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Does anyone else have little sympathy (mrtge r)?

4YearGraduate4YearGraduate 2,945 Posts
edited October 2008 in Strut Central
Family on CNN right now talking about we might lose our home and we expect the government to step in - we didn't know that the ARM loan would go up.b,121b,121HUH?!b,121b,121What the F*ck did these people think ARM stood for? Awesome Rate Mortgage? Yeah i know it was nice to buy a home with a stated income, no money down, interest only 2 year ARM - but what the F*ck did these people think the "2 year ARM" meant? Muthafuckas on the news talking about it's not fare the rate has jumped up. Ok so your mortgage payments were 400$ for two years and now what? You couldn't afford the home then and you can't afford it now. I don't see that as a government problem.b,121In the meantime people kept consuming beyond their means, and now that their raised trucks are getting repossessed, i have a hard time feeling sympathetic. Oh god we can't afford to pay our best buy credit card we maxed out! b,121b,121Most Americans don't know what poor means yet compared to other countries. I don't see 3 years olds selling gum at stop lights yet. I have a hard time feeling sympathetic.b,121b,121/Rant
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  • DJBombjackDJBombjack Miami 1,665 Posts
    There has been a fair number of lenders not fully explaining the 'rules' of certain types of mortgages though. As the saying goes 'Let the buyer beware'... but you can't help but feel that at least some of these people had the wool pulled over their eyes.
  • keithvanhornkeithvanhorn 3,855 Posts
    you sound like a republican
  • 4YearGraduate4YearGraduate 2,945 Posts
    I see that, but when someone buys a home on a "two year arm" you would think they would have to wonder what the "two year" meant.b,121b,121Aside from that owning a home is a huge responsibility. You can't walk away when the the first property tax bill comes in because you didn't know. There are a lot of factors you have to educate yourself about when you buy a home, so I am seeing the "we didn't know" argument a lot more cynically know a days.
  • 4YearGraduate4YearGraduate 2,945 Posts
    I sound like someone who thinks people should be responsible for their excesses.b,121b,121I am no party but i am voting for Obama, thanks.b,121b,121I think i need to turn CNN off and clean my garage.
  • DJBombjackDJBombjack Miami 1,665 Posts
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    b,121. There are a lot of factors you have to educate yourself about when you buy a home
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    font class="post"1b,121b,121Agreed. Back in the 90s I owned a property with an adjustable rate mortgage. The first year was great - low repayments. Then after that 'grace' period, the repayments jumped higher EVERY MONTH. Luckily I managed to flip it and make a profit... but never again. Give me 6% over the next 30 years.b,121b,121My parents always taught me to shop around... get as many opinions and prices as you can, because guaranteed the one that sounds too good to be true will be.b,121b,121(Oh and i'm renting now. And will be for the next few years. F*ck buying.)
  • kitchenknightkitchenknight 4,922 Posts
    There was most certainly some fraud and dishonesty on the part of mortgage lenders- there is no doubt about that.b,121b,121At the same time, there was definitely greed and naivety on the part of the buyer.b,121b,121Unfortunately, we are truly all in this shit now... Be us buyers, lenders, or neither.
  • 4YearGraduate4YearGraduate 2,945 Posts
    I think people are lying. b,121I think with the amount of paperwork you have to fill out to purchase a home at some point the "creative financing" has to come into question. Sure I place some blame on the lenders but seriously - everyone they are interviewing on the news has this "I didn't know the rates would go up" sob story. I'm not buying it anymore. They knew and they thought they would be able to refinance before the arm was up. And in the meantime instead of saving, they spent and extended themselves on credit. Now that they can't re-fi alot of stories are springing up. b,121b,121I like how me thinking some amount of responsibility should be accepted by the buyers makes me "Republican" b,121b,121that's awesome. This isn't welfare or people on hard times. I am talking about people who tried to take advantage of a system that was spiraling out of control are now getting their asses hand to them. YOU DONT HAVE TO OWN A HOME TO BE SOMEBODY.b,121b,121I have a son and i don't like what these bailouts are teaching him about cause and effect, responsibility and accountability. I fret for future generations.
  • CosmoCosmo 9,768 Posts
    I was listening to "A Baby" last night.b,121b,121The wife and I have been very close to buying a home. Now I don't know if it's going to happen.b,121b,121I see what you're saying though, man. Real shitty times.
  • DJ_NevilleCDJ_NevilleC 1,922 Posts
    I hear both sides. My wife and I were VERY close to buying a house last year. It was definitely more than we could (should) have afforded but the real estate agent was making very convincing arguments as to why we could afford it and some creative mortgaging was involved. In the end we backed out and the market started tanking a month later. Phew.b,121I do think some folks got in over their heads but as the son of stock broker I know (and everyone else should also) that markets fluctuate. The thing that sucks this time around is that so many people have their 401K's wrapped up in the market.
  • keithvanhornkeithvanhorn 3,855 Posts
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    h,121
    b,121I think people are lying.
    b,121I think with the amount of paperwork you have to fill out to purchase a home at some point the "creative financing" has to come into question. Sure I place some blame on the lenders but seriously - everyone they are interviewing on the news has this "I didn't know the rates would go up" sob story. I'm not buying it anymore. They knew and they thought they would be able to refinance before the arm was up. And in the meantime instead of saving, they spent and extended themselves on credit. Now that they can't re-fi alot of stories are springing up.
    b,121
    b,121I like how me thinking some amount of responsibility should be accepted by the buyers makes me "Republican"
    b,121
    b,121that's awesome. This isn't welfare or people on hard times. I am talking about people who tried to take advantage of a system that was spiraling out of control are now getting their asses hand to them. YOU DONT HAVE TO OWN A HOME TO BE SOMEBODY.
    b,121
    b,121I have a son and i don't like what these bailouts are teaching him about cause and effect, responsibility and accountability. I fret for future generations.
    b,121
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    h,121
    font class="post"1b,121b,121b,121b,121stop. your argument relies on a specific premise (that people smart enough to know they would eventually get stung by an ARM mortgage, did so in greed, relying on the upward trend of the housing market to provide equity for the future years), that may or may not apply to some, but surely not all of those who are facing foreclosures right now.b,121b,121it also doesn't take into account the myriad of factors that only someone with a crystal ball could have predicted. nor does it take into account the fact that MORTGAGE BROKERS are the biggest culprits in this whole mess. They had nothing to lose and everything to gain by getting someone in a mortgage they couldn't afford. commissions are made immediately. perhaps you are so business savvy that a broker could never pull one over on you, but speak for yourself, don't generalize.....and unless you are referring to some dude who just lost the vacation home that he got with an ARM, i'm really not seeing your outrage.b,121b,121b,121b,121b,121b,121 img src="/ubbthreads/images/graemlins/walkawaysonfinal.gif" alt="" 21
  • CousinLarryCousinLarry 4,618 Posts
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    h,121
    b,121I hear both sides. My wife and I were VERY close to buying a house last year. It was definitely more than we could (should) have afforded but the real estate agent was making very convincing arguments as to why we could afford it and some creative mortgaging was involved. In the end we backed out and the market started tanking a month later. Phew.
    b,121I do think some folks got in over their heads but as the son of stock broker I know (and everyone else should also) that markets fluctuate. The thing that sucks this time around is that so many people have their 401K's wrapped up in the market.
    b,121
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    h,121
    font class="post"1b,121b,121b,121They really do try and push you to a more expensive home. My wife and I bought a house two years ago and are not paying that much more than we were paying in rent. We had to look at a lot more homes to find a good one in our range, but it was well worth it. Our property taxes took a jump the first year but should level out now so we know what kind of payments we are looking at for however long we decide to stay here.
  • SnappingSnapping 995 Posts
    Mortgage brokers could make a good case for ARMs and interest only mortgages when the house values had been steadily increasing for 10 years. Many people who bought houses with these kind of mortgages at the beginning of the housing bubble did quite well with them because they were easily able to refinance when their house had doubled in value! People who got these risky mortgages more recently were sold on those stories and now they are screwed because they cant refinance. I am not saying this to make excuses for people who were unrealistic in their willingness to assume debt. But I do think that they were led astray by the artificially inflated housing market and the financiers who had been steadily profiting from it.
  • GaryGary 3,982 Posts
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    h,121
    b,121 YOU DONT HAVE TO OWN A HOME TO BE HOMEY.
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    font class="post"1b,121b,121b,121Whats up with those photos homey?
  • 4YearGraduate4YearGraduate 2,945 Posts
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    b,121I think people are lying.
    b,121I think with the amount of paperwork you have to fill out to purchase a home at some point the "creative financing" has to come into question. Sure I place some blame on the lenders but seriously - everyone they are interviewing on the news has this "I didn't know the rates would go up" sob story. I'm not buying it anymore. They knew and they thought they would be able to refinance before the arm was up. And in the meantime instead of saving, they spent and extended themselves on credit. Now that they can't re-fi alot of stories are springing up.
    b,121
    b,121I like how me thinking some amount of responsibility should be accepted by the buyers makes me "Republican"
    b,121
    b,121that's awesome. This isn't welfare or people on hard times. I am talking about people who tried to take advantage of a system that was spiraling out of control are now getting their asses hand to them. YOU DONT HAVE TO OWN A HOME TO BE SOMEBODY.
    b,121
    b,121I have a son and i don't like what these bailouts are teaching him about cause and effect, responsibility and accountability. I fret for future generations.
    b,121
    b,121
    h,121
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    b,121
    b,121
    b,121
    b,121stop. your argument relies on a specific premise (that people smart enough to know they would eventually get stung by an ARM mortgage, did so in greed, relying on the upward trend of the housing market to provide equity for the future years), that may or may not apply to some, but surely not all of those who are facing foreclosures right now.
    b,121
    b,121it also doesn't take into account the myriad of factors that only someone with a crystal ball could have predicted. nor does it take into account the fact that MORTGAGE BROKERS are the biggest culprits in this whole mess. They had nothing to lose and everything to gain by getting someone in a mortgage they couldn't afford. commissions are made immediately. perhaps you are so business savvy that a broker could never pull one over on you, but speak for yourself, don't generalize.....and unless you are referring to some dude who just lost the vacation home that he got with an ARM, i'm really not seeing your outrage.
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    b,121
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    font class="post"1b,121b,121I don't have an argument, I have a rant, like I clearly stated in my firs tpost. Up your reading comprehension playboy. b,121b,121I don't know where you live or whats happening there so i can't comment but here in LA it doesn't make sense to pin the mess solely on mortgage brokers. I appreciate your sarcasm and snide comments but blindly defending everyone facing foreclosures is ridiculous. The best way to get this country back on track is for EVERYONE to accept the responsibility and their part in this mess and that includes homeowners facing foreclosure.b,121b,121If you own a home then you know that every month on the mortgage statement there is a very clear breakdown of what you have paid towards principal, what you owe, what your interest rate is etc. That has nothing to do with business savvy homeboy. It takes the same level of intelligence to read a credit card statement. This is what you spent, this is what you will owe, this is the minimum payment etc. b,121b,121For the hardworking people who have been trying to purchase a home but can't now because of whats happening in the lending circuit - I feel for you. For those of you that purchased an extra 2000 square feet in Riverside you KNOW you didn't need and now can't make your payments, sorry man, your shit out of luck. And your mcmansion fucked the environment by increasing your carbon imprint. And by moving out to the IE to afford a MUCH bigger house you have to pay more for gas to get to work, etc. etc. My pity is short. b,121refi) in order to win big with a big house. I ain't havin it and you get no love. b,121b,121An interesting sidenote: I purchased a certain record from a notorious Toronto shop owner for wayyyy more than it was worth because I didn't do my research ahead of time and got excited at the prospect of owning a breakbeat. A a month later I realized the record was worth 1/10th of what I paid AND a box of them turned up devaluing the record even more. I still had to pay my credit card bill that month though. No bailout for the grippers.b,121b,121see how that works chief?
  • Birdman9Birdman9 5,417 Posts
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    b,121I sound like someone who thinks people should be responsible for their excesses.
    b,121
    b,121I am no party but i am voting for Obama, thanks.
    b,121
    b,121I think i need to turn CNN off and clean my garage.
    b,121
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    h,121
    font class="post"1b,121b,121There were and still are No Down Payment, 30 year fixed loans out there for those willing to take their time and do things the right way around. I got mine through a href="http://www.naca.com" target="_blank"1NACA back in 2002, and a 5% interest rate to boot. But I saw people in the program grow tired of being told "you can't afford a $250k house on $40 grand a year", or you haven't saved enough money yet to qualify, while Mortgage Brokers were out there trying to get people to sign up people while the market was hot, and stupid stuff like yearly salary or solid credit history didn't disqualify you. A lot of people screwed themselves, and while I have the sympathy for them of someone who has also made desicions that have screwed myself, the same folks have to accept their situation and figure out what's next. If they can get the help from the bailout, God bless 'em, but this system is not too forgiving...and the bailout probably will help them last.b,121b,121it's the folks who are losing their jobs and can't pay reasonable, fixed mortgages(or rent) that I have A LOT of sympathy for....they are the casualties.
  • DORDOR Two Ron Toe 9,902 Posts
    The fact is anyone who is buying a home, should almost always search for a good lawyer. When we bought our place we asked almost everyone we knew if they ever used a good real estate lawyer. Found an amazing one and it cost a 1000 bucks. Best grand I ever spent. They take care of all the paperwork, explain every question you might have and dealt with the developer very well. Even let us know any rebates & tax refunds we were entitled to.b,121b,121b,121Now I would never even think twice about buying a place without using one.
  • keithvanhornkeithvanhorn 3,855 Posts
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    refi) in order to win big with a big house. I ain't havin it and you get no love. b,121b,121h,121
    font class="post"1b,121b,121you don't know what you are talking about. plenty of people have ARM mortgages, and whether you are directing your disdain at just those people who bought "the big house they couldn't afford", maybe i should remind you that half of the country lives off of credit cards. your stereotype is just dead wrong unless you are referring to an extremely small part of the population i'd call speculators. if these are families on tv, they don't fit the bill.b,121b,121moreover, there are so many other factors at play in the financial world. if someone can't pay there ARM mortgage right now, its just ignorant to assume that they knew that they NEVER would have been able to pay, and that they gambled solely on an upward spiraling housing market. b,121b,121b,121unemployment numbers are ridiculously high. middle class wages are stagnant. energy prices are high across the board. credit is being erased off of people's credit cards every month. its impossible to get a loan. b,121b,121add all these things up + a stock market that just knocked out 40% of most people's retirement funds and/or savings.b,121b,121b,121b,121 img src="/ubbthreads/images/graemlins/ss.gif" alt="" 21
  • 4YearGraduate4YearGraduate 2,945 Posts
    OK, how about I say the same thing for a third time, and let me be very clear my friends:b,121b,121Who i have sympathy for: Family losing job, face losing homeb,121b,121Who I have no love for: Father on Kcal saying he didn't know the ARM would ARM and now he can't understand why the government isn't helping him out of this and how did he end up here? The Arm did what you knew it would do. b,121b,121If someone can't pay there arm now that the two years is up they should have gotten a fixed rate loan. If they couldn't get the house they wanted with that financing, maybe, just maybe, they shouldn't have bought the house. b,121I'm not talking about speculators. I am talking about a large number of people in LA (thousands) who purchased bigger homes playing the joneses and now are in a tight situation, and are placing blame on everybody but themselves. b,121b,121If you lost your job and can't pay that's one thing, and that was never who i was talking about. b,121 no love. ALot of these people enjoyed that period paying $500 a month on 650K$ home mortgages in LA and the jig is up while some homeowners were paying what they actually owed on the principal plus interest of a legitimate loan. My wife and I are carrying a 500K primary and have to pay upwards of 3800$ a month principal and interest on our 30 year.b,121We know people who had the same note and were paying 4-800$ a month. What did they think was going to happen at the end of the arm? YOU HAVE TO PAY FOR WHAT YOU BUY.b,121b,121No more raised trucks, flat screen tv's, helocs etc. b,121b,121Its time for everyone to take individual responsibility for things that were within their control.b,121b,121now i walk away son and shhh. okbye.
  • RockadelicRockadelic Out Digging 13,993 Posts
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    b,121 A lot of people screwed themselves.
    b,121
    b,121
    h,121
    font class="post"1b,121b,121Free public libraries where you can spend months researching buying a home before you sign what is likely to be the biggest contract of your life.b,121b,121Free legal help for first time home buyers offered in every major city in the U.S.b,121b,121The internet with help groups and websites where you can educate yourself on home finance for free.b,121b,121Sliding fee legal help that will assist you hands on with the purchase of a home.b,121b,121b,121That leaves greed and/or stupidity.b,121b,121I have sympathy for neither.
  • phongonephongone 1,652 Posts
    I feel what the one LR is saying but one of the root problems was the myth that home ownership is the predicate for the American Dream. For awhile, everyone bought into that myth and was making money hand over fist - the guy making $40K a year buying a $500,000 with 0 down, the mortgage broker making the huge commission on the fusked up loan, the lender underwriting the loan without proof of income. Point is everyone had a hand in the shit (including you and me) and now is time to return to the fundamentals (save, save, save).
  • RockadelicRockadelic Out Digging 13,993 Posts
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    b,121I feel what the one LR is saying but one of the root problems was the myth that home ownership is the predicate for the American Dream.
    b,121
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    font class="post"1b,121b,121Does this include $50K homes or only $500K homes??b,121b,121A lot of these folks could afford homes....just not the expensive ones they apparently felt they deserved.
  • phongonephongone 1,652 Posts
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    b,121I feel what the one LR is saying but one of the root problems was the myth that home ownership is the predicate for the American Dream.
    b,121
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    font class="post"1
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    b,121Does this include $50K homes or only $500K homes??
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    b,121A lot of these folks could afford homes....just not the expensive ones they apparently felt they deserved.
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    font class="post"1b,121b,121Haha, I couldnt tell you...I live in cali where $50K homes existed in the 1940's.
  • Birdman9Birdman9 5,417 Posts
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    b,121 A lot of people screwed themselves.
    b,121
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    h,121
    font class="post"1
    b,121
    b,121Free public libraries where you can spend months researching buying a home before you sign what is likely to be the biggest contract of your life.
    b,121
    b,121Free legal help for first time home buyers offered in every major city in the U.S.
    b,121
    b,121The internet with help groups and websites where you can educate yourself on home finance for free.
    b,121
    b,121Sliding fee legal help that will assist you hands on with the purchase of a home.
    b,121
    b,121
    b,121That leaves greed and/or stupidity.
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    b,121I have sympathy for neither.
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    font class="post"1b,121b,121I have sympathy/empathy for someone who has gotten themselves into trouble like this, because everyone can bite off more than they can chew. Not wanting to make their suffering any greater is not saying the Government should pay their debt or that they should avoid the fate that others before them have had to endure. Hard lessons, and there but for the grace of God go any one of us. Making a bad choice has consequences, and none of us are above making bad choices. But like Thes said, it is hard to stomach some people making with excuses like they didn't/couldn't know an ARM would put them in a tight spot. I mean, dude. Come on.
  • RockadelicRockadelic Out Digging 13,993 Posts
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  • Birdman9Birdman9 5,417 Posts
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    b,121
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    font class="post"1b,121b,121Well, that's an idiot. Maybe hitting himself in the head with a crowbar would be the move.
  • theory9theory9 1,128 Posts
    A small percentage of those with ARM mortgages were also deceived when the lenders would fudge their income to allow someone to qualify.
  • spelunkspelunk 3,400 Posts
    I don't have sympathy for those who took out foolish mortgages. I have sympathy for the people who work hard like my parents and earn good money only to see 30k go into taxes while their friends are sitting pretty cause they own their home and can write off all his mortgage payments / use home equity credit to pay for their kids to go to college, while student aid is based almost entirely off of income. With the credit mess getting a mortgage is now near-impossible while 6 months ago they would have been handing them out like candy.
  • pcmrpcmr 5,591 Posts
    a href="http://www.soulstrut.com/ubbthreads/showflat.php?Cat=0&Number=1205467&an=0&page=0#Post1205467" target="_blank"1minorities get blamed for the housing crisis
  • verb606verb606 2,518 Posts
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    b,121 But like Thes said, it is hard to stomach some people making with excuses like they didn't/couldn't know an ARM would put them in a tight spot. I mean, dude. Come on.
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    font class="post"1b,121b,121b,121Sayin. I have sympathy for people in tough spots (which I could forseeably be in come next spring) but people complaining about their ARM is NAGL. b,121b,121b,121Like Rock said, there is plenty of information available. Any "10 Things to Know Before Buying a Home" article printed anywhere has "Be wary/careful of ARM's!" as number two or three, if not number one. The first thing both my wife's parents and mine said to us was "Don't get an ARM!" We went into our condo-buying process fairly naive and starry-eyed, but we asked the seller's financial guy, "that's a 30-year fixed, right?" b,121b,121b,121An ARM's kinda like a gamble, and you happened to lose. Not to sound crass, but at this point YOU MUST DEAL, word to mylatency.
  • 4YearGraduate4YearGraduate 2,945 Posts
    I can be sympathetic to a person whose house is now worth less than their mortgage, that is just about all of us homeowners. But here's an actual factual case in point of something i have encountered firsthand. Do with this true story as you will:b,121b,121I was eating lunch with my wife about six months ago and reading the real estate weekly that our local newspaper circulates. When we purchased our home 4 years ago i studied my ass off and read numerous books which also covered the foreclosure market. Though i never had time to delve into that world, I knew that deals could exist for buyers and a lot of the books hipped me to how to read between the lines of the real estate listings. b,121b,121At the back of the paper in the user placed classifieds, i saw a small ad that had all the $ signs covered; something to the effect of: Home for Sale by owner, must sell fast, 2 wk escrow preferred. I knew this could be a good opportunity to pick up a rental so i called the guy and we arranged to meet. b,121b,121I went to check out the house and it seemed pretty good - 2 bedroom 2 bath bungalow in an area of lower San Pedro near the 22nd landing harbor. It seemed to be in good enough shape so I became more interested. Here's where it gets crazy though. b,121b,121He had two weeks before the bank foreclosed. He bought the house two years ago at the height of the real estate boom in LA. He was given a pre-approval for 550K, and he admitted he knew he couldn't afford that but it was a two year arm, interest only, and for those two years he would sail on the small mortgage and then refinance and it would be all good. He said that he had planned to even pocket money when the house appreciated at the refi point. Well, he went out looking for houses and fell in love with this sea-side craftsmen. It was listed at 500K. He got in a bidding war with two other buyers and ended winning the war and closing on the house at a purchase price of 535K. b,121b,121Two years went by and the market softened, then cooled, and then began to slump. Even at the time of the purchase he overpaid for the home based on comps in the area - 500K was the max worth of the home at the time. Well by the time the re-fi came around at the end of the two years the home was appraised at 445K. This didn't in and of-itself disqualify him from the re-fi but the problem was that in the time he owned the home, he had paid interest only and so there was 0 equity in the note, he still owed what he purchased the home at - 535K. The bank declined the re-fi. The Arm came up and boom, now he owed principal and interest at prime. So he was facing foreclosure because he couldn't make the payment. b,121b,121After calculating the numbers i candidly asked, so what do you expect me to do? b,121He said he was willing to eat the 90K difference but expected to get at least 445K for the home. If you are following this, that is not only NOT a good deal, but it is top value compared to the comps in the area. And someone still has to lose 90K. That's when I learned firsthand that when a home has 0 equity there is no way a foreclosure is a good deal for anyone. And that includes taxpayers who will be called in to pay for mortgages that exceed the ACTUAL current value of the home. b,121b,121I walked away from the deal scratching my head at why anyone would want to buy into this class of foreclosure, and sure enough, he lost the home and walked away owing the bank 100K dollars. And that puts the bank & him in a shit position. b,121b,121Was it greed that got him in that home? maybe not, but deep down he KNEW he couldn't afford it. So he had planned to refi when the ARM came down.b,121b,121Following this I looked at 3 other properties facing foreclosure and every single one of them had under 10% equity on the primary note. Most were 0% and the home values had declined. The whoel system was fucked back then (a year ago) and i saw this coming, as did other in the field. I stopped looking at purchasing foreclosure properties after that and put my money in an ING account. b,121b,121Now i bet that dude is kicking himself for not holding out for McCain to come in and let the taxpayers buy out his 535K primary to refi his now 400K value home.b,121b,121b,121b,121
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