On Sat, 2 Aug 2008 12:11:14 -0400, (Terry) wrote:

>What "exactly" does this post have to do with cooking?

Did you read the original post?

On Sat, 02 Aug 2008 11:07:13 -0700, Pan > wrote:

>On Fri, 01 Aug 2008 12:48:29 -0700, sf wrote:
>
>
>>>And did these predatory practices start in 2000, or perhaps, before?
>>>And how much responsibility did the borrowers hold here? Were they all
>>>helpless, clueless victims?
>>
>>So, you want to play Blame the Victim?
>
>No he is not blaming the victim, in that the victim here is the
>taxpayer.

I don't know why you're saying taxpayers are the victim when they are
not bailing out the people who lost their homes. They are bailing out
the lending institutions who made those bad loans.

>Those who took these mortgages out are not victims. They signed a
>contract, knowing that they would be unable to pay if the interest
>rate went up. And they knew that the rate would go up, because it
>said so in the paper work.
>The mortgage brokers didn't care, they were selling the mortgages as
>fast as they were signed, the bundlers and purchases of these thought
>that they would make money in a turn over.
>
>And now the govt. will take the money that I worked for and pay all of
>these fools.
>And those of us who played by the rules will be screwed once again.

So, now I have to get all teary eyed over those poor mortgage brokers
and their horrible problems?


--
I never worry about diets. The only carrots that interest me are the number of carats in a diamond.

Mae West

On Sat, 02 Aug 2008 17:58:13 GMT, Wayne Boatwright
> wrote:

>On Sat 02 Aug 2008 10:51:32a, told us...
>
>> On Sat, 02 Aug 2008 13:41:06 GMT, Wayne Boatwright
>> > wrote:
>>
>>>Yes, it was fixed and working fine now.
>>
>> What was wrong with it?
>
>Bad circuit board.

ouch! I bet that cost almost as much as a new camera!


--
I never worry about diets. The only carrots that interest me are the number of carats in a diamond.

Mae West

Steve Pope wrote:

> In almost no circumstances are home buyers required to pay 20%
> down. Every community has lenders willing to make those 2nd
> loans to bring the down payment down to 10%, 5%, or 0% depending
> on the free availability of money at the moment.
>
> Steve

Bank of American has a "Neighborhood Heros" program where teachers,
police, fireman, nurses and the like could get a mortgage with no money
down.

sf wrote:

> The real question is should you be in the restaurant business in the
> first place. It's a BIG risk! What an idiot for taking the risk.
> Same with home buying. Using Goomba's reasoning, none of us should
> own one. The risk is too big when you first enter the market.
>
Huh? What do you claim I say no one should own? A restaurant or their home?
No one who hasn't researched and understand the risks and
responsibilities SHOULD go out and buy either, don't you think?
Yet NEVER did I say someone shouldn't own either.
I'm a HUGE fan of home ownership, having done it numerous times.

Nancy Young wrote:

>>
>> I think people should be responsible for their actions but a scam is a
>> scam. I was offered a home equity loan at a real attractive rate for a
>> term of 2 years or a fixed rate almost 2 pts higher. The scam is to
>> switch you onto the more profitable adjustable rate and boy, I had to
>> think about that one for almost a full minute before declining. Bait
>> and switch is a classic "sales technique" but in most cases, any loss
>> is relatively minor.
>
> I can't call it a scam if they told you up front what the deal was.

It's a scam in that most folks fail to comprehend the full implications
of the deal. The banks use the fact of the buyers lack of experience to
sell a better deal for themselves. ARMs should only be offered to
persons experienced with procuring loans.

OTOH, I have heard that my friend from high school had such a loan. He
has had numerous chances to get a refinance for his one bedroom condo at
a great rate many times in the last 10 years. He has not. He's a loan
officer. Obviously there's something going on here but my info is a bit
sketchy as I'm hearing this through a mutual friend. However, there is a
chance that he's the dumbest guy I know. That's a pretty major
accomplishment. :-)

>
>> However, with sub-prime ARMs you could lose your home. Americans
>> losing their homes is not in the best interest of America. Sub-prime
>> ARMs allow more people to buy their homes but the bottom line is that
>> the banks should not be making loans to folks unable to support the
>> payments - duh. It's not in the best interest of America and it's
>> citizens.
>
> That's why so many people like me are ****ed off. This whole mess
> is affecting *all* of us. I'm not just mad at the people who put blinders
> on and bought and furnished houses way out of their league. Believe me,
> I'm ****ed off at the banks/etc who made all these bad loans, too.
> Now all the furniture stores are begging for customers because they're
> in trouble. This ripple affect is killing us.
>
>> scam. Oh, yeah, we should outlaw double digit credit card interest
>> rates, just for good measure. :-)
>
> Now, there's a plan! Heh, I mean, dream.
>
> nancy

sf wrote:

> My point is they are dangling those loans in front of people that they
> shouldn't... and they are setting them up for failure. Most of those
> people were first time buyers with no previous experience in real
> estate. The housing market around here was very tight and when I was
> reading about the orchards being converted into suburbs, my "uhoh"
> meter went off the charts. But housing nearer the city was
> astronomical and new housing was "affordable"... with first time buyer
> incentives and iffy loan packages. My own kids paid over $500,000 for
> 800 sq ft (used) boxes last September. One is in San Francisco, the
> other in San Jose. They are hardly McMansions, they are bottom of the
> line entry level homes in borderline neighborhoods. I have a lot of
> sympathy for the people who didn't get sound financial advice and were
> suckered into these predatory loans just because nobody puts the
> brakes on lending institutions anymore. That's free enterprise for
> you. Blame the victim... it's the American way.
>

So are you saying your kids shouldn't have purchased a house because
they're too naive to know if they could afford the payments?
And the prices in California are insane but it doesn't matter where the
house is if the buyer can't afford it, they can't afford it! Lord
knows when in years past when folks in California sold those houses at
those insane profits they don't pay the lenders any more than was required
in the original contract, right? Are people in CA exempt from reading
their contracts or from common sense just because they live in high cost
areas? Do you feel your kids are victims of lenders or just living in an
insanely overpriced area? Who determines the market selling price of a
home in California? Not the lenders, I imagine?

On Sat, 02 Aug 2008 16:22:55 -0400, Goomba >
wrote:

>sf wrote:
>
>> My point is they are dangling those loans in front of people that they
>> shouldn't... and they are setting them up for failure. Most of those
>> people were first time buyers with no previous experience in real
>> estate. The housing market around here was very tight and when I was
>> reading about the orchards being converted into suburbs, my "uhoh"
>> meter went off the charts. But housing nearer the city was
>> astronomical and new housing was "affordable"... with first time buyer
>> incentives and iffy loan packages. My own kids paid over $500,000 for
>> 800 sq ft (used) boxes last September. One is in San Francisco, the
>> other in San Jose. They are hardly McMansions, they are bottom of the
>> line entry level homes in borderline neighborhoods. I have a lot of
>> sympathy for the people who didn't get sound financial advice and were
>> suckered into these predatory loans just because nobody puts the
>> brakes on lending institutions anymore. That's free enterprise for
>> you. Blame the victim... it's the American way.
>>
>
>So are you saying your kids shouldn't have purchased a house because
>they're too naive to know if they could afford the payments?

It's not a matter of affording, it's a matter of understanding the
fine print. When you've gone through a few loans, the fine print that
needs close attention becomes more apparent.

>And the prices in California are insane but it doesn't matter where the
> house is if the buyer can't afford it, they can't afford it! Lord
>knows when in years past when folks in California sold those houses at
>those insane profits they don't pay the lenders any more than was required
>in the original contract, right? Are people in CA exempt from reading
>their contracts or from common sense just because they live in high cost
>areas? Do you feel your kids are victims of lenders or just living in an
>insanely overpriced area?

They are not victims of anything, partially because they consulted us
all along the way. What would you pay for an 800 sq ft box?
Certainly not half a million dollars, yet it was a good deal at the
time.

>Who determines the market selling price of a
>home in California? Not the lenders, I imagine?

Lenders certainly are to blame. If they were still as strict with
their lending requirements as they were when we first bought our
homes, you can bet housing prices wouldn't have gotten so far out of
hand.


--
I never worry about diets. The only carrots that interest me are the number of carats in a diamond.

Mae West

dsi1 wrote:
> Nancy Young wrote:

>> I can't call it a scam if they told you up front what the deal was.
>
> It's a scam in that most folks fail to comprehend the full
> implications of the deal. The banks use the fact of the buyers lack
> of experience to sell a better deal for themselves. ARMs should only
> be offered to persons experienced with procuring loans.

Is it only where I live that you get a truth in lending statement?
You don't even need to read the fine print.

Or get a lawyer to do that for you. Remember when you used
to have a lawyer at closing? The bank would insist, probably
just so you oculdn't come back and say I didn't understand I
would have to pay this back.

> OTOH, I have heard that my friend from high school had such a loan. He
> has had numerous chances to get a refinance for his one bedroom condo
> at a great rate many times in the last 10 years. He has not. He's a
> loan officer.

How many times have I seen mortgage brokers, loan officers
on Suze Orman or the like, in trouble because they thought they
thought the market would go up forever. Surely they understood
the terms of their loans.

> Obviously there's something going on here but my info
> is a bit sketchy as I'm hearing this through a mutual friend.
> However, there is a chance that he's the dumbest guy I know. That's a
> pretty major accomplishment. :-)

Maybe there is some reason he knows he won't qualify.
Like he's upside down on his mortgage.

nancy

On Fri, 01 Aug 2008 07:32:34 -0400, Goomba wrote:

> blake murphy wrote:
> foreclosures
>> have skyrocketed. yep, it's all in our heads...
>>
>> blake
>
> What *exactly* did Bush have to do with mortgages again? The way I see
> it half the people having mortgage problems were people who overbought
> assuming they were going to make a killing when they flipped the house.
> Housing prices readjusted (look at California who led that trend) in
> many areas because they were just insanely overpriced. There were also
> certainly mortgage lenders who got sloppy and allowed unqualified people
> buy more home they couldn't afford which I can find fault with. Yet
> somehow I don't see how Bush (or Clinton before) as being responsible?

not specifially bush, but the republicans in general (and in particular,
phil gramm) who had a hard-on for deregulation of all kinds, but especially
financial institutions, so that mortgage lenders and people like enron
could play fast and loose with such rules as remained.

your pal,
blake

On Fri, 01 Aug 2008 14:50:25 -0400, Goomba wrote:

> sf wrote:
>
>>> What *exactly* did Bush have to do with mortgages again? The way I see
>>> it half the people having mortgage problems were people who overbought
>>> assuming they were going to make a killing when they flipped the house.
>>> Housing prices readjusted (look at California who led that trend) in
>>> many areas because they were just insanely overpriced. There were also
>>> certainly mortgage lenders who got sloppy and allowed unqualified people
>>> buy more home they couldn't afford which I can find fault with. Yet
>>> somehow I don't see how Bush (or Clinton before) as being responsible?
>>
>> They did nothing to stop predatory lending practices even though it
>> was obviously a train wreck waiting to happen.
>>
> And did these predatory practices start in 2000, or perhaps, before?
> And how much responsibility did the borrowers hold here? Were they all
> helpless, clueless victims?

yes, actually they did start right around 2000, when everybody's favorite
codpiece model took office:

In 1933, a few years following the stock market crash, Congress passes the
Glass-Steagall Act, in hopes that regulating banks will help prevent market
instability, particularly amongst Wall Street banks. The purpose of the act
is to separate commercial banks that focus on consumers from investment
banks, which deal with speculative trading and mergers.

The Glass-Steagall Act provided the proper oversight and entity separation
that would prohibit banks and other financial companies from merging into
giant trusts (conflict of interests) -- giant trusts or corporations being
more powerful, naturally, and having the seemingly limitless capital to
lobby their corporate interests, however, with a very myopic scope
(particularly when it comes to factoring in potential losses -- most banks,
as seen in contemporary times, chose not to anticipate losses in the
mortgage market; they presumed home prices would continue to appreciate).

In 1999, former Senator Phil Gramm (who is, incidentally, Senator John
McCain's economic adviser and cochairs his presidential campaign) set out
to completely gut the Glass-Steagall Act, and did so successfully,
replacing most of its components with the new Gramm-Leach-Bliley Act:
allowing commercial banks, investment banks, and insurers to merge (which
would have violated antitrust laws under Glass-Steagall). Sen. Gramm was
the driving force behind the Gramm-Leach-Bliley Act, as he had received
over $4.6 million from the FIRE sector (Finance, Insurance and Real Estate
donations) over the previous decade, and once the Act passed, an influx of
"megamergers" took place among banks and insurance and securities
companies, as if they had been eagerly awaiting the passage of Gramm's Act.
Everything in between Glass-Steagall and Gramm-Leach-Bliley (i.e. Savings
and Loan crisis/bust) was, in large part, the incubation period for what
would take place over the nine years that would follow the passage of
Gramm's Act: an experiment in deregulation.

Shortly after George W. Bush was elected president, Congress and President
Clinton were trying to pass a $384 billion omnibus spending bill, and while
the debates swirled around the passage of this bill, Senator Phil Gramm
clandestinely slipped a 262-page amendment into the omnibus appropriations
bill titled: Commodity Futures Modernization Act. It is likely that few
senators read this bill, if any. The essence of the act was the
deregulation of derivatives trading (financial instruments whose value
changes in response to the changes in underlying variables; the main use of
derivatives is to reduce risk for one party). The legislation contained a
provision -- lobbied for by Enron, a major campaign contributor to Gramm --
that exempted energy trading from regulatory oversight. Basically, it gave
way to the Enron debacle and ushered in the new era of unregulated
securities. Interestingly enough, Gramm's wife, Wendy, had been part of the
Enron board, and her salary and stock income brought in between $900,000
and $1.8 million to the Gramm household, prior to the passage of the
Commodity Futures Modernization Act.

In 2003, Gramm left the Senate to join UBS, which had acquired investment
house PaineWebber due to his deregulation bill. At UBS, Gramm lobbied
Congress, the Fed and the Treasury Department. During Gramm's tenor at UBS
and as a lobbyist, Congress passed the Responsible Lending Act, billed as
an anti-predatory-lending measure, but was called the "Loan Shark
Protection Act" by consumer advocates, as it was designed to preempt
stronger state laws against anti-predatory lending. The Fed largely ignored
the underlying and growing problems within the subprime mortgage/housing
markets, as Bernanke famously acknowledged the housing market in April,
2007 as, "[showing] signs of softening," but said that a "sharp slowdown,"
is unlikely.

(more at:
<http://losangeles.injuryboard.com/miscellaneous/the-subprime-mess-and-phil-gramm-an-experiment-in-deregulation.aspx?googleid=242468>
)

once home loans could be bundled and then 'securitized' (meaning sold to
entities other than the banks issuing the loans), lenders became less
anxious to determine whether the borrower could actually repay. i mean, no
sweat, since home prices were going to rise forever, right? and anyway,
the loan issuer was no longer holding the bag.

so this one you can put squarely on the republicans and their mania to 'get
goenerment out of the way of business,' a.k.a., 'letting my pals make a ton
of money with no oversight.'

your pal,
blake

On Fri, 01 Aug 2008 21:34:58 -0400, Goomba wrote:

> sf wrote:
>
>>> And did these predatory practices start in 2000, or perhaps, before?
>>> And how much responsibility did the borrowers hold here? Were they all
>>> helpless, clueless victims?
>>
>> So, you want to play Blame the Victim?
>>
> And do you want to pretend they don't have any responsibility here?

when someone offers you a home loan with little or not money down on the
property and no serious effort to determine your ability to pay, it's not
surprising many people accepted the offer.

your pal,
blake

On Fri, 01 Aug 2008 21:45:29 -0400, Dave Smith wrote:

> Goomba wrote:
>
>>
>>>
>>> So, you want to play Blame the Victim?
>>>
>> And do you want to pretend they don't have any responsibility here?
>
> I sometimes wonder who the victim is. There are people/banks/credit companies
> who will lend money to people who have little hope of paying it back. They
> will then try to use the the legal system to try to recoup their loss.
> Perhaps there should be stricter rules about lending.

as indeed there used to be. republicans gutted them. see upthread.

your pal,
blake

On Sat, 02 Aug 2008 12:56:42 GMT, Michael "Dog3" wrote:

> Dave Smith >
> : in rec.food.cooking
>
>> Goomba wrote:
>>
>>>
>>> >
>>> > So, you want to play Blame the Victim?
>>> >
>>> And do you want to pretend they don't have any responsibility here?
>>
>> I sometimes wonder who the victim is. There are people/banks/credit
>> companies who will lend money to people who have little hope of paying
>> it back. They will then try to use the the legal system to try to
>> recoup their loss. Perhaps there should be stricter rules about
>> lending.
>
> I just kind of popped in here but have gotten the gist of the
> conversation. A close friend of mine has seen my new kitchen and some of
> the remodeling we're currently doing. She has decided to proceed with
> some of her own remodeling and she's going to use my contractor. Her
> house is worth around $500,000 and it is paid for free and clear. She
> inherited it from her parents. She has paid cash for everything most of
> her adult life, and has no credit history. She needs about $100,000 for
> her remodel project. Not one bank would lend her the money with her
> house as collateral because she has "no credit history" even though she's
> provided utility bills, tax statements etc. which were paid on time.
>
> She told me that unless you are in debt up to your eyeballs it is really
> hard to get credit. Anyway, she's going to use cash for the remodel and
> actually got herself a credit card to establish some credit.
>
> Weird huh? We pay cash for everything but we do have credit cards and a
> credit history. Strange thing is we pay all credit cards in full at the
> end of the month. Is that considered good or bad with lenders I
> wonder... To me (and I'm really ignorant on this subject) it would appear
> that the lending/banking institutions set people up for failure and some
> people take the bait. I half way watched an HBO special on this and from
> what I gather, it would seem, that the more questionable your credit is,
> the more willing lenders are to give you credit.
>
> Michael
>

she is also one of the victims of the sub-prime mess. lenders are
notorious for swinging from lending to everybody, and then when the credit
market goes sour, lending to nobody. ask her if she votes republican.

your pal,
blake

On Sat, 02 Aug 2008 10:36:02 -0400, Dave Smith wrote:

> Michael \"Dog3\" wrote:
>
>> I just kind of popped in here but have gotten the gist of the
>> conversation. A close friend of mine has seen my new kitchen and some of
>> the remodeling we're currently doing. She has decided to proceed with
>> some of her own remodeling and she's going to use my contractor. Her
>> house is worth around $500,000 and it is paid for free and clear. She
>> inherited it from her parents. She has paid cash for everything most of
>> her adult life, and has no credit history. She needs about $100,000 for
>> her remodel project. Not one bank would lend her the money with her
>> house as collateral because she has "no credit history" even though she's
>> provided utility bills, tax statements etc. which were paid on time.
>>
>> She told me that unless you are in debt up to your eyeballs it is really
>> hard to get credit. Anyway, she's going to use cash for the remodel and
>> actually got herself a credit card to establish some credit.
>>
>> Weird huh? We pay cash for everything but we do have credit cards and a
>> credit history. Strange thing is we pay all credit cards in full at the
>> end of the month. Is that considered good or bad with lenders I
>> wonder... To me (and I'm really ignorant on this subject) it would appear
>> that the lending/banking institutions set people up for failure and some
>> people take the bait. I half way watched an HBO special on this and from
>> what I gather, it would seem, that the more questionable your credit is,
>> the more willing lenders are to give you credit.
>
> Her problem is the lack of credit history. She could fix that easy enough by
> taking out a small loan and paying it back. I could have a similar problem
> if I tried to borrow some money because I don't have much of a credit
> history. Our mortgage was in my wife's name and we paid it off early. We
> had car loans in the past but when we inherited some money about 20 years ago
> we paid it off and then set up a "car account", borrowing the money from our
> car account and then paying ourselves back with a monthly transfer from our
> chequining account. We only use credit cards for convenience an pay off the
> balance each month. At this time, we have no mortgage payments, no loans, no
> outstanding credit card balance. The only debt we have is a small student
> loan that we co-signed for our son.
>
> It is not (always) a matter of them not wanting to loan you money and setting
> you up for failure as having a record that shows that you pay off your debts.
> However, there are some predatory companies out there who will extend credit
> to high risk borrowers. Those poor people are already deeply in debt and
> having trouble making the payments on their current loans and accounts. I
> have trouble with the idea that companies can loan those people even more
> money and then use our legal system to squeeze blood out of a stone. The way
> I figure it is that if they are stupid enough to extend even more credit to a
> person who cannot pay it back they should be SOL. Maybe that would dissuade
> them from lending to high risk customers.

some of the folks who whine about 'welfare cheats' should take note. folks
scamming 'welfare' are pikers compared to the investment bankers currently
having their asses bailed out by the government.

your pal,
blake

On Fri, 01 Aug 2008 22:29:49 -0400, Goomba wrote:

> sf wrote:
>
>>> And do you want to pretend they don't have any responsibility here?
>>
>> So, you're blaming the fish for being caught with a very good lure?
>>
> Yup. They hold as much blame as anyone else here. It took two to tango, eh?

the lenders don't have any resposibility to point out potential pitfalls of
a variable rate, or even explain it adequately?

your pal,
blake

On Sat, 02 Aug 2008 11:07:13 -0700, Pan wrote:

> On Fri, 01 Aug 2008 12:48:29 -0700, sf wrote:
>
>
>>>And did these predatory practices start in 2000, or perhaps, before?
>>>And how much responsibility did the borrowers hold here? Were they all
>>>helpless, clueless victims?
>>
>>So, you want to play Blame the Victim?
>
> No he is not blaming the victim, in that the victim here is the
> taxpayer.
> Those who took these mortgages out are not victims. They signed a
> contract, knowing that they would be unable to pay if the interest
> rate went up. And they knew that the rate would go up, because it
> said so in the paper work.

if you have faith that the lenders carefully explained that the higher rate
would mean a *much* higher monthly payment to the mortgagee rather than
emphasizing the low, low initial payment - well then, you have more faith
in them than i do.

i'm sure that you, diligant citizen that you are, read *every word* of
*every agreement* you sign, but let's just say that everyone doesn't.

taken a look at your credit card agreement lately?

your pal,
blake

On Sat, 02 Aug 2008 12:17:11 -0700, sf wrote:

> On Sat, 02 Aug 2008 11:07:13 -0700, Pan > wrote:
>
>>On Fri, 01 Aug 2008 12:48:29 -0700, sf wrote:
>>
>>
>>>>And did these predatory practices start in 2000, or perhaps, before?
>>>>And how much responsibility did the borrowers hold here? Were they all
>>>>helpless, clueless victims?
>>>
>>>So, you want to play Blame the Victim?
>>
>>No he is not blaming the victim, in that the victim here is the
>>taxpayer.
>
> I don't know why you're saying taxpayers are the victim when they are
> not bailing out the people who lost their homes. They are bailing out
> the lending institutions who made those bad loans.
>
>>Those who took these mortgages out are not victims. They signed a
>>contract, knowing that they would be unable to pay if the interest
>>rate went up. And they knew that the rate would go up, because it
>>said so in the paper work.
>>The mortgage brokers didn't care, they were selling the mortgages as
>>fast as they were signed, the bundlers and purchases of these thought
>>that they would make money in a turn over.
>>
>>And now the govt. will take the money that I worked for and pay all of
>>these fools.
>>And those of us who played by the rules will be screwed once again.
>
> So, now I have to get all teary eyed over those poor mortgage brokers
> and their horrible problems?

yep. they'll be living in cruddy cardboard boxes from wal-mart for sure.

your pal,
blake

On Fri, 1 Aug 2008 16:40:20 -0400, Nancy Young wrote:

> Goomba wrote:
>> sf wrote:
>>
>>>> What *exactly* did Bush have to do with mortgages again? The way I
>>>> see it half the people having mortgage problems were people who
>>>> overbought assuming they were going to make a killing when they
>>>> flipped the house. Housing prices readjusted (look at California
>>>> who led that trend) in many areas because they were just insanely
>>>> overpriced. There were also certainly mortgage lenders who got
>>>> sloppy and allowed unqualified people buy more home they couldn't
>>>> afford which I can find fault with. Yet somehow I don't see how
>>>> Bush (or Clinton before) as being responsible?
>>>
>>> They did nothing to stop predatory lending practices even though it
>>> was obviously a train wreck waiting to happen.
>>>
>> And did these predatory practices start in 2000, or perhaps, before?
>> And how much responsibility did the borrowers hold here? Were they all
>> helpless, clueless victims?
>
> How did it come to this, that people had NO IDEA they couldn't
> afford a house 10 times their income? That it was just SO
> CONFUSING, all those big words like balloon payment. What,
> the interest rate is going to go up?
>
> I guess we do need paternalist institutions telling us what to do
> because it's just too much to expect us to figure out these things
> on our own.
>
> nancy

do you think loan agreements are as clearly spelled out as, say, food
labels?

your pal,
blake

On Fri, 01 Aug 2008 21:51:18 -0400, Goomba wrote:

> sf wrote:
>
>> Paternalism has nothing to do with it. Sound business practice does.
>> They needed to meet the same logical standards we met when we bought
>> our first homes 30+ years ago. We put no less than 20% down and made
>> payments that were no more than 25% of our income. There was no
>> choice, that's what we did. Our world of financing was a lot less
>> complicated.
>>
>> However, if those slimy lending practices didn't exist there would
>> have been an economic downturn and subsequent inflationary period long
>> before this. Those practices fueled the new housing boom, which is
>> now a big bust.
>>
>
>
> I bought my first house in 1981, when nationally interest rates were 17%!
> I didn't have to put down 20% because of qualifying for a "first time"
> home loan at 9.35%. That rate would be unheard of today in the 5-6.5ish
> range. For a 40k house, my mortgage payment was $369 (taxes and PMI
> included) I was barely out of my teens yet *I* managed to study the
> papers and ask questions and learn about mortgages. Even back then they
> warned people not to spend more than x percent of their income on
> housing. I believe it was no more than 30%.

and what was the interest rate you received on a passbook savings account?
five or six percent? and now you get, what, less than one percent? in
1981, we were coming out of a highly inflationary period, so comparing
interest rates makes little sense.

your pal,
blake

On Fri, 1 Aug 2008 22:55:04 -0400, Nancy Young wrote:

> Goomba wrote:
>> sf wrote:
>>
>>> Paternalism has nothing to do with it.
>
> Paternalism comes into it when people sign for mortgages
> and then say they are victims, they didn't know what the
> papers meant. Like the bank is their daddy. Most of the
> people we're talking about are not victims.
>
>> I bought my first house in 1981, when nationally interest rates were
>> 17%! I didn't have to put down 20% because of qualifying for a "first
>> time" home loan at 9.35%. That rate would be unheard of today in the
>> 5-6.5ish range. For a 40k house, my mortgage payment was $369 (taxes
>> and PMI included) I was barely out of my teens yet *I* managed to
>> study the papers and ask questions and learn about mortgages. Even
>> back then they warned people not to spend more than x percent of
>> their income on housing. I believe it was no more than 30%.
>
> The guideline I went by was don't get a mortgage more than 1 1/2 times
> your annual income. 2 times was stretching it. Whatever, at least you
> knew not to go house shopping in the expensive part of town thinking
> you could get it for no money down.
>
> nancy

because no bank would give it to you. in the recent past, they did.

your pal,
blake

On Sat 02 Aug 2008 12:17:49p, told us...

> On Sat, 02 Aug 2008 17:58:13 GMT, Wayne Boatwright
> > wrote:
>
>>On Sat 02 Aug 2008 10:51:32a, told us...
>>
>>> On Sat, 02 Aug 2008 13:41:06 GMT, Wayne Boatwright
>>> > wrote:
>>>
>>>>Yes, it was fixed and working fine now.
>>>
>>> What was wrong with it?
>>
>>Bad circuit board.
>
> ouch! I bet that cost almost as much as a new camera!

It was still under extended warranty. Sometimes it pays to buy one.

--
Wayne Boatwright
-------------------------------------------
Saturday, 08(VIII)/02(II)/08(MMVIII)
-------------------------------------------
-------------------------------------------
Don't start an argument with somebody
who has a microphone when you don't;
they'll make you look like chopped
liver. --Harlan Ellison, on hecklers
-------------------------------------------

blake murphy wrote:
> On Fri, 1 Aug 2008 16:40:20 -0400, Nancy Young wrote:

>> I guess we do need paternalist institutions telling us what to do
>> because it's just too much to expect us to figure out these things
>> on our own.

> do you think loan agreements are as clearly spelled out as, say, food
> labels?

Yes. All the mortgages I've ever taken, it was made very clear
what the important details were.

nancy

blake murphy wrote:
> On Fri, 1 Aug 2008 22:55:04 -0400, Nancy Young wrote:

>> The guideline I went by was don't get a mortgage more than 1 1/2
>> times your annual income. 2 times was stretching it. Whatever, at
>> least you knew not to go house shopping in the expensive part of
>> town thinking you could get it for no money down.

> because no bank would give it to you. in the recent past, they did.

I would not have gone for that. Simple as that. I specifically made
sure I didn't buy too much house.

nancy

On Fri, 1 Aug 2008 15:07:37 -0400, Kswck wrote:

> "Goomba" > wrote in message
> ...
>> blake murphy wrote:
>> foreclosures
>>> have skyrocketed.
> yep, it's all in our heads...
>>>
>>> blake
>>
>> What *exactly* did Bush have to do with mortgages again? The way I see it
>> half the people having mortgage problems were people who overbought
>> assuming they were going to make a killing when they flipped the house.
>> Housing prices readjusted (look at California who led that trend) in many
>> areas because they were just insanely overpriced. There were also
>> certainly mortgage lenders who got sloppy and allowed unqualified people
>> buy more home they couldn't afford which I can find fault with. Yet
>> somehow I don't see how Bush (or Clinton before) as being responsible?
>
> Because Libs want to have someone to blame for everything from the mortgage
> crisis to global warming.
> These people who are defaulting on their mortgages are stupid for not
> figuring things out themselves, rather than listening to someone else.
> If your mortgage payment is 85% of your monthly income, then SOMETHING is
> not getting paid that month. Doesn't take a rocket scientist to figure that
> one out.
> Read the fine print-does Balloon Mortgage mean anything to you idiots?
> So someone spending more money on a home than they can afford-can't be their
> fault-it's Bush's fault.

you think the fine print contains the words 'balloon mortage'?

your pal,
blake

blake murphy wrote:
> On Fri, 01 Aug 2008 22:29:49 -0400, Goomba wrote:
>
>> sf wrote:
>>
>>>> And do you want to pretend they don't have any responsibility here?
>>> So, you're blaming the fish for being caught with a very good lure?
>>>
>> Yup. They hold as much blame as anyone else here. It took two to tango, eh?
>
> the lenders don't have any resposibility to point out potential pitfalls of
> a variable rate, or even explain it adequately?
>
> your pal,
> blake

Mine always did, and lord knows we always had to sign a gazillion
documents stating we understood risks and responsibities. Even way back
in the 80s. We basically had one on the second home we owned, but at the
time it was called a "builder's buy down" because he paid the difference
in interest on our behalf and our interest rate was scheduled to rise a
total of 2 more times after the initial sale rate. We actually
refinanced after the first rate hike because set rates were reasonable.
I don't know if ARMs were new then but there was always consumer
education available as to who shouldn't get one (people who couldn't
risk the increase or tolerate the unknown) and whom they might work well
for (someone who knew they were not going to be in the house for long,
or someone whose income was assured of going up).

Nancy Young wrote:
> dsi1 wrote:
>> Nancy Young wrote:
>
>>> I can't call it a scam if they told you up front what the deal was.
>>
>> It's a scam in that most folks fail to comprehend the full
>> implications of the deal. The banks use the fact of the buyers lack
>> of experience to sell a better deal for themselves. ARMs should only
>> be offered to persons experienced with procuring loans.
>
> Is it only where I live that you get a truth in lending statement?
> You don't even need to read the fine print.

This is true. People should be responsible for themselves and I
subscribe to most all those things that a good conservative believes in.
The reality is that I don't really care if an inexperienced buyer get
burned - just as long as it doesn't affect me. I don't care much if most
people get into an ungodly amount of debt - just as long as it doesn't
affect me. Guess I'm a horrible person.

>
> Or get a lawyer to do that for you. Remember when you used
> to have a lawyer at closing? The bank would insist, probably
> just so you oculdn't come back and say I didn't understand I would have
> to pay this back.
>
>> OTOH, I have heard that my friend from high school had such a loan. He
>> has had numerous chances to get a refinance for his one bedroom condo
>> at a great rate many times in the last 10 years. He has not. He's a
>> loan officer.
>
> How many times have I seen mortgage brokers, loan officers
> on Suze Orman or the like, in trouble because they thought they thought
> the market would go up forever. Surely they understood
> the terms of their loans.
>> Obviously there's something going on here but my info
>> is a bit sketchy as I'm hearing this through a mutual friend.
>> However, there is a chance that he's the dumbest guy I know. That's a
>> pretty major accomplishment. :-)
>
> Maybe there is some reason he knows he won't qualify. Like he's upside
> down on his mortgage.
> nancy

Of course, that's probably why he won't qualify - he's way upsidedown.
Thanks - I must be the dumbest guy I know! :-)

Goomba wrote:
> blake murphy wrote:

>> the lenders don't have any resposibility to point out potential
>> pitfalls of a variable rate, or even explain it adequately?

> Mine always did, and lord knows we always had to sign a gazillion
> documents stating we understood risks and responsibities.

Have they revoked Truth in Lending? You had to sign it a day or
two before closing. It states how much your payment is, how much
it will cost over the life of the loan, if it's an ARM how high your
payments can go, etc etc etc. No fine print, big numbers on an
easy to read form.

nancy

dsi1 wrote:
> Nancy Young wrote:

>> Is it only where I live that you get a truth in lending statement?
>> You don't even need to read the fine print.
>
> This is true. People should be responsible for themselves and I
> subscribe to most all those things that a good conservative believes
> in. The reality is that I don't really care if an inexperienced buyer
> get burned - just as long as it doesn't affect me. I don't care much
> if most people get into an ungodly amount of debt - just as long as
> it doesn't affect me. Guess I'm a horrible person.

(laugh) Me too. That's why I'm annoyed, everything's going to
hell because of this housing meltdown. Annoyed at the lenders
and the borrowers. Despite what anyone might think, I'm more
annoyed at the lenders.

nancy

Nancy Young wrote:

> Goomba wrote:
>> blake murphy wrote:
>
>>> the lenders don't have any resposibility to point out potential
>>> pitfalls of a variable rate, or even explain it adequately?
>
>> Mine always did, and lord knows we always had to sign a gazillion
>> documents stating we understood risks and responsibities.
>
> Have they revoked Truth in Lending? You had to sign it a day or
> two before closing. It states how much your payment is, how much
> it will cost over the life of the loan, if it's an ARM how high your
> payments can go, etc etc etc. No fine print, big numbers on an
> easy to read form.

No, but apparently paying attention has been outlawed.


--
Blinky
Killing all posts from Google Groups
The Usenet Improvement Project: http://improve-usenet.org
Need a new news feed? http://blinkynet.net/comp/newfeed.html

Blinky the Shark wrote:
> Nancy Young wrote:
>
>> Goomba wrote:
>>> blake murphy wrote:
>>
>>>> the lenders don't have any resposibility to point out potential
>>>> pitfalls of a variable rate, or even explain it adequately?
>>
>>> Mine always did, and lord knows we always had to sign a gazillion
>>> documents stating we understood risks and responsibities.
>>
>> Have they revoked Truth in Lending? You had to sign it a day or
>> two before closing. It states how much your payment is, how much
>> it will cost over the life of the loan, if it's an ARM how high your
>> payments can go, etc etc etc. No fine print, big numbers on an
>> easy to read form.
>
> No, but apparently paying attention has been outlawed.

(laugh) True. I think my fear of running out of money made me
pay attention. Those depression era parents leave a mark.

nancy

<sf> wrote in message
> Lenders certainly are to blame. If they were still as strict with
> their lending requirements as they were when we first bought our
> homes, you can bet housing prices wouldn't have gotten so far out of
> hand.
>


You have a good point, but you left out "partially" to blame. The buyers
that were out bidding each other for more than the asking price certainly
are at fault too. They just have to say "no, I can't afford this" and walk
away.

"Nancy Young" wrote:
> Blinky the Shark wrote:
> > Nancy Young wrote:
> >> Goomba wrote:
> >>> blake murphy wrote:
>
> >>>> the lenders don't have any resposibility to point out potential
> >>>> pitfalls of a variable rate, or even explain it adequately?
>
> >>> Mine always did, and lord knows we always had to sign a gazillion
> >>> documents stating we understood risks and responsibities.
>
> >> Have they revoked Truth in Lending? �You had to sign it a day or
> >> two before closing. �It states how much your payment is, how much
> >> it will cost over the life of the loan, if it's an ARM how high your
> >> payments can go, etc etc etc. �No fine print, big numbers on an
> >> easy to read form.
>
> > No, but apparently paying attention has been outlawed. �
>
> (laugh) �True. �I think my fear of running out of money made me
> pay attention. �Those depression era parents leave a mark.

There are many steps in obtaining a mortgage, each step is accompanied
by a full disclosure statement you need to sign. And before the
mortage application there is the little matter of the contract to buy
signings, which must be accompanied with how one intends to finance,
more disclosure papers to sign.

Anyone who claims they were never presented with the terms of their
mortgage loan on several occasions and explained in exquisite detail
is a liar.

Normal brained people go to a house closing with a lawyer, your lawyer
will always make you pay attention... the bank's attorney makes sure
everyone pays attention. The only reason people get into dire
financial straights goes back to what I said earlier, they know very
well the details of the loan, but they diliberately lie.

blake murphy wrote:
> On Fri, 1 Aug 2008 16:40:20 -0400, Nancy Young wrote:
>
>> How did it come to this, that people had NO IDEA they couldn't
>> afford a house 10 times their income? That it was just SO
>> CONFUSING, all those big words like balloon payment. What,
>> the interest rate is going to go up?
>>
>> I guess we do need paternalist institutions telling us what to do
>> because it's just too much to expect us to figure out these things
>> on our own.
>>
>> nancy
>
> do you think loan agreements are as clearly spelled out as, say, food
> labels?
>
> your pal,
> blake



Don't y'all think that a tiny part of the problem is those folk who
felt they were putting something over on those blue-suited bankers
willing to loan them unconscionable money to buy the house they never
even dared dream about?

The rich who wanted to live like the uber-rich?

The middle class who wanted to live like the rich?

The poor who aspired to live middle class just for a little while?

The real estate brokers whose motto was "sell, sell sell" and "promise,
anything to make a commission."

The loan officers who wanted to be the "top listers"?

There's more than enough blame to go around.

gloria p

On Sat, 02 Aug 2008 15:11:20 -1000, dsi1 >
wrote:
>
>This is true. People should be responsible for themselves and I
>subscribe to most all those things that a good conservative believes in.
>The reality is that I don't really care if an inexperienced buyer get
>burned - just as long as it doesn't affect me. I don't care much if most
>people get into an ungodly amount of debt - just as long as it doesn't
>affect me. Guess I'm a horrible person.
>
The trouble is that the crummy loans have affected quite a few of us.
I've seen a not inconsequential chunk of my retirement investments go
away because one mutual fund in my portfolio owned the likes of WaMu,
Citigroup, Fannie Mae, and a bunch of other financial stocks.

All those bad loans are connected to other bits and pieces of the
financial system via derivatives and complex financial instruments the
smart guys have been selling each other in increasing numbers over the
past decade.

At the end of last month Merrill Lynch unloaded a buttload of
collateralized debt obligations -- derivatives whose value is tied
ultimately to real estate loans-- for 22 cents on the dollar. The
really smart guys who know more that I do about financial machinations
sold CDOs originally valued at $30.6 billion to a Texas private equity
fund for $6.7 billion. Four weeks prior to the sale Merrill valued
the CDOs at $11.7 billion. Their estimate of the value of their
investment declined $5 billion in four weeks. They can't tell what
the damned things are worth anymore. The sale price is just a best
guess at value.

And there are more buttloads of CDOs out there weighing on the balance
sheets of Wachovia et al. So far the housing/mortgage meltdown has
led to an estimated $400 billion in write-downs across the financial
industry. If a dollar's worth of CDOs is now worth 22 cents, then one
analyst I've read believes there's gonna be more than twice that
amount lost before the fat lady sings in this opera.

When some dummy buys a house he can't afford and defaults on his ARM
when it balloons on him, he's out. But that bad debt, secured by real
estate that's worth less than the loan now that the bubble's burst,
has legs. It walks with others of its kind through Byzantine webs of
interconnected derivatives. When enough defaults happen, when paper,
which is valued on the projection that (say) 90% of mortgage payments
arrive on time, faces a world in which (say) 80% is a more realistic
number, the CDOs and their kin don't look so tasty anymore.

It's no wonder that no less an investing wizard than Warren Buffett
called derivatives "financial weapons of mass destruction." In the
current credit crisis nobody can tell what they're worth anymore. And
the so-called over-the-counter trade in derivatives is largely
un-regulated. The really smart guys who dealt them turned out to be
just as clueless as the schlub who lost his house. They got Monopoly
money mixed in with the real stuff and can't sort it back out.

The S&P financials index has fallen 32% this year. So far. I've seen
two years of gains in my retirement investments disappear. So far.

There's a reason for regulations in the financial markets. Bush said
the other day that Wall Street got drunk and now it has a hangover.
I'd say it's time to find a bartender willing to cut the drunks off in
time.

--
modom

I have long maintained that Texans are not easy to love: we are, like anchovies, an acquired taste.
-- Molly Ivins
** Posted from http://www.teranews.com **

Sheldon > wrote:

>Normal brained people go to a house closing with a lawyer, your lawyer
>will always make you pay attention... the bank's attorney makes sure
>everyone pays attention.

In New York, sure. In California, nobody uses a lawyer for
an uncomplicated house purchase.

Steve

Gloria P wrote:

> There's more than enough blame to go around.

I couldn't agree more.

nancy

On Sat, 02 Aug 2008 01:03:06 -0400, Goomba >
fired up random neurons and synapses to opine:

>sandi wrote:
>
>> Ain't that the truth. Shame on the lenders.
>>
>AND shame on people who borrow more than they can pay reasonable afford
>monthly.

In SoCal, certainly, folks began looking at owning a home as an
investment instead of someplace to live. The folks who bought houses
to flip, then got stuck with mortgages they a) should never have been
offered, and b) should never have accepted, get no sympathy from me.

Terry "Squeaks" Pulliam Burd
--
"If the soup had been as hot as the claret, if the claret had been as
old as the bird, and if the bird's breasts had been as full as the
waitress's, it would have been a very good dinner."

-- Duncan Hines

To reply, replace "meatloaf" with "cox"

Steve Pope wrote:

> In New York, sure. In California, nobody uses a lawyer for
> an uncomplicated house purchase.
>
> Steve

Well, that's nuts.
Thankfully the states where I've purchased homes have all required them.
And sure, I've balked at paying their fee along with all the numerous
other settlement costs....but I am glad I've always had one.

Terry Pulliam Burd > wrote:

>On Sat, 02 Aug 2008 01:03:06 -0400, Goomba >

>>AND shame on people who borrow more than they can pay reasonable afford
>>monthly.

>In SoCal, certainly, folks began looking at owning a home as an
>investment instead of someplace to live. The folks who bought houses
>to flip, then got stuck with mortgages they a) should never have been
>offered, and b) should never have accepted, get no sympathy from me.

I see where San Diego County is suing Washington Mutual to prevent
them from foreclosing upon North County flippers. As a Washington
Mutual bondholder I object to local politicians trying to protect
local speculators at my expense.

Steve