I think this NPR story is relevant.
This will never happen, but it would be funny if, instead of a “bailout”, those mortgage backed securities were simply declared invalid, and tough titty to the assholes who issue and buy them.
You don’t have to bail me out. I object to the categorization of people having problems paying their mortgage as people who lived above their means and overspent and now need help. Sometimes shit happens that you can’t foresee that eats through all your savings and leaves you desperate. Listen to some of the stories of people who were foreclosed on. Don’t assume something like that could never happen to you because you never know.
Yes, mortgage loans are a business but the practices they used to try and foreclose on me were not in their fine print. They will pretend to be sympathetic but when you actually try to make payment arrangements with them you will find that they will refuse partial payments even if you present them with a plan to pay them back the full amount by a certain date at which point you will be barely 3 months behind. By the way, they are my former loan company.
I don’t understand how it is good business to refuse money. I don’t understand how it is good business to take people’s homes and then let the homes sit and rot so they become essentially worthless. I don’t think people need bail outs but I think it’s high time that government cracked down on certain business practices, loan and insurance companies should be at the top of the list. Big business has been coddled by the government for the past 7 years, I hope that’s over soon.
In the Muppets version, the ant gets stepped on before he can enjoy his savings, and the grasshopper hops into his sports car and drives to Florida for the winter.
That was one hilarious skit.
This part is probably right - I doubt the mortgage company would put anything into a contract that said “don’t bother making payments on time, we will not try to collect”.
Essentially, what you are saying here is that the mortgage company didn’t believe you when you promised to pay back part of what you owed on a certain schedule, based on the fact that you had previously failed to pay back all of what you owed on a different schedule. But, as you mentioned, I doubt that the contract you signed compels them to do so, so I am not sure what your objection is. You signed a contract, you didn’t live up to your part, they did what they could to get you to pay as much as possible.
Well, it depends on the circumstances, I suppose. If I owe you $200 and promise to pay you back next July 1, and then in September I offer you $100, is it bad business to refuse and ask for the $200 instead? If $100 is all I can get, maybe it is. If I can convince you to borrow $200 from some one else and give it to me, then it isn’t. Or even $150, or $110.
You say you object to the characterization of people who can’t pay their mortgage as “needing help”, yet you ask for help from the mortgage company and get upset when they refuse. How does that work?
Regards,
Shodan
Everybody knows they did this. That whistle done be blown.
I think both “sides” were to blame; they were scratching each others’ backs. Regular people got too excited about taking on too much debt that they couldn’t realistically pay, and mortgage companies did their best to talk them into making bad decisions.
My FIL started off with a nice little mortgage he could afford on a small house. He decided to keep refinancing and taking all the equity out of the house until the mortgage was maxed out and there was no way he could pay it. No one made him do it; he should have known better than to try to get a mortgage with a payment larger than his actual earnings. But the mortgage company let him do it, which they should never have done. Result–the house is gone and they now live in an apartment.
So IMO both sides are culpable. A lot of people made bad decisions and we’re all taking the fallout.
I did not ask for help in the form of not paying, they made a pretext of saying they will work with you if you have problems but I offered them money to pay my mortgage on a few different occasions and they refused it, they refused a full month’s payment when I was two months behind and they refused the full 3 months due when it was sent before the last payment date of the 3rd month. The only way they would have accepted partial payments was if I had signed up for a twice monthly debit from my bank account which would have come out to be a higher monthly payment and I would have had to pay an additional fee almost equal to another month’s payment just to get on this program. So essentially their “help” was just a way to line their pockets some more.
This was all several years ago and I am paid off, have somewhat decent credit again and am feeling better. I do not need a bail out but I do have sympathy for those people who are dealing with mortgage problems.
But anyway, I really don’t need to explain all the details of my dealings with my mortgage company to you. So you just go ahead and enjoy yourself by continuing to twist my words and reading into them whatever you want. :rolleyes:
They never have, and they probably never will. In The Grapes of Wrath, after the bank forecloses on the Judd’s farm, it not only evicts them but bulldozes their ramshackle farmhouse. I don’t know if it’s because allowing defaulted tenets to stay would give them some implied rights to the property (“squatter’s rights”), or if it’s just a case of the bank saying "We’ll be damned if we let anyone stay there for free!’ It’s probably similar to why in the same novel/film the fruit growers burned the crop they couldn’t sell rather than let the hungry poor have it, as was debated in This thread.
Well, AFAICT you offered partial payment, and they refused, insisting instead on full payment as agreed to in the contract. Again, this doesn’t sound so terrible to me.
You asked earlier why it made good business sense to refuse payment.Here’s why -
IOW, the mortgage company made a business judgment that if they refused your offer to, in essence, renegotiate your mortgage on terms more favorable to you, they would wind up receiving a larger portion of the agreed-to amount of repayment. Again, not such a terrible thing (imo).
As mentioned, I owe you $200. I come to you and say, “I can’t afford to pay you back the whole $200 - how about $150 instead and we will call it even?” I think you would be entirely within your rights to refuse the partial payment and insist on the whole $200. And if it is a secured debt, like a mortgage is, then you have a little more leverage over me to prevent me from saying, “Tough shit - you can whistle for your money” because you can foreclose on the property I put up as security.
That one of the reasons why mortgage debt has a lower rate of interest than credit card debt - people are more likely to pay their mortgage rather than lose their house.
Regards,
Shodan
The effects of the home mortage crisis are being felt by everyone, not just the people who took on bad loans. For the most part i agree with you that we shouldn’t bail out people who make bad financial decisions, but so many of them at once are having a tangible negative effect on everyone else so either way the ants get punished.
So it still doesn’t get discussed WHO made all these “bad financial decisions”? Plenty of homebuyers, sure. What about the investors? The banks, loan companies, and funds who made the loans and bought the securities? The “bailout”, such as it is, is about helping them escape responsibility for their “bad decisions” (and they’re in a position to know better about these things), not about helping homeowners who were overoptimistic/ reckless/ bamboozled/ unlucky. So an investment firm miscalculated and now has to suck the facts of explaining to the shareholders and going out of business, the closest corporate equivalent to getting thrown onto the street. Why no dismissals of them paying the market price for behaving stupidly?
And always, there’s a defense that these guys are there to make money, and their tactics are legal and understandable in that light. Well, the homeowner has priorities that don’t involve charity to the loanholder, and it’s just as honorable and decent that they get what they can and cut their losses when need be, as long as it’s legal. Why should they be held to a code of honor that doesn’t apply to financial institutions?