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"Foreclose me...I'll save money!"

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posted on Jan, 27 2008 @ 02:49 PM
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reply to post by DisabledVet
 


I think it's a great idea. My only question is, in this glutted market, how likely will a homeowner be able to rent it for the amount of their mortgage, much less $100.00 more? Sorry if that seems a silly question, I really don't know the answer.




posted on Jan, 27 2008 @ 03:06 PM
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reply to post by disgustedbyhumanity
 


I am a good investor and sometimes a good investor has to know when to cut losses and walk away. Its called business guy and that is how it works. Sometimes things dont go your way and you have to take the hit dont think that I go unscathed because obviously giving houses back to the bank does affect credit. Banks have business deals tilted in their direction and that is why the banks have so much money and that is why the banks run policy. Make no mistake that interest rate cut the other day is not because we were going to have a 500 point loss on the dow. Its because a bank called the Fed and said u need to cut or we are going to file bankruptcy and stick it to a lot of people. I dont think its the banks you should be feeling sorry for. They knew what they were doing and were making a lot of money doing it.



posted on Jan, 27 2008 @ 04:00 PM
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reply to post by WatchingFromTheFence
 


I read your post, Watching. Thank you for giving us a slice of what is left of the young Middle Class.

Go to thrift stores, ask family members/friends for things for the baby. A relative might even let you "borrow" stuff like bed, stroller, etc. If you have a washer/dryer, you'll save money by using cloth diapers. Ask for them at any baby showers.
Heck, in past generations a baby's first bed might have been a dresser drawer--you'll be making lots of memories with your child, so don't buy into consumerism that says a baby needs a lot of things. Maybe even talk to doctor/hospital re payments.
Also, don't buy baby food. You can buy lots of carrots and peas and rice, etc, cook and grind them, freeze them in ice cube trays, and use them instead of store bought can/jars.

If you have a pet (even goldfish), give it away. Seriously. That is one must do from debt counselors.

From many of the posts, there is a range of reasons for walking away from a mortgage. But, while one might "feel" like walking away now, the consequences are enormous, as has been pointed out in several posts. (losing any money put into the house, still owing balance to bank, calls from collection agencies, bankruptcy haunting you for years after, etc.) If you can hold on to your house, you'll be better off. At one time, home owners rented out a room (get and check references!) to help out.

Sure, lending practices have screwed people royally, and there's anger.
Woody Guthrie decades ago wrote, "Some will rob you with a six gun and some with a fountain pen."

We need in this country to discuss what exactly "family values" means. For years politicians got elected on these "values", yet the economy has been such that it is harder for families to survive as in the past. The American Dream of owning a home has turned into a Family Nightmare for many.



posted on Jan, 27 2008 @ 04:00 PM
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Originally posted by kosmicjack
reply to post by DisabledVet
 


I think it's a great idea. My only question is, in this glutted market, how likely will a homeowner be able to rent it for the amount of their mortgage, much less $100.00 more? Sorry if that seems a silly question, I really don't know the answer.


There are no silly questions...only silly outfits.


But the nice thing about real estate is you can figure all these unknown out BEFORE you take the leap.

So first look online for rentals in your area...and find out what a comparable property is renting for. You may be pleasantly surprised to see that it may be a bit more than your current note payment.

You can also call a relator and have them tell you what rentals are going for but i would first trust and rely on the internet searching for rental listings of comparable properties in your neighborhood.



posted on Jan, 27 2008 @ 04:40 PM
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So...if you weren't already sure that the Banksters will figure out a way to profit from any situation, this link is for you:


You Walk Away

An entirely new industry is popping up to help people navigate this situation...and just who do you think is financing it? Hmmm...oh maybe - the Banks!


[edit on 27/1/08 by kosmicjack]



posted on Jan, 27 2008 @ 06:13 PM
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reply to post by DisabledVet
 


That's a pretty good spiel! Being able to come out on top and all of that. But let's discuss some of the little nasty things that you didn't include in your spin.

1. Even though you *may* get 100.00 a month on top of your mortgage payment, you'll still be saddled with around 30-40% of that loan value counting against you on your debt/income ratio.

2. You'll also need to determine who is going to be responsible for paying the homeowners insurance and property tax. Since property tax ans insurance are rarely the renter's liabilities, be prepared to be saddled with those expenses as well.

3. Also, be sure that 100.00 above your mortgage cost is going to cover any possible repairs to the home that you will be required to fix in a timely manner for your renters. Exactly how old is your roof? Your hot water heater? Appliances? Septic system? HVAC system? Are you ready to spring for that sudden plumbing bill when they clog a line?

4. The assumption that you can nail down 10,000 above your existing loan amount is presumptious at best. Many individuals are upside down on their loans and even if you're not upside down on your loan, you're gambling that your home will not lose more value between the time of your rental start date and the time in which your renters actually can pull financing to purchase from you.

Again...things like this are pitched to those who can't afford it and they're always done with the "pefect scenario" approach. Rarely do you ever hear the dark, little nasties of it discussed in the pitch.

If someone is ready to walk away becuase they can't afford an 800.00-1500.00 mortgage payment, they are most definately NOT in the position to transfer over to a 500.00 - 900.00 rental payment (since they would no longer live in the home) -AND- assume responsibility as a landlord with the financial obligations that are then required to handle that responsibility correctly.



posted on Jan, 27 2008 @ 06:42 PM
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DisabledVet is giving people an answer. There are better ways than just getting rid of your home and letting it go back

I agree, foreclosure is going to become a much bigger deal than it is now.



posted on Jan, 27 2008 @ 07:28 PM
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reply to post by DisabledVet
 



I to have quite a few properites down here in florida but here is the problem Im running into. There are so many properties for rent now since people are waking up and starting to rent them out and alot of people are giving these houses away just to get people in. Ive lost 3 tenants because someone up the road was 500 a month cheaper and Im already taking a loss as it is. Multiply that by several houses and its a chunk of money. I have all houses not condos or apartments. 2 houses I was losing a large sum a month so those are the ones I cut. In theory your statement makes sense but as a real estate investor you should know there is a lot of grey area.



posted on Jan, 27 2008 @ 07:37 PM
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Yeah so to the guy who thinks renting out my house is good idea. Well in a nutshell it's not.


Our mortgage is 2200/month. So, umm, tell me where someone is going to
pay anything near that when I've already physically checked out homes and luxury apartments in good neighborhoods for 1200-1500, in person, in rental guides, and via the internet? CNN just ran a story about the average cost of rent going down nationwide, because everyone is renting out homes. I love when people think they have all the answers. As if I WANT to lose my home. Read my post! I called all the numbers. I did all the research. I even paid a BK lawyer a 100 dollar retaining fee in the event that I may have to file to avoid the deficiency judgment.


In my opinion it's people like you, who bought several homes and wanted to rent them out, that caused this inflationary bubble. I'm not gonna sit here and cry about this, because I'll end up smashing my computer monitor in a fit of rage.

This was not an easy decision. I studied it for months, and as of Jan. 1st, I'm manning up to the plate. Anyone can still buy a home with a foreclosure on their record. By the time i even felt like buying again, I would have enough money saved up to put 20% down. Theoretically, in 2-4 years I could come back and buy this house I'm in right now for substantially less money.


I hate when people tell me that buying a home is like having money saved. It's that way of thinking that caused so many people to live outside their means and buy boats and suv's with home equity loans. We both have 401k's. We have a bank account. Those are our savings accounts. Our home is to live in. Yet, we can't even do that now because of this crash.


I really do believe this crash needed to happen. Even the most modest single family homes are currently out of reach of the middle class American. This will fix all that. It's gonna take people like ME to make it easier for people that couldn't even afford homes yet. It's people like YOU that are more concerned over keeping their OWN equity. You'd rather have your neighbors locked into contracts; slaves to the bank. As long as YOU get to keep your investments, everything is Hunky Dory in the world. Meanwhile, single income families can't even afford two-bedroom homes. We couldn't even have this conversation face to face because it would quickly degenerate to yelling and/or violence.


Why don't YOU do the research before you go posting something as arrogant, with the title of "the solution", for us honest hard-working folks to pine over.



posted on Jan, 27 2008 @ 07:41 PM
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reply to post by WatchingFromTheFence
 


Exactly what Im saying in the post right above yours but yours is much more eliquent. Good Post!!!



posted on Jan, 27 2008 @ 07:51 PM
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I agree that disabledvet's comments were a bit on the naive side at best. Renting is a whole other nightmare in itself. In my neighborhood the only people that want to live here are illegals and or the Hispanics that shelter them. If I rent to them then 20 people will be living in my house tearing it up with nobody to go after for damages if they wreck it. Rental rates are also wayyyy under what many current mortgages are. I bought at the bottom and I still could not rent this place out for what my mortgage is mostly because the tax rate in my town is the highest in the state of Virginia. I pay 4k a year in taxes on a place that I would be lucky to sell for 270k now (assuming anyone would actually buy it). You can't spit in the air around here without it landing on 3 homes that are for sale or being foreclosed on. If it weren't for the outrageous taxes then I might be able to break even IF I could find a reliable renter who was actually a citizen and who didn't use a fake ID.

I am by no means ready to walk away from my home, but if my equity falls below what I paid for it and with the condition of this town, the insane amount of illegal aliens bringing down values, the crazy taxes, the bad schools and the general dilapidation of the area I would not see a compelling reason to stick around. It's not personal, it's business. The government deserves what they get for allowing the country to slide into disrepair and anarchy the way that it has.

[edit on 1/27/2008 by Escrotumus]



posted on Jan, 27 2008 @ 07:52 PM
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Originally posted by disgustedbyhumanity

Just plain outbailing because you made a bad deal is bogus. Peoplelike you are the reason that I am disgustedbyhumanity.



I agree with you 100% and your perfect nickname as well.

I know a lot of people; and all ones I know who do pull this 'scam' are the ones with the most assets - both liquid and solid. (Plus, a new home every seven years.)

Honor, honesty, common sense, fullfilling ones' promises and keeping ones' word, and overall integrity are truly rare qualities.

This is why I plan to vote for Paul Revere ... Ron Paul! He embodies those lost virtues.



posted on Jan, 27 2008 @ 07:56 PM
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reply to post by Trexter Ziam
 


Try getting these virtues from big bank, big oil, and big business in general. I find it laughable you will dog on someone like me but be an apologist for big oil and big bank...how bout some more cherry kool aid with that cheese.



posted on Jan, 27 2008 @ 08:05 PM
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Originally posted by mybigunit
reply to post by Trexter Ziam
 


Try getting these virtues from big bank, big oil, and big business in general. I find it laughable you will dog on someone like me but be an apologist for big oil and big bank...how bout some more cherry kool aid with that cheese.


I haven't even gotten to your post yet - so - I don't know what you might have posted yet. I love the other person's nick and I see what sort of person you are by the nick you chose. My post wasn't directed to anybody except to the person I had quoted.

As for big oil and big bank ... that's a whole separate issue from integrity.

[edit on 27-1-2008 by Trexter Ziam]



posted on Jan, 27 2008 @ 08:07 PM
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reply to post by Trexter Ziam
 


My bad continue reading post again when youve read it all.



posted on Jan, 27 2008 @ 08:28 PM
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Originally posted by Trexter Ziam

Originally posted by disgustedbyhumanity

Just plain outbailing because you made a bad deal is bogus. Peoplelike you are the reason that I am disgustedbyhumanity.



I agree with you 100% and your perfect nickname as well.

I know a lot of people; and all ones I know who do pull this 'scam' are the ones with the most assets - both liquid and solid. (Plus, a new home every seven years.)

Honor, honesty, common sense, fullfilling ones' promises and keeping ones' word, and overall integrity are truly rare qualities.

This is why I plan to vote for Paul Revere ... Ron Paul! He embodies those lost virtues.


Okay, I skimmed the thread and got the jist of your posts - we'll have to agree we have fundamental differences of opinion here and leave it at that.

Persons who knowingly use this gimmick as a scam - simply don't have the character qualities I admire most.



posted on Jan, 27 2008 @ 08:32 PM
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Well, maybe Trexter Ziam has vested interest like homes that he/she owns.

I'm no genius. I'm just a young kid in college new to family life and all of this. I spent my younger years playing in bands and partying. However, I've done so much reading it's not even funny.

It seems to me, this whole market scenario has about four groups of people:

Group 1.
People who bought recently and are upside down that realize there's no way out in sight. They are bailing out, either on purpose or of no other choice.(i.e. Me)

Group 2.
People who own one or more homes and want them to further increase in value. They want the first group to stay in their homes. If the first group bails, they get "disgusted by humanity". Now the first group becomes pieces of trash and terrible human beings. These same people can end up in Group 1 if they're not careful themselves.

Group 3.
The third group is people who have been in their homes so long and are likely not going anywhere. They have equity. Maybe not as much as a few years ago. However, it's equity nonetheless. They're staying put. If they did move they would put all that equity into a different house and still not be upside down. Most of them don't give a hoot what happens. They've ridden out the 80's. They'll ride this out.

Group 4.
Banks and lending institutions. note, the people in Group 2 tend to defend the banks and throw around terms like morality etc. Group 2 defends the banks now, but will curse them later.


I originally intended to become a part of Group 3 (after spending so many years in my home). Now I find myself in Group 1.

Let me ask you, if this fallout does not occur, are home prices to continue to rise? Our wages certainly aren't. I work for a good company, and can tell you that our new contract only gave us 1% increase in wages per each year over the next two years. I suppose I'm lucky to have even got a raise. Who will afford your homes? Group 2 is as bad as the Fed. They want to create money out of thin air. But hey! Who cares, you guys get to drive your big cars and wine and dine and keep rolling it back into new loans when the credit starts to run thin.

Now, to put your whole morality argument into perspective. Walking away from my home, for the future good of my family, does not make me immoral. I'll tell you straight up, here's a good scenario. Say there was a natural disaster and my family needed to eat. I've exhausted all my options. I've tried to work. Plant. Hunt. I mean we are really screwed. Well, if it comes to that point, I happen to own a lot of guns, and guess whose door is getting kicked in so I can scrounge up some grub for my pack. Morality is sometimes a gray area. Yes it's immoral in your eyes, but guess what? My family has full bellies now. I don't throw this story around lightly either. I am basically a good person. I'm sure many of you are, but I WILL do ANYTHING it takes to ensure my family gets the best they can get. Morality can go jump off a bridge.

I understand illegal immigration might contribute in some small way to this mess, but I don't think it plays a very large role. Depending on your area it may have created localized pockets of rampant foreclosure and crime. For the most part, this is an American problem created by our McDonald's Cadillac American lifestyle. If I lived in a country where opportunity was almost non-existent, I'd probably come here with fake ID's as well. Illegals don't help things, but a portion of them are fundamentally good human beings.

[edit on 27-1-2008 by WatchingFromTheFence]



posted on Jan, 27 2008 @ 08:34 PM
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Ahh yes, on a side note I'd like to add that our BK lawyer told us to charge up our cards and not pay them before filing. He said it was free money. Lawyers are mostly snakes and swine. We don't plan on doing this at all.



posted on Jan, 27 2008 @ 08:41 PM
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reply to post by kosmicjack
 


Whats up kosmic. This refinance tactic is booming out of control. If no one has posted it yet, here is a link to a yahoo video on a story from the AP about the run to refinance.
mortgage crunch

Also a link to my thread about an article explaining the reasons for our economic crisis.
the black box economy

If people start running to refinance, it is going to hurt us even more and continue to line the pockets of the elite and Central Banks.



posted on Jan, 27 2008 @ 08:45 PM
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Originally posted by WatchingFromTheFence
Well, maybe Trexter Ziam has vested interest like homes that he/she owns.

I'm no genius. I'm just a young kid in college new to family life and all of this. I spent my younger years playing in bands and partying. However, I've done so much reading it's not even funny.

It seems to me, this whole market scenario has about four groups of people:

Group 1.
People who bought recently and are upside down that realize there's no way out in sight. They are bailing out, either on purpose or of no other choice.(i.e. Me)

Group 2.
People who own one or more homes and want them to further increase in value. They want the first group to stay in their homes. If the first group bails, they get "disgusted by humanity". Now the first group becomes pieces of trash and terrible human beings. These same people can end up in Group 1 if they're not careful themselves.

Group 3.
The third group is people who have been in their homes so long and are likely not going anywhere. They have equity. Maybe not as much as a few years ago. However, it's equity nonetheless. They're staying put. If they did move they would put all that equity into a different house and still not be upside down. Most of them don't give a hoot what happens. They've ridden out the 80's. They'll ride this out.

Group 4.
Banks and lending institutions. note, the people in Group 2 tend to defend the banks and throw around terms like morality etc. Group 2 defends the banks now, but will curse them later.


I originally intended to become a part of Group 3 (after spending so many years in my home). Now I find myself in Group 1.

...

Now, to put your whole morality argument into perspective. Walking away from my home, for the future good of my family, does not make me immoral. I'll tell you straight up, here's a good scenario. Say there was a natural disaster and my family needed to eat. I've exhausted all my options. I've tried to work. Plant. Hunt. I mean we are really screwed. Well, if it comes to that point, I happen to own a lot of guns, and guess whose door is getting kicked in so I can scrounge up some grub for my pack. Morality is sometimes a gray area. Yes it's immoral in your eyes, but guess what? My family has full bellies now. I don't throw this story around lightly either. I am basically a good person. I'm sure many of you are, but I WILL do ANYTHING it takes to ensure my family gets the best they can get. Morality can go jump off a bridge.
...
[edit on 27-1-2008 by WatchingFromTheFence]


FYI - I'm a group 3 but I don't want my equity raising because all that has done for me is quadruple my property taxes each decade.

And you can fall on hard times and defaulting on a home loan does NOT reflect bad character whatsover. My posts addresses ONLY the issue of those persons I personally know who use this loophole to their benefit ... persons who have never fallen on hard times. It's their scam. Now, if one intentionally pulls off this caper; that's when the character meter drops to zero.



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