[MikefromOhio]

Another weekend...another stupid article from Chamberlaintroll....

[RockinRight]

its appraised value of $300,000.

If it still appraises at $300,000...ever hear the term "refinance?" If you've been paying everything on time they ought to at least get a fixed rate that has a payment close to where it was before going up, *maybe* even lower when you factor combining both loans together.

[ExtremeUnction]

"...might be facing a perfect storm in which the true losers are families who borrowed cavalierly without adequately crunching the numbers."

That's life. Get over it.

[RockinRight]

Since they weren’t paying anything toward the principal of their mortgage between 2004 and 2006, they didn’t have any more equity when they refinanced in 2006 than when they moved in. For those 24 months, all John and Karen had done was pay close to $2,000 a month servicing their debt. This was a far higher monthly payment than if they had been renting during this time.

Pros and cons of interest-only loans aside, this is a common phenomenon in overpriced markets. The rent for the same house is less than the mortgage payment on the same property. Without getting too technical and figuring different down payment scenarios, here in Ohio a renter can generally purchase a similar home in a similar neighborhood, and have a mortgage payment very close to what they paid in rent.

[RockinRight]

In the end, they borrowed $260,000--$16,000 more than the initial cost of the house--at a higher rate of interest than they were paying when they first bought the house in 2004.

Fees aside...the interest rate was NOT higher. It was 6.375 on a first mortgage and 9-something on the second...now the whole thing is "a little over 6..."

Not saying the prepayment penalty didn't suck...but I hate when journalists stretch the truth.

[Panzerfaust]

The only bubble bursting here is the idiocy bubble. Those being affected are those who are always affected- the idiots who fail to read a mortgage document and who are trying to live above their means. The couple in the story are two of the stupidest people I've read about in some time.

[Brimack34]

Not yet but I will let you know.

[RockinRight]

since the government counts the money not paid back to the second lender as income paid to the borrower.

Regardless of one's opinion of homeowners who do this, am I the only one that thinks it's BS that the government does this?

Abolish the IRS! Go to a consumption tax.

Wait...sorry...wrong thread...

[Porterville]

Another twit loser article to support the yellow-jellyfish-sping of the weak...

[volunbeer]

Is this a daily article or thread with a few new quotes or victims?

I posted a serious question on the end of the last thread attempting to get a little education on the topic and I killed the thread. This is basically the same thread.

/confused/

I will ask it again to anyone who can answer....

A poster on the other thread said the price of gold/silver would continue to appreciate over time due to a limited supply.

I asked if you could not apply the same logic to premium properties within reasonable commuting distances from major cities/downtowns.

This seems to make sense to me although I am sure there is no single rule for all markets.

[ChildOfThe60s]

With John’s two jobs and Karen’s at Safeway, the Philbrooks believed they could manage the mortgage..............snip........ And the Philbrooks, who had about $900 saved up for their daughter’s future, a few hundred more for emergencies and nothing in reserve beyond that, realized their entire dream now stood ready to fall.

Now kids, let's not place any of the responsibility for this situation on John and Karen. They are just victims of a greedy bank.

When I was a young single man in Orlando, 1 bedroom apts in complexes went for $350 and up. I had already learned my lesson about getting a place that I could only afford if I had a roommate (and something happened to that roomie). So I searched until I found a 1 bedroom garage apt for $150.
Now, if I were like these people, I would have taken two jobs and a roommate in order to live in a spacious 3 bedroom house. Then cried victim when I lost one job and my roommate split.

It's too bad for these people, but I'll spend my pity on real victims. There is no cure for stupid.

[Kay]

Oh my blinking eyes. You have finally posted something with which I agree. It is a wonder.

I could not believe my ears last year when the majority of mortgages were the "interest-only" types. What lame-brains would fall for such a morgage?! Probably the same folks that keep General Nutrition Centers in business that think a pill from Safeway is poisonous but a pill from GNC is "natural".

[tubebender]

By the early months of the summer, 1,352 Sacramento County homes had default notices filed against them in the second quarter of the year, the highest number in nine years,

So 9 years ago it was worse and we all lived through it and prospered. Just like "It was warmer this year than 80 years ago so..."

[norge]

News and Review is a left-wing rag, one of those free papers supported mostly by porno ads. It makes the Bee look conservative.

North Highlands is not the most desirable neighborhood in Sacramento. When the market goes soft, NH would be one of the first to feel it.

[capitalist229]

The most damaging aspect of this story is its impact on consumer psychology.

Just in the past month I have detected a shifting sentiment in office discussions regarding real estate values. The buying frenzy has been stopped cold, indeed many regret not having sold out a year ago.

But real estate has always come back from a decline.

It has always been that way.

BUMP

[goldstategop]

An ARM is fine if you intend to move in a few years. But if you intend to stay the rest of your life in your home, a fixed rate mortgage is a better choice. And try to make a down payment towards paying off the principal, which will in turn lower your overall mortgage payment. Finally, don't buy more house than you can afford.

"Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached." -Manuel II Paleologus

[rightinthemiddle]

Another episode of "The Idiots Who Bought Too Much House."

I'd like to see a poll on how many of these people voted for John Kerry.

The past five years, a lot of people have said to me, "Why don't you get a bigger home in one of those new subdivisions. You can afford it."

Perhaps, but I'm not a slave to my mortgage and have a nice little weekend place on the lake with over 50 percent equity in both.

[finnman69]

I think the premise of this article is being repeated in tens of thousands of households across america. I saw on CNN today that 1 in 300 homes in Colorado is in foreclosure.

[Jim Noble]

when buying a house seemed like a sure ticket to security

To morons, you mean.

[Jim Noble]

“I don’t feel secure,” Karen admitted.

Better vote for a Democrat, then...