Dear folks who wish you owned your own home

[dems4me]

Your prize can be Aps.

We are pushing this whole asp birthday boy thing a little too far

 

[crabcake]

Yea, billions and billions and billions of lender losses, hundreds of lenders closing shop, government bail outs and rising foreclosure rates.

Nothing to see here folks, move along….

:shrug: Stupidity runs amok ... and our population isn't shrinking. Don't blame me. I bought all 3 of the houses I've own the responsible way. No one is bailing me out.

 

[somdrenter]

Show us the effect on normal people, not people who gambled and lost or stupid people who never should have gotten a loan in the first place.

Everything is caused by the "mortgage crisis." Next you're going to tell it's causing Global Warming.

Brutal sell off on Wall Street
Dow tumbles 315 points, the second worst day of the year for stocks, after AIG's big loss and UBS's outlook on financials.

NEW YORK (CNNMoney.com) -- Stocks tumbled Friday, in the second worst day of 2008, after AIG's record loss added to worries about the financial sector and more weak economic news intensified fears about a recession….

…AIG (AIG, Fortune 500) reported a steep $5.3 billion quarterly loss after the market close Thursday and said it took an $11 billion writedown related to big losses in investments tied to bad mortgage bets. Shares of the Dow component tumbled 7% Friday….

…Brokerage UBS said financial firms could end up facing $600 billion in losses as the credit crisis continues to unfold. Banks, brokers and insurers have already lost more than $160 billion related to bad mortgage bets. UBS also cut its first-quarter earnings estimates on a number of investment banks….

Stocks get slammed on recession fears - Feb. 29, 2008

 

[foodcritic]

home buying

Brutal sell off on Wall Street
Dow tumbles 315 points, the second worst day of the year for stocks, after AIG's big loss and UBS's outlook on financials.

NEW YORK (CNNMoney.com) -- Stocks tumbled Friday, in the second worst day of 2008, after AIG's record loss added to worries about the financial sector and more weak economic news intensified fears about a recession….

…AIG (AIG, Fortune 500) reported a steep $5.3 billion quarterly loss after the market close Thursday and said it took an $11 billion writedown related to big losses in investments tied to bad mortgage bets. Shares of the Dow component tumbled 7% Friday….

…Brokerage UBS said financial firms could end up facing $600 billion in losses as the credit crisis continues to unfold. Banks, brokers and insurers have already lost more than $160 billion related to bad mortgage bets. UBS also cut its first-quarter earnings estimates on a number of investment banks….

Stocks get slammed on recession fears - Feb. 29, 2008

These scary stories are cycles in our free market economy. The purchase of a home should be first just that...a place to live. Secondly houses historically have been investments as they appreciate over time. SOMDRENTER mya be only looking at the short term. Sincere home buyers should be looking at a 20-30 year investment. If history in any indicator than ANY home purchase would have a good investment.

 

[somdrenter]

These scary stories are cycles in our free market economy. The purchase of a home should be first just that...a place to live. Secondly houses historically have been investments as they appreciate over time. SOMDRENTER mya be only looking at the short term. Sincere home buyers should be looking at a 20-30 year investment. If history in any indicator than ANY home purchase would have a good investment.

A free market economy would not rely on government bailouts. Historically, as investments go, real estate has just kept up with inflation. On average, Americans move every 5-7 years. If ANY home purchase were a good investment, we should not see such a rise in foreclosures.

 

[foodcritic]

twisting logic

A free market economy would not rely on government bailouts. Historically, as investments go, real estate has just kept up with inflation. On average, Americans move every 5-7 years. If ANY home purchase were a good investment, we should not see such a rise in foreclosures.

Free market bailouts are not the point here. That is a distraction to point that homes appreciate over time. Rental units do not appreciate or do you create equity. People moving is another distraction to the point that homes over the long hual appreciate. The rise in forecloures has nothing to do with a home being a good investment. If that was the case EVERY person who owned a home would in fourclosure....they are not and it is a small % that are. Homes appreciate over time, equity is built over time also intrest paid is deductable yearly on income taxes. Seems like a no brainer to me.

 

[somdrenter]

Free market bailouts are not the point here. That is a distraction to point that homes appreciate over time. Rental units do not appreciate or do you create equity. People moving is another distraction to the point that homes over the long hual appreciate. The rise in forecloures has nothing to do with a home being a good investment. If that was the case EVERY person who owned a home would in fourclosure....they are not and it is a small % that are. Homes appreciate over time, equity is built over time also intrest paid is deductable yearly on income taxes. Seems like a no brainer to me.

Any other market factors/indicators you want to chalk up to “not the point here”? Sure, if you discount foreclosures, a market at a disconnect from fundamentals, the proliferation of toxic mortgages, record high inventory, the billions lost in real estate and the subsequent effect on the economy, tightened lending standards, slow sales, and government bailouts, then yes, the lipstick does look good on this pig.

 

[bcp]

Prices are low and you're STUPID if you don't buy now. Why the hell would you wait until the market picks up and homes cost more?

You wouldn't. Unless you're stupid.

There's a 5 BR, 3 BA right up the street from me that is a creampuff - great condition, hardwood floors, brick fireplace, family room, nice lot, fabulous neighborhood (if I do say so myself) for only $299,900. Mortgage payment of $1600 a month.

There's another one in Excuse the Eff Out of Me Society Hill in Ltown for $229,900, 3 BR, 2BA - $1200 a mo.

A big fat ol' house, 4 and 3, in Great Mills, for $1350 a mo.

And you'll OWN it!

You are TOTALLY not going to get that kind of deal a year from now.

Buy low. Sell high. Duh.

Prices are low so NOW is the time to buy.

If you have decent credit and can actually afford to buy a home, NOW IS THE TIME!

Don't be stupid and let this buyer's market opportunity pass you by.

So STOP that renting!!! Renting is for losers! The American dream is to OWN a home, not friggin rent one.

And NOW is the time.

you realize that the posters that you dont like are also reading and could become your next door neighbor.

will you be going to SoljaBoys crib toasting?

 

[LexiGirl75]

I need someone to elaborate on how this is ethical

The Mess That Greenspan Made: Why stop at reducing the principal?

Federal Reserve Chairman Ben Bernanke called Tuesday for more action to prevent distressed homeowners from falling into foreclosure, including a suggestion for mortgage lenders to reduce loan amounts to provide relief to struggling homeowners.

Ok, an example of what I think is being suggested...

I owe $100,000 on my home, in this market my home is worth $70,000, my mortgage payment is $600 and will reset to $800 and I will not be able to afford my mortgage... (This is the problem)

The solution is... Reduce my loan to $70,000 and I pay $600 for my mortgage? Because its easier to lose the money on that end of it than to lose the entire loan? Can someone help me to understand where they are coming from. I missed the speech this morning.

TIA

 

[LexiGirl75]

Interesting...

These kind of gave me some insight.

On the idea of cutting mortgage values, Bernanke said, "Principal reductions that restore some equity for the homeowner may be a relatively more effective means of avoiding delinquency and foreclosure. "

For how long?

With low or negative equity in their home, a stressed borrower has less ability — because there is no home equity to tap — and less financial incentive to try to remain in the home, he said.

Wouldn't this put undisciplined homeowners back in the current position.

Bernanke acknowledged this idea might be a tough sell to lenders. Lenders, he said, are reluctant to write down principal. "They said that if they were to write down the principal and house prices were to fall further, they could feel pressured to write down principal again," Bernanke said.

Lenders fear the opening of flood gates?

There are several reasons to keep borrowers in their houses. If people start walking away from their homes it can turn into viral urban blight. Cleveland is a prime example of this. Also, a good part of the responsibility for this fiasco lies with the lenders. Why not have them be held responsible? The real problem with this idea though is that lenders don't have any incentive to lower mortgage balances for a majority of their loans. The loans are going to be FHA or PMI backed. They most likely get more money back via the foreclosure process rather than lowering the mortgage principal. This leads to what Bernanke is really worried about and that is Fannie, Freddie, and the Private Mortgage Insurers needing to be bailed out. That kind of money comes out of the tax payers pocket instead of the banks. All in all, Bernanke's crazy idea makes more sense to me than the others ideas I have heard.

Well... we'll see.

 

[somdrenter]

Can someone help me to understand where they are coming from. I missed the speech this morning.

TIA

I think you got the gist of it. With the sort of bail outs that Helicopter Ben and the Democrats are suggesting, the Taxpayers directly or indirectly, will be footing this bill. “Moral Hazard” be damn, with handouts like these, there are few incentives to pay your mortgage.

Legislation could be introduced as soon as next week, said Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee. Frank's comments came Wednesday following a closed-door economic forum convened by Frank and House Speaker Nancy Pelosi, D-Calif.

A key feature of the foreclosure-prevention bill is likely to be a government-backed fund that would purchase pools of subprime mortgages that lenders had reduced to affordable amounts for borrowers, then refinance them into loans insured by the Federal Housing Administration.

House Democrats vow new push on economy - Mar. 5, 2008

 

[refi-rep]

Can you loan me the 20% cash down payment? TIA

Right now you really only need 3% down to do an FHA.

 

[somdrenter]

Prices are low and you're STUPID if you don't buy now. Why the hell would you wait until the market picks up and homes cost more?

You wouldn't. Unless you're stupid.

There's a 5 BR, 3 BA right up the street from me that is a creampuff - great condition, hardwood floors, brick fireplace, family room, nice lot, fabulous neighborhood (if I do say so myself) for only $299,900. Mortgage payment of $1600 a month.

There's another one in Excuse the Eff Out of Me Society Hill in Ltown for $229,900, 3 BR, 2BA - $1200 a mo.

A big fat ol' house, 4 and 3, in Great Mills, for $1350 a mo.

And you'll OWN it!

You are TOTALLY not going to get that kind of deal a year from now.

Buy low. Sell high. Duh.

Prices are low so NOW is the time to buy.

If you have decent credit and can actually afford to buy a home, NOW IS THE TIME!

Don't be stupid and let this buyer's market opportunity pass you by.

So STOP that renting!!! Renting is for losers! The American dream is to OWN a home, not friggin rent one.

And NOW is the time.

Housing Market Spirals, No End in Sight

NEW YORK -- Nervous homeowners and economic analysts have been wondering how much worse the housing market could get. On Thursday they got an answer: Plenty.

Foreclosures are at a record high. Home equity is at a record low. The housing market is spiraling down with no end in sight _ and taking people's sense of economic security with it.

For the first time since the Federal Reserve started tracking the data in 1945 the amount of debt tied up in American homes now exceeds the equity homeowners have built.

The Fed reported Thursday that homeowner equity actually slipped below 50 percent in the second quarter of last year, and fell to just below 48 percent in the fourth quarter. And that was just one example in a day of dismal housing reports.

The Mortgage Bankers Association said foreclosures hit an all-time high in the final quarter of last year. And pending U.S. home sales _ those in the gap between when a buyer signs a contract and when the deal closes _ came in below analyst expectations for January and remained at the second-lowest reading on record.

"There is no sign that we're near the bottom in the housing market," said Douglas Elmendorf, a senior fellow at the Brookings Institution and former Fed economist. "Housing prices will probably fall for a year, two or three to come."

washingtonpost.com - nation, world, technology and Washington area news and headlines

 

[Rael]

I've re-financed a couple of times, the last one was 4.375% X 15 years = $2,200 or so per month. Maybe timing was good interest-wise, but...

Is it good to try to own your home? I've heard both arguments on this 15 yr. vs. 30 yr. vs I/O... Was that smart or not so smart?

 

[beerlover]

I've re-financed a couple of times, the last one was 4.375% X 15 years = $2,200 or so per month. Maybe timing was good interest-wise, but...

Is it good to try to own your home? I've heard both arguments on this 15 yr. vs. 30 yr. vs I/O... Was that smart or not so smart?

To my way of thinking, if you can pay off your house and then continue to invest your house payment amount (or close to it) into good mutual funds, you've got the world by the short and curlies. The people who argue to refinance constantly so you have more interest to write off aren't going by the right math. You get a much higher return on your money by investing it rather than taking a tax break for interest paid...

 

[Rael]

To my way of thinking, if you can pay off your house and then continue to invest your house payment amount (or close to it) into good mutual funds, you've got the world by the short and curlies. The people who argue to refinance constantly so you have more interest to write off aren't going by the right math. You get a much higher return on your money by investing it rather than taking a tax break for interest paid...

Yeah, that makes sense to me also. Always wanted to own my home as quickly as possible. Never had that chance while moving often, but now it's different. Looking forward to that day. Thx, bl.

 

[vraiblonde]

Is it good to try to own your home? I've heard both arguments on this 15 yr. vs. 30 yr. vs I/O... Was that smart or not so smart?

My goal is to pay my house off ASAP. I took out a 30 year, but I pay extra on the principle every month. Some people like to spend their equity and don't care if they ever get the house paid off, but not me. At some point I want to own my house free and clear so I don't have to worry about mortgage payments when I'm ready to retire, plus if I decide to sell I can get the full price in my pocket and use it for whatever needs to happen at that point.

 

[Rael]

My goal is to pay my house off ASAP. I took out a 30 year, but I pay extra on the principle every month. Some people like to spend their equity and don't care if they ever get the house paid off, but not me. At some point I want to own my house free and clear so I don't have to worry about mortgage payments when I'm ready to retire, plus if I decide to sell I can get the full price in my pocket and use it for whatever needs to happen at that point.

We spent some equity three years ago on a home project, but we're trying to pay that one down quickly, too. Someday...
A 30 year paid off sooner with extra principle each month also makes sense to me. You're not tied to giving that extra principle each month, but you're still paying it off (as opposed to being committed to a 15 year monthly mortgage every month).

 

[MMDad]

My goal is to pay my house off ASAP. I took out a 30 year, but I pay extra on the principle every month.

That's how I'm doing it. I can treat my loan as a 15 year, but if something happens and cash gets tight I can go back to paying at the 30 year amount. The flexibility is worth it.

Have you noticed how Patchy and this renter dude say that all down days in the stock market are due to mortgages, and Forest says that it's all due to Bush and oil prices. Gee, if I didn't know better, I might think that the market is a bit more complex than any single issue. Fortunately I have Forest and Renter to explain it so well.

 

[RoseRed]

I have noticed in the paper that my old house in up for Trustee's Sale. I guess the guy that bought it to use as a rental couldn't keep with that and another one of his properties, it was up for foreclosure too.