Niicss's Opinion Because of the sub-prime crisis so many people has lost their homes. And it is predicted that more borrowers will going to face foreclosure in near future.
Joined: 05 May 2008
Posts: 328
Location: Houston 75.44 Dollars($)
Posted: Tue May 13, 2008 6:14 am
Yes it is bad. However, we are fortunate that it has not spread to every part of the nation. Believe it or not there are many economys within our country that are thriving. So even though we have entered into a recession is appears at least for now to be a mild recession.
I feel bad for these people, but I have to asked why did they loose their homes, it does not go into any specifics, if it because of the flexible rate, I think that if you are offered that type of loan, you should take the highest that it could possibly go to and put that amount away each month. If they can not do that then they should not take out this type of loan because at anytime that is what the payment could be.
Don't get me wrong, I do feel bad for these people I hate to see anyone in this situation.
Joined: 05 May 2008
Posts: 328
Location: Houston 75.44 Dollars($)
Posted: Tue May 27, 2008 8:04 am
Hi jbarto65, I hope you had a nice Memorial Day weekend.
You make a very good point. Unfortunately the majority of these people where caught in the middle of markets full of speculation. Many of them had properties that where worth say $700k and when speculators came in it drove up prices to say $900k. So maybe they take out a second mortgage to make improvements on the house or payoff debts. Then of course as we all know the markets crashed and caused their home values to fall back to $700k so now they owe $800k on a home that is only worth $700k.
The other end of course is that many people servicing these people where new loan officers jumping into the industry because of the lending boom. Many sophisticated mortgage people do not understand the dynamics of the various adjustable rate mortgages much less someone who is learning while they are selling mortgages. So this lower class uneducated population was usually told the mortgage payment would go down and that was it. So the tragedy is that they did not understand what they where buying and many times where misinformed. So now they are upside down in their house and their mortgage payments are higher than they could have ever imagined!
As an economist I’m 100% for free markets which says this should be left alone to workout itself. At the end of the day is was dumb real estate speculators that artificially drove up the price but, I can’t help and feel that these people deserve better given how most of them where misled.
By the way I would like to correspond with you more but, they will now allow us to talk about anything else on the forums other than the given topic. Please e-mail me at "cliff@home-buddies.com"
Look forward to hearing from you Cliff
[Email address deactivated as per the forum rules]
