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#15 by Hook'Em on 25 Sep, 2008 14:41
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No
Tough call on how to fix it. I'm against government getting into the housing finance business, however the ability to SENSIBLY borrow money is vital to the economy. If Fannie & Freddie shut their doors, it wouldn't be the worst thing in the world, IMHO. I know those two sentences may seem contradictory, but people that can't pay back a loan never should have been granted a loan in the first place. Again, fault on both sides.
That is an unfair statement. Not everyone that has a hard time paying their mortgage now could not afford it when they took it out.
Disagree, hardly an unfair statement. People default on loans in both good & bad economic times. Individual circumstances differ, I get that. However, the number of people that are walking away from homes despite the fact that they would re-fi 2, 3, 4 times over and park the new beemer in the garage or just use the latest re-fi to pay off their credit cards during these recent times is staggering.
Look, people that are in hard times I feel for, despite what some people may think about me. But people that have put themselves in this situation because of irresponsibility (both citizens and financial institutions) I have little to no sympathy for.
OK, blast away.
I totally agree with that. -
#16 by SlyBaldDude on 25 Sep, 2008 14:48
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I'm have some definite opinions about this issue; but I don't want to get kicked off the board
Suffice to say, I'm ready for the depression or recession or what ever it ends up being. I just got a couple of rabbits from a neighbor and I put in an order for some baby chicks. Now I gotta find a goat and I think our food needs will be covered.
I've moved my mother in law in (cause she gets a monthly SS check) so my mortgage will get paid even if the business goes south ... If the car gets repo'd I still got my paid-for truck to get to town if I need to .. I think I'm ready. All I need is a strait razor and a sharpening belt so I can keep sly if there is a run on razor blades .. -
#17 by schro on 25 Sep, 2008 14:51
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I'm have some definite opinions about this issue; but I don't want to get kicked off the board
Suffice to say, I'm ready for the depression or recession or what ever it ends up being. I just got a couple of rabbits from a neighbor and I put in an order for some baby chicks. Now I gotta find a goat and I think our food needs will be covered.
I've moved my mother in law in (cause she gets a monthly SS check) so my mortgage will get paid even if the business goes south ... If the car gets repo'd I still got my paid-for truck to get to town if I need to .. I think I'm ready. All I need is a strait razor and a sharpening belt so I can keep sly if there is a run on razor blades ..
AWESOME POST. -
#18 by hammerdrill376 on 25 Sep, 2008 15:24
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No
Tough call on how to fix it. I'm against government getting into the housing finance business, however the ability to SENSIBLY borrow money is vital to the economy. If Fannie & Freddie shut their doors, it wouldn't be the worst thing in the world, IMHO. I know those two sentences may seem contradictory, but people that can't pay back a loan never should have been granted a loan in the first place. Again, fault on both sides.
That is an unfair statement. Not everyone that has a hard time paying their mortgage now could not afford it when they took it out.
Absolutely right on that. When we built 3 years ago we could more than afford our mortgage payment. Then the real estate crisis hit which directly affected my industry. I specialized in real estate termite inspections and went from about 9-10 a day to less than 5 a month. We had some tough times but are now starting to see the light of day. But the real estate crisis was not my fault nor the fault of anyone in my industry. I'm not looking for anyone to bail me out however to lump EVERYONE who has fallen behind on a mortgage in the same basket is an incorrect analyis. -
#19 by schro on 25 Sep, 2008 16:40
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No
Tough call on how to fix it. I'm against government getting into the housing finance business, however the ability to SENSIBLY borrow money is vital to the economy. If Fannie & Freddie shut their doors, it wouldn't be the worst thing in the world, IMHO. I know those two sentences may seem contradictory, but people that can't pay back a loan never should have been granted a loan in the first place. Again, fault on both sides.
That is an unfair statement. Not everyone that has a hard time paying their mortgage now could not afford it when they took it out.
Disagree, hardly an unfair statement. People default on loans in both good & bad economic times. Individual circumstances differ, I get that. However, the number of people that are walking away from homes despite the fact that they would re-fi 2, 3, 4 times over and park the new beemer in the garage or just use the latest re-fi to pay off their credit cards during these recent times is staggering.
Look, people that are in hard times I feel for, despite what some people may think about me. But people that have put themselves in this situation because of irresponsibility (both citizens and financial institutions) I have little to no sympathy for.
OK, blast away.
Hammerdrill,
Sorry about your situation. The above is my second post on this topic.
As I've said before, Generally speaking, generalizations are, in general, generally incorrect.
Glad things are improving for you. -
#20 by hammerdrill376 on 25 Sep, 2008 17:20
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Thanks man..Yes things are slowly but surely improving for us.
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#21 by GASlick on 25 Sep, 2008 17:35
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I will say this: We own a small business providing advertising products for other small businesses. Well, businesses aren't exactly throwing money at me for stuff like that anymore. We are doing business, just at about 60 - 70% of what we were doing a year ago.
Our solution: save the house and the vehicles at all costs. If the DirecTV, the internet, the eating out and all that other stuff has to go, then so be it. We need to read more anyway. LOL Also, I went and got another job to help out. Do you think I enjoy running a small business AND working three 12 hour overnight shifts a week? In all fairness though, I have been an x-ray tech for 16 years so I did already have a marketable skill set.
Everyone's unique situation is just that. Unique. Honestly, what ever happens in DC probably will not have an enormous impact on me personally, because my mortgage is current and my bills are getting paid.(barely) It will impact me indirectly though. Just my 2 cents for what it's worth.
And NO I am not happy to spend my money to bailout people with "golden parachutes" who were pretty obviously only looking out for themselves. -
#22 by Jim80 on 25 Sep, 2008 17:59
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gaslick, I'm in the same issue as you. All my bills are current and up to date. I'm a little uneducated about the bailout bill, is the US goverment going further into debt or is it up to us to pay even more money either every month or once a year to bail out the mortgage companies ?
sorry for the silly question.
Thanks
Jim -
#23 by Tyler on 25 Sep, 2008 18:14
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While I'm a huge believer of less government and less government involvement in the markets, I do fear that if we don't bail out the organizations we're going to end up hurting the small and medium sized business owners that are vital to America's and the world's economy. What this mostly comes down to is that people are panicking and causing things to be worse than they actually are. Yes, some large banks failed, but in the U.S. your money is safe unless through FDIC unless you invested in some of the financial institutions that failed. Though, a lot of people are reacting on emotion and not logic regarding their investments in other markets. Sure, money will be harder to get for about a year and that will cause a slump in the economy, but if people weren't reacting as much, it wouldn't be that big of a deal. Yet, people are making it a big deal, so if we don't bail out these companies, they're going to bring down the markets based on emotion, not financial logic.
Don't believe me? Look at Warren Buffet, he just invested $5 billion in Goldman Sachs. Why? Because he sees that their stock (value) dropped based on emotional trading and some small screw up that can be fixed with the long term.
I'm not trying to paint a picture that everything is going to be rosey, because it's not, but it's not as bad as the media is making it out to be, except that it could drive it to be that bad. So, to get to my point, I think the bailout is to provide more psychological comfort to the world, thus preventing the reaction that could occur if they don't bail them out, than the bailout actually brings in regards to real financial support.
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#24 by Jim80 on 25 Sep, 2008 18:22
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Tyler,
I understand and believe your statement on this but is this going to cost the american population an extra tax bill to give everyone some pyschological relief? -
#25 by Robmeister on 25 Sep, 2008 18:23
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people that can't pay back a loan never should have been granted a loan in the first place. Again, fault on both sides.
I'm leaning with ya Schro.....there was a day (to which we have now returned) when the standards for borrowing were straight forward. People WHO REALLY WANTED THAT NEW HOUSE, but could not afford it....couldn't get the loan. Then came the fancy schmancy sub-prime and other creative "B" paper stuff....and those people WHO REALLY WANTED THAT NEW HOUSE, but could not afford it.....got the loan.....
Buying that dream home is so much more of an EMOTIONAL decision....and if you "qualify" it takes a pretty sophisticated and conservative thinker to slam on the breaks and say, "Ya know what....this prolly ain't a good idea."
So the fault is shared.....there's a CERTAIN degree where the borrower should have "known better"....but putting those "creative" qualifiable loans out there to ROPE in those who would otherwise not qualify shares the larger responsibility IMO.
As far as AIG.....they need to be bailed out....if they were to FAIL that would be a GLOBAL economic catastrophe. -
#26 by SlyBaldDude on 25 Sep, 2008 18:23
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Im a bit of a news junky. The way I understand it, the banks making the mortgage loans don't have any security to back the loans due to devaluation (among other things). Banks get money to loan from other banks. Right now banks are not loaning money to each other so we are experiencing a credit freeze. Our economy is based largly on the ability to borrow. People use credit for everything. If we can't use credit we don't buy stuff. The problem is that the banks don't know what their stuff is worth for a few various reasons so their balance sheets are all screwed up which means they don't have any confidence so they arn't loaning. The govt plans to buy up all that bad stuff so the banks know what they are actually worth and will start loaning money again. Thing is .. if the gov't does this that is no guarantee that the banks will loan money like they did before. Most likely they will have very strict credit requirements which means it will still be very hard to borrow which means we're gunna have a period of recession regardless. Personally I wish they wouldn't do anything for a while longer because even the *experts* disagree on what the effect would be. The only thing they seem to agree on is its gunna get worse before it gets better.
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#27 by Tyler on 25 Sep, 2008 18:26
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Tyler,
I understand and believe your statement on this but is this going to cost the american population an extra tax bill to give everyone some pyschological relief?
Unfortunately, the tax bill will more likely be a less hit to the American public than the hit that would occur if we let other industries fail around out side of the financial industry. Why? Well, if we let them fail, the amount of people that go on welfare and public assistance will end up causing a much bigger tax bill. -
#28 by GASlick on 25 Sep, 2008 18:31
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This is all to complicated for this good old southern boy.
I am a news junkie though. I watch FoxNews and read Drudge religiously. I understand what is happening and why it needs to be addressed, but doesn't most of come down to poor decisions by the companies AND the consumers. Here's my point:
When we bought our house 5 years ago we qualified for a $225,000 house. We actually bought a $129,000 house. Just because we could QUALIFY for it doesn't mean we should BUY it. We also didn't do any thing "Creative" either like 100% financing, interest only, ARMs and all that other stuff created to let people buy more than they could afford.
We have a plain old vanilla 30 year fixed.
If we had bought a maxed out home, we would be in far worse shape than we are. -
#29 by SlyBaldDude on 25 Sep, 2008 18:39
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I live in rural Oregon so houses are quite a bit cheaper. Our house cost 79k so the payment on our standard mortgage is very affordable. In fact we could not rent for cheaper than our mortgage payment. We started with an adjustable but I got out a couple of years ago just before it adjusted. I think there are a lot of consumers who forgot that it was going to adjust and .. yer right, now they can't afford their house! What I don't understand is the bank's reluctance to refinance these people into standard mortgages. Seems like they almost want to loose money!