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Who will pay the mortgage when the homeowner walks? You
SF Chronicle ^

Posted on 02/08/2008 2:09:27 PM PST by bshomoic

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To: bpjam

Both political parties were complicit in this fraud, but for different reasons. The party of business, the GOP wanted to create an ‘ownership’ society and thus help their buddies on Wall ST. The Dems wanted to open up housing for the ‘disadvantaged’, namely minorities and those with poor credit and no money for a dwon payment. Both parties had a vested interest in this Ponzi scheme because both parties’ constituents benefitted from Greenspan;s east credit. NO down, No doc, interest only loans were designed to scam the taxpayer by giving out loans to people who could neveither afford the house they were buying, or who would never have qualified for a loan in normal past underwriting standards.

The rebate bill which raises loan limit for Fannier and Freddie is just pouring more fuel on the fire, and the taxpayer will be left holding the bad for the huge defaults just down the road. The $ is being crushed precisely because the world is on to our scam, after all they bought a lot of the CDO’s and now they are next to worthless.


21 posted on 02/08/2008 2:39:49 PM PST by milwguy (........)
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To: Larry Lucido

Thank you for the advice, Larry! I plan on paying an excessive amount of money toward my principal each month. I’m on the “Dave Ramsey” plan toward debt-freedom. I figure I’ve got 17 years on my 30 year mortgage if I make payments according to my finances. I feel good about it, and I have a lot of aspirations. It’s good to be a single guy, too, I suppose.


22 posted on 02/08/2008 2:41:32 PM PST by rarestia ("One man with a gun can control 100 without one." - Lenin / Molwn Labe!)
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To: Larry Lucido; rarestia
You’ll do fine. Just remember, DON’T use your home as an ATM machine. Refinance ONLY to get the interest down, or to do improvements. And NEVER accept an adjustable rate loan. If you can, pay a bit extra every month on the principal. And keep an extra payment or two in the bank, just for a rainy day.

Don't listen to this horrible advice. Take out a home line of credit and use it to buy a 50 inch plasma TV (you can use your tax rebate check to buy a Blu Ray DVD player to go with it). Then go buy yourself a nice shiny 4000 pound SUV thatgets 9 miles to a gallon and requires premium gas. When things turn out badly, you can cry for the Gubment to come save you.

23 posted on 02/08/2008 2:41:59 PM PST by bshomoic
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To: bshomoic
Everyone that wasn't forced to move, that had homes on the market have removed them....Only a fool would sell in this market without being forced. They just did a big story on this in S. Cal.

If I wanted to sell, which I don't, (I really hate cold) I'd wait a year or two before even considering it.

24 posted on 02/08/2008 2:42:51 PM PST by dragnet2
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To: rarestia
Seriously, Congratulations!
25 posted on 02/08/2008 2:43:02 PM PST by nmh (Mike Huckabee the "religious" humanist that pushes socialism! (Clinton/Carter combo))
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To: Larry Lucido; rarestia
Listen to larry, rarestia. You're fine, except you are helping (along with a few thousand others, me included) shoulder the defaults of the dumb-asses and cheats. You'll come out great in the end, because even with the nit-wit drain, you're miles ahead: You care about what happens 15 years down the road.

Sign with confidence on Monday, and save the pen for your trophy case. You earned it. In 15 years you'll treasure it more than the fist-place Pinewood Derby trophy you have in there.

26 posted on 02/08/2008 2:44:57 PM PST by Cyber Liberty (Don't trust anyone who can’t take a joke. [Congressman BillyBob])
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To: 2ndDivisionVet

Property taxes are pretty high in TX, aren’t they? I’ve seen 3-4% of assessed value, but my recollection is hazy. Do you have a reference you could furnish? TIA!


27 posted on 02/08/2008 2:49:39 PM PST by Attention Surplus Disorder (We've checked, and all your zeroes are OK. We're still working on your ones.)
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To: bshomoic

What about Private Mortgage Insurance? Not one word about this being mentioned......every one of those loans made with less than 20% down had to carry it, those that provided the insurance can bail these suckers out. Not the tax payer.


28 posted on 02/08/2008 2:52:33 PM PST by ThisLittleLightofMine
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To: 2ndDivisionVet
Take a look at Dallas - only by watching the Cowboys; I grew up there and at Christmas when we go back it is like old Mexico. My sister lives near Tyler TX, she about fainted when I told her the price of our home 5 years ago, said we could buy the entire city of White House.
29 posted on 02/08/2008 2:59:12 PM PST by SF Republican (Conservatives wanted all or nothing, and they got it.)
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To: rarestia

What fun for you! You will love owning your own home. After closing on our first house my husband and I drove right over to it, unlocked the door, walked into the living room and jumped up and down and cheered. What a feeling.


30 posted on 02/08/2008 3:00:52 PM PST by Emrys (Fashion says "Me, too." Style says, "Only me.")
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To: edhawk

No longer the case.


31 posted on 02/08/2008 3:04:30 PM PST by steve86 (Acerbic by nature, not nurture™)
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To: bshomoic

The housing market collapsed many decades ago due to values inflating beyond the means of everyday people to purchase them. It has since been propped up with creative financing. Many decades ago, home loans were unheard of. In the 50’s, 10 year mortgages were the rule, but over time stretched out to 15 years. Next came 20 year mortgages and now 30 years. During the most recent boom, we saw more 40 year mortgages and even a few at 50!

Think this is bad? Just wait till they come out with 15 year car loans.


32 posted on 02/08/2008 3:05:40 PM PST by umgud
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To: SF Republican

>> We plan on going to SoCal and sit on the sidelines in a rental for a year and then jump back in but with 1/2 the mortgage payment and twice the house.

That sounds like a plan to me... hope it works out for you!


33 posted on 02/08/2008 3:19:45 PM PST by Nervous Tick (Retire Ron Paul! Support Chris Peden (www.chrispeden.org))
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To: Attention Surplus Disorder

>> Do you have a reference you could furnish?

Well, you can have a look at this giant chunk of flesh they just tore out of my butt with their teeth and claws... would that work for you? :-)

But seriously, I just put the calculator to it... our tax burden (all jurisdictions tax / appraised value) worked out to 2%. (Austin area)


34 posted on 02/08/2008 3:23:01 PM PST by Nervous Tick (Retire Ron Paul! Support Chris Peden (www.chrispeden.org))
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To: bshomoic
Take out a home line of credit and use it to buy a 50 inch plasma TV (you can use your tax rebate check to buy a Blu Ray DVD player to go with it).

Dude, you need to read FreeRepublic a LOT more... We just had a thread here where you can give up sex for 6 months and get a 50" plasma TV!

Use the home loan not for a TV (you're not gonna get any nookie if you're married, or you DON'T have a 50" TV already - what a loser, everyone KNOWS that a big TV is a chick-magnet) but something more important like a Kegerator or a massaging recliner to enjoy that TV...

35 posted on 02/08/2008 3:24:54 PM PST by PugetSoundSoldier (Indignation from the sting of truth is the defense of the indefensible.)
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To: Emrys
After closing on our first house my husband and I drove right over to it, unlocked the door, walked into the living room and jumped up and down and cheered.

I've heard the same from some relatives. I don't feel that going into this. Maybe I will. Of course, at 28, I've lived in my parent's home for most of my life except 4 years of college and 3 years in an apt locally. I guess 3 out of 4 is close enough.

Nonetheless, thank you for the well-wishes. I was brought up as a fiscal conservative. I have no credit cards and only student loans and an auto loan to finish paying. After that, it's lump sums into the mortgage. I plan to spend every dime of my money to pay off the house before 30 years. I plan to marry someday (maybe), and it would be a great home to raise at least one kid. We'll see what happens.

I reject your reality and substitute it with my own, in this particular case. Let the welfare mothers bilk the system. When I own all my stuff, I'll be the one laughing!

36 posted on 02/08/2008 3:24:56 PM PST by rarestia ("One man with a gun can control 100 without one." - Lenin / Molwn Labe!)
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To: bshomoic
Bank of America CEO Kenneth Lewis said, "There's been a change in social attitudes toward default ... We're seeing people who are current on their credit cards but are defaulting on their mortgages ... I'm astonished that people would walk away from their homes.

When bankers were wise and acted responsibly and in the interest of their stockholders, foreclosures worked more in their favor than the borrowers. But what we have seen is that banks have become greedy and not acted in their stockholders best interest and it may be that we have too many loans in which there was more irresponsiblity on the part of the lender than the borrower. He cannot blame the borrower for what was a terribly unsound and risky business plan, and that was lending money on home values which had far outpaced the borrower's income and ablity to pay.

37 posted on 02/08/2008 3:35:18 PM PST by Biblebelter (I will NEVER EVER vote for McCain or any other current Senator.)
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To: ThisLittleLightofMine
Yeah well, at last count those companies were on the hook for an estimated $400 billion and they've got all of $15 billion in capital between them.

The insurers have been smashed. That is just one piece of the problem.

38 posted on 02/08/2008 3:35:42 PM PST by JasonC
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To: bshomoic

Maybe we’ll be going back to the days where mortgage lenders expected 20% down.


39 posted on 02/08/2008 3:37:01 PM PST by 3niner (War is one game where the home team always loses.)
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To: rarestia

Good luck with your new home. I’ve never been a home or property owner. I raised two kids by myself and could have used a home back then since we moved quite a bit. But I could never afford it. Now that I’m 60, retired, and my kids have been gone for years, I have no interest in owning anything. Too much responsibility. My rent is very cheap and I’m comfortable.


40 posted on 02/08/2008 3:42:44 PM PST by mass55th
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