OT...But A Major Concern...Homes!

AP news wire 11/08/07:

"Rep. Brad Miller, D-N.C., and Rep. Linda Sanchez, D-Calif., that would allow home mortgages on primary residences to be modified in bankruptcy court. Doing so, advocates say, could help as many as 600,000 homeowners avoid foreclosure.

Sanchez called the bill "a measured response to address the growing mortgage meltdown," which has roiled Wall Street and sent shares of companies such as Countrywide Financial Corp. and Washington Mutual Inc., tumbling."

(end of quote)

T_Bone

Buying a house is a business transaction. Obtaining a mortgage is a business transaction. People make and loose money on business transactions every day. If you borrow more money than you can pay back, you loose money. If you loan money to somebody who can"t pay it back, you loose money.

The lenders got way too aggressive about loaning money to people who were "subprime". They took a chance by making the loan. I have no problem with them risking their money on any investment, that is part of business, but it"s not the responsibility of the taxpayers to make them whole again.

On the other hand, many people borrowed more money than they could ever have been reasonably expected to pay back. Now they will loose their collateral, which was their houses. I have no problem with them stretching their finances to try to make a better life for themselves, many people do it and some make out and some don"t, but it"s not the responsibility of the taxpayers to make them whole again either.

My idiot brother-in-law bought a house a few years back. I knew at the time that he couldn't afford it but he pretended to be quite knowledgeable on how to creatively use financing.

The sheriff sold it a month ago.

I'm going to reply to everyone who thinks the same way as you two so I don't have to type more than one response. I'm NOT picking on you guys but giving you my take on the subject and your the ones who happened to comment first/second.

Have you ever made a MISTAKE that would cause you to default on any loan or debt?

No, I'm not expecting a response but something you need ask yourself. If the answer is YES, then isn't the "pot is calling the kettle black". Everyone deserves a second chance including debtors. That's why we have BK laws! It ain't easy in BK, I don't care who you are.

Did you know that if you have debt(s) that you DO NOT have cash to cover the amount of the debt(s), you are considered by the BK laws to be in INVOLENTARY BANKRUPTCY. That is a fact!

Involentary BK is nothing more than being in controll of BK.

As M Redneck & Vern already stated, BEFORE someone files for BK, there's other relief that is available for any type of debt.

I will say that one should prepare for BK, (the paper work), BEFORE contacting the lendor as the are "due on demand" clause to some contracts just like there's "due on sale" clause. This means the lendor may take steps for there protection against your pending "forced" BK. This may or may not effect your position if forced into BK to seek relief. I strongly urge you to seek legal advice on such matters!

Forced BK is where the lender refuses to renegotiate your debt(s), as BK may be your only choice and the lendor knows this.

Now I will say, that my kids have been warned by me SEVERAL times that if they don't change there ways of handling debt, they soon WILL be in BK. I have discussed with them at length of how to resolve there past issues and where to get other help. They have been well imformed.

I told them that if they file for BK, then there on there own and don't expect help from Mom & Dad as we have already tried to help them for many years. So far, thay have evaded BK.

We would feed, cloth and house our grandchildren but I didn't tell my kids that. However I would not do the same for them! T_Bone

Yes. I have been beyond broke during two periods of my life. I sold what I could and lived on about nothing until I was out of debt.

It's a pretty hopeless feeling. But it was my own doing so I got myself out of it. Never thought about asking someone to bail me out so I could keep my big house, SUVs, vacation home, toys etc.

For sure some people run into problems and that is just how it goes in life. But the majority of the people that are going belly up now walked into it with their eyes open and their mind shut.

And I agree with you as I too once had extreamly large debt.

When I was young and dumb, I was making $7.8/hr, or great top wages for my craft, and my take home pay was $150/wk and my debt was $125/wk with one wife and child.

Yep, I paid cash for my first child to be born in a hospital.

Yep, with $25/wk spendable income, I fed, clothed, and housed my family AND got out of debt! Not that long ago either, early 70's.

T_Bone

When I had the bad times I talked about in my other post, I had also taken two other jobs.

One job I was hired at $7.8/hr for 16hrs on the week-end even tho He was paying OT at higher than $7.8/hr to his regular workers and they were working 10hrs/day and he rode me like a dog. I just kept my mouth shut and kept working, and working harder than anyone else in that shop. The regular boys could have 10min coffee breaks, but I only got a lunch break.

I was really close to paying off my debts when he wanted me to weld a split on a AL gasoline tanker. I had seen the tanker come in that Sunday night but it was too late to get started on it, thank GOD!

On Monday I asked the regular guys at my week job of how to make the AL welds. They all told me I was a fool if I tried to weld on this tank without filling the tank with a special gas, and in a full SCUBA mask (fresh air), or the tank would explode as AL tanks will hold fuel oil in there AL pores.

I was a certified AL weldor but I was really green as to common knowledge of such type of welding. As I suspected, the next Saturday, I was told I had to weld the crack in the AL tanker. I asked for the special gas and the SCUBA equipment to make the weld. He says "you first go cut this list of metal for me". Of course the metal cutting took until quiting time, then he fired me!

That's when I had to find another job at a lower pay rate that I used to pay off my debt. I worked 7days/wk for over a year before my debt was paid.

T_Bone

Here is a secret not too many people understand;

The market gets strong

The market gets weak

The market gets strong

The market gets weak

It's been that way forever and will continue to be that way.

When the market is strong, people overbuy and overextend themselves. Then when it slows down they want to get bailed out.

Developers over build.
Consumers over buy
Banks over lend.

I survived Jimmy Carters total destruction of the housing market in 1980. This one also shall pass.

Funny how the politicians keep saying the the economy is good. You also hear commercials saying that mortgage rates are at an all time low.

I have had a couple of job offers out of state recently and they have been asking if I think I can sell my house. These guys know how bad it is in Michigan real estate. One guy told me he moved a guy and his family to a new state and the guy moved back because he couldn't sell his house in Michigan.

I moved out of automotive and back to aerospace work. Likely one of the best things I ever did.

There has been a long time racket that involves the circle of realtors, mortgage brokers (don't confuse them with bankers -- totally different animal), and appraisers. Brokers aren't regulated by FDIC, OCC, or state bank commissions. They're the unregulated used car dealers of the home loan world and operate off commissions just like the used car dealers (and realtors). Here's the skinny: Realtors refer their customers to their "recommended" mortgage broker and the broker uses his "special" appraiser who will make that house appraise for whatever it needs to appraise for in order to make the deal go through. Do you smell the kickback $? Everyone in the real estate and financial world knows that this has been going on, but NOTHING has been done to correct the problem or to hold accountable those who are involved. As a result of this racket, we end up with overinflated real estate values (here comes the tax man). This has gone on for years and, as history will prove, the bottom will eventually fall out and someone ends up holding the bag. Hopefully the taxpayers don't get stuck with the bill again.