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ShnickyShnack wrote:

bedstuy wrote:

ShnickyShnack wrote:

Maybe if you're okay with paying the bills for other people's gambling, you should consider being okay with paying for their health care.

Nonsense dear... much too logical

:: hangs head in shame ::

Except you all tell me I already AM paying for the uninsured so I guess logic and consistency aren't really your strong points.
And just to repeat it for those with memory problems, I am fine with paying for coverage for those that need it. Said it several times now in fact.

JakeTheTall wrote:

robco wrote:

Yeah, but banks get every scrap of financial information on someone before they make a loan.  They have the buyer's credit history, income statements, current debt load, etc.  They know whether or not the buyer will realistically be able to repay the loan.  They overextend credit to people they shouldn't.  Predatory lending is bad.

It's also ironic that these are the people that need stable, fixed-rate loans the most.  Then again, even in our nation supposedly built on christian values, greed trumps ethics.

Banks CAN get every scrap, but they weren't.  They were loaning money to people based on what the PEOPLE said were their earnings and assets.

Oh horse smurfing smurf. The banks went of a feeding frenzy and abandoned their fiduciary responsibilities in making these loans.
My wife and I bought a house three years ago and we were shocked at the amount the bank said we qualified for. There was no smurfing way on earth people with the income we had could have possibly maintained the monthly payments our max qualified amount would have gotten us. 60% of a families net income is way more than they should be offering.
Frankly I think most people are idiots when it comes to money. Even here we often see otherwise reasonable posters buying into the debt=wealth bullsmurf.
I may be old school but my wife and I are sitting pretty right now, paying our affordable monthly payment on our low interest, fixed rate loan. I knew this problem was going to happen years ago and I and my wife made sure it was not going to be our problem.
Sucks to be those other people who bought the hype. smurf.

Farmerkev wrote:

Except you all tell me I already AM paying for the uninsured so I guess logic and consistency aren't really your strong points.

...are you talking about healthcare costs?

Ack! Death to the healthcare debate! Strangle it in its crib!

Farmerkev wrote:

I wasn't but your liberal buddies thought they would be clever and bring it up in a pathetic attempt to make me look foolish.

Well, the point isn't that you're "already paying," it's that you're paying a lot more because the uninsured typically don't seek out preventative care.  It's an inefficient way to go about it, from a financial angle alone.  It's not necessarily simply a difference between paying one way or the other.

bratboy wrote:

Farmerkev wrote:

I wasn't but your liberal buddies thought they would be clever and bring it up in a pathetic attempt to make me look foolish.

Well, the point isn't that you're "already paying," it's that you're paying a lot more because the uninsured typically don't seek out preventative care.  It's an inefficient way to go about it, from a financial angle alone.  It's not necessarily simply a difference between paying one way or the other.

Yes and no.
Shicky doesn't want to pay for people that gambled they could afford a house and the lenders that gambled on them and it should be illegal.
People take all kinds of gambles though, health and lifestyle choices included. Perhaps he doesn't want to pay for healthcare for people that ride motorcycles or drive too fast or have bad diets and get heart attacks and cancer. He wasn't specific about what risky behaviors he finds acceptable to pay for.

mackerm wrote:

Pariah wrote:

Oh horse smurfing smurf. The banks went of a feeding frenzy and abandoned their fiduciary responsibilities in making these loans.

That gets me to wondering: When did it become tolerable for bank officers to regularly make loans that go into foreclosure? I'd assume that, back in rational times, such an officer would quickly be fired for incompetence.

But now, no big deal? Maybe banks have found a new source of income, like kickbacks from construction companies.

Not quite.  Banks were securitizing and reselling the loans (CDOs, etc).  While earning fees on the loans.  Banks thought they were passing off the risks to others (hedge funds, etc), which earning fees at the same time.

mackerm wrote:

Pariah wrote:

Oh horse smurfing smurf. The banks went of a feeding frenzy and abandoned their fiduciary responsibilities in making these loans.

That gets me to wondering: When did it become tolerable for bank officers to regularly make loans that go into foreclosure? I'd assume that, back in rational times, such an officer would quickly be fired for incompetence.

But now, no big deal? Maybe banks have found a new source of income, like kickbacks from construction companies.

Back in the old days - you went to bank and asked to borrow $50 to take your family to Pizza - and they showed you the door.

Now they give you a credit card and encourage you, telling you you can earn airline miles etc. (which they make real bank off of when you use them, as your credit card gets used quite a bit on vacations)

It's lunacy.

What people wanting to go on vacation SHOULD do - save up money, and use the saved up money to buy their airline tickets and stuff.

Instead, they use their credit card, make minimum payments, go on vacation using the miles, use their credit card some more, refinance their home to pay it all off, charge it some more, and then wonder how they got in over their heads.

The point is being missed; this is a national financial infrastructure problem.

This is not about personal responsibility because the system has been corrupted to such a degree that personal responsibility on a large scale would cause as great a collapse as profligacy. You're not supposed to live within your means.

Yellowfin wrote:

Or have a change in habit.  The situation is like the Irish potato famine: people are starving because they're eating what isn't growing well.  Solution: eat something else, stupid!  Pariah has it nailed.  Be smart and you don't get hurt by this.  Whaaa whaaa people are stuck because they don't use OLD SCHOOL COMMON SENSE.  If ya don't have the cash, don't buy it!   Keeping up with the Joneses is STUPID.

I don't disagree that personal responsibility plays a role here.  Not at all.  My point however is that the finger cannot be pointed at any one party.  Everyone played a role here.  Consumers should either not pay outrageous prices for housing and allow the market to drop and/or not accept these mortgages.  Banks shouldn't have been making the loans and been more fiscally responsible.  But again, the banks knew that these people didn't qualify for the amount, but told customers they did.  Some believe the word of a financial person (even a bad one) over their own judgment.  That, and these loans were agreed to by both parties on the notion that they would take the loan and by the time interest kicked it (or was adjusted), they could turn around and sell it for a profit (rising market) and use that as a down payment for another place using a conventional loan.  Everyone gambled here.  To some, it made sense as the market showed no signs of cooling off.

Problem is that when this sort of thing happens, the market for buying tanks, but rents start climbing.  It's not just a "keeping up with the Joneses" thing either.  Take the city in which I live.  You can't even think about getting into a reasonably-sized place (2+BR in a decent neighborhood) for less than $500K.  That would mean a down payment of $100K using conventional means.  That's beyond the reach of most folks.  So it's either never own or use "creative financing" to get in.  Even areas like Las Vegas and Phoenix are getting bad as demand increases.

That, and new construction needs to be more modest, more affordable homes.  Unfortunately a lot of the new construction is higher-end.

Yellowfin wrote:

Pariah has it nailed.  Be smart and you don't get hurt by this.  Whaaa whaaa people are stuck because they don't use OLD SCHOOL COMMON SENSE.  If ya don't have the cash, don't buy it!   Keeping up with the Joneses is STUPID.

Well, that was half my point, the other was that the banks were being negligent by offering ridiculous loans. Many of the loans that are defaulting now would have been illegal a few years ago.
I see it as a cultural problem, we as a people have really internalized a very powerful "you are what you own" value system at the consumer level and then a "make money today, never mind about tomorrow" ethos in business.
Much is made by the right about the "health" of the economy the last few years but floating a nation of massive debt is only something you can do short term. It's not that you risk a crash. It is a slam dunk surity.

mackerm wrote:

robco wrote:

Take the city in which I live.  You can't even think about getting into a reasonably-sized place (2+BR in a decent neighborhood) for less than $500K.  That would mean a down payment of $100K using conventional means.  That's beyond the reach of most folks.  So it's either never own or use "creative financing" to get in.

I've always wondered about "no down payment" home loans. The down payment protects the lender if housing prices collapse. How is a lender who holds a "no down payment" mortgage protected if he has to sell a foreclosed house in a suddenly weakened market?

All the other people that keep making their payments.
It simply means less profit.

Yeah, but all of the insurance companies are invested in real estate.