Atsumi

Political Party Girl

whyknot

tetracycloide

Moe

RosePetalPlace

m_supercomputer

I worked in a real estate office for 7 years during the housing bubble, and I talked to a lot of people who were getting more home than they could really afford. When I said something like, "wow, that's amazing, I could never afford something like that," almost inevitably they'd say something to the effect of "I didn't think I could either, but the mortgage person said I could!"

Bottom line is, people trusted mortgage brokers and real estate agents because the finance involved in getting a mortgage is fucking overwhelming for the average person. They trusted people whose *job* it is to understand this stuff. That may be unwise, but it doesn't deserve to be punished with homelessness and financial ruin.

A fun anecdote about the mortgage companies - a broker worked out of our office, and she was honest. If she wasn't confident that the rate offered would allow the borrowers to make their payments and keep their home, she would not approve it. She was disciplined and eventually pressured to quit for this, because she wasn't bringing in enough money. Because, you see, mortgage brokerage companies get commissions for the loans they bring in. Most people, I think, don't know this, and assume that the bank would not approve a loan if it was not sound - instead, every incentive encourages mortgage companies to mislead their clients.

m_supercomputer

RainbowBrite

philosophically what could we expect home buyers to know about their mortgages? that sounds like a question best answered on a case by case basis in a forum where each side can present information and make arguments on their behalf, like a bankruptcy court.

tetracycloide

katastic

arodriguez.romero

I guess, maybe, more accurately: a person makes an honest mistake when they take action while lacking information that they couldn't be reasonably expected to know. So, what was it that we could reasonably expect new home buyers to know about mortgages? Obviously it's not the same for everyone; so, what are the characteristics about a person that enable a person to determine what they could reasonably have known about the situation?

braak

SinisterRouge

arodriguez.romero

i live in new jersey and the real estate bullshit (and it is bullshit) has made it so that basically nobody who isn't pulling a six figure salary can afford to buy a home at all, even in the burbs and even in the unposh burbs - even a condo! furthermore, living in this area doesn't automatically guarantee that you make more money at any given job. constantly i see jobs that are far from entry-level that barely pay $50,000 a year. i'm not in a position where i can move right now, ergo i'm here, renting and looking to get on a game show to win big bucks. seriously - it's the only way i'll ever get any kind of financial windfall.

@RainbowBrite: right on. if the banks collapse under this mess, then everybody loses. it becomes harder to do anything - buy groceries, buy a car, keep a job even. what is the most disgusting part is the bonuses that the corporate CEOs give themselves, even while the company is going down the drain. that makes me stabby.

rednrowdy

libritarian 'theology' isn't about just dumping people on thier ass whenever they don't meet with success. it's about properly enumerating rights so that legal recourses such as bankruptcy can fix problems on a per-user basis instead of applying some bull shit, one-size-fits-all blinket fix whenever the market takes a negative swing.

tetracycloide

In other news, the economy has been in the shitter for a while, it is just that no one wanted to say so.

badmutha

It's weird--people should have been equally capable of making poor decisions ten years ago, right? You'd think that if this were mostly a problem of people making poor decisions, and not banks unethically taking advantage of them, then housing market crises would be happening all the time.

@SinisterRouge on Notice!: Agreed. Especially considering that the executive and lenders working at these banks have all the money; it's just their personal money now, and can't be seized in order to shore up the instutitions that the execs have castrated.

braak

On the economy:
One of the biggest problems coming up is inflation, because it makes everything else so much worse. The price of oil is at an all time high, inflation-adjusted, but salaries are stagnant or falling, and the number of people unemployed (including yours truly) is rising. The government stats say that the number of unemployed is falling, but they don't count people whose unemployment benefits have run out and still can't find a new job. So fewer jobs, and less real purchasing power.

That's partly why I'm really worried about these big bailouts in the financial sector, because the government is just flinging money around hand over fist, and lowering interest rates, which is pretty much a recipe for increased inflation.

ambiguous_tart

Principles are nice things to have. I want every thing to be fair for people. But the fact of the matter is, no matter who you are and what your job is, unless you are a farmer that grows his own food and makes his own clothes, you have a vested interest in not seeing twenty million Americans go broke.

braak

flynnchick

rsr26

rsr26

People could only buy homes because banks were making the credit available to them. Shame on the banks for giving out stated income/no income verification loans. Many people who were terrible credit risks were given $400k, $500k, $750k loans to get them into houses they would never be able to afford.

I am all about the personal responsibility, and I was pissed about rate freezes for people who got 2% ARMS and are shocked their rate is now going up. My traditional 30-year fixed mortagage isn't being bailed out by anyone. But I work for a real estate company, who can't afford to pay me, so I can't afford to buy extra stuff, so the people who sell clothes/shoes/furniture can't afford to pay their employees, who can't make their payments, makes it obvious to me that someone needs to get on the ball. And unless you have $30 billion laying around, I think the government is our only option.

BlondeGrlz

SinisterRouge

SinisterRouge

How's your monthly rate, by the way? Can you still afford it? Did anyone triple it in the last month?

braak

this really puts a cherry on my eternal cynicism, too, by the way.

cupcakesofdeath

MadameOvary

On the other hand....It IS the govt's best interest that people don't foreclose en masse, and that major financial institutions don't collapse. I don't pretend to know how to fix it - it's majorly fucked up and whatever "solution" is gonna fuck people over some way or another. So if bailing out a bank means that the whole financial sector won't collapse....ok fine. I guess I'll take it.

RainbowBrite

I bought a house for 200k which is now worth about 180k. Poor me, but I am not going to whine about it and expect the government to write me a check for the difference.

rsr26

I'm going to be on Jezebel for a good deal of the afternoon while I wait for my friends to get out of lab, so I can start my pub crawl with what tiny amount of money I have, since apparently the sum of everything I earned in dollars while living in the US is now worth precisely £1.47. Dum dee dum...

rah29

I need green beer. Now.

lola82

braak

Remember, also, what it means when you "buy a house you can't afford." Why could the people who bought it afford it? Sure, the house is worth a million dollars, but it got mortgaged for $990 a month. That's how you buy a house--you take on an enormous debt that you can pay in small amounts for three decades. It's not the buyers' fault that the houses were over-valued, it's not the buyers' fault that their mortgage rate has to be readjusted to account for the under-value in the first place, and it's not their fault.

And even if it were their fault it doesn't matter. The country doesn't run on principles or libertarian theology. The country runs on people who work, and people who can afford to pay for things.

braak

TheFormerJuneBronson

RyanB

Hooplehead

Megan Carpentier

rsr26

Incognegro is wshing on a starfruit

jessicarabbit

rsr26

katastic

katastic

People are so predictable...

rantmagazine:boo hoo

katastic

howdybeep (runs with monkey wrenches)

But you'd better fucking believe I'm marching his sorry ass to counseling.

howdybeep (runs with monkey wrenches)

bigtittycommittee

Jerseylicious

BlondeGrlz

AthertonMerriweather

I'm so glad I didn't save for retirement yet! It would all be gone. Bear Sterns is the Chrysler of our generation, and these financial products are...Chryslers.

Koreanish

Right? I'm looking for a job in Michigan, the recessioniest state in the recessioning union, and it's looking pretty grim. Better polish up my apple-selling skillz....

vexatious

But the story would be more realistic if they names some diner in Woodbridge.

TheGuvnah

petunia942

@RyanB: I feel it when it comes to everything. It's fucking brutal out there. I filled up my car today. Honda Civic. $35.

SinisterRouge

braak

Wait, don't fuck him. And hang in there, sis.

myrtlebeachbum

Rhody

Yeah the economy's awful, btw. I personally feel it especially when it comes to travel. Can barely afford to take a trip from Boston to Philly to visit my family.

RyanB

Apparently in the biopic of his life, I will be played by the shrill harpie who keeps him from his life, his art and Reese Witherspoon.

howdybeep (runs with monkey wrenches)

Are you fucking kidding me? I can barely pay my rent.

Rhody

rsr26

SinisterRouge

SinisterRouge

SUCH AS.

hamburgerhotdog

SinisterRouge

howdybeep (runs with monkey wrenches)

SinisterRouge

RyanB

TheFormerJuneBronson

BlondeGrlz

MadameOvary

katastic

RyanB

katastic

AthertonMerriweather

RyanB

SinisterRouge

pferde_schwanz

Det. Philangie

rsr26

Obama 08!

myrtlebeachbum

SinisterRouge

SinisterRouge

Except for the economy.

myrtlebeachbum

bananaballs

I have always said that people who are ignorant about politics are only hurting themselves and have no excuse for staying in the dark. Now I feel like an idiot AND a hypocrite for not understanding our economy. Yikes. One more thing to worry about.

Rhody

SinisterRouge

Kittenish