31–40 of 194 posts
OK - The 'web' search/link isn't working for me anymore. Maybe it's time to start rethinking WSJ submissions. Based on the first paragraph, this is the exact same article: http://www.msn.com/en-us/money/realestate/loan-boom-echoes-s...
> Are paywalls ok?
> It's ok to post stories from sites with paywalls that have workarounds.
What about sites that don't have workarounds? The workaround for WSJ no longer works.
Even if it is, it doesn't seem like as big a tragedy if the bank seizes your solar array as of they seize your home.
Seems like an example of how it's easy to be "fastest growing" when something is really small. These loans started about five years ago and the cumulative amount loaned is about $3.4 billion. Most of the activity has been in the past year, so of course the rate of growth is over 100%. But the absolute numbers are utterly tiny. For perspective, subprime loans peaked at over $600 billion per year, and total mortgages o…
Earlier quoted context omitted.
> We're going to keep going from crisis to crisis because banks can't say no, and the government(s) deems them too big to fail Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. The elderly woman in the article initially refused the $50k renovation to her 5 bedroom home, but then agreed because she thought the government was going to subsidize it for her. Th…
> Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. I think that is blaming the victim. As the article says, you have repair people describing the terms of the loan to people. If they don't understand what they're selling (and I'm sure they don't) then how can you expect the average person to? Not to mention the pressure selling that is probably being used…
Moreover, why would they even want to understand? The loan disbursement will be going directly into to their pockets. The incentives are shockingly perverse all around.
As a real estate investor, I lick my chops when I see news like this. But as a human being it's so terrible to see happen over and over again. Watch "The Big Short" if you haven't - everything will crash again.
Earlier quoted context omitted.
> We're going to keep going from crisis to crisis because banks can't say no, and the government(s) deems them too big to fail Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. The elderly woman in the article initially refused the $50k renovation to her 5 bedroom home, but then agreed because she thought the government was going to subsidize it for her. Th…
> Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. I think that is blaming the victim. As the article says, you have repair people describing the terms of the loan to people. If they don't understand what they're selling (and I'm sure they don't) then how can you expect the average person to? Not to mention the pressure selling that is probably being used…
I'm not sure if it's what roymurdock meant, but there's a nugget of truth to what he said. People did take on loans that they never planned to pay off personally. They saw the relentlessly upward trajectory of home prices and wanted to benefit. They took on loans with the intention of refinancing or selling the home a few years down the road. It wasn't an intention to defraud anyone, but it was definitely an attempt to get something for nothing. Just because they were trying to copy others who'd made large profits buying and then later selling their homes doesn't make it not greedy behavior.
Earlier quoted context omitted.
> We're going to keep going from crisis to crisis because banks can't say no, and the government(s) deems them too big to fail Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. The elderly woman in the article initially refused the $50k renovation to her 5 bedroom home, but then agreed because she thought the government was going to subsidize it for her. Th…
> Consumers can say no, and if they had better financial education and/or financial prospects, maybe they would. I think that is blaming the victim. As the article says, you have repair people describing the terms of the loan to people. If they don't understand what they're selling (and I'm sure they don't) then how can you expect the average person to? Not to mention the pressure selling that is probably being used…
Is the book in the US generally stacked towards originators? Certainly, as I argue, with financial literacy being so low, most home-owners wanting to do anything to avoid moving, and family/community ties dissolving. Hell, I went to business school and read 10Ks for a living, and can still barely manage to figure out all the terms and conditions on my credit cards.
I just want to point out that alternatives (usually uncomfortable, but often necessary) do exist to taking on opaque loans.
How does someone get into a situation where they are "leveraged to their eyeballs with rents"? Sometimes it's purely out of necessity (need to be close to sick family, within commuting distance of work, keeping a rent controlled unit) but otherwise most people in the US generally have a choice of where to live and how much to pay in rent. I could live in the city and pay 1.5x what I'm paying now to live in the suburbs in an unorthodox situation, but I don't because then my rent would be >30% of my annual income.
Maybe I'm wrong and I'm one of the lucky, shrinking few who still has this option, the option of mobility than once made the US great? Because I'm young and employable?
Also, if a homeowner considers their home an "investment" that means they should be willing to liquidate that investment at some point when it makes financial sense to do so. People get sentimentally attached to their homes, which is not true of most "good" (read: fungible/liquid) investments.
We're definitely both against fraud, but unfortunately these government programs that make life better for some by subsidizing mortgages, home renovations, tuitions, etc. can and will always be gamed by unscrupulous individuals. Question is - is the payoff to society (higher homeownership, literacy, energy efficiency) worth it?
Seems like an example of how it's easy to be "fastest growing" when something is really small. These loans started about five years ago and the cumulative amount loaned is about $3.4 billion. Most of the activity has been in the past year, so of course the rate of growth is over 100%. But the absolute numbers are utterly tiny. For perspective, subprime loans peaked at over $600 billion per year, and total mortgages o…