CaStylin said:
gotta agree there and since a pretty good chunk of la showed up there after the hurricane, the hood is ever expanding there. That is one of the reasons we left in 06.
AN OPEN LETTER TO PRESIDENT OBAMA
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gotta agree there and since a pretty good chunk of la showed up there after the hurricane, the hood is ever expanding there. That is one of the reasons we left in 06.
I find this very hard to believe that 60% is average, very hard, so hard I think someone made it up. The rule of thumb used to be 25% or one weeks pay without overtime. MOst of the foreclosed mortgages were not because of no 60% of their take home pay. Does someone think that any American worker should live like a pauper while his boss lives like a Bill Gates? IT"S BECAUSE THEY LOST THEIR JOB THE ECONOMY IS HORRIBLE
No one said that most of the foreclosures where because of the them spending 60% of their take home payrick48195 said:
the point that "Texas T" made was that people where not saving which means when they don’t save and they lose their jobs they quickly go into foreclosure. I countered and said saving to support a mortgage is hard to do because of the high percentage of our take home pay spent on home/living cost. He said that that means they where living outside of their means, i said that is the Americans normalityIDK, 60% is a statistic i read at the early beginning of the recession (2007). I too thought it was a little high, but it does say “up to” which means it’s a conglomerate of area averages, I think the 60% was for California. Anyway I will attempt to find the articles for you. There is a bunch of simple math above that suggests 50% for a normal person in an average Market making decent money living an average priced house. Even the person living an area that is not so good is spending more then 25% of there take home.
But i will go head and quote myself
of course if you make more in then average in a housing market that is average the percentage will decrease but most of those who had loss their homes in the most recent years of foreclosures where people who where in their comes for less then 5 year. Having a second income can also dramatically change the percentage rates but home sales to single owners is up largely in the recent yearsCaStylin said:
Just as a question (not to pry) do you only spend 25% of your take home in housing cost? I know I don’t :x
Wow, that’s great; I wish i was in a similar situation.rick48195 said:
If i remember correctly from other post you had been in your industry for 15+ years before you where laid off. I am going to go out on a limb a guess you have been in your house some time now and where at a higher level of pay then at the time you bought the house. Prior to your layoff you making an above average pay on a house bought in prior years, being vested in a mortgage (earning more now then originally alloted when you bought the house) allows you to move down the percentage range. This was/is the hopes of home owners that live in the 50% range; they hope to make more money in the future to lower the cost of there financial necessity but the markets have forced many to fail on this “gamble” when their source of income was cut.
In personal experience I was making a lot less then I am now when I bought my house 3 years ago, I would have been in or close to that 60% range. There are very few first time homebuyers that I know that aren’t spending lower then 40% of the house hold take home pay on there home. But at the same time there are always outliers or amoralities to every situations, Making decent money in a market is below the national average is another common way to have a lot but not spend a lot (supply and demand)
I just hate to see it when people start blaming the homebuyers on this economic disaster, let's focus on the people who caused it instead of the people being hurt by it. Those banks that gave the risky mortgages would be a great start, then the government who allowed it, then we could blame it on this worst economy since the great depression, heck all of these are factors, I don't think any of these people got into these mortgages with the intention of losing their homes, or thought in any way they were living above their means, that mentality is certainly an easy fix, Yep just blow it all off by saying the people losing their homes deserve it because they shouldn't have tried to move up in the world with a little nicer home. We could all easily say that but it doesn't fix anything.
That’s not the case at all with me.... I came damn close to losing mine, my credit was cut in half if not more, I didn’t get a raise (luckily i didn’t get a deduction like many have) or my bonus and gas was through the roof. I was leaving out side of my means, the credit crunch as opened my eyes to that more then I knew before.rick48195 said:
The only people that i think should get some blame for losing their homes are people who thought adjustable rate mortgages (A.R.M.) where good investments and banked the homes into them knowing that a turn in the market for the would leave then financially crippled. A.R.M. is an investment gamble with far higher success and fail rates then any other mortgage type. You gamble, you lose. If you know the risk then you can’t cry about it in a down turn. Yes they are victims of the down economy but they are also victims of trying to ride a Market wave (A.K.A gamble) to save some money instead locking the rate in a possibly be set at a higher rate
True enough but you'd think that the bank would advise them against such a thing instead of encouraging them to do it. Newbie homebuyers only have one thing in mind and that is finally getting into a home of their own, Hell I remember those days, we really didn't know crap. Now on the other hand if there was someone other than a newbie buying a huge home that he could not afford without an ARM shame on them but I would have to think that they are the minority in this huge problem
rick48195 said:
No one forced people to take a home loan. No one held a gun to their head and made them sign. They did it because they didn't know any better. I do think it is the borrower that becomes the slave to the lender.
rick48195 said:
Those banks are in business to make money. Make money and keep their shareholders happy. Generally in investing the larger the risk the greater the potential reward. Those high risk mortgages have a high reward if they get paid. Unfortunately the bottom has fallen out and you seem to want to blame. There is enough to go around but don't leave out the borrower because they are to blame, too.
rick48195 said:
I would never think that anyone should deserve to lose their home but if you can't pay, you can't stay. I see nothing wrong with trying to move up in the world as you term it. The problem is the rate at which the climb was made.
I would not want more regulations. I don't see why people don't seek out more education or at least an attourney or someone with the knowledge to help them with such a large purchase. Letting a banker tell you how much you can borrow is like letting the fox guard the hen house. You better be able to budget and know what you can afford or you will end up on the street sooner than later in any economy.
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