Should not have made a comment on this one. And I am retracting it.

[This message has been edited by miden (edited 10-04-2008).]

During the past several years I have seen real estate sales to folks, who in prior times, could never have qualified for a mortgage. There were programs for just about any situation - first time home buyers with no bank account or money even for closing costs - everything rolled into the note. Programs for various careers such as teachers or peace officers - again with little or no financial requirements. Everyone made money - lenders, mortgage brokers, and yes me the real estate broker. The FHA saw a deep decline in loans because they were no longer the "bad paper" guys. Today the title companies are being flooded with FHA closings because that is where you go if the financials are a bit scary.

On top of all that the lenders were allowed to market the ARMs to folks who spent way to much money for their house trying to keep up with thier friends. These people knew better and are not the illiterate in our society - many are professional types with very good educations.

Then the real killer - Fannie Mae and Freddie Mac softened the requierments - and they were the major buyers of packaged loans. The rest is history as they say.

Wow, I really go windy on this thread. Again, I hope all here do well and as I often discuss with my wife - it is not really important what happens - it is only important that we all learn to cope with the cirmunstances and survive until it gets back to normal.

Hammer

I would guess you may have wanted to claim its the evil rich who are the blame.

People with even $100,000 in the bank will not spend it. People with millions will not spend it/ Think about how many jobs are affected because people who DON'T use or need credit won't put putting into the economy whether its a Multi million dollar G3
Jet or a new car. They won't be eating out as much, They won't be buying home theater systems,They may mow their owm lawns and clean their own homes, less or no vacations,
They may tear papertowels in half and clean and reuse baggoes bless my wife's heart)
The may not buy thhose $2000 RIMS AND $3000 car stereo. ON and on and on

And guess who looses jobs and pays less into the government, not that that matters much because the top 10% pay more than 80% of the entire government's revenue as it is.

Now tax the guy who has $300k in CDs and earns $36K on his SAVING at a higher rate and his $36 is now 20K....$15 less to circulate creating jobs, But 15% more to the government to PAY those who cannot get jobs..

IT's crazy and about to get much crazier should a guy who will need Joe Biden to stay healthy convince America how victimized and poor they are and how they will save the day...
Then blame it all on Bush when they cannot.

We need to throw EVERYONE out of the house and senate and vote for. Main street people have more sense and a far less affected..

MOST of America is doing ok. I personally do not know anyone who is suffering. My co -eworkers making $12 an hour are doing as well as they can do and are not complaining about not becomeing doctors or Government workers. They accept the choices that made and don;t blame it on the government. But will if they lose their jobs because the owner decided he is better off and will pay less taxes by retiring and selling his inventory at fire sale prices. He already passed on buyng the new car he bought every three years this go round.

Look around its the Frank's Audio Works of the world who employee the most people not the GE's and Boeings. You take from them and they ride themselves of employess first then product,,,,,,,




[This message has been edited by Kingfrog (edited 10-04-2008).]

OK, you asked...
I want to know WHO IS RESPONSIBLE for allowing those who could not afford homes buy them. Those who did not have 20% down.

It was absolutely truely BILL CLINTON
He said we need to put lots more folks in houses, so go get it done! Give them the loan! ANd these are amajority of the ones defaulting today!

It's a fact (presented with refernce to documentation by Rush L.)

Lee

Lee..., the mortgage problem isn't just the fault of the buyers. There were some VERY dirty lenders out there preying on low income families too. What blew my mind is how all the finger pointing always leads to some of the dumbest crap you'll ever hear. At one point there were reports saying that the mortgage crisis is the fault of low income MINORITY families! How F'ed up is that! If you really looked at it..., MANY of the families that were failing in the mortgage battle were MIDDLE CLASS families. People were buying $300-$400,000 homes (who could afford it at the time-living in these nice gated communities), but again many of them made a very poor decision and signed on the dotted line accepting their loan with an adjustable int. rate!

The main problem I've seen is that too many buyers signed on with an adjustable int. rate. That IMO is just plain dumb..., I for the life of me could never understand why a person would accept an adjustable int. rate when the country is at war. They didn't have problems when the payments were reasonable.., but when a $650 monthly payment went from that to over $800 within two months and continued to climb people started to really feel the sqeeze.

My wife and I puchased our home without having 20% down. We however were smart buyers. We live within our budget We have credit cards, but use them wisely. We have a nice house, pay our bills, DID NOT sign for an adjustable rate either. I was raised and taught to spend the money you DO have and not money you DON'T have.

There was also a problem with some families that bought these homes who thought they were suddenly RICH. So many living outside of their income brackets. Basically trying to live the life of a classy wine drinker on a beer man's salary. Families really got into trouble doing this.

I don't think the answer is cutting up your credit cards. If you got them..., and have a decent int. rate... QUIT FREAKIN USING THEM.., and pay off the current debt you got and stop racking it up. If you own a home YOU NEED to have at least ONE credit card (as you never know when you may need it for an emergency)

This whole mess has blame on both sides.. It's the buyers and the lenders. Too many were duped by lenders who had dirty lending practices. Too many home buyers were purchasing without using their brains and common sense. It created a huge mess.., and now we find ourselves in the state we're in today.

After I retired I thought playing golf every day was a true dream life - so I did that for about a year - boring to the nth degree. I was never a guy who could sit around and do nothing and that life style was killing me. I decided to get a part time job and was hired at a local Best Buy store selling appliances and later cameras. The store I work for hires mostly college students from the two colleges in our town. These kids are the cream of crop - many work full time and go to school full time. Many or on their on -no help from home. These are the folks who are getting hurt - hours have been cut back severly and many of these kids are really having a hard time. My wife and I help out and buy groceries for a few of them and they are appreciateive - but that does not solve the problem.

I don't understand how the "talking heads" on any TV show or radio talk show can keep talking up how much trouble we are in and expect the public not to buy in to it. You know, keep telling the same story often enough and it becomes the truth. I wonder how many people are not spending money because they believe everything being said on the news shows. I can't state exact figures here but the store numbers are down tons from last years numbers - and I imagine that is true of a lot of retail stores.

I have been a small business owner and I don't buy into the credit problem crap being hyped. As long as my bottom line was looking good I could always find money. I bet it is still the same today.

The question was who is to blame. Well, I am not a believer in blaming others but strongly believe in personal responsitility for ones actions. That said, regardless of who "allowed" all the bad loans or lose investment policies the individuals involved were more than ready to take advantage of the situation.

I sure am on board though with replacing every person in Washington. The entire group has failed to protect the country and it's best interests. God forbid we ever have to protect our country on our own soil - I frankly don't see the guts to do so by those who are in charge. Where is the next "greatest generation" coming from?

Hammer

This bail-out: one of the worst decisions ever. Taken us 5 years in Iraq to spend 600 billion, and then our Congress just hands over 700 billion in a week, just like that. Oh, the House took 2 tries, guess there wasn't enough money spent on wool research, race tracks, and rum runners in the first draft. We talk here about running everybody out of Washington; yeah right, and Ted Kenedy will be re-elected for the 250th year. McCain wants to reduce government and earmarks, but leads the pack in making sure this 700 billion bail-out goes through. They all make me puke.

Deregulation has been the mantra since Reagan (and both sides have bought into it, don't get me wrong!)...

What everybody forgets is that each and every one of those regulations were passed as a response to a problem. They weren't grandfathered into the Constitution They came about for a reason. But leave them long enough in place that many forget WHY they were passed in the first place, and they start to look like an impediment to business, not the necessary check that they actually were.

Now remove those checks and bounds, slip loose the dogs of capitalism, and all of a sudden, we start to act SURPRISED when the same problems recur as a result of the same reason.

The United States of Amnesia...

Hammer and Squeak...everybody, really, is showing that we understand the elements of the mess the country is in.

Greed and ego...those are the critical elements. Ego on the part of people who yielded to the temptation of borrowing sometimes 125% of the purchase price of a house...signed up for 40 plus year mortgages...did ARM's which reset to unaffordable payments and more foolishness just so they can have a larger house than the neighbor.

Then, there's the business establishment that banked on the property values going up to the point where, if a foreclosure was necessary, the house(s) involved would be worth more than the mortgage balance.

The whole affair played on the greed and egos of all involved, and now everyone is paying the price. Rory hit it on the head when he says the bail out is going to cost as much as we have spent on the war in Iraq.

An absolute mess!


Russ

...So, how "BOUT them Philles ! yay !!!!!!