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- inactive, on 03/20/2008, -5/+18That's what happens when you creatively finance homes you have no business buying in the first place, in hopes that the market will keep going up.
Bottom-line: do your homework next time. They don't call buying a home "one of the biggest decisions you'll make in your life" for no reason. When you gamble, you don't always win. - 5xSTUN, on 03/20/2008, -6/+18For what we're spending on the Iraq war every day, we could build a McMansion in the country for every single American family.
And what about what the government is spending to prop up the banks and financial companies who are largely responsible for this mess?
It boggles my mind how a government handout to a miserably poor person is viewed as shameful and disgusting, while a government handout to a wall street billionaire is seen as a sound fiscal policy. - smacksaw, on 03/20/2008, -0/+12Hmm...I gotta come in on the "personal responsibility" side of this one here. First, a lot of that real estate people had no business buying. What if we were talking about their Mercedes getting repossessed? Or having to go into default because they charged up their credit cards? We'd all say "well they deserve it."
But wait. You say a home is not like a luxury card or credit cards. And you're right. However, often a home in SoCal is a luxury, a luxury because you are living in one of the greatest places on earth and it costs to live there. The jobs don't support the cost of living for many people. Yet you can go to middle America like Ohio or NY or OK and pick up a family home for $40,000 or less.
These people live in SoCal and make $8-12/hr but try to swing a $400,000 house. Or they could get a home elsewhere for 1/10th the price and still make $8-12/hr, but live really well.
My question isn't "what is gov't or society doing about these people?" as much as "why are they still sitting there waiting for something to happen when they could GET THE ***** OUT OF THERE!"
Besides, as a native San Diegan I am all for depopulating the area. We cannot support the environmental strain and impact of these people using our scarce water resources and driving everywhere polluting the place up. - induren, on 03/19/2008, -7/+18Deregulation! The true God of the corporate elite! GO USA!
- Ganja420, on 03/20/2008, -0/+10"They sit around waiting for handouts."
Almost every McDonalds will hire you for atleast 7$ an hour.... i know $280 a week isn't alot but its $280 more than $0/week. - swrostmore, on 03/20/2008, -2/+11"Blame the victim" is *****, and here's why: These people were given incentives to borrow more than they could afford. Rather than refusing loans to people who couldn't afford it, banks were actively encouraging it by making loans seem affordable through low interest, and then jacking up the interest rate after a set period of time. This is called ‘fraudulent conveyance’ or ‘predatory lending’ under US law. This was illegal under Clinton and before, but Bush treated it with a wink and a nod, as evidenced by the rise in total percent of sub-prime mortgages from 2% under Clinton to 13% and higher under Bush.
COUNTRYWIDE AND OTHER SUBPRIME LENDERS ARE CURRENTLY BEING INVESTIGATED BY THE FBI AND THE SEC AS WELL AS DOZENS OF LAWSUITS FOR "STEERING" PEOPLE INTO LOANS THEY COULDN'T AFFORD.
So why do people insist on blaming the victim when there is clear-cut evidence of systemic wrongdoing? - swrostmore, on 03/20/2008, -4/+13Correction: The American government HAD been pressuring banks for 20 years to stop red-lining, until Bush took office. Bush's regulators actively encouraged it. Example: In 2000, 2% of US mortgages were subprime. 2006: 13%.
- inactive, on 03/20/2008, -6/+14If you educated your people instead of teaching them creationism in school, you might not be in this situation. Also, trying to win a war for god in Iraq is costing you your entire republic.
- NEWNHLISLAME, on 03/20/2008, -1/+8The end is near
- inactive, on 03/20/2008, -4/+9Let the mainstream media do a few nice FIVE MINUTE SEGMENTS on this. Then it's back to who's screwing who. The media is you enemy if you let them be.
- JessicaLF77, on 03/20/2008, -0/+4But if I was able to research and discover why that subprime loan that looked so good at first glance was going to come back and bite me on the ass, I think most people should. I'll admit it. I'm an idiot when it comes to my finances. If I can spot it, most people should be able to. Only hearing what you want to hear does not excuse you from taking responsibility later.
- inactive, on 03/20/2008, -1/+4Average people speculated on the housing market and lost. Isn't it strange how the people who know real estate got really rich during this time by not advising average people to avoid speculating in the real estate market....?
- JessicaLF77, on 03/20/2008, -1/+4I was simply disagreeing with your statement of "Blame the victim is *****." I think they're both to blame. One for predatory lending, and the other for blindly signing away.
- swrostmore, on 03/20/2008, -1/+4You disagree with what? The fact that your bank may have been breaking consumer protection laws by attempting to steer you into a predatory loan isn't negated by your failure to take the bait.
- swrostmore, on 03/20/2008, -1/+4Predatory lending is called "predatory" because the terms of the loan are intentionally misleading. You're saying people that lost their homes because they were lied to are equally to blame with those who lied in order to reap the profits...because they believed the lies they were told.
- oldhick, on 03/20/2008, -0/+3First off the FBI isn't investigating Countrywide Financial for PREDATORY lending. They are investigating them for making false statements about their financial position and misrepresenting potential losses. There is a huge difference. The allegations of predatory lending are simply being made by columnists and bloggers, not the FBI.
http://money.cnn.com/2008/03/08/news/companies/cou ...
http://biz.yahoo.com/ap/080309/countrywide_probe.h ... - smacksaw, on 03/20/2008, -0/+2The problem with your scenario is that these people could have bought homes that were reasonably priced, or worse-yet not overpriced.
The lending, while irresponsible is half the problem of the lender and the other half what the person chooses to buy.
Again, your logic would be that credit cards should be illegal because of predatory lending. Ok, maybe so. But if people use them to buy things they need and use credit responsibly, there is no problem. But if they use it to buy movie tickets and popcorn and go to the movies 2x a day for a month, it's still the credit card issuer's fault?
No.
Look. You can't blame one side when the other is just to much to blame, if not more. My mom sold her house in California and moved to Washington and bought one for 1/3 the price. She used Countrywide for her lender and she's quite happy with them as she used them responsibly. With your logic, anything could be bad. How about water? That woman died from drinking water trying to win a Wii. Under your logic, we should blame water instead of her for not knowing what she was doing? She's still partially to blame. - nblsavage, on 03/20/2008, -1/+3Really? How about when I was a kid and my dad died and my mom was laid up because of hip surgery? Would you have had us out on the street?
- NonLeftistDiggr, on 03/20/2008, -0/+2Someone gives me incentive to drink bleach, I still decide it's a bad idea.
- BohicaTwentyTwo, on 03/20/2008, -5/+7This is what happens when you let California hippies dictate a city's homless policy.
- EatChex89, on 03/20/2008, -0/+2I love how the people are getting mad at being kicked out. One of the guys on KFI was like "why are they getting mad? They're getting free food, water, toilets. . . It had to end sometime!"
Lol. - swrostmore, on 03/20/2008, -0/+2"In that broader investigation, the F.B.I. is looking into possible accounting fraud, insider trading or other violations in connection with loans made to borrowers with weak, or subprime, credit.
As part of that investigation, the F.B.I. is cooperating with the Securities and Exchange Commission, which is conducting about three dozen civil investigations into how subprime loans were made and packaged and how securities backed by those loans were valued.
Several state prosecutors are also investigating mortgage industry practices."
http://www.nytimes.com/2008/03/09/business/09lend. ...
If I'm confused about anything, its what exactly you are disagreeing with me about. You say the structure of a loan can be designed to make it difficult for the layman to understand, I say that the FBI and the FEC are investigating "how subprime loans were made and packaged." You are correct that I may have oversimplified, as the misleading subprime packaging (I call it steering) investigation is part of a larger investigation into how it relates to the securities trading that you bring up. But my point, that the people who lost their homes did so as a result of intentional steering, and that this is backed up by the FBI and SEC investigation that we both are quoting, remains. - swrostmore, on 03/20/2008, -1/+3Someone gives you a flavored drink and tells you its delicious Koolaid. You drink it and die because it is actually kool-aid flavored bleach. I proceed to claim that your death is your own fault because you didn't know better than to drink bleach.
- lhbaker, on 03/20/2008, -1/+2How many of you non-sympathetic mother ***** are paying a mortgage?
- swrostmore, on 03/20/2008, -0/+1The inquiry comes as the F.B.I. investigates 14 companies as part of a wide-ranging review of business practices in the troubled mortgage industry.
In that broader investigation, the F.B.I. is looking into possible accounting fraud, insider trading or other violations in connection with loans made to borrowers with weak, or subprime, credit.
http://www.nytimes.com/2008/03/09/business/09lend. ... - oldhick, on 03/20/2008, -0/+1I would ask you to provide evidence of these predatory loans. While a loans structure may be difficult for the average laymen to understand in full, this does not equal predatory. Banks are heavily regulated and predatory lending laws have been around for quite sometime and are well known to the mortgage banking industry. You are making accusations that the FBI is not, nor is Congress.
ARM loans and sub-prime loans have been around for decades. The mortgage crisis leading to the bank collapse is not a result of these practices, but rather the banks structuring those loans into securities which are insured and sold to investment houses. The question being asked now is and the investigation of potential fraud, is in whether the banks adequately explained the risk inherent in these bundled securities.
Thats a very high-level explanation, but I thought it was important to clarify as you seem confused as to what is being investigated. - swrostmore, on 03/20/2008, -0/+11) When the borrower takes out a mortgage at 4% interest it may in fact be "reasonably priced." Then the bank suddenly raises the rate to 9% because the house's value dropped, plus charges to make up for the "discounted" 4% rate, the mortgage becomes overpriced, and there's nothing the borrower can do about it. This is what's known as predatory lending.
2) Credit cards should be illegal by "my logic?" I have no idea what kind of thought process would lead you to that straw man. People are given "credit limits" based on their income, I guess the analogy would be if a credit card company gave someone who makes 25k a year a $100,000 credit limit, and then raises the interest after the fact so he can't repay it, that would be predatory lending.
3) Blame water? You're awesome at inventing nonsensical straw men. The proper analogy would be to blame the people who offered an incentive for her to drink a fatal amount of water without bothering to check whether it could be harmful, and I think legally my perspective is more correct than yours (which is to blame the victim). - tucsonsun13, on 03/20/2008, -0/+1A-MEN I say to you
- Waiting2awake, on 03/20/2008, -1/+2 I agree with you completely, however the statement: "These people live in SoCal and make $8-12/hr but try to swing a $400,000 house. Or they could get a home elsewhere for 1/10th the price and still make $8-12/hr, but live really well."
- Where do you suppose that these people got those ideas from though? That is where this breaks down. You can only blame someone if they are fully capable of understanding the agreement they are going into. The reality, rightly or wrongly, is that the average person that got into this mess was NOT capable of understanding what they were getting into - and your right it is their responsibility to understand, assuming they were "capable" of understanding. I will submit to you they weren't. No offense to them.
So on the one side you have "professionals" actively marketing and targeting individuals that this scheme would work with - that also are incapable of seeing the bigger picture 5, 10 years down the road, with the idea that when that 5 or 10 year term comes the debt is off their books and handled in some fund somewhere else.
They looked for people that couldn't understand. One side did, the other didn't. The professionals that did understand did not do their duty by showing a truthful expectation, instead they did what all salesmen will do(without oversight) - accentuate the positive, minimize the negative. These people that got *****, and they had no way of knowing they were going to be *****.
That is where my trouble with all this. Beating someone in a fair fight is great, taking advantage of people that can't defend themselves is grand-douche-baggery. - Dumbledorito, on 03/20/2008, -0/+1It was also the shirking of responsibility by the lending isntitutions. You had mortgage companies removed from the responsibility of making sure the person they were signing up would pay off the debt. There was NO INCENTIVE to make trustworthy loans, since they'd just sell the loans off to third parties.
The public was basically offered free money. - NonLeftistDiggr, on 03/29/2008, -0/+1Right, because that's every example of state aide
- tucsonsun13, on 03/20/2008, -0/+1"they sit waiting for handouts"
I had the option to wait longer for my first job. I could've lived off parental welfare out of college, but I decided to get off my ass and MOVE. As said above, this country has an abundance of bull$h1t jobs that will pay you wages at or below the poverty line, usually below. But that is better than earning nothing. I wanted 25-27 an hour in AZ. But I rushed to take 22/hr in San Diego as I didn't want to be sitting around wasting my life. These people need to move. - oldhick, on 03/20/2008, -0/+1As pointed out in your article, not one mention of predatory practices. The line you are quoting describes the business these companies focused on, subprime loans for borrowers with weak credit. But they are not being investigated for predatory lending. Whats being investigated is how the loans were packaged into securities and sold.
- dupswapdrop, on 03/20/2008, -0/+1Well the government let the banks do this to the farmers in 80's and to manufacturing in the 90's this time it's homeowners wonder who's next?
- lhbaker, on 03/20/2008, -0/+1You think this is limited to Southern California? Gosh. I thought this was affecting everybody, not just shallow minded ***** like you. Native San Diegan, you say? Which reservation are you living on? Borona?
- swrostmore, on 03/20/2008, -0/+1Oldhick is correct, Countrywide isn't being investigated specifically for "predatory lending." There is in fact no legal definition of "predatory lending" and it is only specific abusive lending practices that are outlawed. Federal agencies use the term as a catch-all term for many specific illegal activities in the loan industry.
One of such illegal activities is securitization abuses, also described by oldhick as as "how the loans were packaged into securities and sold," for which Countrywide and dozens of other companies are under investigation by the FBI and the SEC.
http://en.wikipedia.org/wiki/Predatory_lending#Abu ... - inactive, on 03/20/2008, -4/+4Still doesn't equate to "Bush's fault". No matter how you slice it, the homeowners are the ones that should shoulder the blame. Again, they gambled and lost. Otherwise, you might as well blame the casino when you lose playing craps.
- lhbaker, on 03/20/2008, -1/+1Every home owner should get a ***** law degree, so when the broker lies to them, as brokers sometimes do, they know it. Otherwise, they're just getting what's coming to them. The banks acted perfectly respectably, and if they duped somebody, then so be it.
- JessicaLF77, on 03/20/2008, -3/+3I disagree. When I was looking for loans to purchase my first house, I was offered many sub-prime and adjustable rate loans. I researched what my options were, and settled with a 30-yr. fixed rate mortgage. I don't think it's too much to ask consumers to be conscious of what they're signing up for before they sign the papers.
- inactive, on 03/20/2008, -6/+5The American government has been pressuring banks for 20 years to stop red-lining. Now Americans are reaping what they've sown.
- inactive, on 03/20/2008, -2/+0i'd be so pissed if those hippies moved into my hood.
- NonLeftistDiggr, on 03/20/2008, -8/+4For what we are spending on Iraq we could have several thousand dollars not stolen from us in the first place.
I'll explain it to you, because a lot of the time that miserably poor person is in that state because they prefer the hand out over work. - inactive, on 03/20/2008, -21/+10Naturally American leftists think that the nanny government should be building homes for these people.
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