DjTj Posted February 15, 2009 Share Posted February 15, 2009 Not really, IMO. People assume that if banks fail that there aren't other types of financial institutions that can come behind and fill in. Alot of the local smaller banks are doing fine and didn't need bailouts becuase they didn't do stupid things. people IMO think that if these banks fail without a bailout that a big black hole will be left, and again IMO I doubt that will happen. It won't be a complete black hole, but while local banks would be fine to help with personal finance, they aren't going to be able to provide the kind of large-scale financing necessary for modern capital markets.Capitalism Works!!!Yes, over time, smaller banks will grow to fill all of those niches, but maybe we don't want to go through that kind of major dislocation.Capitalism might work by bankrupting major financial institutions, putting millions out of work, and having the market rebuild itself over a few years, but maybe, instead of hitting bottom and building back up from that kind of dire situation, we can use some government money to prop things up for a while. BAD laws/regulations are worse then noneOf course bad laws/regulations are worse than none. But we can argue over what "bad" is...I agree wholeheartedly with IHOPSkins first post. The responsible person got screwed as well, because they bought an artificially inflated house no matter what! I'm not for government handouts, but if they are a given, hook this guy up. I still have $12000 MORE to spend on my wedding and every dollar counts!I don't think IHOP or SHF would call you responsible ... you should have not bought a house at all in protest of the government's undue influence in the free market. Is that right? :whoknows: Link to comment Share on other sites More sharing options...
chipwhich Posted February 16, 2009 Share Posted February 16, 2009 To make it even simpler, if I buy a car and the saleman tells me about this to good to believe deal, I'm going to ask, "what's the catch"? Or at the very least ask him to explain and show me paperwork that has the details. Like the saying goes, the devils in the details. Yeah but here's the thing. There was no catch as long as the value of homes kept rising and interest rates kept dropping. Everyone managed just fine. But when the mortgage rates started to rise and home prices dropped it all went south. Anyway, Americans can't even manage their credit cards, I wouldn't expect much more out of them on a mortgage. Link to comment Share on other sites More sharing options...
ccsl2 Posted February 16, 2009 Share Posted February 16, 2009 Don't forget the people who bought house that they could afford based on their JOBS. Then one or both of them lose said JOB, through no fault of their own. They don't deserve help??? Everyone in a foreclosure situation didn't get into a house they couldn't afford. :2cents: Link to comment Share on other sites More sharing options...
DaveMason Posted February 16, 2009 Share Posted February 16, 2009 I got foreclosed on a little less than a year ago. I guess I am the idiot that everybody hurls generalized insults towards--I got the ARM, the way overpriced house that I could barely afford, etc. I wanted to be a home owner, and everything was way too expensive. It's embarassing, but hey...stuff happens. I hate the victim mentality. I wasn't preyed upon by greedy lenders--I knew what I was getting into. This isn't rocket science--the terms of the loan were very clear to anybody with half a brain. I made an unwise purchase, and the bank made an unwise loan...and we are both paying for it. That's really all there is to it. This bailout stuff is silly. I certainly feel for the people who have lost their jobs as opposed to people who just bought outside of their means, but even then, everybody who purchases a home knows there are risks involved. Jobs don't last forever...go find a cheap rental until you can get back on your feet. I'm not convinced the government needs to bail everybody out. ...although I wouldn't mind some kind of relief so that people with F'ed up credit(due to foreclosure) can buy a home again. I'd love to buy something at today's prices. I promise I'd pay this time! By the time all this bailout stuff goes into effect, today's "distressed" home-owners will aleady be forcelosed on. Where's the relief for my demographic of deadbeats, Obama? Link to comment Share on other sites More sharing options...
IHOPSkins Posted February 16, 2009 Share Posted February 16, 2009 I have a strong feeling that Bush or McCain would've done the exact same thing......McCain voted against itHis bill would NOT have been exactly the same Link to comment Share on other sites More sharing options...
DeanCollins Posted February 16, 2009 Share Posted February 16, 2009 this bail out of home buyers is making me ill. I bought a home last year, put 20% down made all my payments (always have). Let the ****es go through foreclosure. It'll boost the rental market (I have 4) and allow me to buy some more cheap houses. Link to comment Share on other sites More sharing options...
Bubble Screen Posted February 16, 2009 Share Posted February 16, 2009 Well that's not really what happened.I will give you the readers digest version. Couple goes in to buy house. Lets say at 350K. Loan Officer says I have this great program that will get you into a better house...lets say 450K....but payments at the same 350K house. Couple puts 5% down...or 22,500. Couple is thrilled. Loan officer is thrilled. Couple gets qualified for a payment on a 450K loan which is a 3 year interest only arm. Loan officer tells couple, the real estate market is going through the roof. This is an incredible investment, you are getting an amazing deal. Couple signs papers. 3 years later, interest only arm ends. House they paid 450 for is now worth 350-400K. They now have negative equity in the house. They can't move because they can't afford to pay someone to take their house. Even if they could pay someone the negative equity, they can't sell it because nobody wants to buy it. The great loan program they got, their payments just jumped $700 a month. They didn't understand the program in the first place. Now they can't sell it, they can't make payments on it, and the bank doesn't want to hear it. While I think it's shameful people don't understand finances...I would say most of them didn't plan on their house being worth 50-100-150K less than when they bought it. ARM=complete FAIL...I have very little sympathy for someone who chooses this type of loan. I mean, how hard is it to understand that your rate could "adjust", or go up? Link to comment Share on other sites More sharing options...
Bubble Screen Posted February 16, 2009 Share Posted February 16, 2009 We just bought our first house last year. We were approved for $500K, competitive credit and extremely good debt-to-income ratio and NO CASH. We said, "uh great, we're not 1/2 million dollar house type people." Let's put it this way, we said that $330K was outside of our means. At the time we grossed $130K / year. That's a 33% difference in principal approaved and about 30% of our gross income we KNEW was a stretch!I agree wholeheartedly with IHOPSkins first post. The responsible person got screwed as well, because they bought an artificially inflated house no matter what! I'm not for government handouts, but if they are a given, hook this guy up. I still have $12000 MORE to spend on my wedding and every dollar counts! If you and your wife make $130,000 (combined) a year, you could EASILY afford a 330K home. Just sayin... Link to comment Share on other sites More sharing options...
IONTOP Posted February 16, 2009 Share Posted February 16, 2009 I'm a "distressed" homeowner now... Because of the economy... Being a bartender, when your business goes down about 40%, your income suffers... I could not have foreseen something this dramatic when I bought my home 2 years ago... I'm sure I could be in a better situation with some drastic changes, (downgrading my car [currently have about $5,000 positive equity in it], cutting off internet/Cable, not ordering in once a week), but my overall happiness is more important, plus if I did some of those things, it might lead me to go spend money (socializing, b/c this, world of warcraft, facebook save me a hell a lot of money b/c it's mostly free [WoW is $13/month]) Do I want a bailout? Kinda mixed, I don't like getting helped, yet, I bought my place by myself at the age of 22 so I'm stuck with a 8.25% interest rate... I don't want money from the govt, but I would like to see my interest rate drop... And my condo I bought for $83,500 and with my interest rate I'm paying $800/month... I'd be a hell of a lot better off if that would drop $100-200/month... Link to comment Share on other sites More sharing options...
Bubble Screen Posted February 16, 2009 Share Posted February 16, 2009 I'm a "distressed" homeowner now... Because of the economy... Being a bartender, when your business goes down about 40%, your income suffers... I could not have foreseen something this dramatic when I bought my home 2 years ago... I'm sure I could be in a better situation with some drastic changes, (downgrading my car [currently have about $5,000 positive equity in it], cutting off internet/Cable, not ordering in once a week), but my overall happiness is more important, plus if I did some of those things, it might lead me to go spend money (socializing, b/c this, world of warcraft, facebook save me a hell a lot of money b/c it's mostly free [WoW is $13/month]) Do I want a bailout? Kinda mixed, I don't like getting helped, yet, I bought my place by myself at the age of 22 so I'm stuck with a 8.25% interest rate... I don't want money from the govt, but I would like to see my interest rate drop... And my condo I bought for $83,500 and with my interest rate I'm paying $800/month... I'd be a hell of a lot better off if that would drop $100-200/month... You can always take your tax money and refinance, if you are planning on getting something back. You can get a MUCH lower rate than you're currently getting. Btw, only $800 a month? Man, I'd be living like a KING if that's all I paid each month. Link to comment Share on other sites More sharing options...
IONTOP Posted February 16, 2009 Share Posted February 16, 2009 You can always take your tax money and refinance, if you are planning on getting something back. You can get a MUCH lower rate than you're currently getting. Btw, only $800 a month? Man, I'd be living like a KING if that's all I paid each month. Nope I can't... "Distressed" means you've missed a few payments... I hate to admit it, but some months, the money didn't come in like I expected it to... Plus change in management, my hours getting cut to 25/week one week and 40 the next, and so on... So hard to plan a budget like that... And I'm going to assume you make more than $20k-25k/year... Link to comment Share on other sites More sharing options...
D'KanSkinFan Posted February 16, 2009 Share Posted February 16, 2009 I'm a "distressed" homeowner now... Because of the economy... Being a bartender, when your business goes down about 40%, your income suffers... I could not have foreseen something this dramatic when I bought my home 2 years ago... I'm sure I could be in a better situation with some drastic changes, (downgrading my car [currently have about $5,000 positive equity in it], cutting off internet/Cable, not ordering in once a week), but my overall happiness is more important, plus if I did some of those things, it might lead me to go spend money (socializing, b/c this, world of warcraft, facebook save me a hell a lot of money b/c it's mostly free [WoW is $13/month]) Do I want a bailout? Kinda mixed, I don't like getting helped, yet, I bought my place by myself at the age of 22 so I'm stuck with a 8.25% interest rate... I don't want money from the govt, but I would like to see my interest rate drop... And my condo I bought for $83,500 and with my interest rate I'm paying $800/month... I'd be a hell of a lot better off if that would drop $100-200/month... So, do you own your bar, or are you a hired bartender? It's a sad thing about the economy~ when the money gets tight, people tend to drink at home But, you should be able to get a much better home interest rate~ I would talk to the lending institution about getting an appraisal done and a refinance on the loan. You're not defaulting; so I would think they would want to refinance your loan to keep it solvent. It doesn't hurt to ask; we did a few years back and got 1.25% lower interest rate because of the excellent payment score we had with the lending institution. It doesn't hurt to ask~ good luck:) Link to comment Share on other sites More sharing options...
IHOPSkins Posted February 16, 2009 Share Posted February 16, 2009 .....I'd be living like a KING if that's all I paid each month.Here HereI live in exception land....as in "Does not apply in California" The California Retirement Plan?.....sell your house/move to another state/buy a big house/live off the rest :doh: Link to comment Share on other sites More sharing options...
chipwhich Posted February 16, 2009 Share Posted February 16, 2009 this bail out of home buyers is making me ill. I bought a home last year, put 20% downmade all my payments (always have). Let the ****es go through foreclosure. It'll boost the rental market (I have 4) and allow me to buy some more cheap houses. 20% down is an absolute joke in the DC market where houses have gone down in value 30+ percent. Whats your point? My buddy has a house for sale that he paid 487K for. He just had it refinanced with an appraised value of 495K. It's been on the market for a year for 450K and it's been reduced to 395K. Thats how screwed up the banking system is. What you got? I have a deal for you deancollins. Link to comment Share on other sites More sharing options...
DjTj Posted February 16, 2009 Share Posted February 16, 2009 Nope I can't... "Distressed" means you've missed a few payments... I hate to admit it, but some months, the money didn't come in like I expected it to...Plus change in management, my hours getting cut to 25/week one week and 40 the next, and so on... So hard to plan a budget like that... And I'm going to assume you make more than $20k-25k/year... Well, try to build up your savings, and hold out as long as you can ...From the article in the OP, As the administration moved closer to announcing its plan, J.P. Morgan Chase, Bank of America, Citigroup and several other lenders announced temporary moratoriums on foreclosures of owner-occupied properties. The moratorium, while temporary, gives the Obama administration some needed time, Frank said. "It takes a little of the heat off of Geithner," he said.J.P. Morgan Chase and Bank of America said their moratoriums would last through March 6. Citigroup said its moratorium would last until the administration finalizes details of its loan-modification program, or March 12, whichever is earlier. This fulfills a pledge Citi's chief executive, Vikram Pandit, and others made to the House Financial Services Committee on Wednesday. "Citi is taking the necessary steps to help American homeowners keep their homes," the firm said in a statement. most banks seem to be holding off on foreclosures for at least a while ... It will be easiest to restructure your loan if you can bring some cash to the table. Link to comment Share on other sites More sharing options...
chipwhich Posted February 16, 2009 Share Posted February 16, 2009 20% down is an absolute joke in the DC market where houses have gone down in value 30+ percent. Whats your point?My buddy has a house for sale that he paid 487K for. He just had it refinanced with an appraised value of 495K. It's been on the market for a year for 450K and it's been reduced to 395K. Thats how screwed up the banking system is. What you got? I have a deal for you deancollins. BTW deancollins, he will sell you the house for 395K. He only had to take it off the market for 1 day to get his 495K appraisal. Thats a fast 100K in your pocket. Link to comment Share on other sites More sharing options...
LegionOfDoom Posted February 16, 2009 Share Posted February 16, 2009 Yes they should! Link to comment Share on other sites More sharing options...
Bubble Screen Posted February 16, 2009 Share Posted February 16, 2009 Nope I can't... "Distressed" means you've missed a few payments... I hate to admit it, but some months, the money didn't come in like I expected it to...Plus change in management, my hours getting cut to 25/week one week and 40 the next, and so on... So hard to plan a budget like that... And I'm going to assume you make more than $20k-25k/year... Sorry for your predicament. That sucks. And, hell, at $800, you can't even get a nice apartment for that, even if you wanted to get out of your loan and go that route. Yeah, I make more than that. Quite a bit more, acutally. But big changes, I hear, are in store at my place of employment as well. And they're not good. My pay likely won't get cut. But my hours could change and whatnot. Hang in there, though, man. Everyone is going through tough times. But I have faith it will turn around in a year or so. At least one can hope. Link to comment Share on other sites More sharing options...
NattyLight Posted February 16, 2009 Share Posted February 16, 2009 this bail out of home buyers is making me ill. I bought a home last year, put 20% downmade all my payments (always have). Let the ****es go through foreclosure. It'll boost the rental market (I have 4) and allow me to buy some more cheap houses. Dude, not many people, especially first time homebuyers were in a realistic position to put down 20% because they had no equity in a previous home. Seriously, what 26 year old has $60K cash to put down on their first home? If you and your wife make $130,000 (combined) a year, you could EASILY afford a 330K home. Just sayin.. As for my situation, and the "it's easy to make what I do and make a $330K mortgage" statement still doesn't apply when we're making $145,000 this year. Easy is relative, I guess, isn't it? We do other things than just sit on our couch. As two people with taxes, insurance, a little extra towards principal and mortgage we pay $2000 a month. We live in the sticks of southern MD. It would be $500-600 / month more if we had a $330K note. Look, we eat and party well, can save for a wedding, vacations, and holidays; but we still worry about money. We were paying less than 1/2 of our mortgage for rent in a nicer house before "realizing the American dream of home ownership". Link to comment Share on other sites More sharing options...
Destino Posted February 16, 2009 Share Posted February 16, 2009 The feds aren't aiming to bailout the owner. They are trying to fix the economy. The housing market in the US has a very large effect on the economy overall. I'm sure that your concern of getting the best possible deal in the middle of this problem is high on their minds however. Also I hate the pathetic tone in these threads. The government would have bailed me out... I wonder if before writing little pissy self important comments people take the time to research anything at all. Here is how this has affected you if you have done nothing wrong: - Your house may be valued below what it is really worth because lenders are forcing appraisals to use REO comps that may be in terrible shape. They've also shrunk the window to 60 days which complicates valuation and results in people having to accept less than buyers are offering to get a deal done. - If you wanted to invest you'll be delighted to know that you know have to put a great deal more money down than you did before. Oh and before you tell me "good I have the money" the guidelines now state you can only finance 4 houses instead of 10 and still be considered conforming. Doesn't matter if it makes business sense your chance to profit has been reduced dramatically. - Your state is going to lose a ton of money from the decline in propert values. Enjoy the tax increases (which will affect people that don't even own homes) Link to comment Share on other sites More sharing options...
Destino Posted February 16, 2009 Share Posted February 16, 2009 20% down is an absolute joke in the DC market where houses have gone down in value 30+ percent. Whats your point? Did you miss the rental part of his rant? He doesn't want people to be able to buy. A lot of people would prefer that most can't. Investing is great with a strong rental market. It's an investment the investor doesn't pay for if he can keep someone in it. He mentions that he owns 4 so I hope for his sake he owns them free and clear. Otherwise that 20% down idea turns into near 50 and the rates are hilarious. More than 4 puts him outside conforming guidelines. I can't tell you how annoying that rule change has been for me. Link to comment Share on other sites More sharing options...
DeanCollins Posted February 16, 2009 Share Posted February 16, 2009 20% down is an absolute joke in the DC market where houses have gone down in value 30+ percent. Whats your point?My buddy has a house for sale that he paid 487K for. He just had it refinanced with an appraised value of 495K. It's been on the market for a year for 450K and it's been reduced to 395K. Thats how screwed up the banking system is. What you got? I have a deal for you deancollins. why is he selling? now is not the time to sell, he should just sit on it. BTW deancollins, he will sell you the house for 395K. He only had to take it off the market for 1 day to get his 495K appraisal.Thats a fast 100K in your pocket. I don't flip them, so they have to have positive cash flow after 20% down. I can buy 3/2/2 homes here, in decent neighborhoods, for around $100k and get $1200-$1500 per month rent. You do the math. Link to comment Share on other sites More sharing options...
NattyLight Posted February 16, 2009 Share Posted February 16, 2009 As for the topic of the thread, the banks and brokers were 100% complicit and in most cases negligent in lending practices exercised over the last 5 years. Thus, any benefit they receive should be received by those affected. Which is all of us. Link to comment Share on other sites More sharing options...
DeanCollins Posted February 16, 2009 Share Posted February 16, 2009 Natty, I don't get it. I bought 2 houses in the last 4 years. I still have both (and several others). I don't have my hand out looking of something for nothing. A house is an investment like anything else. If a person pays too much for a property and/or borrows more than they can afford to repay, how is that not their fault? Link to comment Share on other sites More sharing options...
NattyLight Posted February 16, 2009 Share Posted February 16, 2009 Natty, I don't get it. I bought 2 houses in the last 4 years. I still have both (and several others). I don't have my hand out looking of something for nothing. A house is an investment like anything else. If a person pays too much for a property and/or borrows more than they can afford to repay, how is that not their fault? You're an educated person in these matters, I am not. However, I am educated and somewhat smart in general terms. Sadly, there is likely a preponderance of uneducated, dumb people in the world. I believe that there was an irresponsibilityl passed in the Clinton administration, a litany of ad campaigns, and other mechanisms that pulled the wool over the American people's eyes that was horrible for this country. Educated people are now ****ed for knowingly ****ing-over really dumb people. Why should either be any 'better" off than the other? I find it difficult to understand this if you are not directly affected. I do not believe either of us are, but our country very much is. That's why I'm real cautious about this. No need to have a toxic view against countrymen who may have made a mistake, when the folks that had more money than God welcomed it. Link to comment Share on other sites More sharing options...
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