Originally posted by michael1983l
so the sheeple being the sheeple all start buying up their council houses. Then the Government de-regulates the Mortgage lenders and they start
lending to people at 100% or even 110% mortgage, flooding the market with new buyers, who in the long term could not really afford what they were
doing. House prices shoot up, pricing nearly all first time buyers off the market and then the rug gets pulled.
There's your problem right there. These "sheeple," as you say, took out mortgages they could not really afford betting housing prices would still
climb and they could sell at a profit. You blame the banks for lending the money. I blame the sheeple for asking for it. There's plenty of blame to go
around here and the "sheeple" bear some burden. Both the banks and the sheeple wanted to make some money here and they both lost. I don't think it's
fair to blame one side of this equation.
Originally posted by Wide-Eyes
reply to post by michael1983l
From what I can tell, the banks/mortgage lenders, aren't actually letting these properties out or selling them. They are sitting on them, waiting for
the cost of housing to increase. They want to make the highest possible raise on these reposessed properties.
They are biding their time.
Of course they are. Their own mortgage is underwater. The banks gambled and lost. It’s now their house. If they sell at the depressed rates they
lose on the books. If they wait, it’s a paper loss. It’s just like selling a stock that went down. You haven’t actually lost the money until you
sell it. They aren't trying to "get a raise;" they are hoping to break even.
Further, if the banks DID put these houses on the market, it would depress the market even more and make the whole thing worse. Think of the
individuals in the same boat who paid too much for their houses. If the banks DID put the repossessions on the market you’d be screaming bloody
murder that they did.
It's definitely a bad situation, but simply blaming everyone but yourself isn't going to help you. You'd like to blame the banks, the mortgage
company, the governments, anyone but yourselves. This is a worldwide economic issue that has affected the entire Western world. A lot of people got
excited about the bubble and they OVEREXTENDED THEMSELVES. Nobody made them do it. They just got greedy.
I have a son who did exactly that. He was in a perfectly reasonable house, but he wanted to live on the lake, so he mortgaged his modest house at 100%
to get the down payment on the lake house, bought that. Prices still were going up, so he mortgaed that house for 100%, bought cars and boats and
fancy granite countertops. Then the housing bubble burst along with his plumbing pipes. His house was worth half what he paid, so he stuck the bank
with it. He abandoned the house. They won't sell it because if they do they lose half a million.
The only fault I can find with the bank here is that they lent my son the money. That was stupid on their part, but the whole thing started with my
greedy son who instigated this whole thing because he thought he should achieve what his Dad did in half the time. Now he suggests he could use some
help, and I say "No." My house is paid off. I have no mortgage. I don't live on the lake and I don't have a boat but I also don't have a negative net
worth and a bunch of bills. My son could have done the same if he'd just chilled out.
I've done nothing wrong and I'm NOT a prisoner of the state. Fancy that.
edit on 11/27/2012 by schuyler because: (no reason given)