why is there not outrage?

[Anonymous]

Anonymous wrote:If everyone in my neighborhood loses their home, then I'm worse off. My own home will lose value because it will be surrounded by empty, foreclosed homes. The reason I'm not outraged is that it is important that we get our economy back on track. If we simply focus on punishing those who got in over their heads, we will all be in trouble.

Some people being bailed out may not deserve it, but I do think most are people who were handed a raw deal and preyed upon. When I bought my home my bank tried really hard to convince me to take a much larger loan than I could afford. I'm talking $200,000 more than what I can afford. And this is a credit union who supposively is doing all they can for their members. I was really shocked that they would do that.

I'm not happy it needs to be done, but it does. I'm not happy that people who got in over their heads and should have known better are being bailed out. But I'm not outraged either.

I agree with your first paragraph. There really is a bigger picture here and like it or not, it impacts thouse of us who made GOOD financial decisions if we do not bail out the bad apples. I don't want to see my neighbor's house go into foreclosure. This would impact me greatly.

For me, as a conservative (politically and financially), it is a very tough pill to swallow. However, I do see why it needs to be done. I struggle with this and want to say "Let those idiots who got themselves into this mess suffer, they don't deserve to own a home anyways!!!". However, that would be cutting off my nose to spite my face. I don't like it, but I understand it.

[Anonymous]

I don't think the OP or the early posters really understand the magnitude of what is going on. Look at this way. Your neighbor has a house that is a fire hazard. He can't afford to clean it up and he doesn't want to.

What do you do? Probably chip in and get it cleaned up.

But, what if your neighbors house was a fire hazard and you decided (because fire insurance had the same regulations as credit default swaps) that you WOULDN'T do anything about it, but buy fire insurance that would PAY YOU when his house burned down?

We had people betting against our economy. Unfortunately, the only option we have is to clean it up. If they exercise the stock injection option of the bail out, not only will the people/banks get bailed out, but we'll own their asses too! Make sure your congressman knows that you want that option exercised and this won't happen again!!!

[jsteele]

Anonymous wrote:
We had people betting against our economy. Unfortunately, the only option we have is to clean it up. If they exercise the stock injection option of the bail out, not only will the people/banks get bailed out, but we'll own their asses too! Make sure your congressman knows that you want that option exercised and this won't happen again!!!

Exactly right. I'm not sure most readers will understand exactly what you are saying so, let me add to it (not saying you guys never heard of Fannie Mae or Freddie Mac or anything like that, just that this is a bit complicated).

Originally, the Paulson plan aimed to buy the toxic debt, hold it for a while in hope that prices would recover, and then try to sell it. At best, this would make a profit, more likely it would simply cut losses, and at worst would be a total loss. However, the bill passed by Congress included authority to purchase stock in the companies rather than simply purchase debt. Buying stock provides banks with the capital they need and gives tax payers an equity role in return. This is what has been happening in Europe. Paulson is now hinting that he will employ this option.

This is one case where having an old Goldman Sachs guy in charge is actually a good thing. In his former role, if Paulson could get his hands on someone in debt to Goldman, he would strip them bare and expel them to the wilderness. If he takes a similar approach toward the banks and financial institutions that got us into this mess, there will be a few executives getting what's coming to them.

On the ironic side, I understand that Castro (not sure if it was Fidel or Raul) got a laugh out of this plan, calling it "communism for the wealthy".

[Anonymous]

As one of those who previously admitted to being outraged, I don't deny the need to address the macro problems in the economy and get credit moving again. And I recognize that that we all share in the pain of mass foreclosures. BUT I'm not as persuaded by some of the PPs that most of the people who can't afford their mortgages were victims - some were, undoubtedly, but I think they are the minority. Many of us - maybe even most of us - said no to the risky deals and easy money, not because we were somehow more sophisticated about the housing markets but because we don't take on debts we can't afford. The mortgage bailouts should be reserved for those who can prove they were scammed, or if the debt principals are going to be readjusted based on current value, that should apply to all homeowners. The proposition that everyone should stay in their house irrespective of their ability to afford it will not stabilize our economy.

[Anonymous]

The mortgages are really just the tip of the iceberg. Don't allow yourself to be distracted by that. They were the final feather on the tons of risk that had already been committed in the financial system.

The radio show "This American Life" did an excellent and entertaining job of explaining what the real "financial weapons of mass destruction" were. You can hear it on their site thisamericanlife.org. It is the most recent episode. You'll laugh, you'll cry and you'll come away with a much better understanding of the situation, which in turn, should help you when you have to make decisions on how to deal with it.

[Anonymous]

The proposition that everyone should stay in their house irrespective of their ability to afford it will not stabilize our economy.

It is in any consolation, I believe the people who participate in the mortage refinancing will have to re-qualify. So those who bought well outside their means will (hopefully) remain screwed. I think those who will likely get help will be those who could afford the inital loan terms, but not the skyrocketing rates associated with some "creative" loans. Yes, it is still unfair, but as others have stated, we need to prevent some of these foreclosures from happening.

[Anonymous]

Anonymous wrote:As one of those who previously admitted to being outraged, I don't deny the need to address the macro problems in the economy and get credit moving again. And I recognize that that we all share in the pain of mass foreclosures. BUT I'm not as persuaded by some of the PPs that most of the people who can't afford their mortgages were victims - some were, undoubtedly, but I think they are the minority. Many of us - maybe even most of us - said no to the risky deals and easy money, not because we were somehow more sophisticated about the housing markets but because we don't take on debts we can't afford. The mortgage bailouts should be reserved for those who can prove they were scammed, or if the debt principals are going to be readjusted based on current value, that should apply to all homeowners. The proposition that everyone should stay in their house irrespective of their ability to afford it will not stabilize our economy.

I agree with you and have vehemently posted that I think people who took loans they could not afford were complete morons-no matter the reason, unless you have an IQ of a handicapped person or are elderly losing your mind, there simply is NO EXCUSE for not reading the truth in lending disclosure.

However, I understand why we need to bail people out. I'm selfish. I want to minimize the damage to ME, a financially responsible person. I want to secure MY property value. I don't think these people DESERVE anything, but in the same breath, I don't want to be effected any more than I already have been. Frankly, I'm very angry at ppl who are short selling and losing their homes. I think they suck and never deserve to own a home again unless they can produce significant sums of cash to do so in the future.

[Anonymous]

Anonymous wrote:I agree with you and have vehemently posted that I think people who took loans they could not afford were complete morons-no matter the reason, unless you have an IQ of a handicapped person or are elderly losing your mind, there simply is NO EXCUSE for not reading the truth in lending disclosure.

However, I understand why we need to bail people out. I'm selfish. I want to minimize the damage to ME, a financially responsible person. I want to secure MY property value. I don't think these people DESERVE anything, but in the same breath, I don't want to be effected any more than I already have been. Frankly, I'm very angry at ppl who are short selling and losing their homes. I think they suck and never deserve to own a home again unless they can produce significant sums of cash to do so in the future.

Maybe you could all do a tour of homeless shelters screaming at the morons about how much more responsible you are than them?
Would that make you all feel better?

[Anonymous]

Anonymous wrote:

Anonymous wrote:I agree with you and have vehemently posted that I think people who took loans they could not afford were complete morons-no matter the reason, unless you have an IQ of a handicapped person or are elderly losing your mind, there simply is NO EXCUSE for not reading the truth in lending disclosure.

However, I understand why we need to bail people out. I'm selfish. I want to minimize the damage to ME, a financially responsible person. I want to secure MY property value. I don't think these people DESERVE anything, but in the same breath, I don't want to be effected any more than I already have been. Frankly, I'm very angry at ppl who are short selling and losing their homes. I think they suck and never deserve to own a home again unless they can produce significant sums of cash to do so in the future.

Maybe you could all do a tour of homeless shelters screaming at the morons about how much more responsible you are than them?
Would that make you all feel better?

I do not feel sorry for them. Nope. Not able bodied people who made poor and gluttonous financial choices-they are now reaping what they sewed. I feel sorry for their children. I also feel sorry for all of the other people who will be losing their jobs and might end up in shelters in part because of people's poor personal finance decisions. In the case of substance abuse, mental illness, elderly, or retardation, yes, I feel sorry. But, do I feel sorry for someone who purchased a 400K home with an 80K income? No, I cannot squeeze out one tiny tear. I cannot muster up one ounce of sympathy. I also do not feel sorry for the banks or the CEOs or the brokers or the real estate agents.


Why would I scream at them? They must be smart enough to realize they already f'ed up, or at least I HOPE they are smart enough now. I feel sorry for everyone else who has to bail them out. I feel sorry for renters who stood on the sidelines and are now being adversely effected by this. I feel sorry for people who lived modestly and within their means who now have to bail them out. I feel sorry for the taxpayers who had nothing to do with this and are now being impacted. That is who I feel sorry for.

[Anonymous]

I know of a couple who is about to have their home foreclosed. The reason why ...... they no longer want to live in the greater DC area. They are not being transfered- both employed - just don't want to live here any longer. They can't afford to sell it as they will need to bring $$ to closing if they could find a buyer. So they stopped making payments a few months ago. (living rent free).

Can they afford the payments - probably. Right now there appears no stigma associated with foreclosure so they think - why not, others are doing it.

When I heard this I could not believe my ears - but this is some of the entitlement mindsets of individuals today.

I am outraged at these individuals and society for creating an environment where this behavior is OK.

[Anonymous]

Anonymous wrote:I know of a couple who is about to have their home foreclosed. The reason why ...... they no longer want to live in the greater DC area. They are not being transfered- both employed - just don't want to live here any longer. They can't afford to sell it as they will need to bring $$ to closing if they could find a buyer. So they stopped making payments a few months ago. (living rent free).

Can they afford the payments - probably. Right now there appears no stigma associated with foreclosure so they think - why not, others are doing it.

When I heard this I could not believe my ears - but this is some of the entitlement mindsets of individuals today.

I am outraged at these individuals and society for creating an environment where this behavior is OK.

Oh, I can top that. My neighbor across the street from me is a realtor. A REALTOR! Keep this in mind when reading the rest of my story. They bought at the peak of the bubble, and paid almost $600K for their 4 bdrm home in Loudoun county. Doing fine, lots of expensive toys for the kids, two cars, mom stayed home, etc. Well, the housing market started to decline, and the realtor dad realized he'd never make his money back. So they bought another house AROUND THE CORNER, lying on the app saying they had a renter for their existing house, and stopped making payments on the first home. Meanwhile, they renovate the second home (painting, hardwoods, adding a full fence) a block away so we all see what they are doing. We, the neighbors, didn't really get what they were doing until the foreclosure notice was stuck on the door.

So, he managed to buy the same model of house he had for only $420K, walk away from the one he paid $600K for with no money down, and because he got into the new house before foreclosing his first house, now he just has to stay put for the next 7 years until it falls off his credit. I'm not sure how he got the second mortgage, he's a realtor and I'm sure he knew some loopholes or financed it under his mother's name somehow. But the point is, he scammed the system and deliberately walked out on the first home for the second, to hell with his credit and the property values.

Oh, and when the new neighbors moved in, they said the family trashed the inside of the house! WTF? They willingly let it go into foreclosure to get out of an underwater deal. Why the bitterness to the bank and the new owners?! It makes my blood boil every time I drive past the new house this family bought, one block over. The NERVE of that man to stay in the same neighborhood.

[Anonymous]

The market pulled back in the late 80's. No one got a bail out then. Lots of my friends lost back then. Why not bail everyone out?

[Anonymous]

Anonymous wrote:

Anonymous wrote:I know of a couple who is about to have their home foreclosed. The reason why ...... they no longer want to live in the greater DC area. They are not being transfered- both employed - just don't want to live here any longer. They can't afford to sell it as they will need to bring $$ to closing if they could find a buyer. So they stopped making payments a few months ago. (living rent free).

Can they afford the payments - probably. Right now there appears no stigma associated with foreclosure so they think - why not, others are doing it.

When I heard this I could not believe my ears - but this is some of the entitlement mindsets of individuals today.

I am outraged at these individuals and society for creating an environment where this behavior is OK.

Oh, I can top that. My neighbor across the street from me is a realtor. A REALTOR! Keep this in mind when reading the rest of my story. They bought at the peak of the bubble, and paid almost $600K for their 4 bdrm home in Loudoun county. Doing fine, lots of expensive toys for the kids, two cars, mom stayed home, etc. Well, the housing market started to decline, and the realtor dad realized he'd never make his money back. So they bought another house AROUND THE CORNER, lying on the app saying they had a renter for their existing house, and stopped making payments on the first home. Meanwhile, they renovate the second home (painting, hardwoods, adding a full fence) a block away so we all see what they are doing. We, the neighbors, didn't really get what they were doing until the foreclosure notice was stuck on the door.

So, he managed to buy the same model of house he had for only $420K, walk away from the one he paid $600K for with no money down, and because he got into the new house before foreclosing his first house, now he just has to stay put for the next 7 years until it falls off his credit. I'm not sure how he got the second mortgage, he's a realtor and I'm sure he knew some loopholes or financed it under his mother's name somehow. But the point is, he scammed the system and deliberately walked out on the first home for the second, to hell with his credit and the property values.

Oh, and when the new neighbors moved in, they said the family trashed the inside of the house! WTF? They willingly let it go into foreclosure to get out of an underwater deal. Why the bitterness to the bank and the new owners?! It makes my blood boil every time I drive past the new house this family bought, one block over. The NERVE of that man to stay in the same neighborhood.

I may be wrong but I do think a foreclosure will stay on your record for ten years. Hopefully that is the case for your neighbor.

[Anonymous]

I want to address a few comments. First 9:38. I am in foreclosures. I work with the banks and assess "value" to homes that are about to foreclosure. I also list distressed properties and work with homeowners in distress to try to re-negotiate terms or negotiate with the bank on short sales.

9:38, what you are describing has become increasingly common. There is a term for this called "buy and bail". It is an OUTRAGE and these people should be jailed. I personally think it is fraud and should be considered a felony. These people are pretending that they are renting out their original house the then stop the payments when they close on their new home. Banks have caught onto this scam. So, if you are planning on "renting" out your primary home and moving into a new home, you now have to have up to 30% equity on the original home. So, if you neighbor tried this today. Here is what his situation would look like today if he tried this:

-Original Home purchased at 600K
-Current value of original home 420K
-He would not be able to qualify for a second loan unless his original loan was paid down by 30%, which would allow a max loan value of 294K
This removes the incentive to try this scam (AKA FRAUD).

In addition to ppl having balloon loans and adjustable loans they cannot afford, there are people perfectly capable of paying their mortgage and simply walking away from their homes b/c they now have negative equity.

People should be mad, they should be real mad at these people. It is disgusting and immoral behavior. From my vantage point working with these scumbags on a daily basis and cleaning up their mess, there are not words to describe my disgust for these parasites.

Excuse my grammar and moments of incoherence in this post. Its hard to put words together when this topic comes up, as I get very angry. If you worked my job, you would need to take 2 showers just to clean the filth off your body after a day at work.

[Anonymous]

Anonymous wrote:I want to address a few comments. First 9:38. I am in foreclosures. I work with the banks and assess "value" to homes that are about to foreclosure. I also list distressed properties and work with homeowners in distress to try to re-negotiate terms or negotiate with the bank on short sales.

9:38, what you are describing has become increasingly common. There is a term for this called "buy and bail". It is an OUTRAGE and these people should be jailed. I personally think it is fraud and should be considered a felony. These people are pretending that they are renting out their original house the then stop the payments when they close on their new home. Banks have caught onto this scam. So, if you are planning on "renting" out your primary home and moving into a new home, you now have to have up to 30% equity on the original home. So, if you neighbor tried this today. Here is what his situation would look like today if he tried this:

-Original Home purchased at 600K
-Current value of original home 420K
-He would not be able to qualify for a second loan unless his original loan was paid down by 30%, which would allow a max loan value of 294K
This removes the incentive to try this scam (AKA FRAUD).

In addition to ppl having balloon loans and adjustable loans they cannot afford, there are people perfectly capable of paying their mortgage and simply walking away from their homes b/c they now have negative equity.

People should be mad, they should be real mad at these people. It is disgusting and immoral behavior. From my vantage point working with these scumbags on a daily basis and cleaning up their mess, there are not words to describe my disgust for these parasites.

Excuse my grammar and moments of incoherence in this post. Its hard to put words together when this topic comes up, as I get very angry. If you worked my job, you would need to take 2 showers just to clean the filth off your body after a day at work.

WHERE and HOW do I report my neighbor? I would love to see him charged with a felony.