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Actually, I am paying attention quite well, though you are refusing to accept the responsibility of your issue which is why you can't accept my comments.I could accept comments and/or critisism were it valid. In our case, your many comments simply had no validity. Don't bother to say "oh yes it does", because I wouldn't accept that as valid either.
Not at the levels that existed with this. There were pockets dependent on area which had increases and small drops as such, but nothing compared to this wide spread fad. Not true, I'm a native Californian and have owned my own homes (several) since I was 23...now 65....my husband is a 5th generation Californian and has owned homes (several) since he was back from Vietnam as ALL his relatives since they immigrated to the state in covered wagons.....so again, points not valid.
Homes have as a national average never experienced such volatile value changes.true Localized influence of such spikes have been relative to the wage index following suit. trueThis was not the case with the housing bubble. It mimicked dot.com bubble which was equally based on no solid foundation of principal. true
Home values doubled, tripled, and in some cases quadrupled in various areas of California (as well as many places across the country) to which the wage index could not reasonably sustain its value. Loan requirements used to be that of 20% down and having to show you made annually a 1/4-1/3 of your homes value. true...we put 35% down.
This is where loan manipulation stepped in which had a combination of government influence and that of irresponsible lender applications. In order to be able to qualify people, they had to use various loan practices that are unethical and with high risk. This practice was not a historical normality. true, which is why I said we baby boomers used to always be able to count on our bankers to be true "stand up guys", then we were duped and cheated quite suddenly and like never in my lifetime. So you proved my point in this statement.
People have to own homes? That is pure garbage.Meaning...that home ownership has ALWAYS (in my lifetime and before) considered to be the pinacle of the American Dream. People have to live responsibly and the American dream was not a stupid home, simply not truebut the individual liberty of being able to pursue ownership of property.Actually having been able to actually own it was the "answer to the American Dream, not just the pursuit of it. Pursue, that is that they "could" own property if they worked hard enough and were able to afford it. As we did over and over again.That they could succeed IF they put in the effort to take advantage of opportunities to achieve such.which we did over and over again. You make it sound like people were "entitled" to homes and that it was a requirement of citizenship to own one.Not in the least, no one is entitled, but WE WERE entitled because we DID IT RIGHT
I am sorry, but your idea of what you needed to do is beyond rational course and defies responsible behavior. You sound like a teenager going on about how they "have to have" and they "had to do this and that" when the fact of the matter is that have actually = want. Again, we worked hard and we did all the right things and we EARNED the privilege of being homeonwers over and over again. As did my parents and my children and grandchildren. Perhaps unlike yourself.
Actually, I was talking about the real world.I'm sure you are talking about YOU'RE real world, no doubt about that. /boggle
It isn't rocket science to do an evaluation of what I explained. It is called making informed and rational decisions. You go on about "reality" and yet you were the one spouting off some naive ideological claim about people "having to" own homes. "Having to"is a relative term. To myself and my family and my families families....Having to is pretty high on our to do lists. Its going to be a lot harder for the next generations, but its still on our bucket lists.
Reasonable in your situation was being able to afford the home you agreed to buy for the price you paid. If you couldn't afford the home, you shouldn't have bought it and if you couldn't afford to live in the area, you should have moved to an area you could afford.You are ridiculous beyond belief. Did you not read my MANY posts that said I COULD AFFORD THIS HOUSE, I COULD AFFORD THE AREA, I MOVED TO AN AREA WE COULD AFFORD ON PURPOSE! This is what I am talking about. It is called "being responsible" it is truly the assessing of "need" over "want" in that of a realistic measure. you just don't listen, or you are not able to actually understand what I have said over and over again.
You were "wanting" and your "wants" made you disregard that which was "reasonable for YOU"Untrue and it drove you to extend yourself taking risks that the value of your home would in turn be the retirement lotto win.again, not true, it was sound judgement based on long experience and thoughtful decision making Your behavior is what caused a lot of the home prices in many areas to go through the roof and since you were being so unreasonable in your evaluation, the lenders were also taking risks on the loans hoping they could also cash in on your risk. You are now beynd the pale, I* don't know who you have been reading but certainly no My posts. We were NOT unreanable in our evalations, the lenders determined the worth of the house, we took NO RISKS on our loan, plain old conventional loan at a good interest rate with a large down payment. Tell me exactly what you think is "unreasonable" about any of this?????
Those "crazy loans" would never have existed without "crazy buyers" applying for them. I didn't have a crazy loan and have said so many, many, many, many, many times in all my posts if you ever actually paid attntion.
Emotional rhetoric. Those buying and selling were getting partial loans (under short time limits to payoff) and trying to flip the homes fast to turn a quick buck. It worked great for a while, but the behavior caused home values to skyrocket as they flipped for profit over and over and the standard home buyer even more ignorant of the issue got into it thinking they were making a good investment. I don't disagree with you.....I just don't fit into this description.
Who is responsible. The buyer is responsible for being stupid and paying unreasonable prices for homes.true The lender is responsible for creating loans and policies to be able to attend to the buyer when it was a stupid risk.true The insurance companies were responsible for stupidly insuring them and then crookedly bundling them in ways to make them appear as good loans and the government is responsible for pushing stupid policies to approve buyers who should not be approved for the loans. true, again, not me involved in any of that
Yes, it is not entirely the buyers fault, but to point the finger at everyone else is simply a desperate irresponsible move to evade dealing with the responsibilities of the issue. true, not the buyers faults (in some cases) but for sure the buyers fault in many cases....again not my problem, as we were not at fault.
You talk of greedy? A person who gets a loan for a home that they can not afford at the hopes of it fast increasing in price so they can get a pay off... that is a greedy... and it is that greed that leads to irresponsible action. true
Lucky? The moment they shot up in price I saw they were unreasonable jumps. Watching a home go from 160k to 380k in less than a year was not reasonable, it was not normal, it was nothing short of a huge smack to the head that it was a false market, a manipulated market and the values of the homes would be based on air, nothing more. It was observation and responsible attention to the issue that caused me to avoid getting into the market. It was the same thing that led me to assess the value of the current states direction in economic and political factors to which I left the state and moved to a more reasonable one.
I am not blaming you for buying before, I thought while it was certainly fortuitous of those who had bought before the bubble, it was however something unrealistic to see hold for most. Those who bought and sold before it jumped and early made a killing, much like those in the beanie baby market.
You said these prices were already high when you got here? Did it ever occur to you to look into housing prices for the state and area for the last 20 years? what are you talking about? I lived in that state 30 years?Did you do any research about the state you moved to? Did you also not realize California was suffering from many issues? It had extreme taxes in all fronts, poor business practice (increasing costs), terrible corruption with its utility companies (Gray Davis was recalled due to the issue) which created government encouraged monopolies. Environmental laws that are bleeding the state to death and causing mass increasing in prices across the board. It never occurred to you to look into such? aGAIN, not my problem. See above!
oKAY, NOW YOU ARE JUST RAMBLING AND RAMBLING AND RAMBING NONE OFWHAT YOU SAY BELOW HAS ANYTHING TO DO WITH ME SO i'M NOT GOING TO BOTHER WITH ALL THAT STUFF, ARGUE WITH SOMEONE WHO REALLY DID WHAT YOU ARE TALKING ABOUT.
Really? Care to provide the analysis for those trends for us? Homes did increase in price and eventually doubled over time, but to claim they were like this, well... now you are stretching and need to provide some proper support for this claim.
Really? If it was worth more than you paid for it, why is it worth 1/2 of that value now? Because of the housing market tanking Worth is not what the market determines, worth is what the consumer is willing to pay. A true value of something is its natural price which is the cost it takes to produce it and bring it viably to market by the manufacturer.
The homes natural price was far above what you paid for it no it wasn't. Its market price may have been below, but markets are volatile. If you are going to claim that the market is your safety gauge, then you might as well have dumped all of your money into the stock market and then complained when it fell.
A home was only a safe investment in the past because it was a long term investment that over time would eventually pay for itself. Though that trend was not applicable when prices burst to the levels the did. It did not become a safe investment market, it became a fad trading market. true, but not where we bought our home. Housing never went into "bubble mode", but they tanked anyway.
You bought the home according to what you thought it was worth, it should make no difference if it drops below that, it was worth that to you, unless... you were gambling on what it was worth to others (market). You gambled when you stopped searching for a home and began to look for some fast return investmentwhich we didn't do, not sure why I'm writing this yet again. This is exactly what caused instability in the market in the first place. People stopped treating homes as long term stable investments and began to treat them as if they were a day trading commodity to make a quick buck. You can play that game, but it is risky and you better be willing to lose when you do.
Then why are you complaining? Why are you walking away? You say you "did it right" and you "bought it at a good and fair price" with a "proper loan". So why are you walking away?So far, we have been paying for an empty house for 4 years to avoid "walking away", because we wouldn't want to ruin our credit, nor would be think it was the proper way to do things for many of the reasons you stated. We also own a house in Texas that we live in as well. BUT....at the end of next year we will officially be retired or my husband takes a chance at dying at his desk because of high stress job, and if the market is still in freefall and no chance of it turning in a forseeable amount of time, we go into "survival mode" and its let the house go, let the bank recoup their money through short sale or holding onto the VERY LOVELY, VERY VALUABLE CALIFORNIA GOLD COUNTRY MOUNTAIN HOME on property that won't ever lose its value even if the house burned down....and go on with our lives without it ruining us and us living under a bridge. Us or them.....I choose us.
If it is because the house dropped below loan value? Then... well apparently it wasn't a "good and fair" price to you because your contingency was that it would grow in price or stay at that value, a risk of the market, not a value of the home. not a true statement of fact. The housing market was never considered a "risk" loan. Ever! It was the one ASSET, that was considere safe.
You are one of those people. My friend bought a home at a higher value, though he did for other reasons (location, close to work and family, he like the house and its build, etc...) he bought it for a lot more than its actual value because he "wanted" it and he was completely willing to accept the cost of the home at the time to meet those "wants". Now his home wasn't as ridiculous as others in price, but he is about 50k under his loan. It didn't matter to him as this was his home, agreed to the price and believed it was worth it for what he "wanted". Again, a home is more than a "want", to my generation it was not only investment it was what we were willing to put our lives/love/entertainment dollars/investment dollars, vacation dollars....whatever into rather than live the "high life", we were stay at homebodies and our home was everything (and still is to us). It wasn't like buying a new flat screee, or taking a tropical vacation...those are "wants".A home investment is not.
So he is keeping his home, though you are not? Why? You claim you bought the home for several "tangible" reasons, but you can't afford it now, though... that begs the question, how could you afford it before? Thats just a dumb question. We moved, we bought another home, we no longer need that home, we could afford it before, we can afford it now....but at som point in the future...it will no longer be affordable. If it is foreseeable that we would only need to hold on a extra year or so, we could "gut it out", but if there is no foreseeable future for selling the home at what is still due....then why gut it out? Why take a chance with our very lives. Pay for health insurance, food, necessities et c etc. etc. or a house we don't live in.
Are you saying you went out and got a loan that you could not reasonable meet its terms? The more you respond, the more it appears you were playing the fast return game trying to buy a home and turn a buck on it.again, you are not paying attention even to your own post! You've said this at least 3 times in one form or another and I've given you solid answers at lest 3 times....so you figure it out from hr.
No need to, it is evident your position is one of not wishing to hold to the responsibility of your choices as you blame other factors for an issue that really is something of your own choice and condition. well you hold to your opinions and we will do what we do when we do it. I won't even remember this post....when we do get around to doing it.
Your home value in that area was still too high when you bought it. How do YOU KNOW THAT? Have you even a CLUE as to where I lieved?Before the national bubble hit, there were local bubbles as well. We even have them here in Texas. In some places, the homes are stupidly overpriced, far beyond their natural price. In others, the home values are very good, balanced, and reasonable.
The same was in California. There were areas that the homes were on the verge of stupidity high and people getting in over their heads in those areas (defaulting) was quite common. Unless your home is 4000+ sq feet on 1-2 acres of land with all the frills and located in a very prime location, you paid way too much for it even at 426k. It was over inflated then,but but locally. In California anywhere for the last 25 years, you coudn't get a house of that size on land for less than 800.....Texas is huge vast amounts of land, and people don't get paid there value in Texas so its cheap to build here.
Those types of places took the hardest hit after the Bubble burst nationally because they were already over inflated anyway. true
The fact that you "lost out" on your time window to make ridiculous profit on your home is not the markets fault. The market finally reached its reality check and came crashing down. Anyone who was playing the game of the market was just as responsible as everyone else in it. I didn't want to make ANY PROFIT, we wanted to retire in it.
You missed out on your window to cash in on the volatile market and your local market crashed closer to the levels it should be as well. It is unfortunate, and I am sorry for the hardships you are dealing with, but for you to dismiss the responsibility here is... well... to be honest... typical of the problems this nation is having. If you can not accept the responsibility here, which many are attempting to evade through out the country as well, then you will put us right back into these silly markets again because at the end of the day, you can't be cheated on a sale to which you never buy. If more people understood this, we wouldn't have bubbles in the first place.
Also if no American ever took a chance on anything than we wouldn't be the grand country that are. If we don't buy, America doesn't thrive, buying a home creates jobs.
Umm... This is impossible, something is not right... I actually agree with you on this.
Though, I will say, those who were flipping houses like crazy couldn't achieve such if consumers refused to pay such exorbitant prices that developed from such schemes. That is, if people would have done such, then those who were doing such speculation would have been left holding the bag and not the average buyer.
My wife and I took extra means to avoid buying in that market. It wasn't always comfortable or easy as it would be to simply just pay for the over inflated homes, but we also avoided getting stuck with ridiculously over priced home.
Agree with both of you, although Nomander doesn't seem to get it that I do agreee wth him on this issue.
There is no "if" for us - we *are* upside down on our mortgage, though not to the tune of 50%. Yes, it would be wrong to walk away from the mortgage, so long as we are able to pay it. My parents raised me to honor my commitments...
If a homeowner owes more on their mortage than the home is currently worth, say
Mortgage: $200,000
Value: $100,000
Under water: $100,000
Would it be wrong for him/her to stop making payments and walk away?
I have never owned a home myself and probably never will so I don't know much about it. But how can you get under water in the first place? Because of interest rates due on the money not paid? Else you would simply continue to own the same amount unless you pay yet another junk, right? Does the total sum you have to pay over the decades stay the same or do the interest rates change over time?
Anyway, the home is as good or bad as it used to be when you decided to get it. So, unless you want to sell it anyway, who cares what it would be worth on the market? Either sell it or pay off the mortgage...
You might also rent a room or two to someone, that is a steady source of income and won't hurt you much in terms of space.
If you're living where you want to be, or where you have a job, and can afford the house payment, why walk away?
I understand if you lost your job and found another one somewhere else that you'd be forced to sell at a loss and would have to decide whether to walk away from that debt or not, but if you look at your house as a place to live rather than just an investment (gone bad) why not just try to ride it out?
There is no "if" for us - we *are* upside down on our mortgage, though not to the tune of 50%. Yes, it would be wrong to walk away from the mortgage, so long as we are able to pay it. My parents raised me to honor my commitments...
And YOU ARE correct. And as long as you hold your jobs and can continue to pay that mortgage you should, it's the right thing to do. But many couldn't. They lost their jobs, their spouses lost their jobs, they either had to walk away from their homes or.....well there wasn't any or's. nothing they could do about it. Let's all keep our fingers crossed you keep working.
And YOU ARE correct. And as long as you hold your jobs and can continue to pay that mortgage you should, it's the right thing to do. But many couldn't. They lost their jobs, their spouses lost their jobs, they either had to walk away from their homes or.....well there wasn't any or's. nothing they could do about it. Let's all keep our fingers crossed you keep working.
Agreed, 100%. However "walking away" as couched by the OP's question seems to imply a conscious decision, not an inevitability. Perhaps I'm reading too much into it?
If you can't pay, you're not "walking away" from your house - the bank is taking it.
Agreed, 100%. However "walking away" as couched by the OP's question seems to imply a conscious decision, not an inevitability. Perhaps I'm reading too much into it?
If you can't pay, you're not "walking away" from your house - the bank is taking it.
If they were speaking of walking away "just because".....My answer was bases on whether or not it came down to an emergency situation. I don't think too many people (although probably some) would walk away for expedience sake. I know my son and daughtere in law paid at the height of the boom and wasn't too smart with the loans they took and just wanted what they wanted....but they didn't walk away, they are just in a situation that they are stuck where they are for another decade to recoup. They have many more years working so they don't have to worry about it too much at this point.
There is no "if" for us - we *are* upside down on our mortgage, though not to the tune of 50%. Yes, it would be wrong to walk away from the mortgage, so long as we are able to pay it. My parents raised me to honor my commitments...
Good for you. Walking away from a debt is immoral and theft.
I have never owned a home myself and probably never will so I don't know much about it. But how can you get under water in the first place? Because of interest rates due on the money not paid? Else you would simply continue to own the same amount unless you pay yet another junk, right? Does the total sum you have to pay over the decades stay the same or do the interest rates change over time?
.
Many people got under water because they bought a house they could not really afford with 1 to 5% down. When the value dropped, the house became worth less than their loan. That is not a problem until you sell the house or until you lose your job and can't make the payments.
Most people who are under water are continuing to make their payments and have no problem.
There are a wide variety of loans; some have fixed rates, others have variable rates.
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Me too!
Else you would simply continue to own the same amount unless you pay yet another junk, right? Does the total sum you have to pay over the decades stay the same or do the interest rates change over time?
