Anybody Underwater on their Mortgage (principle, Canada, payments, rich)
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Buying a house or a car , these days is not much different. Anyone who signs on to a front loaded home loan for 30 or 40 years , is stupid. Such practices should not be allowed. I place almost all the blame on the Banks , and , their greedy practices. They sell the paper even before the ink is dry , to China.
What we need is realistic values for homes , like we have on cars. When you see the Bankers reducing the principle , then there will be some honest effort to fix the problem. Nothing more than 15 years financing should be allowed , 10 years would be better, at affordable rates.. Just like the Credit card Companies , they want to own you , for the rest of your life , just keep making the payments , forever....... people with real integrity want to stop the criminal activity. and , the only way , for the average person to do so , is to stop paying , more power too them !
This is absolutely ridiculous. GROWN ADULTS who personally choose to take on debt do so at their own peril. No one held a gun to their heads to get the loans or the credit cards or whatever. They wanted more and more and wanted their neighbors to be impressed by their big homes, or their big patios, or their oversized SUVs.
I don't have to pay back these loans because I didn't promise that I would. I lived within my means. YOU DO because YOU DID.
This is absolutely ridiculous. GROWN ADULTS who personally choose to take on debt do so at their own peril. No one held a gun to their heads to get the loans or the credit cards or whatever. They wanted more and more and wanted their neighbors to be impressed by their big homes, or their big patios, or their oversized SUVs.
I don't have to pay back these loans because I didn't promise that I would. I lived within my means. YOU DO because YOU DID.
You can argue all you want , about the " moral issue thing ". What you are forgetting is the Bankers should be held to some moral standards also. We are in very bad economic times , it was the banks , and the lack of oversight by our Government that got us to where we are today.... desperate times cause people to do foolish things. That was why we had Usury laws at one time, as a result of back alley Juice loans. Now , the juice loans are legal. The public does need some protection from the money lenders, its not an issue of socialism , but one of survival as we know it.... beware the Banker , as he has the money , is all powerful , and will be the first one to rise from the rubble after the total collapse of our economy... its coming.
I'm going to answer the original post.
Yes, my house is underwater, can you see it on sonar?
Other posters have said that Obama's regime said the loans have to be late in payments before they can help them with assistance.
Well, I was having trouble in late October, I called my lender WM and was told they couldn't help me because I wasn't late on my payments. That if I wanted help I would have to fall behind.
Now I ask you, what kind of a system is this? You want to work with a bank to lower your payments to keep your good credit and you get told you can't do it until it's too late. What a heck of a way to run a business.
So later, in December I call them back and ask them if I can short sell the house that's now 60K less in value than when I purchased it 5 years ago. Okay, I bought it at 309K, it went up to 425K and now it's down to 195K. So when I called the bank and gave them all the pertinent information, they informed me they didn't own the paper anymore and I'd have to go through Chase. So I called chase and they informed me that they also didn't own it anymore that it was now owned by Freddy Mac. So I called them and they said no, I had to be further behind in my mortgage payments before they'd do as short sale on the property. That they were "swamped right now" with people in default and that they had to come first because they were further behind.
Once again, I ask you, what kind of a way to run a business is that?
So you can see why I'm a little bitter with the banking industry.
You can argue all you want , about the " moral issue thing ". What you are forgetting is the Bankers should be held to some moral standards also. We are in very bad economic times , it was the banks , and the lack of oversight by our Government that got us to where we are today.... desperate times cause people to do foolish things. That was why we had Usury laws at one time, as a result of back alley Juice loans. Now , the juice loans are legal. The public does need some protection from the money lenders, its not an issue of socialism , but one of survival as we know it.... beware the Banker , as he has the money , is all powerful , and will be the first one to rise from the rubble after the total collapse of our economy... its coming.
Oh please, it was greed not only from bankers but millions of people who thought were going to make a quick buck or achieve the "American dream" without having to put any effort on it, yeah an I'm including thinking before signing in that effort.
Well, it becomes your problem when the house goes into foreclosure and lowers YOUR property value with the low sale price.
That is why house prices are falling across the country (and with them, values). It is in ALL of our best interests to keep foreclosures at bay as much as possible.
My property value has probably lost 35% or more. This is the house that I had hoped to retire in. (not that this is going to happen anytime soon) There are 4 foreclosures ON MY BLOCK. Nothing to do with me. But, they are affecting me in the decline in my property value. I will not be able to sell my house, refinance nor get any form of an equity loan for improvements for at least 10 years to come. Add this to my 401k that has lost probably 80% of its value, and I am sunk. (I am 52 years old)
THAT IS WHY THIS IS YOUR PROBLEM.
Those properties were sold to people who lied on their loan applications and bid the prices up. The prices should've never gone up in the first place so obviously the system has to work to clean out the excess that was caused by all the fraud and the values will have to fall.
Nobody can set home prices, that is a fallacy. Home prices will align with what new buyers can afford to pay and that is determined by income. Just because foreclosures stop happening doesn't mean home prices will not continue to fall because the properties that need to be sold will only attract offers in line with current affordability and financing conditions. Those transactions set the comparables not foreclosures.
I'm going to answer the original post.
Yes, my house is underwater, can you see it on sonar?
Other posters have said that Obama's regime said the loans have to be late in payments before they can help them with assistance.
Well, I was having trouble in late October, I called my lender WM and was told they couldn't help me because I wasn't late on my payments. That if I wanted help I would have to fall behind.
Now I ask you, what kind of a system is this? You want to work with a bank to lower your payments to keep your good credit and you get told you can't do it until it's too late. What a heck of a way to run a business.
So later, in December I call them back and ask them if I can short sell the house that's now 60K less in value than when I purchased it 5 years ago. Okay, I bought it at 309K, it went up to 425K and now it's down to 195K. So when I called the bank and gave them all the pertinent information, they informed me they didn't own the paper anymore and I'd have to go through Chase. So I called chase and they informed me that they also didn't own it anymore that it was now owned by Freddy Mac. So I called them and they said no, I had to be further behind in my mortgage payments before they'd do as short sale on the property. That they were "swamped right now" with people in default and that they had to come first because they were further behind.
Once again, I ask you, what kind of a way to run a business is that?
So you can see why I'm a little bitter with the banking industry.
Have you decided on a plan of action? I do wish you luck.
You can argue all you want , about the " moral issue thing ". What you are forgetting is the Bankers should be held to some moral standards also. We are in very bad economic times , it was the banks , and the lack of oversight by our Government that got us to where we are today.... desperate times cause people to do foolish things. That was why we had Usury laws at one time, as a result of back alley Juice loans. Now , the juice loans are legal. The public does need some protection from the money lenders, its not an issue of socialism , but one of survival as we know it.... beware the Banker , as he has the money , is all powerful , and will be the first one to rise from the rubble after the total collapse of our economy... its coming.
This type of explanation is very confusing to me. I hear a lot of people saying "blame the banks" for this mess but I really think that in a lot of cases the people who bought homes did not exercise self-discipline and as with everything else these days it's always someone else's fault.
Just because you get a credit card with a $10k limit doesn't mean you have a free $10k to spend. "But it was there so I used it and it's all the bank's fault for giving me a $10k credit line," is the refrain. That's just a crock.
People are complaining that they were somehow hoodwinked by the bank into buy a home when they knew full well that their $50k salary wasn't possibly enough to pay for a $400k home. If they were not smart enough to realize this then I just don't know what to say.
A few years ago, I dipped my toes into the housing pool to see if we'd qualify for anything and people were ready to throw money at us left and right. "I can have you in a $400k house in six months and you won't have to put anything down. You an get a loan for 106%..." a broker said. I said "are you insane? we earn X, there's just no way." He was insistent that we could "swing it." There was no way I would even entertain the idea of doing such a stupid thing. I will add that I've been wishing and praying for a long time that I could have a house of my own and it would have been easy to let my emotions dictate my behavior but no matter how many times I went over it in my head, there was just no way we could "swing" anything. So we stopped looking.
These "no income verification" loans, too, were the fault of the people who took the loans. They figured "hey, we don't have to tell them how little we make and we'll still get a mortgage. what a deal!" and then decided that they'd deal with any fallout later. Well, the fallout has arrived.
There are probably thousands of people that actually have stable jobs (teachers, policemen, firemen, etc.) who have job security, little debt and the means to pay a reasonable mortgage. Allowing the overspenders/irresponsibles to keep their homes and keep prices inflated locks them out of the market and they are probably the most deserving demographic of home ownership because their jobs are more stable than jobs in private industry.
I have all the sympathy in the world for the family that bought a modest home, lived within their means and then were hit with a job loss or medical issue that got them behind in their payments. I would go to bat for those people in a heartbeat and say banks should work with them and do whatever they could to keep that family in their home.
I don't think that the majority of people that this plan will bail out are those in the category above though. I think the people who bought way beyond their means will be rewarded for doing this and that just sucks.
This type of explanation is very confusing to me. I hear a lot of people saying "blame the banks" for this mess but I really think that in a lot of cases the people who bought homes did not exercise self-discipline and as with everything else these days it's always someone else's fault.
Just because you get a credit card with a $10k limit doesn't mean you have a free $10k to spend. "But it was there so I used it and it's all the bank's fault for giving me a $10k credit line," is the refrain. That's just a crock.
People are complaining that they were somehow hoodwinked by the bank into buy a home when they knew full well that their $50k salary wasn't possibly enough to pay for a $400k home. If they were not smart enough to realize this then I just don't know what to say.
A few years ago, I dipped my toes into the housing pool to see if we'd qualify for anything and people were ready to throw money at us left and right. "I can have you in a $400k house in six months and you won't have to put anything down. You an get a loan for 106%..." a broker said. I said "are you insane? we earn X, there's just no way." He was insistent that we could "swing it." There was no way I would even entertain the idea of doing such a stupid thing. I will add that I've been wishing and praying for a long time that I could have a house of my own and it would have been easy to let my emotions dictate my behavior but no matter how many times I went over it in my head, there was just no way we could "swing" anything. So we stopped looking.
These "no income verification" loans, too, were the fault of the people who took the loans. They figured "hey, we don't have to tell them how little we make and we'll still get a mortgage. what a deal!" and then decided that they'd deal with any fallout later. Well, the fallout has arrived.
There are probably thousands of people that actually have stable jobs (teachers, policemen, firemen, etc.) who have job security, little debt and the means to pay a reasonable mortgage. Allowing the overspenders/irresponsibles to keep their homes and keep prices inflated locks them out of the market and they are probably the most deserving demographic of home ownership because their jobs are more stable than jobs in private industry.
I have all the sympathy in the world for the family that bought a modest home, lived within their means and then were hit with a job loss or medical issue that got them behind in their payments. I would go to bat for those people in a heartbeat and say banks should work with them and do whatever they could to keep that family in their home.
I don't think that the majority of people that this plan will bail out are those in the category above though. I think the people who bought way beyond their means will be rewarded for doing this and that just sucks.
I don't know why what I said is confusing. Its all over the media , the why and the results. It is credit that motivates people to go out and buy. That is why we are in such a mess now , no credit , for no body , no body buying , no confidence in the system. The World is in a tail spin to the ground. Things are worse in this country than in Canada. They have more restrictions on their banking industry , the most stable in the world as of now. We need to model our system more like Canada , but , its too late. The next banks to go under will be BOA , and Citibank. Within a couple of months I think.
In a more stable monetary system , people save for a rainy day, not in the US. The largest spender is the Government , its people were just following by example. Every thing is controlled by the Fed., which is NOT a Government Agency. It is just a big bank , distributing funds to smaller banks . Everything changed in 1913 , after the depression in 1898-1907. As much as I dislike Ron Paul , he is right about what needs to be done. Start over , with a new system based on the Gold Standard.
People will always live beyond their means in this Country , the Government has encouraged the practice. One of the reasons we have had such a robust economy , was because Americans spend without abandon. Now its all over , its too late to turn back. The poor are throwing rocks at the rich , just as they did in 1932. It will take inflation on a huge scale to provide a fix. You must agree , if home values were inflating as before , would we have a problem now ,?.. the answer is NO.... In the end , hyperinflation sets in , and we go down again , that too is coming , its just delaying the fall , we do need to wipe out all debt , and , start over , its the only way.
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