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This has to stop. And stop now. While Citibank uses our taxpayer money to consolidate their position in the financial world (and BofA, too, bastards that they are), real people suffer.
Enough greed. I hope they read it. I hope they take heed. Because they surely will fail if they lose the good will of their customers.
I'm sure it's small consolation to know that you're not alone. Many of my colleagues, friends, & neighbors are in similar situations.
Thank you for sharing such a personal account publicly. Hopefully, it will be strong voices like yours that bring this madness to an end.
Warm regards,
John
Call me sickly optimistic, but I expect they will pass something that will work and, this time, with TEETH!
I'm glad you can write about it so well. I offer my thanks to your parents and teachers as well. Your talent is a service to many, so thanks go to you too.
we elected change and change is what we need.
meantime, bankers are getting gazillion dollar bonuses and congress is sitting on homeowner help.
this letter needs to go to every congressperson.
rooting for you and for all of us "little guys"
I think most people that bought homes in the last 5 years are in a similar boat. If you bought a property that lost 40% of it's value, even if you can make the payment, it seems almost silly to.
The market will take more than 7 years to fully recover to your original value (at which time your credit will be repaired) and in the mean time you put yourself in a much better cash flow position by bailing on the property.
What exactly are the banks doing with their bailout monies anyhow?
I have to echo Karoli's sentiment that if the banks dare to do this and things go further south, that they will fail, and abominably. Why should they continue to strengthen themselves through our massive misfortunes?
(They shouldn't.)
I have two loans with Aurora, similar situations. I have heard that Aurora is pretty good about doing loan modifications. If you need someone to work with, I have two great folks I can recommend.
good luck!
LC
Something has to fundamentally change, and soon. Best of luck.
My Ex and I have a joint condo in South Beach and we're stuck with it for now, unable to sell in a declining market and unable to remortgage either. Thankfully, it is rented out at a small loss and we're hoping the market will have improved by the end of the year when the 5-arm finishes; some chance of that and the market price likely will have declined further.
There are huge consequences bearing this burden though, since neither of us can move on and purchase property elsewhere. The annual stress of finding a new renter isn't fun either.
I sincerely feel for you, you have my best wishes for an amicable solution with the banks.
Here is my 2 cents [not an expert at all] about why banks are behaving like fools. They have sold your debt as securities to other investors and so on. Apparently, those multiple investors [hard to track, don't know why] can sue them if they change the terms now. Hence, we are suffering from the lose-lose solutions.
My lesson: Free market works the best when real buyers /sellers are face to face not separated by multiple layers or derivatives.
Good Luck and Namaste!
Subhankar Ray
If you want visit: www.WAHU4ME.com. Maybe we can offer you yet another avenue to create extra monthly income.
I know I'm young so I can't claim any personal experience, but a couple of my friends have parents in the same situation.
It is a tough thing to deal with, and I wish you the best of luck.I hope everything works out, Francine.
I hope that your letter strikes a chord with the right people and there is a sensible solution to your problem which lets you keep the home that you have worked so hard for.
I'll keep my fingers crossed for you and other people around the world that are in a similar position.
I'm curious why Obama's election would inform your decision to stay in a mortgage you can not afford? Did you think that he held some magical power that was going to cure your problems? Did you expect him to pay your mortgage for you?
I'm also curious which part of the "stimulus" plan you're expecting relief from? Is it the money for STD education and prevention? Perhaps it's the money set aside for the Mob Museum? No, wait...it couldn't be either one of those.
I'm sure my comments sound harsh and heartless to you, but I am neither. I hope you can find some relief and that your lender will work with you to find a solution that will benefit both of you. I would encourage you, however not to wait around expecting a "stimulus" plan. The bill currently being debated will be of no help to you - or any other person in your situation.
It's unfortunate but true that we live in an imperfect world where sometimes bad things happen. Bad things are happening now not because of any one person or group of people, but because of decades of horrific mismanagement and procrastination. The economic climate we find ourselves in currently has been on the horizon for years. It's time to pay the piper!
Sell your house. Get whatever you can for it and live to fight another day. But, don't wait for Barak Obama to come to your rescue. He doesn't intend to!
.....harsh....but, true!
I am in a similar situation and share your frustration. It is beyond me why financial institutions will not negotiate for a favorable outcome until you are behind on your mortgage. I've stopped paying my escrow as a strategy to indicate hardship and have retained a bankruptcy attorney. It's a great negotiating tool. As far as credit rating goes, I've stopped caring about that. I've a feeling credit rating won't matter much by the time this is done.
Even if the bleeding stops tomorrow, this economy has changed forever the way people feel and think about finances. It has shaken their faith in whatever corrupt system we've had, and they'll be twice shy about investing in anything.
On my way in to work this morning (and Lord only knows how long I'll have my job) this thought:
My arms are strong.
My heart is true.
My vision, clear.
There is nothing I cannot do.
So, stand firm your ground. Stay in your home until they drag you kicking and screaming from it. We won't take it any more.
So now I'm back working a part time hourly wage job just trying to make ends meet, and still trying to operate what's left of my business (relying solely on the hope that things can't get any worse). BUT there's still my business loans and line of credit that needs to be paid every month- but without the previous sales that were coming in. The banks won't even talk to me about dropping the interest rate or working with me because I've paid it on time every month. It's just due at the first of the month- and that's that (never mind the fact that my family needs to eat, or my son needs therapy and medication, and we really would like to keep a roof over our head).
My heart goes out to you. You're not alone. Keep your chin up and stay hopeful!
There have been cars driving through our quiet neighborhood all day today, driving slowly and looking lost - obviously looking for the house they might bid on come Sunday. The best outcome would be a good price from a bidder who plans to live in the home, but there are SO many successful real estate speculators in a college town.
All the rest of us in the neighborhood can hope for is that the seller gets a good price!
If we end up losing this home I will never ever again enter into a 30 yr mortgage even if it means my wife going back home to her mother and I have to live in hotel room till the end of my days...
Good Luck...I think that we will all need it before its all over with...
You put so easily into words what I couldn't. I have called and called and called, and I have gotten the same response that I am not behind so they can't do anything for me. So let me get this right......when all of us scraping as much money as we can to pay every month, all stop paying, and they have another 6 million foreclosures from people who can't hold on anymore, will they realize the value of re-financing? The banks don't seem to be learning anything from our current situation. They get help, but refuse to help the people who they got the money from........tax payers.
Please keep writing. You speak for so many of us.
Blessings
Your text is a very interesting open letter.
Do you want it to be efficient ? I guess so.
There is a (may be) solution.
In theory, it is a solution for everybody in your situation. Unfortunately, not everybody in your situation can write, and publish on internet, what you wrote.
So here is the (may be) solution.
You are educated and you know to read (=understand, not just deciphering), so i won't spend my time explaining you everything in detail because you can understand by example.
Read this :
http://tinyurl.com/cbbmq6
FORGET ABOUT THE MEANING of the text.
(It is about the situation in the Netherlands and Europe, you're not concerned, not yet.)
Simply FOCUS on the second part of the text, the "Yes we can" part.
Then just apply the METHOD to your letter and add that "Yes we can" second part, adapting it to your personnal situation.
I'll be one of the very first who will participate if you ask to be helped that way.
You are definitely not alone.
We agreed to the price of the home, and we signed on for a mortgage at that price. You did that same thing.
I have recently been let go from the company that I was working for. I still don't consider it an option to try and change the terms of our mortgage. I agreed to those terms, just as you agreed to yours! Now, I voted for Obama, and I, too, disagree with how the government is doling out money to the banks, but two wrongs don't make a right.
It is not the role of the government, or the banking industry, to provide handouts, discounts, or charities (although philosophically I understand the difference between charity and social services).
Out of all of the people in this nation suffering under economic stress, I think for any given sum of money far more people can be helped in the inner cities than areas such as Half Moon Bay.
And while I certainly hope for the best where your business is concerned - as well as your personal finances - I don't see why someone else should help you meet your obligation on your mortgage at no consequence (credit score) to yourself. What does that teach your grandchildren? That you can get in over your head and there's someone there to bail your out?
I think the fact that these companies won't negotiate until you're behind is absurd.
I do think the taxpayer concern is legitimate - i.e. that taxpayers should not subsidize reductions in principal - but there's no reason on Earth they should not renegotiate terms with you BEFORE things get out of hand. It's just common sense - unfortunately it's not that common.
Wishing for the best outcome for you.
You and others in trouble need to check out www.livinglies.wordpress.com
This guys blog is exploding it has great info about attacking the lenders and why your note/mortgage may have already been paid.
there is not answer. we suffer. we will continue to suffer. the fat cats will get us. no stimulus will correct this. giving people a check will make things worse.
good luck with everything
czar
Thank you for being so open, so honest, so transparent, and sharing yourself so wonderfully clearly. I will be extremely interested in hearing what the banks response is to this open, warm, well thought out, and clearly intelligent offer.
I hesitate to think that it won't fit into their "system", and therefore cause you financial ruin..
For now, I advise you to look at other options.. perhaps you can crowdsource a loan, or perhaps you can use something like zopa.com, but relevant for you in the US, to be able to find a large enough group of people who will lend you the money??
I hope whatever happens, that you find a successful resolution of your issue.
Kind regards
Farhan
I am going to link to this in my latest blog article. It is a perfect example of how we can help ourselves out of this if they just let us.
James Miller
http://www.realestategozone.wordpress.com
Why not? Haven't we given them everything else they've asked for?
http://cranfordpundit.wordpress.com/2009/02/05/...
You helped me when I asked, I'll help you if you ask me, and I hope that mortgage brokers, bankers, and others have similar can-do, all-American attitudes.
Namaste
Stories like yours are precipitators of change! I think we need to deluge mortgage companies and the House and Senate with personal stories exactly like these. If I were you (if you haven't already) I'd forward this blog entry to Nancy Pelosi, to Larry Mantle and Patt Morrison of NPR, and to any other source I could think of.
It really doesn't matter whether a person's house was $700,000 or $70,000, losing what we have all has the same impact on an individual.
We, ourselves, have no home to lose since we were never able to purchase one after we moved to California to be with our adult children. (It's a choice we felt was important to make). We were waiting to be able to afford a home here, but on the week before President Obama's inauguation, my husband was laid off. My blog, therefore, is called "Our First 100 Days" and is meant to parallel President Obama's first days in office with our personal experience. It all feels a bit too Grapes-of-Wrath-like, but we have a trusty Toyota instead of a rusty truck to make it back East to the software jobs if we have too.
Hopefully our blogs will reflect an eventual positive outcome so all of us can stay near our families and eventually enjoy enough security and happiness to others.
Cheers - 23eastblue
Your karma right now isn't too good:-)
During the first layoff, '03/'04, he worked as a handyman and I cleaned houses in order to be home when my two children returned from school. We ended up having to sell our house and move into the cheapest house in our city at 900 square feet, with (we later discovered) no insulation. We put 10% down and put a lot of sweat equity into the house thereafter. Despite everything, we remained grateful for the roof over our heads and the heads of our children.
Then came layoff #2. By this time, our 401k was gone, our savings was gone and one uninsured hospital visit (my husband was having chest pains) cost us over $7,000. At this point, in order to hold onto the house, we refinanced from a conventional loan (which we'd always had throughout our 17-year marriage) to an interest only loan to get us through the layoff period. That was three years ago. Although my husband has since regained employment in his field, our home value has plummeted from $350,000 to only $200,000. People have left our neighborhood and abandoned their properties in the middle of the night. There are currently five empty bank-owned properties on our street, four of which have been empty for over a year.
Our mortgage company will not allow us to refinance based on our current value, and our payment has increased because of the switch away from the interest only loan (after the three-year period.)
We are an intelligent, hard-working middle class family (California is so expensive that an engineer's salary coupled with that of a part-time teacher equals middle-to-lower-middle class in our city) trying to hold onto a very small home which we have spent five years frugally fixing up. We do not use or even own a single credit card. We have one car. No big screen TV's, X-boxes, vacations -- just very simple lives.
My husband is aghast as he watches corporate bailout after bailout and the frivolous indulgences that have come in the wake. Nobody bailed him out except his own sweat and muscle. It's simply appalling to watch fat cats grow fatter on our tax dollars, while the little guy busts his hump to no avail.
Not everyone is reasonable. The Times had a story several months ago about a couple who wanted to sell a house which had declined to below its mortgage value, and they were outraged that the lender offered to split the loss 50/50 with them in a sale. I thought it was a reasonable compromise, not an outrage. Your suggestion is reasonable, and hopefully the lenders get a brain.
This recession began in the housing sector and has now spread throughout the entire economy which is why I can't understand why the Govt. absolutely refuses to help the homeowners who are in trouble instead of the fat cats who caused this with their seemingly infinite greed...
how were you planning to pay off this (large) loan if you weren't paying any principal? refinance after you paid off the HELOC? or hoping that house prices would continue to rise?
given your age, did you expect to pay off the house before you died?
Sometimes a positive attitude is hard to keep, and sometimes even harder to show, but it's the only thing I can think of that will get us all through this until things finally do turn around ...and things WILL turn around!
As a taxpayer and a renter I don't care about your personal drama and I don't believe that my taxes should be used to help keep you in a house that you can no longer afford. You keep saying that you aren't looking for a handout when in fact you are. Suck it up and foreclose. If the government bails out people like you who are in over their heads it will artificially inflate real estate prices and perpetuate the bubble. Foreclosure is the fastest way for the market to stabilize and for prices to once again reflect reality. If I recounted a long sob story similar to yours about my business, family, and neighbors, would it convince you to support a policy whereby the government helps pay my rent? Didn't think so. There are a lot of problems in the world today. Trying to keep you in an expensive house in Half Moon Bay isn't one of them.
You made a bad business decision, which since you are a businesswoman makes your fault in this even greater. It was lunacy to buy a house in the past 5 years. Presumably you made a large profit on your Arizona home? Are you going to offer to pay that money back to the lender who facilitated that profit accumulation?
How is it that after being a businesswoman for 40 years you didn't have enough capital accrued to simply buy the house outright? Is it that you did have the capital, and decided to invest it elsewhere? And now you are trying to strong-arm your lenders to re-negotiate a contract?
My partner works part-time, and I don't earn any income because of physical problems. 10 years ago we bought the only home we could afford. You spent almost as much renovating your house as we spent buying ours. We lived with the horrible 40-year-old kitchen for years, until we could afford to get the kitchen replaced.
We watched as the prices around us rocketed in the past 10 years, but never did we fool ourselves that our house was really worth 10 times what we paid for it.
I was predicting this crash since 2000, and I'm not a business man. In that year we looked at buying a separate property and walked away from it because the prices were rising so fast that they were obviously unsustainable.
You haven't exhausted your money-making options. What's stopping you from taking in lodgers? In order to make ends meet, that's what my parents did when their kids left home, and it's what lawyer friends of mine have done since they've over-reached themselves. Or if that's too distasteful, move in with your daughter and rent your whole house. Or if that's too distasteful, rent a 1 bed apartment and rent your whole house.
Or walk away from it, and accept you're a bad businesswoman.
Anyway, contact me if you're interested. I maybe a nobody, but I really do care - TMNK
How would you look someone in the eye (like myself) who bought conservatively 7 years ago and has paid down my loan which is fixed at 5.5% and say that you deserve your loan to be reset and fixed at 4.2%? That's just ludicrous.
And I don't want a handout down to that level because I know what it would cost the government. All money the government spends now has to be paid back at some point by taxpayers. But then again, those that are closer to retirement can just spend away knowing that they won't bear the burden that future generations will bear.
There are no easy solutions to this, to be sure, but this would have far worse consequences than the level of foreclosures that we will see through this and next year.
By allowing the lenders to tease people into homes they really couldn't afford with ARM's and Interest Only loans the Govt. is just as responsible for this recession as are the lenders...Had the lenders been forced by the Bush Admin. to refinance the mortgages going sour in the beginning and kept the owners in their homes this recession could have been stopped in its tracks...Only then would it have made sense for the Bush and now the Obama admin. to bailout those lenders in order to keep credit flowing...
Regards,
DAR
____________________
Unfortunately that is the risk a business person takes if they don't pay into S.S. My own father was a DC who made about 250 grand a year and bragged that he paid in taxes every year what I made as an employee. He had planned on being a millionaire by the time he retired but stopped paying his Withholding Taxes in order to give that money to his ex third wife. When the IRS caught up with him he had to liquidate all of his savings and investments and after his death a short time later my Aunt was forced by the IRS to sell his practice which ended up failing.
Nor did I receive an inheritance since it was all spent by my father's ex third wife and her boyfriend.
My own mother did her level best to get her parents to move in with her when my Grandfathers health began to fail but my Grandmother wouldn't and insisted on putting my Grandfather in a nursing home. Later my mother was able to pull my Grandfather out of the nursing home and he died in her home. But only after my Grandmother and I walked in on an orderly who was slapping my Grandfather's face to get him to eat.
When my Grandmother was forced to move in with my mother when her health began to fail and her home was sold. I advised (and my brothers agreed) that the money should (including our inheritance) be rolled over into her home and her mortgage paid off. As a result my mother is secure and her home could be sold later if needed to take care of her. If there is any money left my brothers and I will inherit then if not that's life and my mother will have been financially taken care of. As it isn't the Govt.'s job to fulfill the duty of ones children to take care of their parents in their old age.
"5-year interest-only mortgage"
what you did is totally, completely, and utterly irresponsible, and those of us who have paid down our house religiously are now paying for this kind of lunacy that people like you have brought upon us. an interest-only mortgage is akin to going to the casino, you made your bed, you sleep in it.
I think that your letter should be published in every Newspaper and on all the tv stations. You are very articulate and are not asking for anything unreasonable! Maybe if these lending institutions could actually look past the charts they make to figure P & L they would realize that helping you and countless others would actually add to the positive end of the bottom line!
President Obama has spoken repeatedly about ushering in a new era of personal responsibility. There are plenty of us out there who dream of one day being able to purchase a home in a locale as lovely as Half Moon Bay, but whom recognized that we could not afford it if we were to do so with a traditional mortgage as opposed to the Monte Carlo, interest-only, devoid of all common sense, no equity model that you opted for.
I feel awful about anyone losing their homes, but what you did is totally and completely irresponsible - you made your own bed, you sleep in it. Take some responsibility and grow up.
P.S. As noted elsewhere - this is not the great Depression, not even close, when unemployment goes to 25%, then you can make the case.
Sell it at a loss, stay somewhere you can afford and shut the hell up. This sense of entitlement is not funny anymore.
See:
If you plan to stay in the house until you die, the current value is not an issue. You should have thought before you bought it whether you will afford the mortgate and you made a bad financial investment.
If you bought it as an investment.......tough luck.......sell it at a loss. Its like any other stock or mutual fund which you bought whose value has gone down. Or stick for a few years and its value may go up.
Anyways..........at your age, if you make risky financial investments, dont ask for a handout at the community's expense!
There are 106,261,000 single family homes in the US. If they give you a break then they need to give everyone a break. Do the math! At 100,000 per home the number is 10,626,100,000,000. 10 Trillion, I don't think Obama has that up his sleeve.
There is no guarantee of happiness in America, only the pursuit of happiness.
Oh and if you are going to rewrite everyone's mortgage that is under water, how about all the people that paid for their houses but have lost money in the last few years? Should the government just write them a check for the decline in the value of their home.
If you customers of your business all called and said they have problems now are you refunding their money?
I don't get it! For the record, I bought my house 2.5 years ago, owe 350k and it is worth 275. I own a small business, which is a restaurant and I'm tightening my belt. I'm not looking for the government to fix it!
Just a brief question--were you selling these properties as the agent?
This post, a continuation of yesterday's, is a series of questions aimed at those who told me I was a bad businesswoman, a fool, and unworthy of help because I bought an "expensive" vacation home in Half Moon Bay.
1)Have you ever wanted to live near, but not with, your very close family? Mine lives in Half Moon Bay
2)Have you ever been optimistic enough to think that for the next five to ten years, you will have an income similar to the one you have had for the last thirty?
3)Have you ever taken a risk for a dream?
4)Have you ever saved and invested over a ten year period, only to see it all evaporate in 90 days?
5)Have you ever spent your days trying to help others succeed?
6)And do you know what a starter home costs in California?
Until you have had all those experiences, you have no right to pass judgment on me.
I love my family and want to live near my grandchild and my daughters, who have left Arizona and tell me they never want to return.
I could afford the house when I bought it, and with a long-standing business (the third I have created for myself) I thought I would be fine.
I took a risk to move to California after 40 years of living in a place I did not enjoy, but stayed in to raise my children and tend to business
I had enough money scheduled to come out of investments last fall to pay for the entire house outright.
I have created jobs, helped others create jobs, been a foster parent, and helped send a young man in Uganda through college. And now I can't afford to go to his graduation.
The home I bought is known as a starter home, a big step down from what I lived in while in Arizona. The $70,000 I made on my Arizona home was the down payment for the house in California. That's all gone now.
I'm not an idiot. I had a plan. It wasn't foolish, and it wasn't even risky. For almost four years I made all the payments easily.
What is wrong with you people? I hope nothing untoward ever befalls you; you will never be able to handle it.
The spirit of America is of entrepreneurship. Entrepreneurship means the ability to take risk. If I didn't create jobs, you wouldn't have one. Period.
If I am foreclosed, I am fine with it and ready to take the responsibility. I am strong and healthy. But if Citibank can run to the government with its hand out, and investment bankers who made more in a year than I made in my lifetime can fracture my mortgage into millions of pieces so I can't even call a banker and have a conversation about it, then I can at least ask.
Thanks so much for this blog posting. It inspired me. I too have been fighting to keep my mortgage current. I was laid-off in September '08. Fortunately I was 2 months ahead on payments at that time and applied most of my severance towards an additional 3 mos. It's now 5 months later and I'm still unemployed and collecting unemployment. But I left a job that was paying close to 6 figures - the monthly unemployment amount will barely cover my mortgage, not to mention electricity, gas, food, etc.
My credit is good and I have a pittance of savings left. But I'm certainly worried. And my mortgage company is treating me like just another number. (possibly because they've be inundated with calls/letters)
Thank you so much for your courage to share your story. I hate to say that misery loves company, but your story really touched me.
I also read one of your previous posts about pulling yourself up by the bootstraps. That's what really inspired me. I'd been considering becoming a consultant in my field of expertise - Email Marketing - but because, I don't know...fear, I have been hesitant. Your post made me realize that there is no better time than now.
Again, sincerely, many thanks.
I just read through some of the responses on this posting. My God.
What I think some of these commenters fail to realize is, "there by the grace of God go I."
People tend dislike people who appear to "have more" than they do, irregardless of how responsible you are/are not OR they are/are not.
Sounds like you're a strong cookie by your sober responses to your critics. Hang in there. I'm pulling for you.
LR
Taken a shot on a dream? Are you kidding? It makes no difference what a starter home costs in Calif. or anywhere else. You sense of entitlement is inexcusable and is symptomatic of why America is in the can.
Bottom line: You went and bought something you couldn't afford. And yes, you are a bad businesswoman so cut the nonsense, would you advise a company, or invest in one that had no equity ownership stake in its business? You got burnt by being greedy; so sorry that your dream of cosmo's and finger sandwiches on the shore of Half Moon Bay didn't work out. Put a helmet on, go get a job, and quit looking for sympathy in cyberspace.
This defies logic - you made interest-only payments while everyone was getting drunk at the punchbowl. I am sorry, while I have no doubt that you are not an idiot, what you did was completely idiotic and therefore, since you are a grownup, you need to take responsibility for it.
Hang in there francine! I wish you all the luck in the world!
Since apparently I am paying for this mess along with millions of other young working professionals, foreclosures is what we want. Yes, foreclosures and 3x reduction in real estate prices, because our economy doesn't pay salaries that let us save up $750K for a house in the middle of nowhere.
Your "investment" should be up for sale for $350K and you should be rebuilding your credit while living in an apartment.
And please leave banks out of it. They only gave you what you asked them for.
Now, I dont think it is right that the banks got bailed out. I am as equally passionate that what you are asking for is flat out dishonest and wrong. Further, your sentimental play and justification is simply a distraction from the facts, and quite frankly, pretty nauseating.
I'm not throwing stones here, we've all been through rough times. But the creme rises to the top, and natural selection will take place. People who are unprepared are going to suffer the consequences of their decisions. Many will become renters, and in all honesty, that is probably what they should have been from the outset. Others are going to reap the benefits of being conservative, and not only living within their means, but also planning for a rainy day... guess what, it's raining.
Remember, when it is time to perform, it is too late to prepare. Plain and simple, your lack of foresight put you here, that's all.
YOU put YOURSELF in a bad situation, and no amount of eloquent writing or sob story of wanting to live near family is going to change that fact. Own up to your mistake and get to work and make it happen, or adjust your lifestyle to accommodate your new means.
Please, dont spread the word that what you are asking for is only fair and reasonable, the comments of those who somehow agree with you have me really troubled at the direction this country is headed.
From the front page of their site: "Companies that are accepted into the Stealthmode Partners portfolio receive coaching, consulting, and connections to the people and resources they need to reach success."
I really don't think this person is in a position to be handing out advice and counseling.
I think that is unreasonable. You should certainly feel free to try to renegotiate the interest rate - that is your prerogative. Of course it is the institutions right to refuse. If you default on the loan then they can seize the asset. Whether that makes sense or not is none of your concern; it's their right and you agreed to it when you signed the contracts.
Why don't you go an ask the person you bought the asset from for your $110k handout? They should rightfully laugh at you. You signed the contract and made the deal. The loss is yours to eat.
I know what property costs in California. I live in the SF Bay are and am just a renter because I could never justify the overinflated prices to purchase. I have family I wish I could spend more time with. I've worked hard, saved hard, and just like you my taxes are being sucked into this mess.
Frankly, I feel I have karma to burn after so many years being fiscally and socially responsible.
I fail to see why we should reward those that are in over their heads. That goes for both banks and for individuals. I have long been disenchanted with where my taxes are going. To give a sense of balance I send $1000 a month to various charities to those suffering from a lack of basic needs like access to drinkable water. For the rest of the spoilt people in this once great country, I say let you all fall down and be forced to pick yourselves up and rediscover what made this country great. Come join the real world.
How on earth can you ask for sympathy as the owner of a luxury $750,000 home? Are you crazy? Are you on Prozac?
You'll be making deals alright... for government cheese and a nice spot in a government retirement facility. You're a waste of life. Please remove yourself from any relevant functions of my countries political system.
BUT: I did what you did for my entire life. I worked, lived responsibly, and I saved money. You cannot dismiss me as a greedy speculator and tell me free markets should pertain here.
I am not speaking for myself. I'm speaking for everyone who was taught that the American dream consisted of a house and a job, and who doesn't have either right now through large global forces. It is naive to think that if the banks don't renegotiate mortgages the entire economy will recover by itself.
You had 50K money that you blew decorating the house. Did it occur to you to save it for a rainy day?
What injustice? You signed a contract you can not live up to. Economies move up and down. Assets appreciate and depreciate. It is foolishness of the highest order to assume property prices will never move down as well as up. Or that an economy will not contract. That bubbles will not happen. etc. etc.
Have speculators done harm? Yes, of course. As have aging babyboomers tying up assets and pricing younger people out of markets. Is this unfortunate? Yes. Is it somehow unjust to those people now caught with their pants down? No. Frankly you sound like you had little concept of the cost and risk associated with the loans; risk that it is your responsibility to understand. Now you pay the price for not being suitable hedged and over-extending yourself.
"You cannot dismiss me as a greedy speculator and tell me free markets should pertain here."
I am not dismissing you as a greedy speculator. I'm dismissing you as someone who over-extended themselves and now has to readjust to your actual circumstances. Why shouldn't the free market be allowed to adjust?
"I am not speaking for myself. I’m speaking for everyone who was taught that the American dream consisted of a house and a job, and who doesn’t have either right now through large global forces."
That is hardly what the American dream consists of. What kind of entitlement problem do you have to think it does? Welcome to the real world. You are much better off than 99.9% of people on the planet, even without your house. You spent a large sum of money redecorating but don't seem to have had money put away to cover these ups and downs? Its shameful having been quite well off, and by the sounds of it you were, and not be able to ride this out.
Like Anthony I'm a CA resident and a renter in a low-cost area. If I lose my job? I have 14 years worth of emergency savings at my current spending level and need not earn another penny in that time. That 14 years worth of living expenses? It wouldn't even cover the price of your house but I know which I'd rather have right now.
"It is naive to think that if the banks don’t renegotiate mortgages the entire economy will recover by itself."
Actually, it will. Will things get a lot worse? Oh yes. I expect the next wave of resets to do severe damage to morale and wipe out overextended people:
http://www.irvinehousingblog.com/wp-content/upl...
Will the economy survive and thrive after some time? Absolutely. Get a sense of perspective. Imagine the sacrifices made during the Second World War. Essentially all that is happening is that we've had a bubble that is unwinding. We're resetting asset prices to be in line with historical averages.
Take a look at this:
http://forum.globalhousepricecrash.com/index.ph...
House prices are insanely out of line with wage levels. Instead of 5x we should be glad if they reset to 2 or 3x. Nevermind a 14% drop, I want a 50 or 60% drop.
Injustice? Don't make me laugh.
It's clear, at least to me, that you posted it with the hope of letting those "in power" know that this crisis is affecting EVERYONE! Perhaps some commenters have had the good fortune, or what they would call good judgement, to have been in their home since the last time interest rates were low. Fixed-rate mortgages were not so difficult to come by back then.
Things changed after that. Mortgages were no longer help by the bank or mortgage company that originated them. Once the mortgage was approved and the funds disbursed, the mortgage "paper" was sold on the secondary market.
The loan officers who, in reality, sold the mortgages to the homeowner earned their living on an incentive basis. Some were paid commissions and other were paid on the basis of how many mortgage loans they sold. Often, loan officers were paid higher bonuses for the less conventional loans, like variable rate mortgages. Because of that, some mortgage loan officers didn't even offer the option of a fixed-rate conventional loan as an option.
This in no way imply that you, Francine, didn't know what your options were and what you were buying. Far from it. My point with this comment is that people in glass houses shouldn't throw stones.
I'm sure not ALL is well in EVERY part of their lives. It's easy for people to call names on a blog comment because they think they know it all and there is no way for anyone to come back on them for their venomous comments. The harsher the venom, the more troubled and twisted the person is who is throwing stones at you.
Forget them or pray for them. Whatever you do, never let them harm your warm and generous spirit, Francine! Of course that would never happen because, as I know you, your spirit is a very strong one too.
Namaste
A few months passed, after losing my home and I got a call from the city telling me to resolve another issue with the home, I gave them the banks phone number.
Please don't let the hecklers here get ya down as they are at heart VULTURES circling what they consider to be roadkill...They also have a moral blind spot when it comes to Reagan and Bush 1 & 2 all three of whom pursued policies that have created the current business models...That have allowed the top 1% (like the guys who ran BOA and other financial institutions who set up these Ponzi like schemes that led to the housing and technology bubbles) to make a lot of money in the short run only to take their millions as they cut their losses and ran when the economy overheated and fell into a recession that cut the legs out from under people like us...
BTW did you know that Bush II's Paternal and Maternal grandfathers were in the banking industry prior to WWII and helped the Nazi's get the financing they needed to build their war machine...I learned this by reading the book "The Rise of the Fourth Reich" written by Jim Marrs...
BTW one of my first comments I made here is still in moderation...
Enough said. Your an idoit looking for big fat government for direction. Grow the fuck up. Send the keys in the mail and let the market figure it out.
Your responsibility is self preservation.
Our country would be a lot better off if we esteemed self reliance.
Did you ever think that that the other 600,000 or so you borrowed to finance your castle, was actaully money that someone else scrimped and saved?
I am Canadian, the same thing is happening here, only two years later than the USA, and god help us is all I can say.
I listened for years to all the fat egos, living in luxury, bragging at the cocktail parties about thier rising property values trading ,up constantlytaking out equity in thier grossly inflated house prices to finance lavish lifestyles, living in mansions with vaulted ceilings, buying cottages for 'investment" etc.
These same business people scream at the municipal politicians to lower thier damm business taxes, then they take the money they saved and spend it on winter vacations. I dont feel sorry for anyone, in fact Im laughing at how stupid you all look now.
And whats worse, you people who overpaid for yoru houses, were victims of the con artist mortage and real estate brokers, now send all your "toxic assets" overseas so now the entire world is a victim of the rapacious greed of Americans. phooey...
Sell the damm castle and live in your means, even of it means renting a tiny apartment.
Firstly, buying anything on credit without the income to support the loan is a big risk. Admittedly, this is a tough one for the self employed. I also work for myself. Not every self-employed person will have sufficient confidence in always being able to earn enough to pay the mortgage. If in doubt, rent.
Secondly, and most crucially, a home can never be a speculative asset. It is worth nothing. You cannot sell it. Its value to you is purely as a means of warmth and shelter. Far too many people in this country (I am in Scotland) bought their house, and a lot more beside, because prices were rocketing skywards. Nobody seemed to recognise that if the property is sold at twice the price it was bought at, the owner is only going to have to pay the same amount for another house!
So I say to you Francine, concentrate on your business. Develop that and if necessary, find an accountant to help you manage your cash. It doesn't matter what your neighbours are doing. Your house is your home. You live there because it suits you to do so, not because it has a market value of this or that.
I'm an entrepreneur, too, and I don't buy it that your bank needs to rescue you.
I make decent money, enough to provide for our four children and to allow my wife to stay at home, go to school, or have a career as she sees fit. We live within our means, which means not having massive debt over our heads that we might or might not be able to pay later. We chose to live in a house we could afford, not a house that we thought we could afford "monthly payments" on. That's called living within your means, and it's kind of a radical concept in America.
Now, of course, even though our house is nice and is adequate for our family, we too aspire to bigger, better and nicer, so we continue to put money away toward buying a larger house eventually. The difference here is that we won't buy it until we have the money in hand rather than relying on fictitious money (i.e. credit, the polite term for incurring massive amounts of debt) to pay for what we want but can't afford.
So I have a really hard time buying into this argument that you were somehow smart about things. Smart is not saying, "Well, I have enough money to get banks to allow me to incur over half a million dollars in debt (on a SECOND HOUSE, no less) and since I can presently afford the monthly payment, I'll go for it." You don't automatically qualify as smart, either, by being wealthy enough to receive large amounts of credit, or by being an entrepreneur for decades, or by being a good writer (which, to keep the ego in check, you're not a bad writer but you're no Hemingway, at least not from this open letter).
And I don't buy that you're just caught up in bad circumstances. Being the victim of a bad situation is being paralyzed and no longer able to work, or having to spend your life savings on medical bills not covered by insurance, or having your home destroyed in a natural disaster. But counting on future income that you haven't yet earned, then recklessly incurring massive debt, and then being unable to pay back your debt when inevitable economic changes occur is not being a victim. That's called making poor choices.
And I daresay it's these common, but nonetheless poor, choices that many Americans like yourself have made that are responsible for the financial meltdown we're witnessing.
As for my family and me, we may not have multiple mansions, but we're largely unscathed by what's happening in the financial sector because we haven't set ourselves up to be affected by it. I'm not going to lie, that's a really good feeling.
"I guess I don’t have to create jobs anymore for you guys, because you are safe with your 30-year fixed rate mortgages and don’t need me to take anymore risks on your behalf."
You seem to have a passive/aggressive victim complex combined with delusions of grandeur and a nice dose of paranoia. Get over yourself.
Susan
http://pay-dayadvance.net
Susan
http://pay-dayadvance.net
What was the fallout of your request?
The fact of the matter is we as a society have allowed the lenders to promise the world without any just believable reason that all would come true.
I will be the first to admit that some of the problem lies at the foot of the borrower, who for whatever reason allows the lenders to think all will be ok. The truth of the matter is all MAY and I mean MAY be ok should things keep rolling along and all promises made live up to their protential. Reality is this is very rarely the case. Lenders allow borrowers to get in way over their heads and the repercussions are they go bankrupt and the lender forecloses. No foul right?
Of course there is, the lender should be looking out for all involved and that also means me the investor,
A lender who looks only at the best means of making a buck without looking at the long term implications do not deserve the right to foreclose or cause harm.
One only needs to look at how messed up this world has become, we have lenders sitting there begging college and university student who are just kids to go into debt up to their eyeballs, without even blinking an eye. Our children are being taught, debt is a good thing. Just look at the average student loan in any country. Most students without well off parents who can afford to send their children on to higher education are in debt for 1000's of dollars before they even get their first real job.
The sell job is borrow now, when you get out you will be making enough money to easily pay off these debts. Then the crash hits, no jobs to be had anywhere, certainly not for a student just out of school with no real experience to speak off. Now the students the same as the over extended borrowers can not pay their loans, the lenders cry foul and beg for tax payer relief and get it, but the poor borrower who may or may not of ever been given the loan loses all.
The arguments heard here make very little sense to me, to say one person is at fault because a lender has allowed them to get to the point of no return does not wash, a lender should not be lending money unless they are willing to take the loss period. If in the real world all at fault paid the price maybe things would not be were they are today. For each loan unpaid just adds another payment to those of us that can pay. The lender forecloses, all the cost and loss that the lender entails just gets dumped onto those that can pay. It can be in the form of tax relief to th lender, a bailout or just increased fees because the lender needs to make up for its loses.
In the end we are the ones paying and therefore should have some say in what is happening to the credit market. I for one would sooner see people paying whatever they can and keeping them in their house, even if it means morgages with no interest.
Lenders need to be found accountable for the actions they are doing. We need to get back to reality where those who do not have the means to pay, do not get the loans.
People who feel I have do everything right, I live within my means, I own a smaller house or rent etc.
Reality is that currently you may live within your means, this does not mean you always will.
Rents can skyrocket, interest rates can skyrocket, taxes can skyrocket and honestly all of these things will happen if we are to get out of this mess, just the facts of time proves this. A correction will need to be made at some point in time.
Just in the last 3 months at where I am employed 750 employees were let go, all with 20-25 years of stellar service. Ask anyone of those 750 people if they ever thought this would happen to them?
I would dare to guess that not one of them would of.
How long before these people begin to run into the same problem with their credit ratings?
Do we just blame them?
Everyone needs to give their heads a shake and ask what can we as a society do to improve things and lay the blame where it belongs on the lenders who are so eager and willing to loan money out like it was water, without once looking at the person they are lending too!
JMO