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Posted: 9/19/2009 4:51:21 AM EST
I'm interested in your responses.

Scenario:

Because of the housing market crash, you're now upside down in your mortgage, and you think to continue paying is dumb, silly, wasteful, etc.

Is it OK to walk away from a mortgage when you're able to afford it?

I say it is not.

Someone, somewhere, will have to pick up your slack.

As explained here:


http://www.ar15.com/forums/topic.html?b=1&f=5&t=929703

Originally Posted By Backstop:
I long for the days when a business contract was a moral thing.

IE: your handshake and signature meant something.

I'm talking about holding up your end of the bargain because it's the right thing, and you have the ability to do so.

I'm not talking about no longer being able to afford your side of the deal.

You should not walk away from an agreement just because you don't like the current financial status of that agreement.

It is a business contract; sometimes you win, sometimes you lose.


Thanks.

NPP
Link Posted: 9/19/2009 4:54:25 AM EST
I agree that it never is. A contract is your word.
Link Posted: 9/19/2009 5:00:14 AM EST
[Last Edit: 9/19/2009 5:02:42 AM EST by m4hk33]
in theory if you agree to the terms of a deal you should honor that commitment, but the home morgage is the most fucked up thing that i have every gone through,

prime example, my house was 249K, if i carry that loan to term the back would make roughly 500,000 dollars off that loand(just estimating).

thats fucked up, im not asking for a free loan like a politician, but im not asked to be bent over and raped for 30 years, or give every nickle i earn to the bank to avoid paying them an extra half million dollars.


so in short, so just like when i see i guy screwd over in divorce court or child custody hereings, and goes and kills his wife/exwife, it is wrong, but I understand why it happens and cant really blame them.
Link Posted: 9/19/2009 5:01:43 AM EST
IMO, the only time it's OK to walk away from a mortgage is if the bank violates the terms of the contract. You would be better off suing the bank though. When I got laid off I spent my savings to fix up my house to get ready to rent it out. I rent it out at a loss each month but that loss is nothing compared to the gain I will get in 5 maybe 10 years. Walking away is really for quitters and it really pisses me off that people are walking away from mortgages only because the house is not worth what they owe on it. That should be a hanging offense.
Link Posted: 9/19/2009 5:01:53 AM EST
The .gov and the banks have manipulated the martket to such an extent that I have no ill feelings to someone that walks away.

What do they get per year iun overdrafty fee etc? Billions.

Fuck them.....

I have been in the mortgage business for 8 years working in such depts as loan origination, servicing and loss mitigation (in an odd way)

At GMAC mortgage we were REDUCING people principal balance by 10's or 100's of thousands of dollars to keep people in the house. Yet at the same time if your debt ratios were good , NO HELP....

Also this was for Homecomings loans that werer not Fannie or Freddie Loans..

Fannie and Freddie are still the issue here. Reduce people debt so that they have some skin in the game and they will less than likely foreclose. Dont and people will give the house back.

FANNIE AND FREDDIE WILL NOT ISSUE ANY DEBT FORGIVNESS where the private investore have and are.....

If you study the #'s a person that is deliquuint and gets a mocification is much more likely to go back into default. If you are preemptive with this and say...

"OK house is worth $200K. Thewy owe $325K. Maybe we do an FHA loan at 97.7% and recoup $195,400 or we do nothing and forclose and sell the house for maybe $180K and still pay $40-70K in fee's to attorneys, taxes, clean up crews, realtors etc etc etc..."+

You will get a good chunk back.......

Fannie and Freddie need to do debt relief or this will continue....

Fuck Fannie, Fuck Freddie, Fuck Barney Fran and CHris Dodd.....

Link Posted: 9/19/2009 5:03:33 AM EST
Originally Posted By m4hk33:
in theory if you agree to the terms of a deal you should honor that commitment, but the home morgage is the most fucked up thing that i have every gone through,

prime example, my house was 249K, if i carry that loan to term the back would make roughly 500,000 dollars off that loand(just estimating).

thats fucked up, im not asking for a free loan like a politician, but im not asked to be bent over and raped for 30 years, or give every nickle i earn to the bank to avoid paying them an extra half million dollars.

so in short, so just like when i see i guy screwd over in divorce court or child custody hereings, and goes and kills his wife/exwife, it is wrong, but I understand why it happens and cant really blame them.


No one is forcing you to get a home loan. If you don't like the terms don't get the loan. You go loan someone money and see how you feel about it taking them 30 years to pay you back.

Link Posted: 9/19/2009 5:04:09 AM EST

Originally Posted By m4hk33:
in theory if you agree to the terms of a deal you should honor that commitment, but the home morgage is the most fucked up thing that i have every gone through,

prime example, my house was 249K, if i carry that loan to term the back would make roughly 500,000 dollars off that loand(just estimating).

thats fucked up, im not asking for a free loan like a politician, but im not asked to be bent over and raped for 30 years, or give every nickle i earn to the bank to avoid paying them an extra half million dollars.

so in short, so just like when i see i guy screwd over in divorce court or child custody hereings, and goes and kills his wife/exwife, it is wrong, but I understand why it happens and cant really blame them.



I've got a feeling that you're going to take a beating on that post "If you didn't like it, you shouldn't have signed it, blah, blah", but I agree with you. I understand that banks don't exist to be charities, but give me a break. If the government REALLY wanted to help the middle class, they could offer low or no interest loans for houses.

Link Posted: 9/19/2009 5:04:10 AM EST
Originally Posted By bclark1:
I agree that it never is. A contract is your word.


I disagree. A buisness deal with a morgage company is just that, buisness. If it comes between food for my children and my word to a morgage company (who, btw will f*ck you in a flat second if it was to their advantage) Then it's a no-brainer, finance company loses..

However, if it's a face to face with a person. Then you must uphold your word.

Link Posted: 9/19/2009 5:06:29 AM EST
Originally Posted By Eagle7222:
The .gov and the banks have manipulated the martket to such an extent that I have no ill feelings to someone that walks away.

What do they get per year iun overdrafty fee etc? Billions.

Fuck them.....

I have been in the mortgage business for 8 years working in such depts as loan origination, servicing and loss mitigation (in an odd way)

At GMAC mortgage we were REDUCING people principal balance by 10's or 100's of thousands of dollars to keep people in the house. Yet at the same time if your debt ratios were good , NO HELP....

Also this was for Homecomings loans that werer not Fannie or Freddie Loans..

Fannie and Freddie are still the issue here. Reduce people debt so that they have some skin in the game and they will less than likely foreclose. Dont and people will give the house back.

FANNIE AND FREDDIE WILL NOT ISSUE ANY DEBT FORGIVNESS where the private investore have and are.....

If you study the #'s a person that is deliquuint and gets a mocification is much more likely to go back into default. If you are preemptive with this and say...

"OK house is worth $200K. Thewy owe $325K. Maybe we do an FHA loan at 97.7% and recoup $195,400 or we do nothing and forclose and sell the house for maybe $180K and still pay $40-70K in fee's to attorneys, taxes, clean up crews, realtors etc etc etc..."+

You will get a good chunk back.......

Fannie and Freddie need to do debt relief or this will continue....

Fuck Fannie, Fuck Freddie, Fuck Barney Fran and CHris Dodd.....



Interesting.

Thanks.
Link Posted: 9/19/2009 5:11:25 AM EST
Originally Posted By Marcbme:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.


I disagree. A buisness deal with a morgage company is just that, buisness. If it comes between food for my children and my word to a morgage company (who, btw will f*ck you in a flat second if it was to their advantage) Then it's a no-brainer, finance company loses..

However, if it's a face to face with a person. Then you must uphold your word.



+1 I think even Dave Ramsey said food before debt.

Link Posted: 9/19/2009 5:12:49 AM EST
i dont care if i take a beating, and it doesnt matter if it was, a 250K house or a 25K house in the projects, these are the same types of loans that the mafia would give out back in the day. but its ok for the banks to do s?

its not that i cant afford my house, its the fact that the housing market in the US has been so overinflated that there are no other pratical options,

save for 20 years to get an average house,
or
get a shitty house, in a shitty area, and make tripple payments




your not going to get away from paying at least the double the asking price for the home if you plan on being there for any extended period of time

home morgages are almost as big of a scam as credit cards, which i dont have
Link Posted: 9/19/2009 5:12:53 AM EST
When the company you contract with no longer cares about your situation and your well being. In the past you would go down to the bank, get a mortgage from the banker and he would be willing to work with you to help keep you in your home if you fell upon hard financial times. To the lender it was a business transaction but because of the personal relationship most also felt a moral obligation to do what they could to help you.

This is not the case in most modern situations. The only thing that matters to the lender is the bottom line. When the housing market was doing great, most lenders had very little interest in adjusting loans or helping out the borrower because it wasn't a good financial decision. They could take possession of a home and quickly flip it to recoup their money. Only after the housing crash have they gained much more interest in helping people because they already have a huge catalog of foreclosures that they aren't able to sell.

To most modern banks and lenders you are nothing more than an account number on their balance sheet. Their decision to make a loan to you is simply a business decision based greatly upon another arbitrary number known as a credit score. So if it's simply a business transaction on their side then why should you take it any more personally?
Link Posted: 9/19/2009 5:14:48 AM EST
Because of the housing market crash, you're now upside down in your mortgage, and you think to continue paying is dumb, silly, wasteful, etc


Those thoughts arent even an option.
You borrowed a set amount of money.
You lost it.
That doesnt change the fact that you still need to repay your loan.

Making bad choices doesnt exempt a man from the outcomes of those bad choices.

What the hell has happened in America when the idea of walking away from responsibility was a common practice.
Link Posted: 9/19/2009 5:17:07 AM EST
Originally Posted By Ponyboy:
When the company you contract with no longer cares about your situation and your well being. In the past you would go down to the bank, get a mortgage from the banker and he would be willing to work with you to help keep you in your home if you fell upon hard financial times. To the lender it was a business transaction but because of the personal relationship most also felt a moral obligation to do what they could to help you.

This is not the case in most modern situations. The only thing that matters to the lender is the bottom line. When the housing market was doing great, most lenders had very little interest in adjusting loans or helping out the borrower because it wasn't a good financial decision. They could take possession of a home and quickly flip it to recoup their money. Only after the housing crash have they gained much more interest in helping people because they already have a huge catalog of foreclosures that they aren't able to sell.

To most modern banks and lenders you are nothing more than an account number on their balance sheet. Their decision to make a loan to you is simply a business decision based greatly upon another arbitrary number known as a credit score. So if it's simply a business transaction on their side then why should you take it any more personally?


Well, I'm not in this situation, so I can't comment from experience.

But aren't the banks now working with folks?

Don't they have .Gov funds to provide lower rates, etc?

And I agree that from the banks perspective, it is just a business contract.

To answer your closing question: Guess it was just the way I was raised.

Link Posted: 9/19/2009 5:18:56 AM EST
Originally Posted By neonfires:
Originally Posted By Marcbme:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.


I disagree. A buisness deal with a morgage company is just that, buisness. If it comes between food for my children and my word to a morgage company (who, btw will f*ck you in a flat second if it was to their advantage) Then it's a no-brainer, finance company loses..

However, if it's a face to face with a person. Then you must uphold your word.



+1 I think even Dave Ramsey said food before debt.



Ummm, the OP said nothing about choosing between food & mortgage - specifically stated able to afford mortgage.

Is it also OK to default on your auto loan when you drive it off the lot and it's worth less than the loan value

Link Posted: 9/19/2009 5:20:56 AM EST
[Last Edit: 9/19/2009 5:21:11 AM EST by Backstop]
Originally Posted By neonfires:
Originally Posted By Marcbme:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.


I disagree. A buisness deal with a morgage company is just that, buisness. If it comes between food for my children and my word to a morgage company (who, btw will f*ck you in a flat second if it was to their advantage) Then it's a no-brainer, finance company loses..

However, if it's a face to face with a person. Then you must uphold your word.



+1 I think even Dave Ramsey said food before debt.



Oops - FMJ3 explained my original post.

Link Posted: 9/19/2009 5:21:53 AM EST
If you bought the house and the value skyrocketed, would you hand over your profits to the lender? Hekk No!


Then why should someone expect their lender to eat their losses?

In has been said many times, "In a bull market, everyone is a capitalist. In a bear market, everyone is a socialist..." Seems to be true.
Link Posted: 9/19/2009 5:22:08 AM EST
Originally Posted By m4hk33:
in theory if you agree to the terms of a deal you should honor that commitment, but the home morgage is the most fucked up thing that i have every gone through,

prime example, my house was 249K, if i carry that loan to term the back would make roughly 500,000 dollars off that loand(just estimating).

thats fucked up, im not asking for a free loan like a politician, but im not asked to be bent over and raped for 30 years, or give every nickle i earn to the bank to avoid paying them an extra half million dollars.


so in short, so just like when i see i guy screwd over in divorce court or child custody hereings, and goes and kills his wife/exwife, it is wrong, but I understand why it happens and cant really blame them.


True. I will avoid like crazy getting all caught-up in that rat race. I will live in the most cost effective (cheapest) way I can. Fuck that nonsense of 'homes as an investment' and fuck all those that have jacked-up home prices by trying to make a killing.

I'm quite please to see so many in the downward sprial. Well, not all.
Link Posted: 9/19/2009 5:24:20 AM EST
Your concern for your lender should not exceed their concern for you.

They gave you a SECURED loan based at a rate they based upon the perceived risk.

they entered into the bargin freely, just as you did, with a fixed set of terms.

Posted Via AR15.Com Mobile
Link Posted: 9/19/2009 5:26:50 AM EST
Originally Posted By pale_pony:
If you bought the house and the value skyrocketed, would you hand over your profits to the lender? Hekk No!


Then why should someone expect their lender to eat their losses?

In has been said many times, "In a bull market, everyone is a capitalist. In a bear market, everyone is a socialist..." Seems to be true.


It's going to be real funny to see all these people turn socialists in a few years when banks won't give out loans to flakes.

Link Posted: 9/19/2009 5:27:34 AM EST
Originally Posted By Backstop:
Originally Posted By Ponyboy:
When the company you contract with no longer cares about your situation and your well being. In the past you would go down to the bank, get a mortgage from the banker and he would be willing to work with you to help keep you in your home if you fell upon hard financial times. To the lender it was a business transaction but because of the personal relationship most also felt a moral obligation to do what they could to help you.

This is not the case in most modern situations. The only thing that matters to the lender is the bottom line. When the housing market was doing great, most lenders had very little interest in adjusting loans or helping out the borrower because it wasn't a good financial decision. They could take possession of a home and quickly flip it to recoup their money. Only after the housing crash have they gained much more interest in helping people because they already have a huge catalog of foreclosures that they aren't able to sell.

To most modern banks and lenders you are nothing more than an account number on their balance sheet. Their decision to make a loan to you is simply a business decision based greatly upon another arbitrary number known as a credit score. So if it's simply a business transaction on their side then why should you take it any more personally?


Well, I'm not in this situation, so I can't comment from experience.

But aren't the banks now working with folks?

Don't they have .Gov funds to provide lower rates, etc?

And I agree that from the banks perspective, it is just a business contract.

To answer your closing question: Guess it was just the way I was raised.




The banks are now working with people because they already have too many foreclosures on the books that they can't get rid of already. If you were a bank would you rather foreclose on another home that you can't sell or work with the people and try to continue getting some kind of revenue out of them even at a reduced rate. It's a simple business decision that something coming in on a loan is better than nothing.

When a home is foreclosed on and there's not much of a chance of finding a buyer anytime soon then not only will the lender no longer be receiving any income from that house they will also be losing money each month to taxes and resale value of the home due to disrepair. When the housing market is good then foreclosing is a good business decision and when the housing market is bad then it's not. Don't think that the banks are doing people a favor out of the goodness of their heart by working with them, they are just trying to stem the massive bleeding of cash they are experiencing.

I've never been in this situation either and honestly the housing market crash and downturn in the economy has really had zero affect on my family at all. However, I understand why people will simply walk away from a mortgage and I really don't have any problem with them doing it because if the shoe was on the other foot the bank would have walked away from their end of the bargain long ago.



Link Posted: 9/19/2009 5:29:58 AM EST
[Last Edit: 9/19/2009 5:31:48 AM EST by m4hk33]
i dont think that its a matter of people not wanting to accept responsibility for there commitment, i just think that people see banks for what they are and after years of being bent over by them, they are saying fuck it

get a morgage, the overwhelming percent of the morgage goes to intrest for at least the first half of the term

closing coast, they get a few thousand dollars for writing the loan,

fees for absolutly everything,

higher rates based on an immaginary number

i make great money, have never missed any type of payment that i made a commitment to, but because i chose to not to go into debt since i was 18 years old by getting new cars, my lack of significant cradit history say i pay more,


so let me see, i have two chose,
spend 60K on two cars, over say 8 years, lose 40K in deprecation to essentially buy a decent credit score to get a decent loan,
or
be responsible, dont throw 40K down the drain in deprecation, pay what bills you have, apply for loan, and get bent over

bank wins either way

fuck em
Link Posted: 9/19/2009 5:30:36 AM EST
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********
Link Posted: 9/19/2009 5:32:51 AM EST
defintly agree with you, it would be better could save and not deal with the banks but thats not an otion after 50 years of artificial inflated values
Link Posted: 9/19/2009 5:35:56 AM EST
Originally Posted By Marcbme:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.


I disagree. A buisness deal with a morgage company is just that, buisness. If it comes between food for my children and my word to a morgage company (who, btw will f*ck you in a flat second if it was to their advantage) Then it's a no-brainer, finance company loses..

However, if it's a face to face with a person. Then you must uphold your word.



the feds let you deduct the interest from your taxes
Link Posted: 9/19/2009 5:38:36 AM EST
I have seen this though process on ARFCOM a great deal, that "a contract is your word" and that the breach of this sort of contract, ie, a mortgage is some sort of moral failing. This is not borrowing money from an individual, friend, relative, or even George Bailey down at you local S&L. This is borrowing from a very large institution that gives you a take-it or leave-it contract that moreover contemplates that both parties might find it more efficient to breach the contract at some point and provides remedies for that breach. The breach is merely exercising another part of the contract. That provision would not be there if both parties had not contemplated it. There is no credible argument that exercising a part of agreed to contract is immoral.

Now the mere fact that one is upside down on their mortgage at the time is a poor reason to exercise your breach options. The market will turn around at some point and if you can afford the mortgage and do not need to move then I don't really understand why one would think that would work out well for you.

I moved last year and had a tremendously tough time selling the house; it took 13 months. I had to stop paying my mortgage in January as I simply could not afford two homes. Finally was able to do a short sale in August and avoided foreclosure, but of course my credit rating took a beating.

Bank worked with us and they understood the situation, but if I could have affroded to continue to pay I certainly would have.
Link Posted: 9/19/2009 5:39:37 AM EST
Originally Posted By Lightning1960:
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********



Wrong.

All of these problems were created by companies that were trying to make money. They made loans to people that obviously couldn't afford what they were buying because they had a chance to make a huge amount of money. They didn't care whether the people could ultimately pay the loans or not because they would just foreclose and resell the house so it wasn't their problem. What they're now finding out is that it actually is their problem when huge numbers of people began to default.

If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says? That's akin to me loaning my son $100 and expecting him to pay it back when I know that he doesn't have a job. Is it his fault that I end up $100 poorer or is it mine for giving him the money when I knew that I had no chance of recovering it?

Link Posted: 9/19/2009 5:49:42 AM EST

Originally Posted By Ponyboy:


If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says?

You screwed up by trying to buy a house you can't afford. The bank screwed up by loaning you the cash.


Link Posted: 9/19/2009 5:49:59 AM EST
Originally Posted By Ponyboy:
Originally Posted By Lightning1960:
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********



Wrong.

All of these problems were created by companies that were trying to make money. They made loans to people that obviously couldn't afford what they were buying because they had a chance to make a huge amount of money. They didn't care whether the people could ultimately pay the loans or not because they would just foreclose and resell the house so it wasn't their problem. What they're now finding out is that it actually is their problem when huge numbers of people began to default.

If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says? That's akin to me loaning my son $100 and expecting him to pay it back when I know that he doesn't have a job. Is it his fault that I end up $100 poorer or is it mine for giving him the money when I knew that I had no chance of recovering it?



Well, kinda.

I place the majority of the blame on banks, .Gov, etc.

But the borrower is - at least to a certain degree - at fault.

I know folks that have a monthly payment so large, it requires 1.5 weeks of work to pay; about 38% monthly gross.

That's freaking nuts.

And from my POV, irresponsible.
Link Posted: 9/19/2009 5:50:57 AM EST
Deej, you beat me by 17 seconds.



Then again, you probably already knew what I was gonna post.

Link Posted: 9/19/2009 5:51:42 AM EST

Originally Posted By Backstop:
Deej, you beat me by 17 seconds.



Then again, you probably already knew what I was gonna post.


great minds think alike?
Link Posted: 9/19/2009 5:52:36 AM EST
Originally Posted By Deej86:

Originally Posted By Backstop:
Deej, you beat me by 17 seconds.



Then again, you probably already knew what I was gonna post.


great minds think alike?


HAHA!

I figure you were probably reading mine (mind).
Link Posted: 9/19/2009 5:55:09 AM EST
[Last Edit: 9/19/2009 5:56:58 AM EST by Dystopia]
Originally Posted By Lightning1960:
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********



That’s how I do it.

If you can’t afford to buy it twice you can’t afford it. That’s my motto.
It’s amazing when people I talk to say that they can’t save any money when they are making over sixty thousand a year. Then I see their house and their two new cars and unnecessary junk they buy and the vacations they go on. They are in debt up to their ears. Then I tell them I have no debt at all, I will never pay one cent in interest and they can’t understand how I do it on one salary.
Link Posted: 9/19/2009 5:55:44 AM EST
Originally Posted By Ponyboy:
Originally Posted By Lightning1960:
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********



Wrong.

All of these problems were created by companies that were trying to make money. They made loans to people that obviously couldn't afford what they were buying because they had a chance to make a huge amount of money. They didn't care whether the people could ultimately pay the loans or not because they would just foreclose and resell the house so it wasn't their problem. What they're now finding out is that it actually is their problem when huge numbers of people began to default.

If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says? That's akin to me loaning my son $100 and expecting him to pay it back when I know that he doesn't have a job. Is it his fault that I end up $100 poorer or is it mine for giving him the money when I knew that I had no chance of recovering it?



I don't fully agree.
I think some blame lies with the banks, but the majority belongs to the person getting the loan.
Because it falls on who solicited who,
The bank didn't look them up offering them a loan, The person went to the bank asking.
Link Posted: 9/19/2009 5:56:54 AM EST
ANY TIME IT IS MORE BENEFICIAL TO YOU AND YOUR FAMILY!!!!!!!!!! Ive had my bank and a mortgage co. i was doing business with just close up shop and close the doors with out a single word or notice to me!!! SO FUCK THEM ALL!!! THEY'll FUCK YOU IN A MINUTE TO BENEFIT THEMSELVES!!!. this aint the 1950's anymore where your word was your bond and co's stuck to their end of the contract w/ the customer being #1 on their list!! THOSE DAYS ARE GONE!!! im 42 yrs old and have honored every agreement/contract i have signed!! and still screwed twice!! its a new day and age, SO FUCK THE GREEDY/CROOKED MORT. CO'S!! TAKE CARE OF YOU AND YOUR FAMILY FIRST!!!
Link Posted: 9/19/2009 6:00:15 AM EST
When it's paid off.
Link Posted: 9/19/2009 6:00:26 AM EST
Link Posted: 9/19/2009 6:01:23 AM EST
Originally Posted By bclark1:
I agree that it never is. A contract is your word.



I agree. A man is only as good as his word.
Link Posted: 9/19/2009 6:07:24 AM EST
Originally Posted By Bud:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.



I agree. A man is only as good as his word.


The contract explicitly details what will happen under a default, so you are still going by the contract. Counter-party risk is a fact of life
Link Posted: 9/19/2009 6:08:45 AM EST
Originally Posted By Lightning1960:
Originally Posted By Ponyboy:
Originally Posted By Lightning1960:
America would be better off today if things were done the old fashioned way.
If you want something, work hard, save your money, and buy it.
All these problems are the result of the "got to have it now" mentality.
*********Flame away********



Wrong.

All of these problems were created by companies that were trying to make money. They made loans to people that obviously couldn't afford what they were buying because they had a chance to make a huge amount of money. They didn't care whether the people could ultimately pay the loans or not because they would just foreclose and resell the house so it wasn't their problem. What they're now finding out is that it actually is their problem when huge numbers of people began to default.

If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says? That's akin to me loaning my son $100 and expecting him to pay it back when I know that he doesn't have a job. Is it his fault that I end up $100 poorer or is it mine for giving him the money when I knew that I had no chance of recovering it?



I don't fully agree.
I think some blame lies with the banks, but the majority belongs to the person getting the loan.
Because it falls on who solicited who,
The bank didn't look them up offering them a loan, The person went to the bank asking.



WTF do you think advertising is if it isn't soliciting for business?

So banks that don't advertise home mortgages are 100% free from fault and banks that do are somewhat to blame?

Link Posted: 9/19/2009 6:09:59 AM EST
[Last Edit: 9/19/2009 6:11:19 AM EST by Max_Mike]
Originally Posted By Deej86:

Originally Posted By Ponyboy:


If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says?

You screwed up by trying to buy a house you can't afford. The bank screwed up by loaning you the cash.




Naw that make too much sense and actually expects people to be held personally responsible for their actions and poor choices.

I love how some members who claim to be libertarian seem to always want to find other entities to blame for bad personal choices. If you take out a loan you cannot pay there is only one person to blame, find a mirror and look to see that person. The bank may have been willing to make a bad loan to a chucklehead but you choose to accept their terms nobody forced you.
Link Posted: 9/19/2009 6:12:26 AM EST
[Last Edit: 9/19/2009 6:13:14 AM EST by Backstop]
Originally Posted By bear_grillz:
Originally Posted By Bud:
Originally Posted By bclark1:
I agree that it never is. A contract is your word.



I agree. A man is only as good as his word.


The contract explicitly details what will happen under a default, so you are still going by the contract. Counter-party risk is a fact of life


I'm certainly not an attorney, but I think you're seeing way too much fine print between the lines.



Your end of the contract says, "I'll pay."

If you don't pay, the contract says, "XYZ will happen."

Not paying, walking away, etc. isn't part of the 'contractual agreement on your part.'

Guess that's pretty subjective until an attorney stops in.
Link Posted: 9/19/2009 6:15:12 AM EST

Originally Posted By Backstop:
I'm interested in your responses.

Scenario:

Because of the housing market crash, you're now upside down in your mortgage, and you think to continue paying is dumb, silly, wasteful, etc.

Is it OK to walk away from a mortgage when you're able to afford it?


That would be pretty fucking stupid.

You drive a new car off the lot, you are upside down before the first payment. Do you skip out on that?

How dumb you look when the market bounces back and your home is up 50% but you no longer own it and the bank gets all the profit.
Link Posted: 9/19/2009 6:16:07 AM EST

Originally Posted By Max_Mike:
Originally Posted By Deej86:

Originally Posted By Ponyboy:


If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says?

You screwed up by trying to buy a house you can't afford. The bank screwed up by loaning you the cash.




Naw that make too much sense and actually expects people to be held personally responsible for their actions and poor choices.

I love how some members who claim to be libertarian seem to always want to find other entities to blame for bad personal choices. If you take out a loan you cannot pay there is only one person to blame, find a mirror and look to see that person. The bank may have been willing to make a bad loan to a chucklehead but you choose to accept their terms nobody forced you.
That I agree with. I'm not wholly blaming the bank here. I'm blaming the person who A) wanted to buy a $200,000 house on $10,000 a year income and B) decided that he'd sign the deal anyway even though there wasn't a snowball's chance he'd be able to afford it.

I also blame the bank that would be stupid enough to loan money to those that cannot afford it.

Link Posted: 9/19/2009 6:17:19 AM EST

Originally Posted By Ponyboy:

If I make $10,000 per year and I want to buy a $200,000 house and a bank loans me the money to buy it knowing that I can't afford it then who is ultimately at fault when the bank ends up owning the house exactly like the mortgage contract says?

50% on buyer for buying something they cannot afford.
50% on lender for lending money to someone they knew could not pay it back.
Link Posted: 9/19/2009 6:17:40 AM EST
[Last Edit: 9/19/2009 6:22:44 AM EST by jbombelli]
When we bought our house, our mortgage lender approved us for $100K more than we wanted to spend. The realtor and loan officer did their level best to get us to spend that money. The loan officer also did everything he could to steer us away from a fixed rate, and go with an adjustable rate loan. They talked about the American dream. They told us how much more money we'd be making in a few years, and how we'd be able to afford the balloon payments, and if something happened and we couldn't, then we'd be able to sell the house or refinance at that point. They literally tried EVERY trick in the book to get us to spend more than we wanted, and to get us to take a stupid loan. If I'd bought everything they were selling, it wouldn't have mattered to them if I'd defaulted, since they sold my loan right away anyway. In the first 4 years I probably had 10 different banks own that loan. Some of them more than once.

If I had not been a licensed financial advisor myself at that time, I might very well have spent that money. But I was smart enough to stick to my guns. Many others were not.

I lay 65% of the blame on the banks, 35% on the government, who forced these banks to write bad loans, and then gave them a way to unload those loans via Fannie Mae and Freddie Mac, which resulted in their intentionally writing billions of dollars worth of such loans..Only 10% of the blame goes to the actual purchaser who bought more than he could afford.


So forgive me if I don't feel disdain for someone for walking away from a loan they probably didn't want in the first place, but only bought because of a smooth-talking salesman.
Link Posted: 9/19/2009 6:17:41 AM EST
Originally Posted By Old_Painless:
Originally Posted By m4hk33:
i dont think that its a matter of people not wanting to accept responsibility for there commitment, i just think that people see banks for what they are and after years of being bent over by them, they are saying fuck it

get a morgage, the overwhelming percent of the morgage goes to intrest for at least the first half of the term

closing coast, they get a few thousand dollars for writing the loan,

fees for absolutly everything,

higher rates based on an immaginary number



It sounds like you looked at their deal that they offered you and didn't like it.

So, why did you sign the note?

Did someone hold a gun to your head and force you to agree to those terms?

You signed it and promised to meet the obligations of the loan. Now, you are angry.

The only person you ought to be angry with is yourself, for signing a note that you didn't like.



Agreed.

I have to wonder what the responses to age ratio would be here?
Link Posted: 9/19/2009 6:19:39 AM EST
Link Posted: 9/19/2009 6:20:35 AM EST
Maybe if the banks get burned badly enough this time around they'll price risk appropriately the next time.

This is from someone who spent the first half of his career pricing risk for a major bank.

Link Posted: 9/19/2009 6:21:08 AM EST
[Last Edit: 9/19/2009 6:22:29 AM EST by Backstop]
Originally Posted By Deej86:
I also blame the bank that would be stupid enough to loan money to those that cannot afford it.


Me and my friends are just a bunch of dumb old farts, but we got to talking once.

It was offered the banks knew they were making high risks loans, but felt the interest they would make for the short term, then re-acquiring the home for re-sale, would severely outweigh the risk(s).

But they miscalculated the exact chain of events.
Link Posted: 9/19/2009 6:21:32 AM EST
Originally Posted By Old_Painless:
Originally Posted By Deej86:

I also blame the bank that would be stupid enough to loan money to those that cannot afford it.



And some of the blame goes to Barney Frank and his comrades who wrote legislation that forced banks to make loans to these folks that were bad loan risks.



agree 100%

banks were, in many cases, forced to lend the money to bad risks

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