A better bail out idea?

[WrenchMonkey]

...people have been buying way more house recently (since the mid 1990s) then should have bought due to low interest rates (compared to the 20% interest rate home mortgages that were around when I bought mine in 1980-81). Buying too much house has the got ya of higher property taxes and higher homeowners insurance costs.

Christ-a-mighty, I agree with Mike...

The other half of those higher property/school taxes is the teachers' unions insistance that the solution to a poor education system is always more money. Look at per-pupil spending over the last couple decades...

Robert

 

[Ecomike]

Christ-a-mighty, I agree with Mike...

The other half of those higher property/school taxes is the teachers' unions insistance that the solution to a poor education system is always more money. Look at per-pupil spending over the last couple decades...

Robert

We don't believe in unions in Texas!

 

[Ecomike]

Christ-a-mighty, I agree with Mike...

The other half of those higher property/school taxes is the teachers' unions insistance that the solution to a poor education system is always more money. Look at per-pupil spending over the last couple decades...

Robert

We have let uncontrolled free enterprise and mass merchandise marketing turn our kids, the new generations, into consumption demons, debt demons, and out of control credit consumers, and we have failed to force the school systems, like High schools and Intermediates schools, to teach basic financial principles to those youngsters that are not lucky enough to have fiscally conservative parents teaching them.

 

[WrenchMonkey]

We have let uncontrolled free enterprise and mass merchandise marketing turn our kids, the new generations, into consumption demons, debt demons, and out of control credit consumers, and we have failed to force the school systems, like High schools and Intermediates schools, to teach basic financial principles to those youngsters that are not lucky enough to have fiscally conservative parents teaching them.

Christ-a-mighty, I agree with Mike... Again.

That's it... I think I'm going to bed...

Robert

 

[red91]

Ha this will get worse...

I know people that are letting their homes go into forclosure so that they can "trade up".

Those people need to go to jail, period.

 

[Ecomike]

Ha this will get worse...

I know people that are letting their homes go into forclosure so that they can "trade up".

Those people need to go to jail, period.

How does that game work?, or how is it played?

 

[red91]

How does that game work?, or how is it played?

if you have enough equity in your home you use it as leverage against a much better home and then default on the first.

Just don't use the same lender...

 

[WrenchMonkey]

if you have enough equity in your home you use it as leverage against a much better home and then default on the first.

Just don't use the same lender...

All you'd accomplish is losing the equity.

Why wouldn't you just sell it, even if its below value, to at least get some money out of it, and preserve your credit?

:dunno:
Robert

 

[red91]

All you'd accomplish is losing the equity.

Why wouldn't you just sell it, even if its below value, to at least get some money out of it, and preserve your credit?

:dunno:
Robert

Flooded market, skitish buyers, and NOT that much equity in it.

Around here houses aren't selling, period.

Hell there are people walking away from their houses now simply because they aren't worth what they paid for them. So their saying, screw this....
Why should "I" have to take the loss...let the bank take it.


Nothing like "responsible" home owners....

 

[JNickel101]

I'm surprised more people haven't started setting fire to their homes to collect the insurance money on it....

 

[RichP]

Flooded market, skitish buyers, and NOT that much equity in it.

Around here houses aren't selling, period.

Hell there are people walking away from their houses now simply because they aren't worth what they paid for them. So their saying, screw this....
Why should "I" have to take the loss...let the bank take it.


Nothing like "responsible" home owners....

That happened in NJ back in the 90's, when IBM closed a large office building in Bergen county, took close to 2500 executive and management high paying IBM jobs, houses that were selling for $500,000+ dropped to $150,000 literally over nite when they made the announcement. When IBM closed it also took out branch offices of banks, furniture stores, all the support stuff, total waterfall effect including the computer support companies. The company I worked for lost $150,000 a year in maintenance contracts. A guy in my guard unit who was a branch manager for National community bank said people were just walking in and dropping off their house keys, alarm codes, then just walking out.
It took 10 years but the market finally recovered and the homes are back up where they were. I imagine it was similar in Texas when Heylmyer closed TI and moved their factories and production overseas and laying off 50,000 people in less than 3 months, the stockholders made 10% that year. Of course TI pretty much dropped off the map after that, I guess they are still in business but I don't see their chips or equipment around anymore.

 

[WrenchMonkey]

Flooded market, skitish buyers, and NOT that much equity in it.

Around here houses aren't selling, period.

But if you don't have any (or much) equity in the cheap house, the bank is never going to let you use it as collateral (which what I assume you meant by "leverage") towards a new, expensive house...

I see how you could (try to) buy a new house, then just default on the old one to avoid the hassle of selling it.

I just don't see how that's "using" the one towards the other.

Robert

 

[Ecomike]

That happened in NJ back in the 90's, when IBM closed a large office building in Bergen county, took close to 2500 executive and management high paying IBM jobs, houses that were selling for $500,000+ dropped to $150,000 literally over nite when they made the announcement. When IBM closed it also took out branch offices of banks, furniture stores, all the support stuff, total waterfall effect including the computer support companies. The company I worked for lost $150,000 a year in maintenance contracts. A guy in my guard unit who was a branch manager for National community bank said people were just walking in and dropping off their house keys, alarm codes, then just walking out.
It took 10 years but the market finally recovered and the homes are back up where they were. I imagine it was similar in Texas when Heylmyer closed TI and moved their factories and production overseas and laying off 50,000 people in less than 3 months, the stockholders made 10% that year. Of course TI pretty much dropped off the map after that, I guess they are still in business but I don't see their chips or equipment around anymore.

TI is still huge, I think they are the largest scientific calculator maker around. When was this anyway, 1980s?

 

[WrenchMonkey]

When was this anyway, 1980s?

That happened in NJ back in the 90's

Robert

 

[RichP]

TI is still huge, I think they are the largest scientific calculator maker around. When was this anyway, 1980s?

Might have been really late 80's, I was at bellcore as a member of technical staff, when he came on board as CEO and replaced Rocky Morano who was from NJ Bell, the bell operating companies cycled CEO's thru on 5 year cycles, Rocky retired. Heilmeyer came on board and the first thing he did was was cut the work force by 50% right off the bat, 12,000 to 6,000 over nite, well, three months anyway, then started hiring green cards to fill the vacancies he created.
He was the only CEO I ever saw that had an armored limo and armed body guards and in NJ armed body guards take quite a bit of doing considering that they did not even allow retired police to carry.
I made it thru all three cuts till they had an 'affirmative action' cut where they took all the 40-50 year old white guys and let them go.
In my opinion we need to put the US of A's house in order first, we need to stop companies from moving every single job they can save a buck on from moving it overseas and then bringing their products back into the country like it was made here. Until that changes we will continue to go downhill.

 

[Boatwrench]

If you have a "good" job, with no reasonable housing within 65 miles, it's not a good job.

If you find a "good" place to live, with no decent-paying jobs within 65 miles, it's not a good place to live.

This is the best point of the whole thread.