Here we go again... govt telling banks to "loan"

[m_ridgeway]

Read your post wrong thought you said 50percent. Still yet 20 is a standard at my bank and normal is 30 or greater for a home. They don't get a lot of home loans but they don't get many defaults either.
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[mzrsq]

What the govt is doing is encouraging the same lending practices that started this mess to start with... (that is what has tightened up the credit market to the point of strangulation for many)

Though I agree with your point, If somebody doesn't step in and try to help, small business will all but disappear. If a bank is not willing to help, were else do we have to turn to?

And strangulation pretty much sums up my past 4 weeks experience.

 

[TonyMastodon]

Quit making sense Tony...this is the internet...it is implied that everything must be taken out of context.

Oh sorry...i forgot that people on the internet have better solutions than the people in charge. If only construction workers, mechanics and warehouse workers made all the shots. This place would be so much better!!

 

[afterhours]

Credit default swaps are also a large part of this problem.
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but only when the guy making $30k annually, living in a $500k home defaults on his ARM....

 

[TonyMastodon]

Read your post wrong thought you said 50percent. Still yet 20 is a standard at my bank and normal is 30 or greater for a home. They don't get a lot of home loans but they don't get many defaults either.
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Just curious, how much did you pay for your house? and how much is it worth?

 

[jdsbusa]

Why not? Obama didn't have experiance either......and he made it in
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or military experience....or small business experience.....or.....

 

[F=MA]

25k=8k?
20percent would be about 35 which is not unresonable for anyone to put down on a 175k home. I could mover an hour north and my house would have cost at least 2x as much. Me and several others raise childrend there. No bubbles no troubles.
I am more aware than most about cost of living adjustments. I spen about 2 weeks in my home in 08 and about 3months in 09. I travel all over the us and stay for periods of time in diff locations rural and urban. No matter what I've noticed when I look at property (which I do every where I go) there's the homes market at young people all new and nice shiny for a lot more than the middle aged marketed homes that aren't perfect but still very solid and excellent starter homes for a reasonable price.
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20% of 50k = $10,000
5% of 175k = $8,750

Effectively the same level of out of pocket investment was the point I intended to communicate.

I've also never understood the reason to buy a brand new "starter" home. A coworker of mine who earned the same did just that and I never understood the logic. Some people just aren't resourceful enough to fix a toilet when it breaks I guess.

I have the same feelings about cars/trucks, but that's even further off topic.

You are fortunate to live in a place where property values are low, and you don't have to spend what you saved at the gas pump in order to transport yourself to/from work every day. This has become less common.

 

[F=MA]

Why not? Obama didn't have experiance either......and he made it in
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And Bush had a MBA! That sure worked out well.

 

[m_ridgeway]

Just curious, how much did you pay for your house? and how much is it worth?

72.5. Haven't had it appraised since I bought it when I appraised for about 80. I would list it for 75 and probably get high 60's fairly quick.
I believe its 2300 sqft 3bd 1bath. 2car garage. Older home. 3 lots. Nicer part of town. I know how cheap things are here. But on the same note I didn't buy where the same home is 120 and up.
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[m_ridgeway]

20% of 50k = $10,000
5% of 175k = $8,750

Effectively the same level of out of pocket investment was the point I intended to communicate.

I thought you said 50percent. I see what your saying. I know my money wouldn't go as far in a lot of other areas of the country but I choose not to live there and if I did I still wouldn't enter into a mortgate that I owe 95 percent of a 175k home. I would wait and save esp if I were single. The only reason I bought a house as young as I did is I had a kid and wife. My decision my hardships and its working out. When I'm 30 I could be debt free a home owner or sell and move up own a few vehicles and toys and pay only a house payment. Also putting down about 40k+
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[F=MA]

I thought you said 50percent. I see what your saying. I know my money wouldn't go as far in a lot of other areas of the country but I choose not to live there and if I did I still wouldn't enter into a mortgate that I owe 95 percent of a 175k home. I would wait and save esp if I were single. The only reason I bought a house as young as I did is I had a kid and wife. My decision my hardships and its working out. When I'm 30 I could be debt free a home owner or sell and move up own a few vehicles and toys and pay only a house payment. Also putting down about 40k+
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I saw you replied to that before I got my post up. This thread moves faster than the .org chat room.

Again, for your personal accomplishments. Somewhere you learned a lesson about finance that many don't until things outside their control cause what had been historically reasonable expectations to prove to be incorrect at a particular moment in time.

I can't rationally believe that people...millions of them...buy a house with the intent to not pay for it. Therefore in attempting to understand why millions of people are struggling to pay for their homes, I can't simply write it off as "they shouldn't have bought a home to begin with". Ultimately the reasons involve more complexity than internet message boards are generally capable of resolving.

 

[m_ridgeway]

I saw you replied to that before I got my post up. This thread moves faster than the .org chat room.

Again, for your personal accomplishments. Somewhere you learned a lesson about finance that many don't until things outside their control cause what had been historically reasonable expectations to prove to be incorrect at a particular moment in time.

I can't rationally believe that people...millions of them...buy a house with the intent to not pay for it. Therefore in attempting to understand why millions of people are struggling to pay for their homes, I can't simply write it off as "they shouldn't have bought a home to begin with". Ultimately the reasons involve more complexity than internet message boards are generally capable of resolving.

I belive all if not most buy with good intent and its not usually just the homes. Its the cars, and exp, the exp with the home, family needs, and the lisrt goes on and on. At my income level I couldve afforded a lot more on a monthly note about 4-5x as much but I can't ensure I can always make this money. If I got hurt I'd be done. Esp since alots based on over time. But thanks and good luck to you.
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[afterhours]

intentions to pay...do not always equal sound financial decisions.

 

[F=MA]

I belive all if not most buy with good intent and its not usually just the homes. Its the cars, and exp, the exp with the home, family needs, and the lisrt goes on and on. At my income level I couldve afforded a lot more on a monthly note about 4-5x as much but I can't ensure I can always make this money. If I got hurt I'd be done. Esp since alots based on over time. But thanks and good luck to you.
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You are wise beyond your years. What do you credit the development of your philosophy to?

Thanks also. We're in a very strong position financially. I had the good fortune of spending a large portion of childhood in a time and place not far from you where no adults I knew had jobs with the exception of the pastor at the church my family attended and my teacher at school. This was an experience I use to this day to motivate myself.

intentions to pay...do not always equal sound financial decisions.

Certainly not...yet we continue to send high school graduates out into the world with barely the ability to balance a checkbook.

 

[Liltroy]

And this, ladys and gentlemen, is why I'm proud ot be "trailer trash". I paid $21k for my trailer 3 years ago. As of last week its still worth a little over 17 and I only owe for two more years. May be a trailer, but its almost 1200sqft and its value has dropped alot less than the houses around here. I did the smart thing when I was young....got a good job, lots of toys, got in trouble, left job, lost toys, lost a house I only had for 6 months, ruined my credit and now I'm forced to lisve only by necessity. The busa is the only thing "extra" that I've bought in almost 10 years, but right now when my jobs on the downslide, and everyone around me is losing thier homes and cant make their credit card payments, it makes me happy that I have a 485 beacon score and couldnt go out and buy "over my head". My friends are always talking about how I need to get my credit straight and I'm like"why? so I can go into debt?". By having horrible credit, I've been forced to save and pay cash for things, a lesson my father always tried to teach me when I was young. Credit serves no purpose but to destroy our economy and our lives. He used to always tell me" son, if you cant pay for it, you dont need it." I have two "newer" vehicles that I paid cash for, my home is almost paid for, and my bills could just about be paid on minimum wage. The irs and sallie mae(student loans from way back in my good credit days) are threatening me to garnish my check and I really dont care cause tow more years and I'll be done working on the books and they wont have anything to garnish. Everyone that is in a bad spot becasue they cant pay a loan did it to themselves by trying to live above thier means. I did it to myself and it taught me a valuable lesson. Will you learn the same one or continue to blame the government and banks for the mess you let yourselves fall into? No one could see the future, including the banks that YOU signed the loan papers at. And dont think for a second I'm being insensitive because brothers, I've already done this years ago and I realized that I broguht it on myself in more ways than one.......the question is, will you realize the same? I believe someone here said something about taking responsibility.???

 

[J'Man]

Oh sorry...i forgot that people on the internet have better solutions than the people in charge. If only construction workers, mechanics and warehouse workers made all the shots. This place would be so much better!!

They certainly can't do any worse. I'd also bet they're much more trustworthy. Just because someone is white collar (even though I am one) doesn't mean they are any more intelligent than anyone else.

 

[J'Man]

[/QUOTE by Mr Brown]The main problem as I see it is that a representative democracy cannot function when the representatives no longer represent the people. This is what has happened. The ruling political class is concerned only with two things: Selling their influence, and ensuring their own future as politicians.
They could not care less about those they nominally serve, and we allow them to continue this way. They magnify trivial differences among us, and we buy right into it, arguing about religion, immigration, healthcare and war, and the whole time they are doing whatever they want.
Term limits are the answer, after a certain amount of time has passed, an individual should not be eligible for public office of any sort for 10 years. They should have to go get a job, and live like the rest of us.
As far as the economy goes, there should be no such thing as "too big to fail" in our economy. If, as we do in name, we have a capitalist free market economy then it's sink or swim. The stock market was created to allow speculators to join industrialists to finance a specific good or service. It has degenerated into the mess we have today due to there being no REAL good or sevice behind what is being sold. Somebody mentioned the market being okay with the sale and re-sale of the subprime mortgages had the bubble not burst. This is simply not true. The houses were worth what they were worth. Artificially increasing the price simply to turn a profit is what caused the crash. A demand for housing in a given area is what raises the housing prices in that area. The rate of growth was unsustainable, and the banks knew it. They just got all they could and got out, knowing we would foot the bill.[/QUOTE]

+1 Nice write up Jeremy!

 

[Dino]

[/QUOTE by Mr Brown]The main problem as I see it is that a representative democracy cannot function when the representatives no longer represent the people. This is what has happened. The ruling political class is concerned only with two things: Selling their influence, and ensuring their own future as politicians.
They could not care less about those they nominally serve, and we allow them to continue this way. They magnify trivial differences among us, and we buy right into it, arguing about religion, immigration, healthcare and war, and the whole time they are doing whatever they want.
Term limits are the answer, after a certain amount of time has passed, an individual should not be eligible for public office of any sort for 10 years. They should have to go get a job, and live like the rest of us.
As far as the economy goes, there should be no such thing as "too big to fail" in our economy. If, as we do in name, we have a capitalist free market economy then it's sink or swim. The stock market was created to allow speculators to join industrialists to finance a specific good or service. It has degenerated into the mess we have today due to there being no REAL good or sevice behind what is being sold. Somebody mentioned the market being okay with the sale and re-sale of the subprime mortgages had the bubble not burst. This is simply not true. The houses were worth what they were worth. Artificially increasing the price simply to turn a profit is what caused the crash. A demand for housing in a given area is what raises the housing prices in that area. The rate of growth was unsustainable, and the banks knew it. They just got all they could and got out, knowing we would foot the bill.

+1 Nice write up Jeremy! [/QUOTE]

+1....

 

[m_ridgeway]

What do you credit the development of your philosophy to?

Can't really credit it to one thing or even a few. Just learned a respect for money and never had handouts. Had to pay my own way. Watched others my age fail as I started a family at 19 I had to provide a future. Debt isn't a very good 10yr plan.
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[Bird Hunter]

[/QUOTE by Mr Brown]The main problem as I see it is that a representative democracy cannot function when the representatives no longer represent the people. This is what has happened. The ruling political class is concerned only with two things: Selling their influence, and ensuring their own future as politicians.
They could not care less about those they nominally serve, and we allow them to continue this way. They magnify trivial differences among us, and we buy right into it, arguing about religion, immigration, healthcare and war, and the whole time they are doing whatever they want.
Term limits are the answer, after a certain amount of time has passed, an individual should not be eligible for public office of any sort for 10 years. They should have to go get a job, and live like the rest of us.
As far as the economy goes, there should be no such thing as "too big to fail" in our economy. If, as we do in name, we have a capitalist free market economy then it's sink or swim. The stock market was created to allow speculators to join industrialists to finance a specific good or service. It has degenerated into the mess we have today due to there being no REAL good or sevice behind what is being sold. Somebody mentioned the market being okay with the sale and re-sale of the subprime mortgages had the bubble not burst. This is simply not true. The houses were worth what they were worth. Artificially increasing the price simply to turn a profit is what caused the crash. A demand for housing in a given area is what raises the housing prices in that area. The rate of growth was unsustainable, and the banks knew it. They just got all they could and got out, knowing we would foot the bill.

+1 Nice write up Jeremy! [/QUOTE]

Definitely !!!