Stop Blaming the Homeowners

[talisyn]

RachelleDrew, do you mean to tell me it wasn't the greedy bankers, stock manipulators, mortgage lenders who caused your neighbors to lose their house but it was living beyond their means? That is impossible. Everyone was to become millionaires by buying and trading, not living in, the houses. Notice I say houses because many were not bought to be their home, only a stepping stone to future riches.

Most of the people I deal with in Idaho have been in their home for ten years. Never had a hybrid mortgage or sub prime or any other exotic type of financing. Hard working, ethical people.

Ben Raines

You're in Idaho too? Cooooooool

I agree, most of the people in Idaho are pretty commonsense. There are some I wonder about though. If you've ever driven around Twin Falls and have seen those huge houses that sprung up like mushrooms the past couple of years like I have you have to wonder what are the jobs these people have that can afford those houses and why am I not working there

[Hemidakota]

I am not an investor nor am I financial savvy, but I do know that with any investment there is a risk. It is my understanding that before on leaps....one needs to be prepared for the fall.

Perhaps it is a good time rid of all debts and focus on eternal welfare of the family unit.

[bytor2112]

My father -in-law sent this to me:

Dear President Obama,

> > >> > Thank you for helping my neighbors with

> their mortgage

> > >> payments. You know the

> > >> > one's down the street who in the

> good times refinanced

> > >> their house several

> > >> > times and bought SUV's, ATV's,

> RV"s, a pool, a big

> > >> screen, two Wave

> > >> > Runners and a Harley But I was

> wondering, since I am

> > >> paying my mortgage and

> > >> > theirs, could you arrange for me to

> borrow the Harley

> > >> now and then?

> > >> >

> > >> Richard Ford

> > >> > Queen Creek AZ

> > >> >

> > >> > P.S. They also need help with their

> credit cards, when

> > >> do you want me to start

> > >> > making those payments?

> > >> >

> > >> P.P.S.

> > >> > I almost forgot - they didn't file

> their income tax

> > >> return this year. Should I

> > >> > go ahead and file for them or will you

> be appointing

> > >> them to cabinet posts?

>

>

>

[LittleWyvern]

> > >> > lol,

> stereotypes.

[Just_A_Guy]

FWIW, just Saturday I was talking to a guy who has been trying to refinance his house. The loan officer told him he'd have a better chance of doing so if he got behind 2 or 3 months on his current loan first.

That's ridiculous.

[bytor2112]

FWIW, just Saturday I was talking to a guy who has been trying to refinance his house. The loan officer told him he'd have a better chance of doing so if he got behind 2 or 3 months on his current loan first.

That's ridiculous.

:huh:??? Where is the duct tape???

[Palerider]

FWIW, just Saturday I was talking to a guy who has been trying to refinance his house. The loan officer told him he'd have a better chance of doing so if he got behind 2 or 3 months on his current loan first.

That's ridiculous.

Is this a Great Country or what????:)

[Just_A_Guy]

FWIW, just Saturday I was talking to a guy who has been trying to refinance his house. The loan officer told him he'd have a better chance of doing so if he got behind 2 or 3 months on his current loan first.

That's ridiculous.

Just wanted to point out that this is apparently an ongoing thing. I just today talked to a client whose loan officer suggested he do the exact same thing. But his application was denied anyways, and now he's facing foreclosure.

A bit of free legal advice: Don't be stupid generally. And specifically, don't default on your mortgage if you can afford to pay it--no matter what your loan officer, or Uncle Sam, assures you the "reward" will be in the future.

[Elphaba]

. . . or Uncle Sam, assures you the "reward" will be in the future.

I assume you're talking about Obama's "Making Home Affordable" program, as that is, essentially, Uncle Sam. If you're not, just ignore the following.

To qualify for assistance from "Making Home Affordable," you must be current on your mortgage payments.

Making Home Affordable - Home Affordable Refinance or Modification

Edited to add eligibility requirements:

Making Home Affordable eligibility requirements:

• You are the owner occupant of a one to four unit home,
• The loan on your property is owned or securitized by Fannie Mae or Freddie Mac.
• At the time you apply, you are current on your mortgage payments (current means that you haven’t been more than 30-days late on your mortgage payment in the last 12 months or, if you have had the loan for less than 12 months, you have never missed a payment),
• You believe that the amount you owe on your first mortgage is about the same or slightly less than the current value of your house,
• You have income sufficient to support the new mortgage payments, and
• The refinance improves the long term affordability or stability of your loan.

Elphaba Edited June 11, 2009 by Elphaba
To add eligibility requirements.

[MorningStar]

I think both are to blame, but ultimately, the homeowner has to take responsibility for the choice they made. Only you have full access to your budget and you can't allow a company to tell you how much you can afford. We have had companies tell us we can afford much larger payments than we could cover in reality. They don't ask for every single bill you have or charitable contributions. If you buy a house you can't afford thinking that you will be OK because it's going to go up in value soon, that's not something you can count on.

An investment involves risk. If the possible risk of the house declining would ruin you, then you shouldn't be buying the house. We got fed so much baloney about how the house would go up 7% in a year and how it was just going to keep going up and up and up, but we knew that couldn't be. It couldn't continue at the rate it was around here because costs were increasing and salaries weren't. We were told just to get an interest only loan and then we could sell the house for a profit in 5-7 years and certainly by then my husband would have a raise.

It would have been easy to fool ourselves and think, "Of course we'll get a raise! Yes, we can do this!" We had one expensive medical problem after another, he switched to a job that ended up being bad for us, the health insurance was switched to a $3000 deductible one, then he got a $800 per month pay cut, and now that he changed jobs, he has received another pay cut. If we had purchased a house like we were being pushed to do, we would be so screwed right now.

I also get tired of the lie that mortgage payments never go up like rent does. Um, what about property tax? That can get pretty steep. This is one of the biggest financial investments you'll ever make and I don't understand why more people don't take classes on it. I refused to buy a house with my husband until we took classes and that was what gave us a slap back into reality. We couldn't afford a house and if we did buy one just because a lender was dumb enough to give us one, we would be one financial disaster away from foreclosure. Another benefit of state sponsored classes is that they have programs to help first time homebuyers. Most people don't take advantage of those (and they're free in my state) and figure they don't qualify. We could make up to $90,000 a year and still qualify.

Banks aren't a charity. They want to make money. Of course they would do something shady if given the opportunity. They too were counting on property values going up, so if a family foreclosed, no loss for them because they could just sell it for a profit. Shame on them for doing that, but you just can't trust people when it comes to money.

Also, families can live in safe areas and rent. It's easy to justify buying something you can't really afford. For years I thought we deserved a house and we just couldn't continue to live in an apartment. Now I have 4 healthy, happy children in a two bedroom apartment. We are really hoping for the blessing of a house still, but we've learned that home ownership is not a must.

[MorningStar]

The families living on each side of us are losing their homes. My family is not, which is strange since we make far less than they do. By far less, I mean we make like 40 thousand a year and they make over 100 thousand a year.

Now how is it that we figured out to save our money and buy a house in cash instead of letting the bank get our hands behind our backs? We refuse to get loans and gamble with credit, yet we have to pay for their house anyway? Why didn't they sell their fancy vehicles if they knew they were having trouble making their house payments? Why didn't they disconnect the satellite television? Why didn't they pull their kids out of expensive private school? Why, why why?

It doesn't take a genius to figure out that if you don't have the money, you SHOULDN'T BUY IT.

I feel no pity for most people who lost their homes. It's one thing if you were truly doing everything in your power to save yourself from the situation, but for every five have-nots I will meet fifteen will-nots.

The lenders and the borrowers share equal blame in this one, and I shall continue to blame them. Although I don't so much care myself, because I actually *ahem* own my house, not the bank.

The lame thing about fancy new cars is that they decrease in value so dramatically, when you do try to sell, you owe more than it's worth. This is why I will never buy a brand new car. A friend of mine thought she just had to have a brand new van and found the payments were too high. They ended up selling it, but still owed over $4000, which they took out of their 401K. What a dumb waste of money.

[Palerider]

It was 8 years of letting big business run this country unbrideled; to me it just seems awfully funny how myself along with millions of others; {

across the world} saw this coming 7 years ago; the little working family in this country could only be robbed so much; then there is no more; this is what happened to our economy; big business, {with bush supporting them} simply do not understand that there big profits come from people working and buying products; not from cheating every last dime out of the downtrodden and little person whom scrapes by in this world; they have the mentality of; "well; if we give more money to big business; then big business hires more workers"." It simply does not work this way! the worker needs the money to be able to support the big business; they take everything from us;... they fail too; I think an awfull lot of them have figured this out as of late; but unfortunately there are still some whom just dont get it and probably never will. Thank God we now have someone in the white house whom has the guts to stop kissing A## and is actually keeping his campaign promises to the average american citizen.:)

since you knwo so much about the last 8 yrs....try to look up which politicians were all hollering about the Fanny Mae and Freddy Mac loans.....then look who did nothing about it....

Obama not @#$ kisser.....LOL!!!!!!!!!!!!!!!!!!!!!!!!

[Elphaba]

@#$ kisser....

I have just reported you for swearing!

For shame Pale. For shame.

Elph

PS: Can I swear about Bush too? :=)

[Palerider]

I have just reported you for swearing!

For shame Pale. For shame.

Elph

PS: Can I swear about Bush too? :=)

you have so many times there are not enough books to contain all the swear words you used.......LOL!!!!!!!!!!!!!!!!!!!!!!!!!!!!

[Hemidakota]

If it was not for the media downplaying an alarming problem, we would be facing a national crisis. 1 out of 398 owners foreclosed on their homes.

[Just_A_Guy]

Youch.

(Referring to both the statistic and the none-too-compassionate analysis thereof.)

[Moksha]

Bytor,

Do you not recognize you do the exact same thing?

Few people are as full of ideaology as you are. I readily admit I am one of them. But the fact that you' would rant at someone else, when you do the very same thing, is really bad form.

Elphaba

I do not think it bad form, but rather one of those mysterious quirks in the universe. Sort of like a zebra with a tic-tack-toe pattern.

:)

[drjme]

Very intereseting documentary I watched recently

the ascent of money: safe as houses

part five goes through goes through prime, sub prime, federal credit, credit 'by colour' and a lot of interesting info relating to home ownership and govt incentives effects on economy.

[boyando]

I keep reading, all over the net as well as here on lds.net, tirades against homeowners, blaming them for the financial crisis, and frankly, it is just plain mean.

Many Americans bought their homes because they believed in the age old value of homeownership and thought it would make a sound investment.

They believed it was the best thing for their family, for their children. They wanted them to live in safer neighborhoods, proven schools, and yes, even a better lifestyle. Lord forbid!

Now the American Dream of homeownership has turned into an American nightmare with over two million people being forced into foreclosure. Ten million are having trouble making their payments. Perhaps another six million homes will face foreclosure by 2012.

That is 18 MILLION homeowners, of which the vast majority are mom and dad and two-and-a-half kids.

Eighteen million Americans did not try to take advantage of you by recklessly borrowing money for a home. Eighteen million Americans believed their bankers who told them they could afford these mortgages.

Eighteen million Americans believed their bankers when they told them their loans were safe.

The banks that lied to eighteen million Americans are to blame.

In all of the research I’ve done, no one says it better than Church Warnock, a self-described small-church pastor:. He doesn’t write for the Wall Street Journal, or the National Review, but he has a flock of people who are facing financial disasters. He says:

• Homeowners didn’t package and slice up mortgages into untraceable, unmeasurable and risky economic instruments.
• Homeowners didn’t relax the rules allowing banks to increase their debt-to-deposits ratio.
• Homeowners didn’t run the SEC, Fannie Mae or Freddie Mac whose lax oversight and loose policies allowed the Bernie Madoffs to steal billions, and predatory lenders to defraud millions.
• Homeowners didn’t create the shellgame called credit default swaps, a house of cards created by the lenders to provide the illusion that real “insurance” covered their loan portfolios.
• Homeowners didn’t create the housing bubble, or inflate the market price of property, or assure others that “your house value will always go up.”
• Homeowners didn’t rate the riskiest of financial instruments as sound and solid, like the rating agencies did. Those same agencies are supported by the companies they rate.

Eighteen million Americans had never heard of “Sub-Prime Mortgages, “Collateralized Debt Obligations,” or “Credit Default Swaps.” I had never heard of these things until I started researching this, and I’m not stupid.

I’ve posted this video before, but this is a good time to post it again. It’s called The Crisis of Credit, and it explains the complicated steps that put these risky mortgages in our hands. To expect the average person to have known all of this is absurd, and even cruel.

Were there abuses? Absolutely. Was there carelessness? Yes. Should we have been more thorough and self-educated? Obviously some of you were.

But we’re not all bankers, or financial gurus. We don't have financial consultants to safeguard our investments. Heck, we don’t all have the TIME to research these loans.

Additionally, how should it have occurred to us our banks might be lying to us?

A relative handful of rich Americans, who took advantage of relaxed regulations, complicated financial schemes, and just plain greed and even ruthlessness, are more to blame for this financial crisis than even one of these eighteen million famlies.

Spread the blame where it belongs, not totally on the backs of Americans who were trying to live the American Dream by purchasing the ONE investment we’ve all heard, all of our lives, is sound, profitable, and safe.

Elphaba

I would be very careful if I were you. 80% of what you said is very conservative.

Not that I don't want you to come over to the light side, but please take it slowly. Our hearts are not getting any younger you know.

Love ya

[its_Chet]

FWIW, just Saturday I was talking to a guy who has been trying to refinance his house. The loan officer told him he'd have a better chance of doing so if he got behind 2 or 3 months on his current loan first.

That's ridiculous.

My mother in law was given this exact same advice. And then she told me I should do it.

It's like I can actually hear Joseph Smith and Brigham Young's palms smacking their forheads in frustration.

Edited July 2, 2009 by its_Chet

[its_Chet]

It's been said before, but I agree that there's plenty of blame to go around. The people who signed up for ARMs and balloon payment loans, the thieving scoundrels like Madoff, the corrupt politicians like Barney Frank, the reckless practices of Fannie and Freddie, etc.

I would also add that I have a hard time sympathizing with real estate speculators who've gotten burned when I only own one house and it's where I'm trying to raise my family. To a point, I haven't got anything against people looking to enrich themselves off of real estate, but they ought to bare in mind that when they drive up prices (as they did in Maricopa County, Arizona), it makes it harder for would be homeowners to find a place to live. Thanks to what's going on in the world around me, I've had a paycut, an increase in my health insurance premiums, face rising energy costs and general inflation, and may actually get dragged down the drain even though I didn't pull the plug. I used to be able to afford my mortgage, but times are getting difficult. My "thanks" to those whose greed has put us all in this situation.

But really, I think the blame ultimately lies with those who have defied the will of God and have made a habit of mocking and insulting Him. I blame the people who refuse to observe the Sabbath. I blame the people who have abortions for convenience. I blame the people who violate the law of chastity and the word of wisdom. I blame the people who let their idea of right and wrong be inspired by one or another political party (especially one that celebrates perversity, obscenity, and militant secularism, among many other very bad ideas), instead of by the Gospel of Jesus Christ.

In short, we are living in Sodom and Gomorrah, and the burning sulphur is already starting to fall from the sky.

Thanks a lot to those people who couldn't be satisfied with their unholy practices and beliefs being kept to themselves, and instead insisted on having them broadcast on the street corners and in the town square. Thanks a lot to those who get all worked up about CO2 emissions but couldn't care less about "Bruno" playing at their local theatre.

The wicked are destroying this country. They are pulling down the wrath of a just God. And unfortunately, the rain falls on the just and the unjust alike. Time for us all to get our food storage. We may need it sooner than we may have thought.

[Elphaba]

I would be very careful if I were you. 80% of what you said is very conservative.

Not that I don't want you to come over to the light side, but please take it slowly. Our hearts are not getting any younger you know.

Love ya

Hey bro,

Take it as a sign that I really try hard to look at issues from all sides, instead of automatically taking my talking points from my favorite, or disdained, pundits.

Just imagine--perhaps the day will come when even I make Olbermann's "Worst Person in the World" award.

Nah.

Elphaba

[Palerider]

Hey bro,

Take it as a sign that I really try hard to look at issues from all sides, instead of automatically taking my talking points from my favorite, or disdained, pundits.

Just imagine--perhaps the day will come when even I make Olbermann's "Worst Person in the World" award.

Nah.

Elphaba

I have been wondering where my favorite liberal has been lately.....nice to see you back....:)

[tefor]

Sheesh. How hard can it be to figure out? If you can't afford a $500K home, DON'T BUY IT. If you can't afford a $250K home, DON'T BUY IT. If you can't afford a $150K home, and can't find anything cheaper, then keep renting instead--and thank the Lord that you at least have a place to live (and can move with relatively little hassle, should the need arise).

Remember: "What is property unto me, saith the Lord?" (D&C 117:4)

Way back when my bishop was telling me that I needed to get with it and buy a house (the responsible thing to do), I told him that I couldn't afford it, and went my way. (When you're trying to get by on $35,000 a year with three special needs kids, the last thing you want to deal with is a mortgage.)

No matter what society, the banks, the government, or even the Church says, I know what I can afford, and the responsibility is mine--nobody else's. Same goes for anybody else who buys a home they can't afford.

[freckleface]

Now it's just very very sad. So who's to blame..the banks, the non-bank people, or those who have indoctrinated us into thinking every American should own a home because if you don't you're abnormal?

My family lived in a bus out in the deserts of S. Cali for 10 years. I learned a lot during that time, mostly that it's ok to live without credit of any kind and paying cash is a good thing. I may not be able to buy a car for $30,000..but you can bet I can pay cash for a $9,000 one

You are indeed a hero of mine, talisyn.

My husband and I owned a home which we sold a few years ago, in a very lovely, newly constructed neighborhood that was considered great for for it's schools and location. It was a street of about ten homes in total. One of the homes became a rental and had a very decent, nice, clean, family occupying it. However, the attitude of some people living on the street was very critical, negative and down right hateful. They were the only family the "self appointed mayor" wouldn't invite to street parties, and referred to in passing conversation as"renters, trash, or low life's." It was infuriating. My husband and I befriended the family and found that they were putting one of their kids through med school. Another one was in college. The home was always impeccable inside and the people extremely friendly. They became our friends and we disconnected from the others on the street, which was a huge sigh of relief.

I just don't get it. The mentality of "keeping up" with what society dictates to us as "normal" can be a downright prison. Provident living is defiantly something we should all strive for. And if it means renting . . . than more power to you!