I am a guy who actually saved up 20% and put it down on a house in 2007 only to have subsequently seen my equity disappear. I cannot get a better interest rate than the 6.25% I’m paying because if I refinance I’ll have to pay homeowner’s insurance as I’d basically have no money down. I can’t qualify for that sweet $8000 credit for first time home buyers.
My coworker just qualified for the government 2% home loan. She had the foresight to buy a home with a subprime loan and huge payments she couldn’t afford and then get laid off (but rehired after just 1 month). However, now her husband’s business has picked up, she makes close to what I make and their new loan payments on their huge new home will be less than what it would cost to rent a two bedroom apartment.
I don’t have a car worth less than $4,500. My 8 year old truck, which I own, is worth about $6,000. Can’t make anything out of the cash for clunkers either. By the time it devalues to less than $4,500 the program will be over.
So, if you do things ‘right’ you qualify for nothing. Stupid bailouts just reward the greedy, stupid and just plain lucky. When the government programs change batshit crazy-like in 6 months, it makes it next to impossible to plan/budget to take advantage of any of them.
It sounds like you are financially far ahead of most people, in that you’re planning wisely, saving quite a bit of money, and probably investing for retirement. The fact that some people are being rescued from financial disaster with advantageous refinancing terms doesn’t really change the fact that you are likely to enjoy a much better standard of living for the rest of your life, barring unexpected things like getting hit by a bus or being framed for murder.
As someone who also does his best to use money wisely, I can’t say that I feel that life sucks for me. But if you really feel that poorly about your station in life, I will buy you a cupcake if you think it will help.
I’m not feeling sorry for myself, I’m doing fine enough actually. But it irks me that the rules keep changing. How the hell do you plan for any of this crap?
Also, the example of my coworker is someone who is just lucky. They don’t need the help, at least not after her 1 month of unemployment. She’s laughing to the bank. That money is not helping someone who truly needs it.
In Canada their are loads of government programs to help people, but they are established and it is possible for the middle class to take advantage of some of them too. For example, a 1 year maternity leave paid with unemployment is pretty much standard for anyone who wants it. You can plan & budget for that years out.
I sympathize with what you are saying, but the part I quoted makes no sense to me. These programs are to help people who find themselves in unfortunate situations, not for people to rearrange their finances to put themselves into unfortunate situations. The cost overrruns would be enormous were that allowed to happen.
That said, I agree with you for the most part. Why shouldn’t I get my home note modified and save some money if other people are doing so?
You can’t man. You just have to do the best for yourself the best you can see fit at any moment in time.
And tho it may not provide much comfort, rest assured that many if not most of the folk being bailed out are sufficiently fucked in enough other areas of their lives tat you needn’t overly envy these couple of bones they are being tossed. Even with this aid, they will still be existing at a level below the comfort and predictability you value.
Also, tho they are reaping some benefit now, realize they were experiencing some discomfort before. So you have to compare their entire picture to yours. They are gettig some advantage you are not, but they are unlikely to be coming out ahead of you, especially when viewed in the long run.
I hear ya. I’m in a similar boat. Can’t get a bail-out and can’t get cash for clunkers. My car is 12 years old (I bought it exactly 12 years ago July 14th) and is practically worthless as a trade-in, but the estimated MPG is too high.
If I think about it, it irritates me, but I don’t spend much time thinking about it. Knowing what I know now, I would have done everything the same, I’m guessing.
jtgain, I worded that a little poorly. But what I mean is socialist goverment programs are more fair if they are stable & longer lasting as opposed to expiring in a year or less. As for example the cash for clunkers thing. Everyone’s car would eventually devalue to less than $4,500 - but only people who currently own such a rig benefit. So I’m saying the program would be more fair to people who plan ahead if it was set up to last at least the 8 years or so it takes for a vehicle to devalue that much.
And things like this are not even about the poor/needy/unfortunate. I’ve read statistics showing many millionaire drive beaters and many poor people drive nice new cars because they can/could get the financing. Cash for clunkers benefits people who are at a certain point with their cars at a certain time. I realize this program is more about helping auto makers than people. The whole stimulus crap is more about helping banks, car manufactures and people who were stupid & greedy enough to buy more than they should have from banks and car manufactures.
Thanks for the link IvoryTowerDenizen. From a preliminary look I’m not sure I qualify for that but I’ll definately check it out in more detail.
It doesn’t affect my financial situation. It just affects my mental situation as I listen to her repeated bragging about their great 2%, 40 year fixed home loan. About how their payments dropped from $3000/month to less than $1000 on their awesome 5 bedroom home in a brand new neighborhood. About how their income is actually higher now than it was when they bought the place.
If I hear about it again tomorrow, I might lose it…
Obviously, she wouldn’t brag to you about how miserable she was knowing she could lose her house to foreclosure. She does brag to you when she gets a good new mortgage. You’re seeing her mental state when she’s happy and not when she’s sad- obviously, yours looks worse next to hers if that’s the case. Doesn’t mean it is overall, though.
Hm…well, I guess I don’t get the situation of the OP. I planned ahead, put down 20% with a decent fixed rate. And I had the bank call my wife and I about a month and a half ago and ask us if we’d like to refinance at over a point less than our original loan. This will take us from our original 30 year note (well, it was 26 years since we’ve had the house for 4 now) to a 15 year note, at a full point less, with no closing costs. Our payments will actually drop about a hundred a month…but the biggest thing is we go from a touch over 6% to a bit under 5%, and of course we go from a 30 year loan to a 15 year loan.
And they called us. So…I’m not unhappy at all with the turn of events, personally. To me it’s like folks who are always trying to find out what everyone else makes…myself, I negotiate the best deal I can when I take the job. If someone else negotiates better (or more likely worse) then that’s life. If I don’t think I’m making enough money for the job I’m doing then I’ll take my services elsewhere.
Funny, based on their website I wouldn’t qualify either! My house is worth more than I paid for it and our mortgage payment is about 18% of our monthly gross, so we have no payment problems. I went through my lender and he brought it up, so I’m not sure how the qualification bit applies in practice.
There will always be someone who got a better deal than you did, and there will always be someone who didn’t deserve to get a better deal than you but did anyway. That’s just the way it is. This doesn’t just apply to mortgages or salaries, either.
The only solution I can see (that doesn’t involve a time machine) is to stop trying to compare the deal you got with the one someone else got. Stop letting your co-worker make you unhappy. Change the subject or say you’re too busy to talk when she wants to talk about her mortgage. It’s kind of tacky to brag about one’s personal financial situation, anyway.
You’re right but I think we’re comparing apples and oranges! Don’t forget that this 2% home loan is a federal program. When I think of social services I figure they should either be fair to everyone - or else just help the unlucky/unfortunate rise up to a lower-middle class or so lifestyle, from which point they can start making it on their own.
This is a federal program, paid for by you, me and generations of future Americans. Are you people really saying there is nothing inherently wrong with some people getting subsidized with tax dollars to live in upper middle class homes they could never afford if they had interest rates everyone else has to pay?
I am actually a very liberal minded person, and support most social programs. But lately I’ve been seeing many examples of how when the federal government rolls spending out in a hurry it often makes no sense.