How the housing sector went under

garv221garv221 Member Posts: 1,914

Comments

  • BeaverC32BeaverC32 Member Posts: 670 ■■■□□□□□□□
    Loved it! Although it is sad that it is true. My dumbass friend bought a house with no money down so he has a monthly payment that is well beyond what he can pay himself. In order to pay it he is having his brother, his brother's girlfriend, and his friend living with him paying rent. He is also trying to rent out his spare bedroom. Plus his school taxes aren't rolled into his mortgage so it will be interesting to see his reaction once that bill comes in.

    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.
    MCSE 2003, MCSA 2003, LPIC-1, MCP, MCTS: Vista Config, MCTS: SQL Server 2005, CCNA, A+, Network+, Server+, Security+, Linux+, BSCS (Information Systems)
  • garv221garv221 Member Posts: 1,914
    BeaverC32 wrote:
    Loved it! Although it is sad that it is true. My dumbass friend bought a house with no money down so he has a monthly payment that is well beyond what he can pay himself. In order to pay it he is having his brother, his brother's girlfriend, and his friend living with him paying rent. He is also trying to rent out his spare bedroom. Plus his school taxes aren't rolled into his mortgage so it will be interesting to see his reaction once that bill comes in.

    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    Did he buy an ARM? Or is he just simply a dumbass who bought a 30yr fixed at a rate much higher than he could afford?
  • keenonkeenon Member Posts: 1,922 ■■■■□□□□□□
    the true problem is that he was sold something they knew he couldn't afford.. no verifications just all around bad deal. alot of mortgage brokers and banks sold people into bad deals for $$ commission checks .. sub prime lenders and programs that the broker/bank put you in offer better $$ than the normal stuff

    predatory lending is what its called:
    One less contentious definition of the term is "the practice of a lender deceptively convincing borrowers to agree to unfair and abusive loan terms, or systematically violating those terms in ways that make it difficult for the borrower to defend against."[1] Other types of lending sometimes also referred to as predatory include payday loans, credit cards or other forms of consumer debt, and overdraft loans, when the interest rates are considered unreasonably high.

    Although predatory lenders are most likely to target the less educated, racial minorities and the elderly, victims of predatory lending are represented across all demographics.[2][3]

    Predatory lending often occurs on loans backed by some kind of collateral, such as a car or house, so that if the borrower defaults on the loan, the lender can repossess or foreclose and profit by selling the repossessed or foreclosed property.
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  • dave0212dave0212 Member Posts: 287
    Great, but unfortunately so true
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  • garv221garv221 Member Posts: 1,914
    Keenon

    ^ Agreed. Even though this situation has the same stance as "Guns don't kill people- people kill people" There should have been better restrictions and the banks should have never approved loaning ARMS and Interest Only to those who cannot financially swing the change in monthly obligations a year later. Just a nasty situation where people were told what they wanted to hear and not told what they didn't want to hear when getting a mortgage.
  • bertiebbertieb Member Posts: 1,031 ■■■■■■□□□□
    125% mortgages FTW! icon_eek.gif
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  • mengo17mengo17 Member Posts: 100 ■■■□□□□□□□
    BeaverC32 wrote:
    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    When it comes to housing only?
  • dynamikdynamik Banned Posts: 12,312 ■■■■■■■■■□
    That was great. Thanks for sharing. I saw one of those images on Digg, but I had no idea it was part of a larger project.
  • undomielundomiel Member Posts: 2,818
    mengo17 wrote:
    BeaverC32 wrote:
    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    When it comes to housing only?

    Not in my experience. Just this morning my wife read a journal entry from a college girl who just got a brand new 2009 Honda Fit. It's sad that she'll be paying for that one for a long time.
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  • garv221garv221 Member Posts: 1,914
    undomiel wrote:
    mengo17 wrote:
    BeaverC32 wrote:
    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    When it comes to housing only?

    Not in my experience. Just this morning my wife read a journal entry from a college girl who just got a brand new 2009 Honda Fit. It's sad that she'll be paying for that one for a long time.

    A 2009 Honda Fit costs about 16K, that is not a big deal at all.
  • EJizzelEJizzel Member Posts: 94 ■■□□□□□□□□
    garv221 wrote:

    This is great, I already forwarded the link to my co-workers.

    My wife used to work for 2 mortgage companies and would come home every day with stories of people with a 500 credit score getting approved for a loan. She would actually not approve many loans but would get overridden by the higher ups.

    The funny thing is one of her old bosses just got sentenced to 18years for filing fraudulent loans and pocketing the $$$.
    http://mortgageblues.us/news/488
  • undomielundomiel Member Posts: 2,818
    garv221 wrote:
    undomiel wrote:
    mengo17 wrote:
    BeaverC32 wrote:
    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    When it comes to housing only?

    Not in my experience. Just this morning my wife read a journal entry from a college girl who just got a brand new 2009 Honda Fit. It's sad that she'll be paying for that one for a long time.

    A 2009 Honda Fit costs about 16K, that is not a big deal at all.

    It's a huge deal if you don't have $16k.
    Jumping on the IT blogging band wagon -- http://www.jefferyland.com/
  • dynamikdynamik Banned Posts: 12,312 ■■■■■■■■■□
    I think income in relation to whatever type of loan is the important thing to look at. A $16k car is a lot if you're making minimum wage, but it's nothing at all if you're pulling down six-figures.
  • dtlokeedtlokee Member Posts: 2,378 ■■■■□□□□□□
    16k? I have at lest that much in my spare change drawer...
    The only easy day was yesterday!
  • garv221garv221 Member Posts: 1,914
    EJizzel wrote:
    This is great, I already forwarded the link to my co-workers.

    My wife used to work for 2 mortgage companies and would come home every day with stories of people with a 500 credit score getting approved for a loan. She would actually not approve many loans but would get overridden by the higher ups.

    The funny thing is one of her old bosses just got sentenced to 18years for filing fraudulent loans and pocketing the $$$.
    http://mortgageblues.us/news/488

    confused0068.gif Wow, now that is a serious sentence that was deserved.
  • BeaverC32BeaverC32 Member Posts: 670 ■■■□□□□□□□
    mengo17 wrote:
    BeaverC32 wrote:
    I see so many people spend beyond their limits when it comes to housing, it's ridiculous.

    When it comes to housing only?

    No, but it is more pronounced with a 100k+ loan versus , for example, spending a couple thousand on a vacation you really shouldn't be going on. People purchase houses for the max amount they were approved for, but don't factor in other expenses such as utilities, groceries, repairs and general maintenance, taxes, etc. In other words they can afford the mortgage but then realize they forgot to factor all of life's other expenses.
    garv221 wrote:
    Did he buy an ARM? Or is he just simply a dumbass who bought a 30yr fixed at a rate much higher than he could afford?

    Simply a dumbass that has a 30yr fixed rate. He bought it late spring of this year and is already talking about selling the house. Absolute idiotic decision to buy a house in the first place, but live and learn I guess.
    MCSE 2003, MCSA 2003, LPIC-1, MCP, MCTS: Vista Config, MCTS: SQL Server 2005, CCNA, A+, Network+, Server+, Security+, Linux+, BSCS (Information Systems)
  • rfult001rfult001 Member Posts: 407
    Wow! Give this to Bush and Co. It might give them some insight.
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