patrick.net

@Tenouncetrout

There is no reason why the FHA guidelines that allow home ownership for every one in America that can show a credit standing and have a job can have a resource to borrow from. Other than banks that would want a greater chunk down and a charge a higher interest rate. Which would only serve to creating further hardship, to pay back the loan.

Ok, say that again but this time do it in English...it sounded like you were on to a very good point but then your ramblings lost me again?

@BAP

I humbly disagree 100% with this post if you are talking about the central valley of California. Since RE is local, I submit that in the future such statements have an area specific to the statement so valid numbers can be found. Here in the central valley of mexifornia you will not find a 20% DP loan on ANY new house, investment house, or whatever house since 1999 …. many of the central valley hispanic homebuyers where cultivated by greedy REwhores and LiarLenders, creating a whole bunch of buyers that would never qualify for a loan (of any type) without some illegal Lender activity ….. The rest were just greedy sheeple that make for stupid buyers, and the last stupid buyer has yet to buy, do not forget that … the last stupid buyer is getting ready to fall for the gov supplied bait.

LOL.....I will trade you 8K for 100K in equity?

@cashmonger

How many times can all of us go over the same old sh*t over and over again? I’m roughly 6 months into my involvement on Patrick.net and picked up loads of great information on here, but posts like this show up every week and the same things are repeated over and over and over and over again.

Well, most of us actually come to this forum to discuss housing. We could try talking about golfing but I dont think most are interested in that, my suggestion is that if you see a post you dont like...move on and find one you do like.

@Bap33, you speak of your beloved Central Valley so affectionately - who do you stay there? I’m sure the reasons are many and possibly complex, but why don’t you cut your losses and move to an area of California or even to a different state that makes more sense for you? When I first moved to California in 1999, I lived down in Bakersfield – a town very analogous to Merced. I had a great paying job and bought a brand new house in the year 2000 for $75 sq/ ft. After living a very comfortable life there for 7 years, the mrs and I decided to have kids. One day while she was still pregnant, I woke up and looked around and said out loud, “F*uck this – this isn’t living.” I was honest with myself for once and realized what was around me. I decided on that day that I would not raise my kids in a county where the teen pregnancy rate was at or near the highest in the state, nor would I settle for having my kids go to schools where the English-speaking households were the minority. I found a new job in a significantly “whiter” area and moved. I took it in the shorts financially for a while, but now after 5 years I can honestly say it was the best decision I ever made. My happiness parlayed itself into career/finanical success. I’m happy when I drive around the area I live in – I rarely see suspected illegal immigrants and very rarely hear Spanish spoken freely and loudly in public. The neighborhoods you describe do exist, albeit far away in pockets and not in every square mile. The schools are some of the best in the state.

I love the "whiter" statement, it shows that you possess a limited vocabulary and most likely a limited education. The color of a person's skin does not dictate the housing market nor their pride in ownership. Pride in ownership is directly related to their education level and the economic ability of the buyer to maintain the property and uphold decency standards. I can take you to some trailer parks in the south that are much worse than the central CA area you are referring to. Next time try using words like "higher socio-economic status" and move away from simple words like "whiter"....it shows more class. But then again, I am also a supporter of tougher immigration laws:

1. If you migrate to this county, you must speak the native language
2. You have to be a professional or an investor. No unskilled workers
allowed.
3. There will be no special bilingual programs in the schools, no
special ballots for elections, all government business will be
conducted
in our language.
4. Foreigners will NOT have the right to vote no matter how long they
are here.
5 Foreigners will NEVER be able to hold political office.
6. Foreigners will not be a burden to the taxpayers. No welfare, no
food
stamps, no health care, or other government assistance programs.
7. Foreigners can invest in this country, but it must be an amount
equal to 40,000 times the daily minimum wage.
8. If foreigners do come and want to buy land that will be okay, BUT
options will be restricted. You are not allowed waterfront property.
That is reserved for citizens naturally born into this country.
9. Foreigners may not protest; no demonstrations, no waving a foreign
flag, no political organizing, no badmouthing our president or his
policies, if you do you will be sent home.
10. If you do come to this country illegally, you will be hunted down
and sent straight to jail.
Harsh, you say? The above laws belong to the immigration laws of
MEXICO!

@cashmonger

I’m happy when I drive around the area I live in – I rarely see suspected illegal immigrants and very rarely hear Spanish spoken freely and loudly in public.

I think we agree on the same points, I just want to make the point that we cannot focus on specific groups of people as this is a socio-economic issue.

Your issue seems to be rooted in the fact that these people EITHER have 1) a different skin color 2)chose to NOT assimilate into American society and 3) have forced their language and culture upon us. I can agree that it does not sit well with me that English is becoming secondary language of choice for jerks that come to our country, however, the same things were not said of the Irish, Italian, Jewish peoples that came here in the early 1900's. Actually, the early settlers of Irish, Jewish and Italian peoples displaced former African slaves from working industrial jobs during that era. Africans had been here 400 years yet jobs were given to the new settlers of Irish, Jewish and Italian descent. I doubt that anyone would make the same statement if the neighborhoods were dominated by a group of Irish, Italian immigrants speaking their native tongues. Take note, that as these generations pass so too did their Italian, Irish cultures and language. The same is happening with Mexican immigrants as well, if you dont believe me just walk up to one and start speaking Spanish...I guarantee they will respond in English.

In 'State of Emergency' Pat Buchanan stated:

“ America did not listen [to Booker T. Washington’s concerns]. Millions of jobs in burgeoning industries went to immigrants who poured into the United States between 1890 and 1920. These men and women enriched our country. But they also moved ahead of and shouldered aside black men and women whose families had been here for generations and even centuries. Not until immigration had been dramatically cut in the Coolidge era, and World War II created an all-consuming demand for industrial workers, were black Americans brought by the hundreds of thousands north to the manufacturing cities of America. And when they were, a Black middle class was created upon which the civil rights movement was built. When immigration stopped, Black America advanced, as Frederick Douglass, Booker T. Washington, and A. Philip Randolph said it would “

I put quotes around it Forex in order for me to be able to say that I didn't really mean it and/or claim sarcasm (more sarcasm here). I grew up in the south and am very familiar with the folks you described. You are right - it is more a socio-economic desire than it is anything color related. I think we all know that. Consider the post I was responding to though...

Housing is good thing to talk about in a housing forum, but we keep resetting the same stuff over and over again.

elliemae says

Yea - but Techie, you might not have been able to get THAT house if you’d waited. I think I recall how much you and the wife loved it. I sincerely hope that you are enjoying the place.

Funny thing is there even nicer houses going for less money in my area now. I really wanted to wait longer, but the house had everything we wanted and you should have seen some of the crap we seen people wanted 350k for. I'll admit it was a mistake to buy so early in the housing collapse, I'm lucky if I have any equity in the house right now, but I'll live with the mistake and not blame the bank or the realtor. The wife isn't happy with the bills or the fact we don't the the cash to make improvements she wants but she's accepts the reality we have now.

A professional should have more experience, he is being paid for his expertise and training. Those include banks, lenders, realtors, government agencies, the federal reserve, congress, etc. Everyone played a part in the housing boom and bust. Every person had some responsibility in it. There are several people who stood up and said there was a problem, but many didn't. The problems compounded and created the situation we're in today.

That being said, the guy in the story might have used several factors in making his buying decision.
1) The market had moved away from what he could afford, so he bought what he could afford. That being in a neighborhood that wasn't quite as desirable as he had thought. I'm sure he expected "issues" but not multiple break ins. I'm sure there are other issues with that neighborhood that he didn't have experience with and didn't realize would be an issue for him. I think it would be fairly reasonable to assume that a neighborhood going up in value at the pace it was back then, would likely push trouble out as well. If he could afford the place, then how could someone less economically fortunate afford that those places? As they sold, they would be pushed out. That is fairly reasonable to assume.

2) Property has been a very stable investment and almost always helped people with retirement. Someone mentioned "how does it help? an atm machine?" I say: If your retirement savings aren't sufficient and/or rents increase faster than you can afford you will be pushed from your rental property to who knows where. If the retiree had owned he would not have experienced this. He might not have some big wad of cash to pull from, but then again he doesn't have rent to pay. If they had a huge wad of cash and just before retiring it was all "lost", they would still have to cover rent. If their housing value crashed then they would still be left with nothing, but rent would be covered.

3) He was in a non-recourse loan (hopefully??). If everything failed him, he had one option he could employee himself to stop his losses and get out. If the banks and others involved failed to foresee a time when this option could be employed, that is their fault. They took a gamble, and like him are starting to lose out.

Now he is looking at pulling that trigger and before he does, he is saying "What other options do I have, what can I do?" For him, it's probably the right decision to make. It is his right, and part of the process that was used to get him into the house. No one probably expected him to use it, but it was there for him.

That being said, it could be said he is doing a socially responsible thing in some views. He is asking how he could avoid pushing the dooms day button, which will doom the bank to a massive loss, will push him into moving, but will also hurt others who are going to be effected by more inventory on the market, potentially higher rates for them to cover those losses, and the neighborhood potentially loses a "good" resident of that neighborhood.

And to finish up, I saw a great comedian the other week. "Immigrants are coming here, not knowing our language, they can't write, they can't read, they have little education, and few skills if any. If they're stealing your job, you're a retard."

I think we're all reading a bit more into it than exists. It looks like poor choices on their part and they want to bail. If their home had appreciated, they wouldn't want to share the profits with the bank...

In the bubble, the only people doing the correct thing was sellers. They kept pushing for more and more in their asking prices. Sellers could get away with pushing prices up and up and up only because there were lenders willing to finance those higher prices. Buyers are left with two options: 1) reject financing, stay out of the market, and more than likely rent or 2) compete against buyers who are being financed with huge sums of bank money by financing with huge sums of bank money.

Should buyers have taken out Sub-prime, Option ARMS, Alt-A loans with housing to income ratios of 10:1? No.

Should banks be expecting the money they loan out back with interest over the course of the Sub-prime, Option ARMS, Alt-A loans and with housing to income ratios of 10:1? No.

Who's primarily at fault? Well, last time I checked people who worked for banks are supposed to know what the heck they are doing. If somebody has seen a bank commercial saying, "Come borrow money from us, we are a bunch of idiots who don't know a dollar bill from a hole in the ground," please someone point it out on You Tube. I'd like to see it. Even worse, by pushing up housing prices through short sighted financing, the banks endangered their prime borrowers by forcing them to compete with sub-prime borrowers.

Sure the borrowers should not have borrowed the money. But, if you are a tow truck driver, your job, 40+ hours a week is to tow. If you are Wal-mart stocker, your job 40+ hours a week is to stock. If you are a banker, guess what...your job is to manage money.