And to make matters worse, some lenders will call in a loan when the value of the property used to back it falls too low. That's especially a problem for businesses, which when it's all over, is where jobs and money have to come from if the economy is to grow.
Most people I know are upside down if they took advantage of the deadly combination of bubble property values and lax loan qualifications. And as more homes are foreclosed on, or simply abandoned, the problem is going to be getting worse.
I fear America has grown soft in the last 50 years and we are ill-prepared for the kind of belt-tightening it's going to take to get over this. If you compare the lifestyle of my parents right after WWII and my sister and I were toddlers with that of a similar family today it's no surprise it more expensive to make it now. I won't bore you with details, but think about the huge differences in the size of their starter home, the car they drove, etc.
And I keep hearing that even with the steps taken to make it all better the sources of credit are still reluctant to make loans.
” I won’t bore you with details, but think about the huge differences in the size of their starter home, the car they drove, etc.”
I know what you’re talking about here.
Hubby and I took the traditional approach as advised to us by our parents...start out with a small inexpensive apartment.
Save up for a down payment on a small starter home.
If you outgrow that home, you can add on to that home or sell and put the money to a new home.
Now we see these early-twenty something couples buying McMansions right out of college that is fully furnished via credit from the furniture store. 2 beautiful brand new vehicles.
I have been wondering how they all managed to swing it because the math just doesn’t add up.