Posted on 05/30/2005 6:19:28 AM PDT by Flavius
Edited on 05/30/2005 6:35:29 AM PDT by Sidebar Moderator. [history]
PHILADELPHIA - To walk Thayer Street in northeast Philadelphia is to count, door by door, the economic devastation afflicting a working-class neighborhood. On a single block, 18 of the 42 brick rowhouses have gone into foreclosure in the past three years.
There's Marciela Perez, who fell ill with cancer, lacked health insurance and stopped making mortgage payments. Barrel-chested Richard Hidalgo, who got divorced and could no longer make his monthly nut. And Mike O'Mara, a rawboned and crew-cut truck driver who took on too much debt, lost his job and fell behind on his mortgage.
"Mortgage companies convinced us to refinance, and each time our bill went up," O'Mara said as he surveyed his narrow street from his shaded front porch. "You fall behind and they swoop down on you."
Excerpt msnbc.msn.com
What about the idiots who are making the loans? Totalitarian government isn't the answer either. The problem is we've already got too much government involvment in housing, lending, and the economy in general. The government's worst sin is dollar policy (manipulation), but the media doesn't cover it, probably because nobody cares.
Aren't Pulitzers based on word count?
Did you calculate how quickly you would pay off the house if you left the mortgage payment the same and took the lower interest? When I financed my house, adding about $200 per month halved the term of the mortgage.
Just adding the small next month's principal payment to each monthly payment will pay off a thirty year morgage in fifteen years.
We just did the same exact thing... Sold our Southern California home for an obscene amount of money. Paid off all debts and bought a luxury Condo on the Colorado river for cash with loads of money to spare. The Condo, which we bout 18 months ago, is now worth double what we paid. I'll miss the weather in Southern California, but that's about it. I moved here 15 years ago from NY to get away from the liberal politics and the madding crowds. Well, they've caught right back up to me here in San Diego, so I'm outta here!
Say, you could win elective office in any major city with that attitude, or have a long career in journalism. Yes, the sky has always been falling since the beginning of time, we are stuck in a living Hell that will only get worse, and there is no way out. Other than that, everything is fine.
Your payments are lower, but the amount of money you owe is now larger.
Yes, but done correctly, I'll pay less in the long run.
I refinanced a 30 year, 7% mortgage (25 years remaining) with a 15 year, 5.5% mortgage. I shaved 10 years off and my payment stayed the same.
Oh, yeah. Absolutely. I was once warned that if you do not clear it with the mortgage company before sending the payment that it could be applied to the escrow. Not my experience ... I just called and requested the draft be increased.
Oh plllease...you sound like the other side. I don't see banks putting guns on people's head to get a loan.
Another you're a fool for getting an interest only loan person. Believe it or not, for some areas and people, it is the best option.
We just purchased, two months ago, a home outside of Miami. An area that is having huge increases in housing prices. We took out an interest only loan for the entire amount of $223,000. Our payment is under $800 per month. With a payment that low, we are able to send additional money each month towards principle. Usually $300 but we will be increasing that to $500 in the next 6 months. You show me a single conventional mortgage that puts that much into principle right off the bat.
A week ago, a house on my street sold for $265,000. This house is smaller than ours, 1 less bedroom and has none of the upgrades ours has. Already our home has gone up in value. It doesn't hurt that our area is projected to have housing increases of 30-40% this year. We plan on selling this home, taking the proceeds and purchasing another home in two years. On paper, we should walk out of here with at least $100,000 in equity. Not a bad deal for two years.
Not all interest only loans are a bad idea. Depending on the area, the persons plans and needs and their ability to discipline themselves into sending principle payments along with the interest payment a person can do very well.
You mean there isn't going to be a "buy one get one" sale? Darn.
The best time to deal with financial trouble is before you get into it. Save first. Put away enough to live on for a year and don't buy anything unecessary until you have at least that much saved.
I understand if you just are not making enough to pay the mortgage but it seems to me that with some income you should be able to at least cover the mortgage and that it should be first priority.
You can eat for pretty darn cheap in this country if you want to. Food should never be an issue. Gasoline, I suppose, could be a problem if you are job hunting.
This is anecdotal evidence. What is the big picture? The word "many" is the giveaway (as in: "Many find offense with the flesh-colored Crayola" or "Many would be comfortable with the surrender of US sovereignty to the UN"). Seems like lib efforts to trash a healthy economy and, ergo, trash Bush, the ultimate objective.
If you are speculating on a house, the ARM will make sense. You actually will have paid in less on payments with the ARM than you would have with the fixed mortgage that is front-end loaded with interest payemnts.
Two things are key though. First, you have to sell the house in a short period of time and the house has to appreciate in value. In California, that is not a problem right now - or at least it has not been. You can flip a house in a year and make 15% to 50%.
If the low monthly payment provided by the ARM makes is possible for you to get in the game, it is fine. But if you are in your house for the long haul, you would be crazy not to lock in these low interest rates for 30 years.
I feel sorry for people who spend beyond their means, buy houses they cannot afford and then lose it all. NOT!!!
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"I feel sorry for people who spend beyond their means, buy houses they cannot afford and then lose it all. NOT!!!"
"I stated that the interest only loan can make sense if one is purchasing in a market that is consistently rising, and one KNOWS they will have the house for only a couple of years "
Consistently rising?
Where can I get me one of them crystal balls. What about PLUNGING real estate values as in 1991?
I dont think so. but i could be wrong as finance isnt my best suite. we refied 80% so to my pea brain thats a smaller amount we now owe?
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