short sell and rent to get out of other debt or hold on and wait it out? - Page 11

[dinahx]

I guess so.

[La Sombra]

Originally Posted by mnnice

I don't think you can peg that all on predatory lending and frankly am a bit irritated/find it a bit racist at the implication that african americans are too stupid to find a good loan. There are differences in resources that among middle class whites and middle class African Americans (I'm pretty sure that the odds that white Americans have more affluent relatives that can help them out are higher). Maybe more African Americans live in areas that have been hard hit in this recession?

I think about the old correlation is not causation expression fits here very well.

Ah, I didn't want to jump back into the fray here because I have really concluded that I'd rather reach out to those who are in this situation and know how excruciating it is than beat me head against the wall trying to convince people of my feelings and point of view, yet, mnice, I couldn't let this go uncorrected:

Whoa, no, you are TOTALLY MISSING THE POINT HERE. The point is that people who are victims of predatory lending are NOT stupid (greedy, immature or any of the other words that have been tossed around here)! If you'd listened to/read the piece, you'd have learned that African Americans were disproportionately targeted for sub-prime loans--even upper-middle class African American families that could have qualified for a traditional loan NOT because they were themselves stupid but because they were taken advantage of by predatory and apparently racist lenders. The point that I think many of us are trying to make here that I think some of you are missing is that the mistake many people made was NOT being greedy or cavalier but was in trusting the "experts" who sold them their loans.

"2009 may also go down in history as the year that more African Americans fell out of the middle class than any other time in our nation's past. Best estimates are that African American homeowners are 2-1/2 times more likely to be in foreclosure than their white counterparts. At that rate, more than a million African American homeowners will lose their home in the next four years. That's one in every five."

These people were indeed NOT stupid but were instead hopeful that they could join the middle class in living the American Dream like many of the pps here.

If a woman goes out walking on a dark street at night and gets assaulted, you don't blame the woman. The same is true here. Maybe some of us are guilty of naivete. But that doesn't excuse a system that deliberately exploited our trust and our dreams for a bright future.

Well, the inauguration yesterday left me, for one, feeling full of hope and motivation and a feeling of brotherhood so once again...my heart goes out to everyone who is suffering during these scary times but I believe that things will change! Good luck to you and your families and your neighbors.

[dinahx]

I agree, the pitch goes like this:

Hmmm, with your credit, work history, general scumbagginess, the ONLY loan you will qualify for anywhere is this (predatory) one. Also, you will be able to afford the MOST house this way, and since houses appreciate x percent per year around here, more house means more equity faster. Which means moving up to a house you really like (since the ones a price range above are always WAY better). My mortgage brokers literally acted SHOCKED and appalled when I decided to demand a fix rate and get three estimates. Like WHY would you do that?

Just saying, it was dang tricky!

[grniys]

I honestly don't see the whole "blame the banks" thing when you buy a house you no longer want/ can't afford/ "lost" money on. To me it seems like racking up credit card debt and then blaming the cc company for charging you a lot of interest. You (general you, not aimed at a specific poster) agreed to the terms by taking the credit... whether in the form of a mortgage or by going out and charging things on a credit card. Now you (again, general you) have to live up to the end of your bargain. ETA: And if you don't understand something DON'T SIGN AND TAKE THE MONEY! Ignorance is NOT an excuse!

And yes, I do understand that circumstances change, and I totally understand when someone has to foreclose because they have no other options. But to walk away just because you have a plan or a dream for your life and the house is tying you down? That's just irresponsible and selfish, imo.

[Sonnenwende]

Originally Posted by grniys

. But to walk away just because you have a plan or a dream for your life and the house is tying you down? That's just irresponsible and selfish, imo.

Yep. This is one of the reasons renters should not be sucked into all the hype surrounding buying. Renting is not throwing money away if your overall financial, job, or lifestyle situation does not support buying. It is the smart move to keep renting.

[The4OfUs]

I had made a post, but apparently it was eaten, re: the long term vs short term investment view of buying a house. We didn't buy a house until we were sure we were going to be in it for at least 10 years (based on our family planning ideas looking at school districts, and job/careers getting stabilized looking at commute times), because we didn't trust the market to be stable/increase over the short term and wanted less of a chance of getting screwed. We rented for the first 8 years we were married even though we could have probably afforded a small house as DINKs in a low COL area. I guess I just don't see buying a home as 'the next step', but as something that you do when you are ready to set down roots and be in a place for the next 10+ years. Buying just to buy a house to have the "American Dream" and wagering that the value will go up in a few years and you'll make out when you want to move/upgrade is a really risky way to view homeownership, IMO. And I know of several people IRL who have done that...bought a house they knew they weren't going to stay in for more than a few years, and then sold/upgraded and now are really, really stretched to the limit. It almost seems as if this is another symptom of the increasing disposable, impermanent nature of the society...but that may be the topic of another discussion.

**requisite disclaimer that the above does not apply to situations where sudden unexpected circumstances are thrust upon a family and you can no longer afford the payments, need to move for emergent reasons, or the neighborhood becomes dangerous, etc. This is about people who buy a house expecting to sell/move/upgrade after building equity in 5 years or less, trusting that teh market will increase - that just seems very short sighted and inherently risky IMO.

[The4OfUs]

Originally Posted by Sonnenwende

Yep. This is one of the reasons renters should not be sucked into all the hype surrounding buying. Renting is not throwing money away if your overall financial, job, or lifestyle situation does not support buying. It is the smart move to keep renting.

Or, I could have skipped reposting and just said, : to this.

[La Sombra]

Originally Posted by grniys

I honestly don't see the whole "blame the banks" thing when you buy a house you no longer want/ can't afford/ "lost" money on. To me it seems like racking up credit card debt and then blaming the cc company for charging you a lot of interest. You (general you, not aimed at a specific poster) agreed to the terms by taking the credit... whether in the form of a mortgage or by going out and charging things on a credit card. Now you (again, general you) have to live up to the end of your bargain. ETA: And if you don't understand something DON'T SIGN AND TAKE THE MONEY! Ignorance is NOT an excuse!

And yes, I do understand that circumstances change, and I totally understand when someone has to foreclose because they have no other options. But to walk away just because you have a plan or a dream for your life and the house is tying you down? That's just irresponsible and selfish, imo.

No, no, this foreclosure mess is not about a pandemic of people who decided their houses were "tying them down!" You can give examples of individual cases where this was true but what I urge is to look at the big picture of this mess and talking about how and why it happened. Individual responsibility must play a part, but I think that anyone who does not see how much bigger and more complex this crisis is than just people who decided they didn't feel like living in their houses anymore needs to learn more about it. If we don't acknowledge that, we are simply trading anecdotes, preaching to the choir of people who are not themselves facing foreclosure and making sophomoric arguments that don't illuminate the topic and that get us nowhere.

A pp linked to a This American Life special on the housing crisis that I think would be a great primer for someone looking for details (and varying viewpoints) on how this whole thing happened.

[grniys]

Originally Posted by DianeAK

No, no, this foreclosure mess is not about a pandemic of people who decided their houses were "tying them down!" You can give examples of individual cases where this was true but what I urge is to look at the big picture of this mess and talking about how and why it happened. Individual responsibility must play a part, but I think that anyone who does not see how much bigger and more complex this crisis is than just people who decided they didn't feel like living in their houses anymore needs to learn more about it. If we don't acknowledge that, we are simply trading anecdotes, preaching to the choir of people who are not themselves facing foreclosure and making sophomoric arguments that don't illuminate the topic and that get us nowhere.

A pp linked to a This American Life special on the housing crisis that I think would be a great primer for someone looking for details (and varying viewpoints) on how this whole thing happened.

Where did I ever say the foreclosure mess was caused only by the ones walking away from their homes by choice? I'm just saying it's not right for them to do so now. I KNOW that this is a complex situation. Really, I'm not ignorant. But people deciding they don't want to live in their homes because they've lost value or they feel "cheated" by the banks still isn't right.

[La Sombra]

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