belief that mortgages and all that interest should be illegal...in my opinion, i do agree that the interest charges are a huge factor in buying a home...i remember my first home was $162K and my wife and i saw that paperwork with a 30 yr balance of $400K+, it is an eye opener for sure...but there is nothing you or i can do about that, is there???
Yes there is.
1. Buy a cheaper house.
2. Put more money down.
3. Don't buy a house.
People have been lending each other money for centuries. Its not a new concept, and the game hasn't changed.
What has changed is people thinking everything has to be done with credit instead of cash, and/or people buying more than they can afford in the numbers they are now. What you can afford today might not be what you can afford tomorrow, and a smart consumer plans ahead.
The banks also did not plan ahead, and engaged in risky behavior. They turned loans into investments, and when those loans went bad so did much of the market. They didn't create those investments with any notion of "what happens when things arent so good?".
Sure there are always things out of our control in life, and that is why its best to plan ahead for what may be on the horizon. If you are maxing yourself out in the good times there is NO WAY you can survive the down times.
cannarella
03-02-10, 20:44
Or live in a tiny one room apartment for 15 years and save every penny until you can afford to pay cash for a house.
People do this all the time. That's how our grandparents did it.
Back to the OP, is the cause of the situation your back injury and being unable to work to make payments on the house? I am guessing so if you are entering foreclosure. I am sorry about your situation. Is there anyone in the house that can work a job or two until you can dig out? Have you tried to sell the house? Maybe a short sale and get a loan for the difference. Are there things that you can sell that can help get you out of the deep end of the pool? It is definitely a time for soul searching and doing whatever is possible. Have you considered selling your firearms? Desperate times call for desperate measures. Best of luck.
yeah, but you know as well as i do that the greater majority of people don't do that...my wife and i bought our first home when we were around 30...had our first kid around the same time...
we were looking for an investment and a home was the best way to shelter our money at the time...retirement plan maxed out, $30K+ in savings account, no kids, one car paid for and the other with a year left on it, both veterans with VA homebuying options...excellent credit...we spent five years there and made a $23K profit to apply to the new home we're in now...we've been in this house for 6 yrs in aug, built from the ground up...i did the majority of the work to "try" to save us money...we are doing quite well for ourselves, but we had a tough go of it at times...we all do...we're now looking to refi and get a 15 yr loan on our "mcmansion"...i want the house paid for well before i retire, but looking at the way our country is headed, we too are wondering IF we will be able to retire when we want to...
I am definitely disappointed in some of the responses given to the OP. I believe he certainly should know what he signed when he purchased his home and he should know that it is up to him and his family alone to make those payments. I also believe in taking responsibilty for ones actions.
BUT, put yourself in his shoes. What if YOU lost your job and despite your best efforts, you are going to lose your home. I know that I would be mad, eventhough I know it is my own fault. Perhaps this is his only outlet to vent.
We are in a tough economy right now and a lot of good people are having difficulty. Yes, even people who are living within their means. Is it your own fault if you get laid off? Is it your own fault when you blow through 6 months of savings and unemployment and you still can't find a job? A $10 an hour job will not pay a mortgage even if you only bought a $199,000 home. Hell, in the Denver metro area we had more than 1,000 people show up to apply for $8 an hour positions at a Kohls. This is a very difficult job market for everyone.
Cut the guy some slack. The OP doesn't deserve to be belittled. Disagree with him if you want, but don't belittle.
Oh, and for the poster that doesn't believe that a person could pay $199,000 for a 1200 sq. ft. home, here are a few listings that took me about 5 minutes to find in Denver.
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=771533
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=824847
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=853289
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=852609
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=852568
cannarella
03-02-10, 21:06
yeah, but you know as well as i do that the greater majority of people don't do that...my wife and i bought our first home when we were around 30...had our first kid around the same time...
we were looking for an investment and a home was the best way to shelter our money at the time...retirement plan maxed out, $30K+ in savings account, no kids, one car paid for and the other with a year left on it, both veterans with VA homebuying options...excellent credit...we spent five years there and made a $23K profit to apply to the new home we're in now...we've been in this house for 6 yrs in aug, built from the ground up...i did the majority of the work to "try" to save us money...we are doing quite well for ourselves, but we had a tough go of it at times...we all do...we're now looking to refi and get a 15 yr loan on our "mcmansion"...i want the house paid for well before i retire, but looking at the way our country is headed, we too are wondering IF we will be able to retire when we want to...
Yes, however it can be done. Well done on your planning. All it takes is discipline and a willingness to sacrifice. I am a full believer that if I live like nobody else now, below my means, later I will be able to live like nobody else, with the rewards of my planning.
I am definitely disappointed in some of the responses given to the OP. I believe he certainly should know what he signed when he purchased his home and he should know that it is up to him and his family alone to make those payments. I also believe in taking responsibilty for ones actions.
BUT, put yourself in his shoes. What if YOU lost your job and despite your best efforts, you are going to lose your home. I know that I would be mad, eventhough I know it is my own fault. Perhaps this is his only outlet to vent.
We are in a tough economy right now and a lot of good people are having difficulty. Yes, even people who are living within their means. Is it your own fault if you get laid off? Is it your own fault when you blow through 6 months of savings and unemployment and you still can't find a job? A $10 an hour job will not pay a mortgage even if you only bought a $199,000 home. Hell, in the Denver metro area we had more than 1,000 people show up to apply for $8 an hour positions at a Kohls. This is a very difficult job market for everyone.
Cut the guy some slack. The OP doesn't deserve to be belittled. Disagree with him if you want, but don't belittle.
Oh, and for the poster that doesn't believe that a person could pay $199,000 for a 1200 sq. ft. home, here are a few listings that took me about 5 minutes to find in Denver.
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=771533
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=824847
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=853289
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=852609
http://www.recolorado.com/Search/propertyDetail.asp?mls_number=852568
that's why i've wasted so much time this eve on this topic...the guy is in a tight spot and who knows what he's going through...and then jackasses jump him on this board??? we have a band of internet tough guys that have been fortunate enough to have jobs for now!!!:rolleyes:
CarlosDJackal
03-02-10, 21:19
You guys rock!!!!! You guys need to come over and help me find that $ 30,000 truck. It must be hiding under all of that rust on my 97' Wrangler that I payed off in 2000.HEY maybe theres mansion under our dirt floor basement, 1200square ft. home built in 1854.I've had a job since 1984, never unemployed. An unexpected broken back didn't help anything. You guys that don't see this is wrong anyway you lookat it are the problem. Enjoy your silver spoons.
I don't know about the other posters, but I wasn't implying that you specifically had a $30k car or a mansion. I work two jobs to pay my bills and build some financial cushion. I'm also the first of my siblings to obtain an Undergraduate and Graduate degree on my own.
My Father worked three jobs to keep a roof over out heads, clothes on our backs, and fod in our belly. I wouldn't know what a silver spoon is even if you shoved it up my nose.
It sucks that you are going through what you are going through. But demonizing the very establishments that allowed you to purchase your house and probably your car in the first place isn't really a very productive use of your time.
aybe you would be better off using your time and energy into convincing your creditors to work with you until you can get back on your feet. Just a thought. :rolleyes:
Yes, however it can be done. Well done on your planning. All it takes is discipline and a willingness to sacrifice. I am a full believer that if I live like nobody else now, below my means, later I will be able to live like nobody else, with the rewards of my planning.
thank you for the kind words...my family had a tough go of it like i said...we sold our place, i lived in a camper while the wife and my boys lived with her mom and stepdad until the house was safe and liveable...we still are saving what we can, hell, we have been on vacation 2 times in 10 yrs...we stay home and watch our finances with as much frugality as possible, although there are somethings that we can't pass up(i will buy a gun here and there)
we actually bought our first tv since 2002...i've got 2 1994 sony trinitrons, a 1997 35", and the 51" we bought in 2002 for $1200...and we felt GUILTY for buying it...
her dad gave us some shit about it until we told him we paid less for it than he'll pay for his golf club memberships...we splurge at times, but we were both raised in extremely conservative households...as long as our savings continues to grow, our house can appreciate and we have jobs, we are financially secure...
but, all of those things are nothing compared to our boys...i hope that the OP realizes that the house doesn't make his home, his family is all that matters...god bless, and if i hit the lottery tonight, you're the first person i will take care of...buck up!!!
rambling post #45
There is so much wrong in your post i am not even going to try. Take responsibility!
BTW, RE commission is not 12%, more like 6%, or less if you can negotiate worth a darn.
I know plenty of people that are having troubles these days, myself included. The problem I have with the OP is that he is blaming the wrong people. His little rant reminds me of the guy that flew his plane into the IRS building.
He could have posted about his situation and would have had plenty of people offer advise on how to fix it.
the gov't opened up loans that they and the applicants BOTH knew they could not afford...there are plenty of scumbag real estate agents, mortgage brokers, appraisers, and bankers that are willing to take these high risk people because the banks know they will NEVER EVER lose money on a home...they will keep selling the mortgage to another entity and revolve the circus of bad debt to another company and write that bad debt off...then the next one writes that debt off, and the next and, you get the picture...
You need to get your facts straight and not paint with a broad stroke. Many banks and financial institutions got saddled with these bad debts and failed.
dirtbag real estate agents(READ ALL R/E AGENTS) ask you for your earning statements and will rarely show homes in the "lower" end of your buying power...they will use whatever tactic necessary to get their 12% and don't give a flyin' rats ass about you after you sign that closing paperwork...how many people actually read their entire contract, i can tell you that i didn't read every word...i've bought two homes and i can honestly understand some people's gripes, i have some of my own...but, i also had a 30 yr mortgage locked down and i am doing pretty well...real estate agents will tell you anything you want to hear to close the deal, they're USED/NEW HOME SALESPEOPLE...just like a car salesperson, they are all dirtbags...they are just trying to get by on your 12% commission...
Real estate agents should not be asking for your earnings statement. They should be asking you for a pre-qualification letter from your bank. This way they know what you can afford so they don't waste their time in showing you a house that you can't afford. The total commissions on a completed sale is often 6% (NOT 12%). That means 3% for the agent representing the buyer and 3% for the agent representing the seller unless it is otherwise noted in the contract. It can go as low as 3% or as high as 10% for the total transaction.
An agent will show you homes in the price range you're are pre-qualified for. Are there unscrupulous characters out there? Absolutely. They exist just as they do in auto sales, gun sales, and whatever the hell sales. Sales people work on commission and they have to complete the sale to make money. It is their JOB. It is your job as the consumer to steer the sales person into what you want and if they don't listen, terminate the working arrangement. Don't put up with someone who isn't looking out for you.
It is your fault you don't read the paperwork. I know it's long, boring, and full of legalese. I can honestly say that after reading my first closing docs front to back, I've never done it again with the others. But to put it bluntly, if you don't agree to their terms, don't borrow the money.
that entire section of the "economy" belongs right at the bottom of the ocean with the child molesting preachers, the scumbag ambulance chasing attorneys, the malpracticing doctors, the lying dirtbag politicians...need i go on??? yeah, it sucks that people are going through this stuff...but, they are having their arms twisted, their ears whispered into that it'll be ok, and their significant others telling them, "daddy, i sure do like this house"...
yeah, nobody is twisting an arm...:rolleyes:
See, now you're just getting all emotional and the truth comes out. The arm twisters are not the real estate agents, mortgage brokers, and bankers. It appears that its your family members twisting your arm to approach these people. At least, I hope your real estate agent or mortgage broker isn't getting close enough to whisper sweet nothings into your ear!:D
msg too short
Alpha Sierra
03-03-10, 05:31
Some people live their entire lives without any financial cushion (LT disability insurance, cash, liquid securities, mortgage insurance, life insurance, etc) that would prevent or significantly reduce problems like this one.
Some people go through life with nothing more than the skills needed to do manual, repetitive, unskilled labor; never bothering to obtain skills that would improve their job security or allow them to move on to some other occupation should they lose their current one.
They bet they will never need such things. Then reality strikes.
Bobert0989
03-03-10, 06:11
Wait a minute. You bought a1200 sqft home with a dirt sub-basement built in 1854 for $199,000.00? Sorry bud, but that just sounds like crazy town talkin'! Where the hell do you live where 156 year old home costs that much? It'd better have some historical value or sit on some huge mineral rights!
Sorry about your problems, but man, that's just an insane crazy price for that kind of home! Let alone the monster interest rate you got.
Lol... try looking around Fayette County, KY... or even downtown Richmond...
Plenty of OLD houses downtown bringing $200k - $750k, mainly because they're close to campus. We looked at one...
On a personal note, my wife and I just purchased our first home, and are set to close on the 22nd of this month. We, too, were involved in a bidding war, so I went straight to the realtor and said "_____ is my highest offer. Anything else is out of my means at this time". She called that evening and said the seller had counter-offered our offer, for $1,500 more. I said "No." She said, "C'mon, it's just $1500... is that enough to keep you out of a home?"
I said "Yup. It's more than I'm comfortable paying, so tell them 'no thank you' for us, and we'll keep shopping around."
They called the next morning and said the contract was ready at our offered price. SO... we got the house, and our payments, with escrow for taxes, are only about$20 more per month than our current rent. And now my little boy's 2nd birthday present is looking like a German Shepard puppy, instead of more "inside toys". ;)
msg too short
again, i am not speaking of myself with the "daddy" comment...that was a generalized statement for others out there...there are emotional situations, my sister in law lost her job due to medical conditions...she had to have open heart surgery because she smokes and drinks caffeinated drinks...those are decisions that i'm sure many on this board make as well...people make decisions to put things into their bodies like that, i choose not to...personally, i would love to see urinalysis tests given to everone collecting a paycheck, welfare reform, and smokers/drinkers/caffeine users charged more than i am for insurance...
like i said before, i know plenty of people that have been stuck with a 12% commission, my brother was one of them...he agreed to it because of a short time frame needing to sell and he made $50K in the NOVA area...
my best friend just happens to be the state real estate investigator, so it gives me a little insight into what is going on...i didn't stay at a holiday inn express last night...
I don't think anyone here doesn't feel for what the OP is going through, or couldn't wind up where he is with a few slips here and there. However (and this is not directed at the OP)...
What he posted hit on a nerve for a lot of us. We spend wisely, we save, we watch our finances, we don't live beyond our means, etc. while we watch all the shitbirds around us live it up. Our only consolation during the good times is "it can't last forever", yet now when so many of them are crashing the .gov is bailing everyone out and these same people are blaming everyone but themselves (like "bankers". reminds me of the movie Nothing But Trouble).
People have come to have a ****ed up idea of the lifestyle afforded by a given income. If you're not already saving for a rainy day, investing for retirement, buying health insurance for your family, buying disability insurance for yourself to ensure that your family is taken care of... you can't afford that bigscreen TV. And if EVERYONE (or at least the majority) would live like this, more people could afford the exact same houses they are in today because the prices wouldn't be as high.
and then there's the kid thing. I know of three people in my company that are currently in danger of being laid off who's wives are pregnant. This economy did not just spring up in the last 9 months. We've been laying people off for over a year, yet these people chose to make a baby in that environment, and are now using that as leverage with the company trying to play on they sympathies they think the bosses have. and regardless of whether it's good times or bad, the reality is that most people spitting out puppies can't afford the number of puppies they have.
I will say this though in the OP's defense. It is very easy to condemn someone in his shoes, but if you haven't dealt with a debilitating injury or illness for yourself or a spouse you have no idea what is involved and just what is what. None. Every time I hear these public healthcare debates on the radio where they say "the vast majority of Americans are happy with their health insurance" I can't help but think they must not know what their policy really covers, or had to deal with a major illness under that policy. I'm not for the "public option", but the VAST majority of people (many of whom think of themselves as rational and knowledgeable) in truth don't know the first thing about what happens when the bills start coming in for $10k/each chemo treatments. Or the fact that the majority of disability plans paid through work only pay out 60% of your base salary AND you're required to take on making your insurance premium payments out of that 60% AND you still get taxed on it.
It's easy to say "I drive a '97 POS" or "I haven't bought a new TV in 5 years", but if you don't have good insurance, and KNOW that you have good insurance, you should probably be driving an '87 POS and forgo the TV entirely. You should probably forgo that extra kid to, and for many people one kid is probably one too many.
I don't think anyone here doesn't feel for what the OP is going through, or couldn't wind up where he is with a few slips here and there. However (and this is not directed at the OP)...
What he posted hit on a nerve for a lot of us. We spend wisely, we save, we watch our finances, we don't live beyond our means, etc. while we watch all the shitbirds around us live it up. Our only consolation during the good times is "it can't last forever", yet now when so many of them are crashing the .gov is bailing everyone out and these same people are blaming everyone but themselves (like "bankers". reminds me of the movie Nothing But Trouble).
People have come to have a ****ed up idea of the lifestyle afforded by a given income. If you're not already saving for a rainy day, investing for retirement, buying health insurance for your family, buying disability insurance for yourself to ensure that your family is taken care of... you can't afford that bigscreen TV. And if EVERYONE (or at least the majority) would live like this, more people could afford the exact same houses they are in today because the prices wouldn't be as high.
and then there's the kid thing. I know of three people in my company that are currently in danger of being laid off who's wives are pregnant. This economy did not just spring up in the last 9 months. We've been laying people off for over a year, yet these people chose to make a baby in that environment, and are now using that as leverage with the company trying to play on they sympathies they think the bosses have. and regardless of whether it's good times or bad, the reality is that most people spitting out puppies can't afford the number of puppies they have.
I will say this though in the OP's defense. It is very easy to condemn someone in his shoes, but if you haven't dealt with a debilitating injury or illness for yourself or a spouse you have no idea what is involved and just what is what. None. Every time I hear these public healthcare debates on the radio where they say "the vast majority of Americans are happy with their health insurance" I can't help but think they must not know what their policy really covers, or had to deal with a major illness under that policy. I'm not for the "public option", but the VAST majority of people (many of whom think of themselves as rational and knowledgeable) in truth don't know the first thing about what happens when the bills start coming in for $10k/each chemo treatments. Or the fact that the majority of disability plans paid through work only pay out 60% of your base salary AND you're required to take on making your insurance premium payments out of that 60% AND you still get taxed on it.
It's easy to say "I drive a '97 POS" or "I haven't bought a new TV in 5 years", but if you don't have good insurance, and KNOW that you have good insurance, you should probably be driving an '87 POS and forgo the TV entirely. You should probably forgo that extra kid to, and for many people one kid is probably one too many.
rob, i completely agree with you...i always tell people if my job goes away the last thing i worry about is someone coming to take my house...if my job fails this federal gov't has failed, so everyone will be in the same boat and have lost jobs...
i have an excellent job, i'm not perfectly happy with my health insurance and dental care but it covers my current needs and i am lucky enough not to need to use my insurance for BIG problems...i exercise, eat well and do not do things that would cause me health problems(no smoking/drinking/caffeine)...
i am hard core with this stuff and i didn't have kids when i wanted them, we chose to do it when we could afford them...my wife and i were financially established before we took on the house, suv's, kids and big screen tv's...yeah me!!!
all that being said, if we were both to lose our jobs, we don't have enough in savings to last us indefinately...not very many do...:rolleyes:
financial markets collapse and see what that money in savings pays for...you better hope you stocked up on food...that's what i do...
all that being said, if we were both to lose our jobs, we don't have enough in savings to last us indefinately...not very many do...:rolleyes:
The reason you're seeing so much bitterness in this thread is that if the people living outside their real-world means had reigned it in a bit the rest of us wouldn't be in danger of joining them in the same boat. and for those same people to blame "the bankers" when they voluntarily signed on the dotted line is pure stupidity.
I don't know the particulars of the OP's situation, but clearly a $200k house was outside his means and the purchase was not made with an eye towards the potential for debilitating injury, and now his bad decision making and poor planning are just one more foreclosure and drain on the system that effects us all.
The reason you're seeing so much bitterness in this thread is that if the people living outside their real-world means had reigned it in a bit the rest of us wouldn't be in danger of joining them in the same boat. and for those same people to blame "the bankers" when they voluntarily signed on the dotted line is pure stupidity.
I don't know the particulars of the OP's situation, but clearly a $200k house was outside his means and the purchase was not made with an eye towards the potential for debilitating injury, and now his bad decision making and poor planning are just one more foreclosure and drain on the system that effects us all.
Best post yet.
trappernana
03-03-10, 11:22
In 2005 I made $40,038, my wife made $43,729,we had the money. No car loans.I broke my back in 3 places.I've had surgery and I'm healing. My doctors won't release me and the banks won't wait.Everyone of you are right . I should have taken more responsibility and got out of here as soon as they said "you may never work again" My ignorannce and lack of taking immediate control put us here, not some entity. Sorry for the crying like a B*#ch.:)
In 2005 I made $40,038, my wife made $43,729,we had the money. No car loans.I broke my back in 3 places.I've had surgery and I'm healing. My doctors won't release me and the banks won't wait.Everyone of you are right . I should have taken more responsibility and got out of here as soon as they said "you may never work again" My ignorannce and lack of taking immediate control put us here, not some entity. Sorry for the crying like a B*#ch.:)
Well if it's any consolation you are by no means alone, and there are a lot of other people that put themselves in your shoes willfully and not accidentally.
A lot of us had no real idea of what could happen if something like an injury or major illness sidelined us. I think the current economic conditions have more people paying attention to some things, but not to this. Most people don't even know the realities of disability insurance I posted above, or the real-world costs of major medical expenses. People ignorantly think "oh, I'm covered" because when they went to the Dr. for the flu they got a visit, diagnosis, and script for a combined copay of $50 at most. Watch what happens when they get cancer, or break their back.
FWIW, at $80k total income I would have been shopping in the $100-150k range. I know that in 2005 there wasn't much in that range, but that's why I rented for so long. The boom time of real estate meant great rental rates which meant more left over for saving. Around that same time I got qualified, by myself mind you, for a $300k loan. Pure freakin' insanity to me, and even that $300k wasn't going to buy me much.
thopkins22
03-03-10, 12:50
A lot of us came across harsh in our initial posts, not because we don't think it stinks for you and your family...but because the alternative would be much worse for far more people.
If I were you I'd contact SafetyHit and take him up on his offer.;)
We upgraded houses last year. The bank pre-approved me for far more money than I would ever borrow. It's no wonder people are so upside down and overextended in real estate loans.
I bought a lot less house than I could have paid for. When deciding what I wanted to pay, I didn't consider what our household income is today. I looked at what I would earn and be able to pay if I suddenly had to get a new job tomorrow. I also considered what I would be able to pay if my spouse or I was out of work for an extended period. I shopped smart, got a great house and did better than expected with a seller doing a short sale.
On real estate agents... You should shop for them as hard and diligently as you shop for your house. I know a bunch of them who are flunkies from other professions, and/or have been convicted of various crimes, and/or are otherwise turds. I know some terrific, honest, and worthy agents as well. They are not always easy to discern, but careful interviewing and backgrounding helps. I chose an older, experienced, well established, and well-regarded agent in my community. Commissions weren't anywhere near 12% for our deal, but this might be market dependent. I think it was 6% combined.
I haven't had a car payment in years. I would like the clean, quiet, and comfort of some of the new vehicles on the market, but I like having several hundred dollars in my pocket every month for savings or disposable income.
I have friends and neighbors that have borrowed to their limits. They have custom homes, cars that are never older than the term of their loans, and assorted toys. They're lives are a house of cards, though. If they or their spouse lose their job, get sick and can't work, or they have other tough circumstances, they are toast. They are nice people, but there won't be much sympathy for them.
Our house was priced at 199,000. Before we pay it off it will cost us almost a half million dollars! That's F*CKING criminal.Why do we tolerate this? It's the same with cars,a 20,000 car will cost 35,000. I have no problem with loan companies making a profit but this is ridiculous. These people should be boiled in oil. They are the reason my family is loosing our house. The b*#tards are foreclosing and I can't do a F-ing thing. WHAT? The Gov. They turned us down!!:mad:
USURY.
However, when "alarmists" were warning most chose to pay ZERO attention and they were labled all manner of ugly terms. Perhaps you know a few or read a few or even laughed at a few. The Banks are NOT your friend. They never were and until we gain sovereignty over our nation's money supply they never will be.
When you signed you assumed responsiblity for the debt. That said the usurious parasites need to be put an end to.
Man, I pray for you and I hope that you land on your feet wiser for the experience.
In 2005 I made $40,038, my wife made $43,729,we had the money. No car loans.I broke my back in 3 places.I've had surgery and I'm healing. My doctors won't release me and the banks won't wait.Everyone of you are right . I should have taken more responsibility and got out of here as soon as they said "you may never work again" My ignorannce and lack of taking immediate control put us here, not some entity. Sorry for the crying like a B*#ch.:)
Yes, you were ranting and did not initially present your situation well for evaluation. Not at all in fact.
But as I stated to you before, I can and am willing to try to help you. If you want some knowledgeable, free advice then PM me. I want nothing in return, just offering help.
Even if you are a hard-head, let me hear you out for your child's sake. Perhaps I can at least give you a sense of direction.
USURY
Most states, if not all, have usuary laws. If this was a legal rate in his state on the day he signed the loan papers then it wasn't usuary. And, he agreed to it.
Not aimed at the OP - What do people expect when they take out a 30 year mortgage and barely pay more than interest only for the first 20 years? Example:
$200,000 at 7.5% for 30 years = $1,393.48 per month
Total of payments = 360 x $1,393.48 = $501,652.28
$200,000 at 7.5% for 20 years = $1,611.19 per month
Total of payments = 240 x $1,611.19 = $386,685.60
$200,000 at 7.5% for 15 years = $1,854.02 per month
Total of payments = 180 x $1,854.02 = $333,723.60
Same amount borrowed and same interest rate - the only thing that is different is the length of the loan. Anybody who maximizes the house they can buy and takes a 30 year or interest only loan to finance it is asking for trouble.
A handy, dandy mortgage calculator:
http://www.bankrate.com/calculators/mortgages/amortization-calculator.aspxhttp://www.bankrate.com/calculators/mortgages/amortization-calculator.aspx
Well you may be in luck; Fox news is reporting that the White House may push to freeze all foreclosures.
organdonor
03-04-10, 00:05
Yeah! Down with free markets! Down with personal responsibility! Down with capitalism! ****ing bastards!We don't live in a free market society anymore.
Bobert0989
03-04-10, 03:53
But as I stated to you before, I can and am willing to try to help you.
Sounds like a very nice guy. THIS is the reason we gather in groups like this... to help. Nobody needs to ever leave their computer mad at the world over what someone has said online. It's not worth it. Life's too short to worry about the little things.
To the OP:
I wish you and your family the best of luck. I'm sorry things went so sour in the beginning of this thread, and hope your troubles can be resolved. Good luck with your back, too.
~Bobby
parishioner
03-04-10, 04:38
Trappernana, I feel for you. As a young adult, not having forayed into the world of financial management and home owning, this thread has been an educational experience for me as it has good advice and information.
Keep your head up, keep busting ass for your family, and sooner or later the skies will clear. And remember the happiest of people don't necessarily have the best of everything; They just make the most of everything they have. Cliche saying but I'll be damned if its not true. Good luck.
This song might give you a lift...
http://www.youtube.com/watch?v=PXg8E0kzF1c
We're in the process of buying a foreclosure right now - probably close next Thursday. Good deal for me, $68,000 less than the new construction price in 2007.
At first I felt weird buying a foreclosure. I wanted to know why they were foreclosed on. Were they stupid, and bought more house than they could afford? Or, did they just lose their jobs through no fault of their own? If the former, then they got what they deserved. If the latter, I feel bad for them.
The way things are now, you can't count on anything. There is no job security anymore - it's an illusion. I have been employed at the same company for 10 years. Everything is fine - for now. I could get laid off tomorrow. If I do, there are not a lot of jobs for me nearby. I will probably work two jobs to try and make ends meet, but it likely wouldn't be enough. I'd be in serious trouble DESPITE having saved up 20% for my new house and lived below my means for the last 10 or more years.
Given the current state of job insecurity, one could argue that spending any money is irresponsible. But you can't live that way, and you can never save enough money to survive serious long-term unemployment.
I can only imagine how frustrating it is to have done everything "right" and still suddenly be on the verge of losing everything. I'm not in that position, but with one stroke of someone's pen that could change without warning.
Not everyone having trouble is a deadbeat. Good luck to the OP and I hope it all works out for you.
I can only imagine how frustrating it is to have done everything "right" and still suddenly be on the verge of losing everything. I'm not in that position, but with one stroke of someone's pen that could change without warning.
Not everyone having trouble is a deadbeat. Good luck to the OP and I hope it all works out for you.
I think you touch on an important point, and that is that so many people think they've done nothing wrong. "It's all Bush's fault" or whatever else they blame things on. In reality they chose to live the delusion. Buying a house that cost 2-4x your combined yearly income is "the right thing to do". Buying a new car every 3-55 years is "the right thing to do". Having tile floors, granite counter tops, and stainless steel appliances is "the right thing to do". Buying a 50"+ TV and connecting thousands of dollars worth of equipment to it and feeding it all with every channel available is "the right thing to do".
guess what? You were lied to. But that doesn't make it "their" fault. You chose to be blissfully ignorant of reality because doing so felt good at the time. Your friends and neighbors were all impressed, you weren't a "dirty renter" (although some renters do deserve that moniker), you had a nice car, nice vacations, etc. It was easier to believe the lie than it was to scratch the surface and see that it was all hollow.
All of us have been guilty of these kinds of things.. Every, single, one. I bought a 2001 F150 when my '97 (paid off) Chevy was running just fine, then sold that F150 right when it was about to be paid off only to buy a 2005 GTO, which I then traded in a couple of years later on an Escalade... and now I'm not happy with the Escalade, and had I kept the Chevy (or at least the Ford) and invested that money I'd have well over $100k if I had invested safely, forget about it if I had taken a few risks.
However, Detroit didn't make me do it. The government didn't make me do it. Mommy and Daddy didn't make me do it. I did it to myself, and for what? To learn a lesson for myself, that's what I think. Not to look for people to blame.
You make a good point, Rob. A lot of people think they did nothing wrong. But it is possible to spend money on things you enjoy and still be living within your means. Anyone on this site with more than one or two guns could easily have spent that money on other, "more responsible" things. However, there is nothing wrong with enjoying the fruits of your labor provided you are still saving wisely and not going into debt.
We're in the process of buying our second house. We lived in our first for 8 years, and have "outgrown" it. What does that really mean? It means we've accumulated too much crap to fit in the old house. Why? We have hobbies now. I have my guns, my wife has her scrapbooking. I want to start reloading - I need space for that. And so on. The new place is a little more expensive, but we feel we're still well within our means. And it's a nicer neighborhood. But sure, we COULD stay where we are at and save the difference. We don't NEED to move.
I could have put thousands more down on my new house had I not bought any guns over the last 8 years. Was I irresponsible? Some people would say so, sure. Would that mean that anyone on this site who owns more than one gun gets what they deserve for their fiscal irresponsbility if they fall upon hard times? Some people would say so, sure.
But I'll give the OP the benefit of the doubt that he wasn't living beyond his means, and that he is the victim of bad circumstances, bad luck, whatever. And if that is the case, then if it makes him feel better I'll let him rant at whomeever if it help him get through his day.
EDIT - In a way, the banks are at fault. One thing I noticed buying a home now is that the banks now have this "holier than thou" attitude about lending, acting like they are taking action to prevent a future bubble, etc. The bubble was about greed, and the banks were just as greedy as homeowners who "traded up" every 18 months. The banks took HUGE risks with risky loans, and it was NOT all forced upon them by government regulators. The banks screwed up, and then got billions of our tax dollars to save them, only to have now unemployed homeowners put out on the street. It's ironic that you pay taxes to save your bank so they can kick you out of your house when you get injured. You would THINK banks would be better of accepting reduced payments for a while in lieu of forclosure. Eventually, a lot of people will get back on their feet and be able to resume their regular payments. However, all of these foreclosures are not helping anyone. Fannie Mae is losing $60,000 on the house I am buying ... and that is essentially $60,000 of our tax money. You could have let the original owners stay there for 1/2 payments for a couple of years, and if they eventually got back on their feet the banks would not really be out of anything - you'd still owe your full balance.
Frivolous, yet responsible, spending is generally the best track to take. If you don't most people will over-spend. Which is another whole aspect of this problem we find ourselves in, and that is nobody knows how to make and live within a budget.
Figure out what you need to pay your bills, what you need to go into retirement, what you need to go into the rainy day fund and then what's left over is yours to do with as you please. Of course if you didn't give yourself the allowance of $50/week to spend on fun you could wind up with a fatter retirement, a beefier rainy day fund, etc. but that's not the way it happens for most people. If you try to over-restrict yourself most people will wind up blowing a much larger amount on one indulgent purchase. Don't allow yourself that $50/week? I bet that after 4 weeks at most you'll be plunking down on a new $1k TV!
Nobody seems to know how to live withing a budget, spend money they have not money they think they're going to have, etc. I blame the death of the allowance system for kids. most parents, around here anyway, just indulge, indulge, indulge. There is no sense of the value of money in terms of time spent earning it (when I was a kid I thought of everything in terms of how many times I'd have to mow the lawn to buy it!). These same people become adults with no idea how to manage their lives. They start to think that a $200k house on $80k income is somehow reasonable. Get enough of those people together and they start driving up the housing prices, meaning that even those that want to live within their means and have been doing everything right (not media right, actually right) can't buy a house while the shitbags living beyond their means can, do, and then leave us holding the bag.
I'm not an overly religious person, or a religious person at all, but I find it interesting how many of the 7 sins are now coming home to roost, and are the cause of all our undoing.
1. luxuria (extravagance)
2. gula (gluttony)
3. avaritia (avarice/greed)
4. acedia (acedia/discouragement)
5. ira (wrath)
6. invidia (envy)
7. superbia (pride)
Balance, it is all about balance. Don't spend beyound your means, but, if you can afford it, don't deny yourself the fruits of your labor either.
The problem, as I see it, is in how we define living within ones means. As rob has so rightly pointed out, living within ones means, among other things, should include prudent retirement, health care and job loss reserves. Shit happens!
Both mmike and rob make good points; although, mmike and I will have to agree to disagree about whose fault overspending is. Ultimately, it is my choice and my choice alone.
The world is full of people trying to sell you something. You are the one who has to decide to buy it or not, and if you do buy it you are the one who has to live with your decision.
I find it telling about our society today that people call in to Suzy Orman on national TV to see if they can afford something or not.
I have been debt free, except for my home mortgage, for 40+ years, way before Dave Ramsey came on the scene. It is very liberating and gave me the confidence to become self employed 15 years ago. I could have never done that if I had been loaded with debt. But that guy gives really good advice and is hard core about debt free. More people need to listen to him and he should be required viewing for HS and college students.
what i do with my 10 and 8 yr olds is this...we give them allowances, they get money for special occassions from us as well as their loved ones and it goes into their wallets INSIDE my safe...then, if they WANT a book from the book fare, a new toy, oldest wanted to get a recorder for music class, that money is there for them to use...
both of my kids have $5K in savings bonds that hopefully won't turn to shit once the chicoms trade their t-bonds in...my kids know the value of money and they also know that they have chores to do to keep that money flowing in...they MUST keep their rooms clean, take out the trash, get good grades and mind their elders...
they do not have access to any money, they don't have cell phones or even laptops...i know family and friends/aquaintences of ours that give their 10 yr olds laptops and cellphones, getting on facebook and such...there are definately some crazies out there that think its cool and hip to be "friends" with their kids rather than parenting their kids...
but back to the financial responsibilty issue, there are plenty of people that will be foreclosed upon in the near future as well...i think i heard rush or someone spouting another 1.8 million homes are headed to foreclosure this year...
Balance, it is all about balance. Don't spend beyound your means, but, if you can afford it, don't deny yourself the fruits of your labor either.
The problem, as I see it, is in how we define living within ones means. As rob has so rightly pointed out, living within ones means, among other things, should include prudent retirement, health care and job loss reserves. Shit happens!
Both mmike and rob make good points; although, mmike and I will have to agree to disagree about whose fault overspending is. Ultimately, it is my choice and my choice alone.
The world is full of people trying to sell you something. You are the one who has to decide to buy it or not, and if you do buy it you are the one who has to live with your decision.
I find it telling about our society today that people call in to Suzy Orman on national TV to see if they can afford something or not.
I have been debt free, except for my home mortgage, for 40+ years, way before Dave Ramsey came on the scene. It is very liberating and gave me the confidence to become self employed 15 years ago. I could have never done that if I had been loaded with debt. But that guy gives really good advice and is hard core about debt free. More people need to listen to him and he should be required viewing for HS and college students.
Where did I say overspending is anyone's fault but the overspender? The point is what constitutes "overspending"? Some people would say that all of us with gun collections have "overspent" and could have spent that money elsewhere. To me, overspending is when you're going into debt for unnecessary items, or making frivolous purchases while not saving any money at all. I know a couple of people who save almost everything. Yes, they will be able to retire at 55 but up until that point they not really living a live I would consider enjoyable.
If I gave the impression that I was advocating passing the buck on poor financial decisions, I mispoke.
I don't have sympathy for people who purchased $500,000 homes on a $60,000 a year salary. But I DO have sympathy for people that have lived within their means and are losing everything because they lost their jobs or were injured through no fault of their own. That can happen to any of us, and we shouldn't just assume everyone who is on hard times these days is a deadbeat who made poor choices.
Like you, I live pretty much debt free. A mortgage and a small car payment, no store credit cards and no other credit card debt at all. I have a savings, but if I lost my job and couldn't find another (a real possibility around here) after a year or so I'd be in trouble. Did I do something wrong?'
I do find it ironic that the banks are getting a free ride with tax money paid for my the homes they are foreclosing on. There is a lot of blame to go round, and both borrowers and lenders are to blame. However, the lenders are getting their debts settled for them. Borrowers didn't cause lenders to do all the funky things they did with the mortgages. Yes, people are to blame for buying more than they could afford. But banks are to blame too for taking huge risks with mortgages. They knew exactly what they were doing, they gambled and won when the government bailed them all out.
But I DO have sympathy for people that have lived within their means and are losing everything because they lost their jobs or were injured through no fault of their own. That can happen to any of us, and we shouldn't just assume everyone who is on hard times these days is a deadbeat who made poor choices.
I agree, but look at the OP's situation a different way.
He and his wife were pulling in $80k/year, which is more like $60k after taxes. They bought a house for $200k. That's a $2k/month payment on $5k/month income. It's not unreasonable to think that this is "within their means".
However, with that 20/20 hindsight, we know without a doubt that a house bought for $200k in 2005 is more like a $100-$150k house today. And what it appears is that there weren't any provisions being made for disability insurance, rainy day plans, etc. Again with that 20/20 hindsight, let's go back and rent at $1k/month for the last 5 years, and not have any out of pocket maintenance costs (the landlord pays for that), that's $60k worth of savings. If that number sounds familiar it's because it's equal to the after tax annual income. Not to mention having half of the living expenses to deal with when things go south.
It's not my intention to pick on the guy here, I'm just using the numbers that we have in front of us. I do this because this question of "living within your means" keeps coming up, and the problem is that this scale is skewed and many people that THOUGHT they were living within their means in fact were not, as evidenced by their current situations. No, you can't know that you're going to break your back in three places, but you can spend your money wisely so that if it does happen you're prepared. and it starts with not buying a house that costs 3.3x your annual after-tax income. And if you go through your whole working life not needing that extra savings? you got yourself one hell of a retirement. :D
I do find it ironic that the banks are getting a free ride with tax money paid for my the homes they are foreclosing on. There is a lot of blame to go round, and both borrowers and lenders are to blame. However, the lenders are getting their debts settled for them. Borrowers didn't cause lenders to do all the funky things they did with the mortgages. Yes, people are to blame for buying more than they could afford. But banks are to blame too for taking huge risks with mortgages. They knew exactly what they were doing, they gambled and won when the government bailed them all out.
As I said earlier, we need to agree to disagree. Just because a bank, mortgage company or realtor is offering goofy terms it doesn't mean anybody has to accept those terms. There are coke dealers offering coke, should I buy some? Whose fault is it if I do? I say it is mine, mine mine alone. We simply disagree.
But, as to the quote above. Don't fall into the media trap of "all banks". Only a small percentage of the nations 8,000 banks took TRAP money and most of that has been paid back. Who, of size, hasn't paid back their bail out money? That would be Citi, AIG, GM, Fannie, Freddie and GM. I have no sympathy for any of them.
And most of the nations 8,000 banks, mostly small community banks, did not take huge risks. I know it is popular to bash "the banks", but all banks did not contribute to the problem, only a very few did.
And please explain how "the banks are getting a free ride with tax money paid for my (sic) the homes they are foreclosing on." There is no federal tax due on the purchase of a house. If you are referring to real property taxes, those are state and local and none of that was used to bail out any of the troubled banks to my knowledge.
trappernana
03-04-10, 09:48
Our payments are $1,330.00. We put down $30,000, a good chunk of our savings.The rest is gone since my accident ,along with about $3,000 worth of crap on E-bay,and 7 guns. I feel like I stirred up a hornets nest. I'm truly sorry.
I just skimmed through this thread and there are some very good points and encouragement, but I am not sure if I saw anything about Fannie Mae and Freddie Mac. These two, and Barney Frank had a lot to do with trying to give everyone the "dream" of owning a home and "happily" living beyond their means. As said, valid points and I agree with most of the sensible ones, but I believe this is the genesis.
Oh and while these two reported a net loss of $72 billion(!) for 2009, our government chooses to go after banks. This is needs to be laid out for everyone to understand.
This probably has nothing to do with the fact that these entities are semi controlled by the US Government.
To the OP, I am sorry about you losing your home.
The thing to remember is that God sometimes closes the window, but will later open a door for you.
We give out a financial (Christian based) road map from Crown that really tells you like it is and puts things in order of priority (in regards to paying off debt).
The knowledge that seems to be missing in our culture is how to live BELOW YOUR MEANS. Just because you make $100k a year doesn't mean that you have to spend ever single dollar of it!
I pay myself $35k a year. Do my companies make way more than that? Sure do. Do I need all that extra money to live? Nope.
Last year we paid off our home. Was it painful and did we have to cut back to do it? Yes we did. When the final check was sent, it felt like a HUGE weight was removed from my back. Knowing that I can quit my job at any time and go flip burgers for a living is a great feeling.
I think what people don't always realize is that when you owe someone money (banks, CC companies, etc) you are a slave to them. They control your life. You have to make a certain level of income (in a job that you most likely hate or stresses you out) just to make the payments on your home, car, boat and CC's.
True freedom is being able to take a job that you enjoy (for less money).
C4
Man, I never would've guessed it, but Grant is really Dave Ramsey!
Really, good counsel Grant and I am a follower and firmly believe that a faith based lifestyle is important.
Good going and congratulations on that huge mile stone of yours.
Man, I never would've guessed it, but Grant is really Dave Ramsey!
Really, good counsel Grant and I am a follower and firmly believe that a faith based lifestyle is important.
Good going and congratulations on that huge mile stone of yours.
Thanks. My wife and I are fans of DR and his teachings.
C4
As I said earlier, we need to agree to disagree. Just because a bank, mortgage company or realtor is offering goofy terms it doesn't mean anybody has to accept those terms. There are coke dealers offering coke, should I buy some? Whose fault is it if I do? I say it is mine, mine mine alone. We simply disagree.
But, as to the quote above. Don't fall into the media trap of "all banks". Only a small percentage of the nations 8,000 banks took TRAP money and most of that has been paid back. Who, of size, hasn't paid back their bail out money? That would be Citi, AIG, GM, Fannie, Freddie and GM. I have no sympathy for any of them.
And most of the nations 8,000 banks, mostly small community banks, did not take huge risks. I know it is popular to bash "the banks", but all banks did not contribute to the problem, only a very few did.
And please explain how "the banks are getting a free ride with tax money paid for my (sic) the homes they are foreclosing on." There is no federal tax due on the purchase of a house. If you are referring to real property taxes, those are state and local and none of that was used to bail out any of the troubled banks to my knowledge.
Banks that received bailout money were compensated for their own bad lending practices.
AGAIN, I am NOT saying that it's not an individual's fault if they buy more than they can afford, so I don't know where you are getting that. However, I AM saying that the banks are at largely at fault for THEIR misfortune - yes, regulators "encouraged" certain lending practices, but many lenders knowlingly did very risky things with mortgages, and they lost. Only to be later bailed out with our tax money. The "tax money" I am referring to is that the people who lived in these homes paid federal income tax at some point, right? Where did the TARP money come from - federal income tax.
Do people here really think the banks bear NO responsibility for their own poor lending practices???
All I am saying is that BORROWERS who made bad choices have themseleves to blame.
LENDERS that made bad choices have themselves to blame. BUT - they received bailout money, provided in part by the same BORROWERS they are foreclosing on. I just thought that was ironic, that is all.
I feel like I stirred up a hornets nest. I'm truly sorry.
Don't be sorry, sir, it has been a good discussion. I, on the other hand, am truly sorry for the situation you are in. Health problems are a bitch and can really f-up ones life even if one did everything else right. Best of luck.
I agree, but look at the OP's situation a different way.
He and his wife were pulling in $80k/year, which is more like $60k after taxes. They bought a house for $200k. That's a $2k/month payment on $5k/month income. It's not unreasonable to think that this is "within their means".
However, with that 20/20 hindsight, we know without a doubt that a house bought for $200k in 2005 is more like a $100-$150k house today. And what it appears is that there weren't any provisions being made for disability insurance, rainy day plans, etc. Again with that 20/20 hindsight, let's go back and rent at $1k/month for the last 5 years, and not have any out of pocket maintenance costs (the landlord pays for that), that's $60k worth of savings. If that number sounds familiar it's because it's equal to the after tax annual income. Not to mention having half of the living expenses to deal with when things go south.
It's not my intention to pick on the guy here, I'm just using the numbers that we have in front of us. I do this because this question of "living within your means" keeps coming up, and the problem is that this scale is skewed and many people that THOUGHT they were living within their means in fact were not, as evidenced by their current situations. No, you can't know that you're going to break your back in three places, but you can spend your money wisely so that if it does happen you're prepared. and it starts with not buying a house that costs 3.3x your annual after-tax income. And if you go through your whole working life not needing that extra savings? you got yourself one hell of a retirement. :D
I do not disagee with anything you have said here. But, that $200k house, if you put 20% down on it, would not have a $2000 a month payment, either. In my neck of the woods, 80k a year is a good salary and you're hard pressed to find anything short of a 1br condo for under $200k - and you'll pay at least $1000 a month in rent, anyway. At current rates, a 160k mortgage at 5% is very reasonable on an 80k salary.
Banks that received bailout money were compensated for their own bad lending practices.
Not true as stated - there were some banks that didn't need a bail out and didn't want TARP money, but it was forced on them. This is fact.
AGAIN, I am NOT saying that it's not an individual's fault if they buy more than they can afford, so I don't know where you are getting that.
What I am disagreeing with is the notion that a bank is somehow responsible for my own stupid decision. That is what I thought you were saying in several of your threads. If not, then we don't disagree on that.
However, I AM saying that the banks are at largely at fault for THEIR misfortune - yes, regulators "encouraged" certain lending practices, but many lenders knowlingly did very risky things with mortgages, and they lost. Only to be later bailed out with our tax money.
On this we agree, but I do object to the term "the banks." There are many small community banks (most of the banks in the US) that got hurt and hurt badly because of the actions of a small number of the larger banks and GSEs which I believe you are really referring to.
For example, in their investment portfoios, a lot of small banks owned stock in Fannie and Freddie as it was thought to be a "safe" investment backed by the full faith and credit of the US Government. But when the US had to take over Fannie and Freddie ( http://en.wikipedia.org/wiki/Federal_takeover_of_Fannie_Mae_and_Freddie_Mac ) these investments were wiped out and some of the banks found their earnings and capital impared with no way to raise more. This stopped lending activites and led some of the small bank failures we have seen. Did these banks make risky RE lons? No, they didn't. Their sin was investing in a GSE and they got crushed as a result. In hindsight, they should have bailout of their GSE stocks when they still could and that they didn't is their fault.
Also, many small banks got into trouble as the whole RE situation unwound, not because they made stupid loans but because a lack of liquidity in the market drove down RE prices so far and so fast. And then the bank regulators made them write down the loans (mark to market) thereby imparing both earnings and capital, also stopping lending activity.
Do people here really think the banks bear NO responsibility for their own poor lending practices???I think that some banks do, but far from all because most weren't engaging in poor lending practices.
Well, I'm a recovering economist, and have put some time in on the bank thing, and other bailout issues.
The real issue in the long term, vis-a-vis risk is that the government has effectively underwritten the risk in the market place, which changes the risk structure. When there are no consequences for risk (or the consequences are mitigated), then people will continue to make risky decisions on both the sides of the equation. The government, by underwriting the risk in the TARP case has not created an adverse risk curve. So people will keep doing it.
On the other hand, they advanced the risk curve in other markets. Chrysler is a good example. When the Fed/Treas/White House (Read Bernanke, Geithner, Obama) successfully demonized the hedge fund managers (ironically one of the funds in quesion was a Teachers and Police fund), and got them to reduce their debt seniority, they made it better only in the short term, and only for one group: The Union (UAW, if IIRC). The long term problem with this is that it will create instability in the corporate credit markets. If creditors buying bonds believe that they can arbitrarily lose seniority because of government action, then their risk rates go up, and therefore interest rates go up. In the future, the result of that will be that it will be harder for companies to raise capital (or more expensive), because the risk is higher. The interest rates will be higher because of that risk. Unions and manufacturers will pay for it down the line somewhere. Penny wise, pound foolish.
So this entire series of moves has basically ****ed the risk in the market place. Even though interest rates are low, peoples' risk aversion is higher. I own a commercial building that I've had 2 or 3 full price offers on from decent buyers, and banks won't currently give them commercial loans. Good times.
The real issue in the long term, vis-a-vis risk is that the government has effectively underwritten the risk in the market place, which changes the risk structure. When there are no consequences for risk (or the consequences are mitigated), then people will continue to make risky decisions on both the sides of the equation. The government, by underwriting the risk in the TARP case has not created an adverse risk curve. So people will keep doing it.
Exactly, this and the codependent concept of Too Big To Fail have created a huge problem.
Meanwhile the small community banks get beaten into the ground via mark to market and, for most of them, not bad lending practices. It is no wonder good lenders are wary and loans might be hard for some to get.
Too Big To Fail always seemed like a cheap scapegoat and a great way to justify government actions to me.
Not true as stated - there were some banks that didn't need a bail out and didn't want TARP money, but it was forced on them. This is fact.
What I am disagreeing with is the notion that a bank is somehow responsible for my own stupid decision. That is what I thought you were saying in several of your threads. If not, then we don't disagree on that.
On this we agree, but I do object to the term "the banks." There are many small community banks (most of the banks in the US) that got hurt and hurt badly because of the actions of a small number of the larger banks and GSEs which I believe you are really referring to.
For example, in their investment portfoios, a lot of small banks owned stock in Fannie and Freddie as it was thought to be a "safe" investment backed by the full faith and credit of the US Government. But when the US had to take over Fannie and Freddie ( http://en.wikipedia.org/wiki/Federal_takeover_of_Fannie_Mae_and_Freddie_Mac ) these investments were wiped out and some of the banks found their earnings and capital impared with no way to raise more. This stopped lending activites and led some of the small bank failures we have seen. Did these banks make risky RE lons? No, they didn't. Their sin was investing in a GSE and they got crushed as a result. In hindsight, they should have bailout of their GSE stocks when they still could and that they didn't is their fault.
Also, many small banks got into trouble as the whole RE situation unwound, not because they made stupid loans but because a lack of liquidity in the market drove down RE prices so far and so fast. And then the bank regulators made them write down the loans (mark to market) thereby imparing both earnings and capital, also stopping lending activity.
I think that some banks do, but far from all because most weren't engaging in poor lending practices.
OK, I see your point. I shouldn't say "the banks" - for example, several banks were coerced into taking TARP money, such as BB&T for example.
I should have been more clear. The banks that DID do risky things and DID take taxpayer money are a bunch of jackasses.
You make a good argument and have obviously read up on this more than I have! :)
Nathan_Bell
03-04-10, 15:26
"Plan for the worst, hope for the best" used to be the standard for people. You have a solid, ok paying job, as does your SO. You live off of one. My grandparents saved every dime, come hell or high water, from my grandmother's job and only lived off of my granddad's income. They did this because the Depression had taught them that you must have a cushion, and it needs to be a large one because bad times come at the worst time. The follow up generations have disregarded the lessons of that generation and have dug a hole that makes the one we, as a nation, were in during the Depression look like a mud puddle.
Is it easy to live on one person's income? Yes and no. It is easy to put shelter over your head, food on the table, and clothes on the back with one middle class income, it won't be a McMansion, NY Strip steaks, or designer threads, but it is doable. It just is hard to step away from the "newest, bestest, NOW" mentality that our culture is saturated with and do that without feeling you are shorting yourself and your family.
So we end up with $50k in credit card bills, $2k a month in car expenses, and a house that you are not really certain you like and is probably bigger than you need. I guess that means the mantra of our generations is "plan for the best, and hope to win the lottery", because that is the only way most folks will ever get their heads above water.
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