Thread: Why is the deficit so big?

Originally Posted by danzik17

I was pre-approved for a mortgage far larger than I should have been. The banks reasoning was that my debt to income ratio extremely good, therefore I was eligible for such a loan.

Nevermind the math I did that stated I could do that......if I lived off of ramen noodles and didn't go anywhere. But hey, I'd have a house right?

So, you didn't take the bigger house, Danzik? Good.

Originally Posted by Big Smoothy

So, you didn't take the bigger house, Danzik? Good.

I'm still looking. The area I live/work in is stupid expensive. For anything "decent" it's at least 250K+. Anything nice, you're into the mid 300's to 400.

^ May I as where? City?

Originally Posted by danzik17

I'm still looking. The area I live/work in is stupid expensive. For anything "decent" it's at least 250K+. Anything nice, you're into the mid 300's to 400.

Try living where a decent 2-3 bedroom is $600-750k....a 5 bedroom in a good neighborhood like mine $900k-1 million.... I keep telling my GF if we sold our house and moved to Texas we could buy 3 homes, live in one and rent the other 2....

Originally Posted by maniclion

Try living where a decent 2-3 bedroom is $600-750k....a 5 bedroom in a good neighborhood like mine $900k-1 million.... I keep telling my GF if we sold our house and moved to Texas we could buy 3 homes, live in one and rent the other 2....

True that, but the sunrises won't look the same. You live in paradise, a place i always wanted to see. hopefully i will in this lifetime.

ROFL... I love the way we have all the economic solvers on this web site.. Maybe you all should go apply for a position in the White House.

Originally Posted by maniclion

Try living where a decent 2-3 bedroom is $600-750k....a 5 bedroom in a good neighborhood like mine $900k-1 million.... I keep telling my GF if we sold our house and moved to Texas we could buy 3 homes, live in one and rent the other 2....

lol...you can find affordable and sensible housing anywhere if you want..nobody "has" to buy a 1million dollar house.

to truly be able to "afford" a 1milion house you have to be able to save up the 200K for the down payment AND have a good 4-6months P&I in cash reserves in the bank or another good 16-20k.

the majority of people that buy homes that expensive can not truly afford them and never plan on paying them off.

I've been doing mortgages off and on part time since '94. I can't tell you how many times me and my buddies in the mortgage biz re-financed people with homes that big that had NO money in the bank, no cash reserves and not the greatest furniture in the world...freaking perpetrators!

Originally Posted by Big Smoothy

^ May I as where? City?

Fairfield County in CT

Originally Posted by LAM

lol...you can find affordable and sensible housing anywhere if you want..nobody "has" to buy a 1million dollar house.

to truly be able to "afford" a 1milion house you have to be able to save up the 200K for the down payment AND have a good 4-6months P&I in cash reserves in the bank or another good 16-20k.

the majority of people that buy homes that expensive can not truly afford them and never plan on paying them off.

I've been doing mortgages off and on part time since '94. I can't tell you how many times me and my buddies in the mortgage biz re-financed people with homes that big that had NO money in the bank, no cash reserves and not the greatest furniture in the world...freaking perpetrators!

We're talking Hawaii here, even condo's average $150,000 for little more than a barracks like cube in an overcrowded building with little parking...

Thanks, Danzik.

Must be a nice Fall, there.

Originally Posted by maniclion

We're talking Hawaii here, even condo's average $150,000 for little more than a barracks like cube in an overcrowded building with little parking...

oh yea housing is a totally different story on any island. my parents have a massive condo for sale in St Croix that's listed for like 2M. can't imagine what condos' and homes with decent lots for go for out there...crazy money I'm sure.

Originally Posted by min0 lee

The Tea Party and Republican wingnut solution is to cut or eliminate Social Security and Medicare, Federal payments to the states, money for infrastructure and everything else that once made America work.

Did America stop working? I mean unemployment aside, if America doesn't work anymore, we should let people know. Maybe the illegals will all go back to their countries that still work.

And lol @ Social Security and Medicare making America great! What a fucking joke that is! Whatever did we do for the 161 and 190 years before those two social programs came along? How did people ever survive without social programs to take care of them?

lololololololol!!!!

Originally Posted by bmw

Did America stop working? I mean unemployment aside, if America doesn't work anymore, we should let people know. Maybe the illegals will all go back to their countries that still work.

And lol @ Social Security and Medicare making America great! What a fucking joke that is! Whatever did we do for the 161 and 190 years before those two social programs came along? How did people ever survive without social programs to take care of them?

lololololololol!!!!

you may want to check the history books. before social security in the 30's old people with no retirement were all over the streets. right now today in 2010 30% of the wage earners in the country can not save any money for retirement. do you have any idea what you are talking about?

Originally Posted by bmw

And lol @ Social Security and Medicare making America great! What a fucking joke that is! Whatever did we do for the 161 and 190 years before those two social programs came along? How did people ever survive without social programs to take care of them?

IMO, Medicare is a bigger threat to the United States than terrorism at the moment (and decades before) and possibly many years ahead in the future.

It's the elephant in the room politicians will not confront.

Most of the public is too ignorant and oblivious to even know about the issue.

And no, Min0, the Republicans do not want to really get rid of Social Security. Well, maybe privately, some do; many do. But it won't fly, and cause who-knows-what kind of chaos to the 77+ million boomers, hitting rolls NOW.

Originally Posted by LAM

you may want to check the history books. before social security in the 30's old people with no retirement were all over the streets. right now today in 2010 30% of the wage earners in the country can not save any money for retirement. do you have any idea what you are talking about?

I wasn't aware that American history only included the 1930's, a period when a quarter of the nation was all over the streets, regardless of their age. Great depression? Dust bowl? Come on.

Maybe those 30% could save money if they did things differently. Made different choices, ya know? No, we can't all be doctors, lawyers, CEO's, etc., but there are still opportunities out there and people are getting rich every day.

I made a lot of money in a previous job. I maxed my 401K, and invested in other places as well, and still lived well on 2/3 of what was left over. I saved the rest and am glad I did when that company laid me off and went out of business in 2008.

Others in my position were buying million dollar homes and $100,000 cars, all on credit and blowing whatever was left. I know people who were making half a million a year for 2-4 years who are broke and now making $60K. They lost everything. They could have lived for ten years or more without a job if they lived like I did when times were good.

Cost of living here is freaking cheap...you can get a new build, 1800sq ft, with a 1/2acre plot, in a good school district, for under 170k.

or move to the barrio and buy a 1800sq ft home for 50k

Originally Posted by bmw

Maybe those 30% could save money if they did things differently. Made different choices, ya know?

lol..typically heartless republican rhetoric...you may want to read up a LITTLE about sociology, education and economics...not everyone has the same choices

Originally Posted by LAM

lol..typically heartless republican rhetoric...you may want to read up a LITTLE about sociology, education and economics...not everyone has the same choices

meh, I'm not a repub., but should I say, "typical brainless, bleeding heart, knee jerk, democrat rhetoric"? Nah.

People have choices. They do. The stories of people who have risen to achieve great things coming from nothing are numerous...NUMEROUS! Why do you make it sound impossible?

Do you believe the extreme leftist rhetoric that no one who isn't already rich can do anything to attain any level of financial stability? Really? Cuz it seems like you're doing your best to spread it. Like all the marxist/stalinists out there. Problem is, some people are starting to believe it, so they act on their beliefs. They think they'll never have anything just because they started off with nothing, so they'll blame everyone else and think everyone else owes them everything.

I don't pity anyone who thinks they are entitled to something for nothing.

Originally Posted by bmw

meh, I'm not a repub., but should I say, "typical brainless, bleeding heart, knee jerk, democrat rhetoric"? Nah.

People have choices. They do. The stories of people who have risen to achieve great things coming from nothing are numerous...NUMEROUS! Why do you make it sound impossible?

Do you believe the extreme leftist rhetoric that no one who isn't already rich can do anything to attain any level of financial stability? Really? Cuz it seems like you're doing your best to spread it. Like all the marxist/stalinists out there. Problem is, some people are starting to believe it, so they act on their beliefs. They think they'll never have anything just because they started off with nothing, so they'll blame everyone else and think everyone else owes them everything.

I don't pity anyone who thinks they are entitled to something for nothing.

like I said read up on sociology a little you obviously know nothing about it

Originally Posted by LAM

like I said read up on sociology a little you obviously know nothing about it

Seriously?

I expected better from you.

Originally Posted by bmw

Did America stop working? I mean unemployment aside, if America doesn't work anymore, we should let people know. Maybe the illegals will all go back to their countries that still work.

And lol @ Social Security and Medicare making America great! What a fucking joke that is! Whatever did we do for the 161 and 190 years before those two social programs came along? How did people ever survive without social programs to take care of them?

lololololololol!!!!

They barely survived, most of them were serfs who practically slaved for just enough food to feed their families....later they were farmers, miners or factory workers who all were lucky if they lived past 45, and usually they worked up until the last days....I'm talking about the common men, not the rare educateds back then who could save up some cash and retire early cause not everyone can win or else their wouldn't be enough winnings to go around....

Originally Posted by bmw

meh, I'm not a repub., but should I say, "typical brainless, bleeding heart, knee jerk, democrat rhetoric"? Nah.

People have choices. They do. The stories of people who have risen to achieve great things coming from nothing are numerous...NUMEROUS! Why do you make it sound impossible?

Do you believe the extreme leftist rhetoric that no one who isn't already rich can do anything to attain any level of financial stability? Really? Cuz it seems like you're doing your best to spread it. Like all the marxist/stalinists out there. Problem is, some people are starting to believe it, so they act on their beliefs. They think they'll never have anything just because they started off with nothing, so they'll blame everyone else and think everyone else owes them everything.

I don't pity any one who thinks they are entitled to something for nothing.

Why is it that the people at the top like CEO's who royally fuck up and jeopardize the welfare of all the employee's of a company get a golden parachute, while everyone else has their retirement funds depleted, lose their jobs, health insurance, etc....? Us workers bees need a safety net for when some higher up decides to screw everyone over....

Originally Posted by maniclion

Why is it that the people at the top like CEO's who royally fuck up and jeopardize the welfare of all the employee's of a company get a golden parachute, while everyone else has their retirement funds depleted, lose their jobs, health insurance, etc....? Us workers bees need a safety net for when some higher up decides to screw everyone over....

I agree. If you fuckup you should pay, not get paid. That's how it used to be. It should have been written into their contracts that if they fuckup they don't get their bonuses or severance, or they would get cuts from pensions, etc.

Let's bring that down a few levels (rewarding fuckups). Wifey and I bought a house we could afford, on a full doc loan (verified income and assets). We made our payments over the years, and we have equity (even kept equity through the RE crash). Now we contacted our lender about a loan mod to get our rate down from 6.25% (this was over a year ago). You know? Since all the people who were going into foreclosure because they bought homes they couldn't afford on stated income they didn't have, were getting bailed out of their home loans and having principal reductions on their homes they were upside down on?

"Have you missed payments?" No Mr. Lender, we've paid you every month on time, we're one of your best customers!

"Do you lack the ability to pay?" Nope! We were smart and saved money when times were really good. We have plenty in the bank and we should continue to be a good and faithful customer for many years to come.

"Sorry, we only reward those who lied to us in the beginning and knowingly bought homes they knew they couldn't afford. Responsible people such as yourself get nothing from us. We realize that by shafting you like this you will probably take your business elsewhere, but we are short sighted, and hope that you really are more like the typical consumer and will stay with us regardless. Nothing for you! You have to be delinquent with us to the point of foreclosure before we will reward you!"

We took our loan elsewhere. Refinanced to 4.625% with another lender. I remember the days when you rewarded loyalty and good behavior. My how I miss those days. Today we reward people with an entitlement mentality...after all they've been told by society and gov't that they in fact ARE entitled.

Originally Posted by bmw

I agree. If you fuckup you should pay, not get paid. That's how it used to be. It should have been written into their contracts that if they fuckup they don't get their bonuses or severance, or they would get cuts from pensions, etc.

Let's bring that down a few levels (rewarding fuckups). Wifey and I bought a house we could afford, on a full doc loan (verified income and assets). We made our payments over the years, and we have equity (even kept equity through the RE crash). Now we contacted our lender about a loan mod to get our rate down from 6.25% (this was over a year ago). You know? Since all the people who were going into foreclosure because they bought homes they couldn't afford on stated income they didn't have, were getting bailed out of their home loans and having principal reductions on their homes they were upside down on?

"Have you missed payments?" No Mr. Lender, we've paid you every month on time, we're one of your best customers!

"Do you lack the ability to pay?" Nope! We were smart and saved money when times were really good. We have plenty in the bank and we should continue to be a good and faithful customer for many years to come.

"Sorry, we only reward those who lied to us in the beginning and knowingly bought homes they knew they couldn't afford. Responsible people such as yourself get nothing from us. We realize that by shafting you like this you will probably take your business elsewhere, but we are short sighted, and hope that you really are more like the typical consumer and will stay with us regardless. Nothing for you! You have to be delinquent with us to the point of foreclosure before we will reward you!"

We took our loan elsewhere. Refinanced to 4.625% with another lender. I remember the days when you rewarded loyalty and good behavior. My how I miss those days. Today we reward people with an entitlement mentality...after all they've been told by society and gov't that they in fact ARE entitled.

I wouldn't look at that as a reward, the banks are only trying to get all of their money back from idiots they never should have given loans. There is no benefit to them to help you, which is why they won't. I agree, it's fucked up, but what can you do, that's how capitalism works. People need to do what you did and take their business elsewhere to make them learn.

Originally Posted by bmw

I agree. If you fuckup you should pay, not get paid. That's how it used to be. It should have been written into their contracts that if they fuckup they don't get their bonuses or severance, or they would get cuts from pensions, etc.

Let's bring that down a few levels (rewarding fuckups). Wifey and I bought a house we could afford, on a full doc loan (verified income and assets). We made our payments over the years, and we have equity (even kept equity through the RE crash). Now we contacted our lender about a loan mod to get our rate down from 6.25% (this was over a year ago). You know? Since all the people who were going into foreclosure because they bought homes they couldn't afford on stated income they didn't have, were getting bailed out of their home loans and having principal reductions on their homes they were upside down on?

"Have you missed payments?" No Mr. Lender, we've paid you every month on time, we're one of your best customers!

"Do you lack the ability to pay?" Nope! We were smart and saved money when times were really good. We have plenty in the bank and we should continue to be a good and faithful customer for many years to come.

"Sorry, we only reward those who lied to us in the beginning and knowingly bought homes they knew they couldn't afford. Responsible people such as yourself get nothing from us. We realize that by shafting you like this you will probably take your business elsewhere, but we are short sighted, and hope that you really are more like the typical consumer and will stay with us regardless. Nothing for you! You have to be delinquent with us to the point of foreclosure before we will reward you!"

We took our loan elsewhere. Refinanced to 4.625% with another lender. I remember the days when you rewarded loyalty and good behavior. My how I miss those days. Today we reward people with an entitlement mentality...after all they've been told by society and gov't that they in fact ARE entitled.

the majority of the problem wasn't with no-doc or stated income loans, they only accounted for about 20% of those bad loans. new and 1st time home buyers weren't the problem either. the main problem was that people (middle class American) were using the equity in their homes as ATMs to pay off/down revolving debit AND to continue consumption and spending. since about the late 70's Americans have been paying more and more for goods and services while wages have remained stagnant in many markets. the mortgage meltdown was more of a credit meltdown. Americans have been falling deeper and deeper into dept for decades because the US economy was slowing to a crawl after really 20+ years of economic "boom" after WWII, and this was the culmination of that. American have been digging a financial hole for the past 40 years. this is why I keep telling you guys to look at the data on the BEA website, it tells the hole story.

U.S. Bureau of Economic Analysis (BEA) - bea.gov Home Page

unfortunately for many there is no end for the current economic situation. you can not force companies to pay higher wages or force them to lower the cost of their goods and services. opening up credit markets in the 90's was pretty much the Fed's last resort but people blew threw the equity in their homes much faster than they had anticipated.

that's why it doesn't really matter if a Democrat or Republican is POTUS, no one can fix the economic mess the middle class is in. we need to remove the corporate special interests groups from politics, return to a true fiscally conservative government, stop going into debt policing planet earth and pretty much re-do the whole education system...don't see any of this happening any time soon

Originally Posted by LAM

the majority of the problem wasn't with no-doc or stated income loans, they only accounted for about 20% of those bad loans. new and 1st time home buyers weren't the problem either. the main problem was that people (middle class American) were using the equity in their homes as ATMs to pay off/down revolving debit AND to continue consumption and spending. since about the late 70's Americans have been paying more and more for goods and services while wages have remained stagnant in many markets. the mortgage meltdown was more of a credit meltdown. Americans have been falling deeper and deeper into dept for decades because the US economy was slowing to a crawl after really 20+ years of economic "boom" after WWII, and this was the culmination of that. American have been digging a financial hole for the past 40 years. this is why I keep telling you guys to look at the data on the BEA website, it tells the hole story.

U.S. Bureau of Economic Analysis (BEA) - bea.gov Home Page

unfortunately for many there is no end for the current economic situation. you can not force companies to pay higher wages or force them to lower the cost of their goods and services. opening up credit markets in the 90's was pretty much the Fed's last resort but people blew threw the equity in their homes much faster than they had anticipated.

that's why it doesn't really matter if a Democrat or Republican is POTUS, no one can fix the economic mess the middle class is in. we need to remove the corporate special interests groups from politics, return to a true fiscally conservative government, stop going into debt policing planet earth and pretty much re-do the whole education system...don't see any of this happening any time soon

Agree and agree!

Sounds like we both want the same kind of gov't!!

Originally Posted by Dale Mabry

I wouldn't look at that as a reward, the banks are only trying to get all of their money back from idiots they never should have given loans. There is no benefit to them to help you, which is why they won't. I agree, it's fucked up, but what can you do, that's how capitalism works. People need to do what you did and take their business elsewhere to make them learn.

All of their money back? Well sure, ideally. But when they were forced to write off principal to the tune of up to 20% of a loan, and reduce the rate to below the market average for someone with very good credit? There wasn't really any getting money back, it was more about preservation of what was left.

I'd call it a reward to the borrower. I was duped. All my life I was told to save and not over extend myself and pay my bills on time. Shit, I could have bought a bigger home for twice as much and just stopped making payments for a year until the bank wrote off some principal and gave me a sweet low rate based on my irresponsibility, inability to pay and now shitty credit. Boy did I fuck up!

Total reward.

Lam, you are an intelligent man. I commend you.