Blaming the homeowners for their own ignorance!

[Tech_Esq]

Are you trying to tell me that loan documents, even the fine print on your VISA agreement, are easily read and understood?

That is all I'm saying... the paperwork is complicated for a reason, and the reason is NOT to protect the consumer.

The consumer needs to trust that their government won't let con artists write the documents... How has that worked out for us?

If 2% of loans were funky - shame on those 2% for signing.

If 20% are funky - protection that was assumed (because it was not obviously stated) is missing.

You are correct - not rocket science


-Joe

And so? How do you answer your implied question? Were 2% of the loans funky or 20%?

My understanding is less than 5% are in default. I assume some of those were people where they knew what they were getting into and thought they were smarter than the system and got caught. So let's chalk 1% up to those kind of people.

My basic feeling is that people knew or should have known what they were getting into. I know what the pressures were I sold my house in 2003 and bought one the same year.

I sold my house because I had owned it for 11 years. I knew what the house was worth, but the market kept pushing the price higher and higher. I thought I sold at the top, but in fact I was probably a couple of years shy of the top. Anyway, I figured if I held it any longer I would get hurt.

When I bought my new house, I could have afforded more house. I put 20% down on my current house and had a few more points I could have put down. I could have bought a bigger house. I didn't because I was cautious. I know there were certainly pressures from the mortgage industry to try to make me buy more but you have to be smart enough about what you are doing to resist the temptation.

 

[Care4all]

Question#1....
How much will my payment be every month?

Question#2
Can I afford to pay that for x number of months ?

It ain't rocket science....

Its the same questions you ask no matter what your are buying....
a $500 PC or a $50,000 car or a $500,000 home...

Their payments were FIXED for 3-5 years before the adjustable mortgage rates wnet up thru the sky.

These people PAID their mortgages for the 3-5 years.

These people WERE TOLD by the Mortgage companies, that when their adjustable rate kicks in and goes up beyond their current needs, they would EASILY be able to get a Conventional Mortgage that is fixed, because the value of their homes would have gone up enough to build up the 20% needed as a downpayment or equity in order to get a good rate conventional loan.

This did NOT happen....

it is not that all of these people could not afford their mortgages, they could afford them when they were 6% or 7%, but now that their mortgages are at 11% and 12% etc, with the adjustable mortgage rate hikes, they can not afford their mortgages.

This is the case with MOST of these people who borrowed on subprimes...

Of course this does not negate that there were SOME of these subprimers, just some...that were playing the system....

but i do not believe this was even close to being the MOST.

care

 

[AVG-JOE]

And so? How do you answer your implied question? Were 2% of the loans funky or 20%?

My understanding is less than 5% are in default. I assume some of those were people where they knew what they were getting into and thought they were smarter than the system and got caught. So let's chalk 1% up to those kind of people.

My basic feeling is that people knew or should have known what they were getting into. I know what the pressures were I sold my house in 2003 and bought one the same year.

I sold my house because I had owned it for 11 years. I knew what the house was worth, but the market kept pushing the price higher and higher. I thought I sold at the top, but in fact I was probably a couple of years shy of the top. Anyway, I figured if I held it any longer I would get hurt.

When I bought my new house, I could have afforded more house. I put 20% down on my current house and had a few more points I could have put down. I could have bought a bigger house. I didn't because I was cautious. I know there were certainly pressures from the mortgage industry to try to make me buy more but you have to be smart enough about what you are doing to resist the temptation.

Honestly, I don't know the exact percentage, but if the taxpayers have to come up with 3/4 of a trillion dollars to put a band-aid on it, it had better be a lot more than 2% of mortgages have 'issues'

The fact that you, who put up a reasonable down payment and bought the correct house instead of the biggest, and I who 3 years ago downsized into something much smaller, exchanging my 15 years left on a 30 year fixed for a 10 year fixed just makes us smart. You and I are going to get screwed by this and it was not our fault. Sucks, doesn't it?

Most people, I think, were like you and me - they may not have had the 20% down, but they asked questions and purchased the correct house for the time that they bought.

So basically we are going to bail out the profiteers who 'creatively' financed speculators and idiots. Sucks, doesn't it?

-Joe

 

[AVG-JOE]

Their payments were FIXED for 3-5 years before the adjustable mortgage rates wnet up thru the sky.

These people PAID their mortgages for the 3-5 years.

These people WERE TOLD by the Mortgage companies, that when their adjustable rate kicks in and goes up beyond their current needs, they would EASILY be able to get a Conventional Mortgage that is fixed, because the value of their homes would have gone up enough to build up the 20% needed as a downpayment or equity in order to get a good rate conventional loan.

This did NOT happen....

it is not that all of these people could not afford their mortgages, they could afford them when they were 6% or 7%, but now that their mortgages are at 11% and 12% etc, with the adjustable mortgage rate hikes, they can not afford their mortgages.

This is the case with MOST of these people who borrowed on subprimes...

Of course this does not negate that there were SOME of these subprimers, just some...that were playing the system....

but i do not believe this was even close to being the MOST.

care

The only time I considered an ARM (mid '90's) I was assured by both the real estate agent and the mortgage guy that I would be able to refinance it at a lower rate before the adjustments kicked in.

Figuring that if they could predict the future, they would be living in paradise on stock trades, I went with the 30 year fixed.

-Joe

 

[DiamondDave]

Are you trying to tell me that loan documents, even the fine print on your VISA agreement, are easily read and understood?

That is all I'm saying... the paperwork is complicated for a reason, and the reason is NOT to protect the consumer.

The consumer needs to trust that their government won't let con artists write the documents... How has that worked out for us?

If 2% of loans were funky - shame on those 2% for signing.

If 20% are funky - protection that was assumed (because it was not obviously stated) is missing.

You are correct - not rocket science


-Joe

No... not at all.. there are LAWN IS PLACE TO LAY IT OUT SIMPLE ENOUGH SO THAT A PERSON WITH A 10TH GRADE EDUCATION CAN EASILY UNDERSTAND WHAT IS GOING ON... hell, just look at the fucking amortization table....

And if you are a brain dead liberal fuck who can't understand it, then hire an adviser for $200 to look over it... $200 ain't much when you are dealing with say a $200K investment

If a firm broke the law.. hold them accountable.. .but this is not the fucking case.. these people agreed to absurd adjustable rate loans starting at interest that was way below the rate at the time, expanding their supposed buying power and over extending their ability to pay in the future... it is the individual's fault for signing up for this absurd crap to begin with.. these types of loans were meant for people with reasonable thoughts of a 30% or so salary increase.. for people looking at short term turn around in a house to sell.. people looking at only staying in a house for 2 or 3 years... these people could have easily bought within their means and taken out a 30 year conventional fixed rate, but they did not...

Now would I personally (if I were a mortgage broker) even put one of these absurd ARMs in front of a person making 25K? Nope.. Nor (if I were a real estate agent) show someone making 30K houses that cost 300K... but there is nothing criminal in it.... it is the person's choice to over-extend themselves if they so choose to exercise that freedom....

 

[WillowTree]

Their payments were FIXED for 3-5 years before the adjustable mortgage rates wnet up thru the sky.

These people PAID their mortgages for the 3-5 years.

These people WERE TOLD by the Mortgage companies, that when their adjustable rate kicks in and goes up beyond their current needs, they would EASILY be able to get a Conventional Mortgage that is fixed, because the value of their homes would have gone up enough to build up the 20% needed as a downpayment or equity in order to get a good rate conventional loan.

This did NOT happen....

it is not that all of these people could not afford their mortgages, they could afford them when they were 6% or 7%, but now that their mortgages are at 11% and 12% etc, with the adjustable mortgage rate hikes, they can not afford their mortgages.

This is the case with MOST of these people who borrowed on subprimes...

Of course this does not negate that there were SOME of these subprimers, just some...that were playing the system....

but i do not believe this was even close to being the MOST.

care

WERE TOLD




therein lies the problem. nobody spends 500,000 dollars cause somebody tole them something. do they??

 

[Care4all]

WERE TOLD




therein lies the problem. nobody spends 500,000 dollars cause somebody tole them something. do they??

Willow, i understand your point...but will you PLEASE show us where someone of the minority or subprime status to qualify, bought a home for $500k and they got the loan....

the average home cost in America is $275k for a 2000 sq ft home....

yes, in California maybe a few other prime markets, but how many of them could there really be in this statement that you keep repeating?

any links on that....?

Care

 

[Alpha1]

Are you trying to tell me that loan documents, even the fine print on your VISA agreement, are easily read and understood?

That is all I'm saying... the paperwork is complicated for a reason, and the reason is NOT to protect the consumer.

The consumer needs to trust that their government won't let con artists write the documents... How has that worked out for us?

If 2% of loans were funky - shame on those 2% for signing.

If 20% are funky - protection that was assumed (because it was not obviously stated) is missing.

You are correct - not rocket science


-Joe

No...I didn't mean that at all....Legal documents are confusing to the layman....thats why we hire lawyers...its HIS DUTY to protect your interests and not let you sign any document that is other than what is considered normal operating procedure in the field....and that is your protection...you can claim he did not do his duty in protecting your interests....
You don't need to fully understand the legalities ..... its the lawyers job to make you aware of what he thinks might be out of the ordinary....or not in your best interests and advise you accordingly....

Your concern should be your ability to honor the agreement

 

[chopcrazy]

I have some questions that the Treasury and Congress should let the public know.

1. If the government assumes these sub-prime loans, will the government collect on these like they do for delinquent student loans? Will the delinquent homeowner forever be hunted by the government until the loan is paid? Wage garnishment??

2. If the government gets $700B in warrants from these banks, how will the government ever be able to unload the warrants if the stock increases substantially in value? Who could the government sell its stake to?

It took my company two years to refinance $500 million in debt. The government is trying to say that in a week's time that we can bail out the banks for $700 billion.

 

[Care4all]

The only time I considered an ARM (mid '90's) I was assured by both the real estate agent and the mortgage guy that I would be able to refinance it at a lower rate before the adjustments kicked in.

Figuring that if they could predict the future, they would be living in paradise on stock trades, I went with the 30 year fixed.

-Joe

We refinanced our previous VA mortgage that was at 8.5% down to 5.12% in a 7 year fixed, ARM....we did this, because we KNEW we would be selling our home in about 4 years and the lower ARM would save us some money in the mean time....and were very, very fortunate to have sold it for a profit nearing 2 years ago.

Where we are hurting now, is the new home we bought here in Maine, has reduced greatly in value since we bought it, cash.

So, even though we do not have a mortgage now for this home, we have lost tens of thousands of dollars in our home's value in just 2 years, so it hits pretty hard in the gut....

AND NONE OF THIS is our fault, but the fault of others that gambled, both banks and homewoners, and now, not only do i have to take the kick in the gut with my losses, I now have to BAIL OUT all the people that were at fault with my own money too....

as my husband would say, we're being screwed from the front and back on this mess and I am mad as hell about it!

 

[WillowTree]

Willow, i understand your point...but will you PLEASE show us where someone of the minority or subprime status to qualify, bought a home for $500k and they got the loan....

the average home cost in America is $275k for a 2000 sq ft home....

yes, in California maybe a few other prime markets, but how many of them could there really be in this statement that you keep repeating?

any links on that....?

Care

I'm thinking there were a lot. my proof? the cost of this bailout. 700 billion so far, that is $2300 dollars so far for every taxpayer and they say that's just the start, it could go to 3 trillion. now you tell me. oh and edited to add Nancy Pelosi wants to put the ceiling for each homeowner at 700,000 dollars.. so that's where I got my figure

 

[Alpha1]

I have some questions that the Treasury and Congress should let the public know.

1. If the government assumes these sub-prime loans, will the government collect on these like they do for delinquent student loans? Will the delinquent homeowner forever be hunted by the government until the loan is paid? Wage garnishment??

2. If the government gets $700B in warrants from these banks, how will the government ever be able to unload the warrants if the stock increases substantially in value? Who could the government sell its stake to?

It took my company two years to refinance $500 million in debt. The government is trying to say that in a week's time that we can bail out the banks for $700 billion.

Many of these loans were taken out by minorities....not all, but many....it was those lending practices of no down payment, no credit check, no proof of income that caused a lot of this problem....
So no....we ...the taxpayer will eat this debt in the end, no way will government go after minorities or what will obviously be the poorer citizens about tis...

 

[Care4all]

I'm thinking there were a lot. my proof? the cost of this bailout. 700 billion so far, that is $2300 dollars so far for every taxpayer and they say that's just the start, it could go to 3 trillion. now you tell me. oh and edited to add Nancy Pelosi wants to put the ceiling for each homeowner at 700,000 dollars.. so that's where I got my figure

But willow, i believe i read that ONLY 12% of the subprime mortgages are in default or foreclosure...ONLY 12% of them...so how could THIS really be the problem?

I truely do not understand what is going on here, but whatever it is, be certain we are not being told the truth, BY ANYONE!

 

[Tech_Esq]

Honestly, I don't know the exact percentage, but if the taxpayers have to come up with 3/4 of a trillion dollars to put a band-aid on it, it had better be a lot more than 2% of mortgages have 'issues'

The fact that you, who put up a reasonable down payment and bought the correct house instead of the biggest, and I who 3 years ago downsized into something much smaller, exchanging my 15 years left on a 30 year fixed for a 10 year fixed just makes us smart. You and I are going to get screwed by this and it was not our fault. Sucks, doesn't it?

Most people, I think, were like you and me - they may not have had the 20% down, but they asked questions and purchased the correct house for the time that they bought.

So basically we are going to bail out the profiteers who 'creatively' financed speculators and idiots. Sucks, doesn't it?

-Joe

In a word....YES!

 

[WillowTree]

But willow, i believe i read that ONLY 12% of the subprime mortgages are in default or foreclosure...ONLY 12% of them...so how could THIS really be the problem?

I truely do not understand what is going on here, but whatever it is, be certain we are not being told the truth, BY ANYONE!

you are probably right,, remember back about 2 years? It was about two years ago that Chris Dodd started yelling that we needed to do something to help out these poor homeowners who were being foreclosed on,, Bank America announced too that they were doing business with illegals.. We have been had plain and simple. The only thing we can do is vote these assholes out of office and that probably won't help a bit.

 

[Alpha1]

We refinanced our previous VA mortgage that was at 8.5% down to 5.12% in a 7 year fixed, ARM....we did this, because we KNEW we would be selling our home in about 4 years and the lower ARM would save us some money in the mean time....and were very, very fortunate to have sold it for a profit nearing 2 years ago.

Where we are hurting now, is the new home we bought here in Maine, has reduced greatly in value since we bought it, cash.

So, even though we do not have a mortgage now for this home, we have lost tens of thousands of dollars in our home's value in just 2 years, so it hits pretty hard in the gut....

AND NONE OF THIS is our fault, but the fault of others that gambled, both banks and homewoners, and now, not only do i have to take the kick in the gut with my losses, I now have to BAIL OUT all the people that were at fault with my own money too....

as my husband would say, we're being screwed from the front and back on this mess and I am mad as hell about it!

Funny how the people that "do the right thing" and "live within their means" and "obey the laws" are usually the ones to get screwed.....while the screw-ups always manage to pass the blame for their mistakes onto someone else...and get others to take their side....

 

[Care4all]

The stock market only gives jobs to those working in it.

Why are the rest of us bailing them out? That $700 billion would be better used elsewhere, even in the hands of those in adjustable mortgages that WANT to keep their homes and can afford to do such if they could get a fixed rate mortgage....

then less homes would default and my home value would not continue on this spiral downward.....

helping the homeowners is the only way I WOULD BENEFIT from a bail out, it would have to be a bail out of the homeowners by giving them conventional mortgages/rates to pay...

and i still don't agree to any of this, just saying bailing out the bankers doesn't help me one iota....

 

[WillowTree]

The stock market only gives jobs to those working in it.

Why are the rest of us bailing them out? That $700 billion would be better used elsewhere, even in the hands of those in adjustable mortgages that WANT to keep their homes and can afford to do such if they could get a fixed rate mortgage....

then less homes would default and my home value would not continue on this spiral downward.....

helping the homeowners is the only way I WOULD BENEFIT from a bail out, it would have to be a bail out of the homeowners by giving them conventional mortgages/rates to pay...

and i still don't agree to any of this, just saying bailing out the bankers doesn't help me one iota....

well, wait,, before we decide, let me go out and upgrade.. I want a 700,000 dollar house and will be glad to let you help me get it..Thanks in Advance

 

[chopcrazy]

We refinanced our previous VA mortgage that was at 8.5% down to 5.12% in a 7 year fixed, ARM....we did this, because we KNEW we would be selling our home in about 4 years and the lower ARM would save us some money in the mean time....and were very, very fortunate to have sold it for a profit nearing 2 years ago.

Where we are hurting now, is the new home we bought here in Maine, has reduced greatly in value since we bought it, cash.

So, even though we do not have a mortgage now for this home, we have lost tens of thousands of dollars in our home's value in just 2 years, so it hits pretty hard in the gut....

AND NONE OF THIS is our fault, but the fault of others that gambled, both banks and homewoners, and now, not only do i have to take the kick in the gut with my losses, I now have to BAIL OUT all the people that were at fault with my own money too....

as my husband would say, we're being screwed from the front and back on this mess and I am mad as hell about it!

Even though the value has dropped, you have not lost anything until you sell your home.

The government has not said how the bail out will be paid. If we just fire up the printing press, than conumers will pay through the nose with inflation. Oil jumped $16 yesterday because of the expected future devaluation of the dollar.

These banks played with fire and deserve to get burned. Based upon the info that has been shared with the public, I say no bail out.

 

[ABikerSailor]

You know, heres' the question that I would like to have answered by the Federal Reserve.......

How much money did they get in kickbacks and graft from Fannie and Freddy as well as all the other banks that are now falling for them passing legislation that allowed predatory lending?

And.....as a follow on......

If the first is true (which it probably is), I'd also like to know that since they were running the Fed, and had inside information to get rich with, is the reason that they are trying to pass this SEVEN HUNDRED BILLION DOLLAR BAILOUT, is because the are afraid of losing their entire retirement portfolio? It kinda looks like, and also stinks, because WE THE TAXPAYER are paying for THEIR fucking stupid ass mistakes.

I'm pissed!