Why the hell should my tax dollars go to bail out sub-prime lenders and their clientele?

What ever happened to personal responsibility? Why should I pay for someone else's poor financial decision? Nobody forces anyone to buy a house. Nobody needs a house. Why is there all this societal pressure to buy a house? I am very financially secure and perfectly happy rentiing. I don't want the headaches and responsibility that comes with owning a house. I have better things to spend my money on, at least right now. I'm 40 and a happy renter.

So, what business has Congress even considering playing mama and papa to people who foolishly got themselves into bad loans? The people made their choice, they will have to live with it. Nobody forced all these folks going belly-up with their houses to make the choices they did, and I'll be damned if one cent of the American tax dollar should go to bailing them out!

:-)

Might be be humanitarian?

My mortgage was actually MUCH cheaper when I was a single Mom than if I had tried to rent. And I would have had to rent a two-bedroom apartment/house because my child is male.

My two-bedroom home (with an added den) was about $200 to $300 less than renting.

Now, I didn't have a sub-prime mortgage, but my point was that it doesn't save money in a lot of cases.

My point people who made these poor financial decisions are not deserving of a special kind of welfare just for them, nor are the companies that gave them the loans.

When you own, you have to pay for the re-roofing, plumbing problems, electrical problems, etc.

If you're in a real new place, hopefully you won't have those expenses for a while. But eventually, they'll rear their heads.

Our house payment including property tax and homeowners insurance is less than we were paying to rent. Granted, if the furnace breaks or something it's our problem -- there's no landlord to call.

I bought a TH condo because I was tired of my rent going up $50+ a month every year. My mortgage payment was higher then but after 3 years it's most likely less than what I'd be paying if I was in my old apartment. Since I have a fixed rate I have few worries for future years unless my property values go way up and my income goes down.

I think the fault it two fold. First, yes they need to read the contract. They have to take into account the additional costs of fixing. I just had some repairs I knew I would have to make eventually. I also didn't get something gigantic that was barely affordable to make room for a car payment whenever that is needed. Second, these companies are giving people mortgages that probably shouldn't have them. It's predatory.

The "I am so ignorant that I didn't see it coming" excuse just does not wash with me.

I once asked Jorma Kaukonen what was the most important thing he had learned in the music business.

He replied, "Read the fucking contract".

Congress must pass legislation regulating these loan practices.

I understand what you are saying about bailing them out, but I would sure rather see my tax dollars spent on programs like this than in Iraq.

Why do these people deserve a special kind of welfare different than everyone else?

on that one?

liberals?

poor people?

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Im just wondering if the bailout this time might be for the buyers rather than the big business
why is it that the subprime lenders should get bailed out instead of the people they preyed on

Why does a special group of foolish consumers deserve any more than the rest of us?

Yes, the realtors/lenders, etc. undoubtedly lied and misled many people.

But I don't see picking up the tab for somebody else's mortgage. I rent. Home ownership isn't an entitlement.

like -read a contract- ?
It worked 40 years ago, what the hell happened?

There will always be evil people trying to exploit others, why not teach people to look out for the evil people and to think for themselves about their own futures?

We can regulate everything, but people are clever and will still figure out a new way to fuck over other people.

But my heart does go out to the people who were blatantly tricked and lied to. Like this guy, for instance.

http://www.mercurynews.com/ci_5411822

If they don't understand it, don't sign it. The foolishness of others ain't my responsibility!

But people are gullible. It's a shame.

out that if you're making $54k a year you have no business buying a house for $543,000 unless you have a down payment of $300K.

Sorry, only an idiot would fall for that scam.

conmen?

Oh, wait a minute -- sorry. I thought your rage was directed at the assholes who preyed upon the ignorant brainwashed consumer sheep that the corporate infotainment complex has so carefully bred for all these years.

My mistake...

who thought a savings and loan was a safe place to put their savings? Why should I pay for their gullibility? Idiots! :sarcasm:

I can't think of any.
edit: my mom is a little old lady who lost $200K in Enron investment. There wasn't any federal insurance for that.

But I do remember some very sad stories about people getting dimes on their dollars. When those places went under they took a lot of innocent people down with them. Sorry about your mom. I bet she worked her ass off for that money,

My mom did work hard...she put 3 kids through college and still saved, and invested. She's 91 now and became a Democrat 5 years ago after a very long lifetime of being a Republican. Mom got smart, finally. :D She calls Dubya names I rarely say out loud. I'm serious!

I'm sure she's invented a few new ones.

the more love is sent her way. :D

:hug: I'm so sorry your family has had to go through this.

I live in AZ - little old ladies and men were hit hard here.

for those of us who lived here since before the mid-80s.

The sub-primes were a con just like the Nigerian scam. Were people foolish? Yes--but they were also victims of a crime.

... disguised as a humanitarian gesture.

As someone who has been heralding this debacle, often to ridicule, for 2-3 years here, I'm adamantly opposed to bailing out fat cats who thought there was no reason that underwriters wouldn't loan to these folks and these folks who 90% of were trying to live way beyond their means and their gamble didn't pan out.

If I were king, not one cent of the common purse would bail out a single one of them. This wasn't a case of idiocy, it was a case of greed and property lust.

I also rent. I got sick of the whole mess of owning a house. I had owned for years and even with a husband all repairs and hiring, banking etc. were my jobs. Yar even moving snow or grass cutting. Now I rent and find I am very happy with it. Most people use owning like renting any how. The days when my father paid off his home in 5 years is just gone. I think any how.

and cant wait to unload the damn thing, down market or not it's going up for sale next month and I never want to own again. But - that said - I live in an area with rent control. It's tough when your rent can double every nine months with no recourse. I've lived like that, and that's why I understand wanting to own so badly. Nobody can come and tell you you have to move.

these people only "thought" they owned a home. 0 down, interest only, adjustable rate mortgage? Why does someone making $50K a year think it was a good idea to buy a $500K house. The answer is greed.

who believed in the American dream and didn't know the right questions to ask. But you go right on ahead and look down on him if it makes you feel good. That's what liberality is all about, after all.

Rent control is only working -against- you in this case...........???

Unless your rental prop is a slum...........

:eyes:

most expensive city in the country, for bubkes. It's most definitely not a slum. I could never afford to buy here. So I bought a second home and rent it out. Rent control is working for me just fine, thanks. What isn't working is being a landlord. It effing sucks.

1500 sq ft 2br/2ba flat with the gorgeous view of the bay thanks.

I did that for a while...in Tampa. My rental house was 2 doors away from my house. A genuine pain in the ass just dealing with tenants, I do understand. I wasn't implying you live in a slum, it was a reference to your rental property which I gather isn't near your residence...you didn't say where it was. Is it a place you wouldn't consider living in?
And I'm not familiar with 'bubkes", is that in California?

Not my first choice of a place to live, but not my last either. Sorry, bubkes is an expression that means "very little money". Maybe my grandmother is the only one to ever use it, dunno,

I like Phoenix...for a few hours. I like SF a lot. :D

how it is!

http://www.thelastoutpost.com/site/1531/default.aspx

Sometimes one can discover fascinating facts in unexpected placed. In the Business section of the New York Times on March 26th 2007, we see an ad for an auction on page C9. It announced that Morgan Stanley Mortgage Capital, Inc. is auctioning off 13,200 residential mortgage loans on March 29th 2007. These mortgages were generated originally by NC Capital Corporation, New Century Mortgage Corporation, Home123 Corporation and New Century Credit Corporation. The aggregate face value of these items is $2.48 billion!

What has happened is this:

So-called “subprime” mortgages were made by these companies to persons with dubious, little or no credit. The initial lenders faked credit reports and persons holding them were often able to get a house with no down payment at all! What these lenders did next was to sell the mortgages to big Wall Street houses, take the money and run with it.

The buyers had been bamboozled into thinking they had paper of value and when the time came to increase the payments, as they had every legal right to do, they quickly found out that the mortgages could barely make the small initial monthly payments and when the banks holding the paper, raised the rates, the holders were completely unable to pay (as the original mortgage brokers well knew) and the homes went into foreclosure and the Wall Street firms were stuck with billions of dollars of paper with nothing behind it but fake credit reports.

Now, the small original lenders have folded up their tents, cackled with glee as they pocketed their loot and vanished into the night, leaving the respectable firms with billions in debt. This is as big a fraud as the rigged dot com frauds of the ‘90s. (or the S&L collapse in the '80's)

...

I have no idea about the credibility of the site.

everyone thought they were a financial genius for the past 8 years. you were made to feel like an idiot if you didnt take out a huge mortgage.

You have never been to closing? There is too much to read it all. We chose a real estate agent we felt we could trust and had her go over everything and summarize it for us when we got to closing.

If we had been without an agent to represent our interests and hampered by only partial understanding of the language, we could have really been victimized.

The con-artists are the ones who should pay, not their victims. These victims have been swindled out of their futures. Their safty nets are gone and they have also lost their good name -- their honor. Have a little compassion for the little guy. Next time you could be the victim.

The banks made a huge mistake, right? They recklessly over-extended themselves, right?

Why should they expect to get a handout from the public purse?

(Just trying to think like a Republican, sorry)

when they are buying a house and then have their dreams dashed. We are seeing a lot of families with children living in cars here in Orlando. My heart goes out to them. To the people who were flipping houses I have no compassion. So I am torn. The families who are devestated break my heart.

Not all of us screwed by this shit are 'welfare queens' or buyers of 'McMansions'. Its a long story, I doubt you'd be interested. Yeah, we should have hired a fucking attorney with whatever money we don't have and gone over the papers with a fine tooth comb...basically we were scammed, the contract we got was not the one we agreed to. You trust your lending institutions not to fuck you over to a certain extent. Lesson learned. I'll get out of this one somehow because I'm a stubborn bitch and the payments on my house are still cheaper than renting, but DON"T denigrate innocent people just because they got caught in this mess. It's like that Blackadder episode where they are laughing about how only fools can be kidnapped, turn around, do something stupidly human and wind up being kidnapped themselves. Many of us fucked by this are working poor in modest housing. Pretty much just like everyone else. And the bastards playing this game are slick, slick, slick. The media has done a good job of spinning it to make it look like only pretentious bastards and the terminally stupid have been caught up in this. They do that for a reason, because they don't want you to see or feel comapssion for the people who really have been victimized. IMO we need to bail out the homeowners, not the lenders, but that would make too much sense... I'm done. End of rant.

I agree with you 100%. Must be nice to be able to look down on the poor sots who lost everything because they're not as smart as you. Unless of course you believe in karma.

im just looking for the pols to not bail out banks. i dont even know what a bail out of the homeowners would look like, at best they could claim bankruptcy and walk away. try and get a loan after that.

the doc you signed is not what you are paying? or are you telling me you didnt read your note before you signed it?

Like I said it was a long story...they kept fucking up the docs, we'd approve the changes, scan everything else and sign. I'm sure something got snuck in but I don't know when or where. It would boil down to 'he said, she said' and at this point, I just want to sell this house ( my second...) and go back to renting. I'm just sayin', we are not all fuck-ups...I've got my own buisness and another job to boot. I'd go to a lawyer now, but I can prove nothing...

on edit: don't worry, you ain't bailing me out, I've got enough to say, "oooh crooked game, lost my chips" and back out gracefully, but there are other people who have kids who staked themselves in this thinking that they were getting stable.

i want to see banker perp walks. i hope whoever scammed you goes to prison.

"predatory lending practices". A bit before his time maybe.

Anywho, my best wishes to you and yours. And you're spot on in your edit.

of a paper critiquing predatory lending at the last meeting of the Southern Economics Assoc. usury still exists (and im against it), but that is not the main problem here, imo. people got caught in a spec bubble. they assumed RE was going up up and away, and they had to get in.

..except for the "figure out that you shouldn't buy a house" statement. Right now, there are a ton of hard working families who are trying to figure out living arrangements for their kids. Maybe they're not as bright as we think we are.

I'm all for helping out the homeowners, but I say absolutely NOT in bailing out the banks.
They bought loans that they KNEW weren't good paper. Seems like a poor business decision that they should have to figure out themselves.
Oh I don't know, left to their own devices...could they possibly work out deals with the present homeowners for fair market values, locked in rates and affordable payments to try to gentle their losses?
Some is better than none and that would absolutely solve part of everyone's problem without government assistance.

Just like the S&L scandals of yore.

Everyone thinks all the victims here are living in McMansions--not even close. My heart goes out to you. You are stuck and the lenders get off scor-free. some blissful American Dream :sarcasm:

Thanks for sharing the voice of experience; I hope it reaches the right ears.

Message removed by moderator. Click here to review the message board rules.

i know plenty of people that dont own a house, so i dont get the "ROFLMAO!! THAT's a candidate for the all-time stupidest thing I've ever seen on DU."


did you want to bail out people that got nailed in the tech bubble?


why do suggest that profits be privatized but losses socialized. that creates perverse incentives.

IMFUCKINGPEACH!

I agree that the lenders should suffer whatever consequences they have coming to them, but I'm confused about you apparent conflation of the people that were suckered into these loans with the companies that took what little they had to make the loans.

The politiwhores are worried that if the lenders go under and the foreclosures go through, the whole ponzi scheme will be exposed and the ripple effect will crash the economy. I don't think anybody wants to see the results of what would make the great depression look like 90's happen.
:kick:

this isn't a Ponzi scheme. If they're doing something that abrogates a written contract (yes, I know about the putative legality of oral contracts but that isn't really relevant here), they haven't actually Broken the Law. Yeah, their practices are sleazy, manipulative, and shady but the fine print in a contract is binding as long as it's accepted by the parties.
It may suck but it's the way of things.

talk is now about how to head off the herd before it tramples the whole farm. The manufactured housing boom was brought about by the deregulation and utter lack of oversight by the government on the lending industry. The (false) boom was created to make a failing economy look like it was expanding.

With rampant ignorance and ever increasing use of technical manipulation to hide the real terms and consequences of contractual agreements, I do think that we simply have to find some means of ensuring that there is, in fact, a meeting of minds when these deals are constructed.

bragging about home ownership being at an all time high? I think I remember that. They took credit for that are they willing to take the fall for the foreclosures?

I guess there are some who are just not quite as financially astute as you.

:thumbsup:

to figure out that you shouldnt buy a house that cost 10 times your income before interest



well played

Hate those "welfare Mommas" too?

how is a poor single woman trying to raise a family equivalent to someone that buys a house with no money down and doesnt make a payment toward the principal of the loan.


I was an afdc child, i remember when billy weld cut off my grandmother. these are not the same people.

i support national health care, i support affordable housing programs. i dont support a bailout of people who overconsumed.

of foreclosure? Do share.

BTW, I'm all for your purported goals. I just don't like blaming a working family after a speculative real estate bubble has burst. Kind of like blaming Tom Joad for the drought.

what does a bail out mean to you? i think best case scenario, these people get to claim bankruptcy and walk away. if they cant afford the house, and shouldnt have bought it in the first place, i dont see a scenario where they keep it.


people get foreclosed on all the time, it sucks. prior to the spec bubble, i felt terrible for people that got foreclosed on.


people i dont feel bad for: flippers, people carrying two mortgages, people that used equity loans to buy cars, tvs etc.


we are all going to suffer because of their over exuberance during the upcoming recession.

I also know that a lot of folks are getting caught up in the after-affects of the speculative bubble. No doubt, they were sold a risky, highly leveraged piece of paper. I just think that most of them were not white-collar types, "overconsumuing", and now put in the position of having to give up their 7:00 tee-time at the country club.

I'm strange. I just have a bent toward the little guy.

we got socked with the "Savings & Loan" scammers (there was a Bush and a McCain in that one)..

Indirectly we "paid out" for ALL the dot coms who skimmed millions and then bailed..and for Enron and for all the others..

the ones who play by the rules, always get stuck cleaning up after the profligates..

and you wouldn't want them to be out of pocket, now would you?
(it's not the clientele of the sub-prime lenders that are going to be bailed out--trust me nobody gives a shit about them--it's the whiteshoe bankers who finance the sub-prime mortgage companies who get politicians moving to tap your wallet to cover their mistakes)

If we find out that they are in need of assistance situation because of a bad financial decision, then they shouldn't get it. And, following that same logic, we should abolish social security - I mean, seniors who rely on social security were too dumb to prepare for their retirement, right? Those idiots!
:sarsasm:

I am disgusted and freakin' tired of greedy pucks taking advantage of people constantly fed with what they're supposed to have and can never get!!!!

The economic oppression in this country (and its foreign policy of economic oppression abroad) is the most gross ethical violation of democracy and humanity ever perpetrated in modern times,...and,...

I am SICK of such GROSS OPPRESSION!!!! :puke: SICK OF IT!!! :puke:

The greed displayed during these last 4 years has been completely disgusting. When you buy a home and your mortgage is 7k/month and you can rent it out for 3k/month, then you are not buying an "investment". An investment implies cash flow. If you buy, and expect the property to rise in the future, then you are, by definition, a speculator. All the speculators who took out 200k helocs here in Los Angeles to buy BMWs and vacations and are now in trouble can go f@ck themselves. They deserve, and will get, none of my sympathy. Greed has driven the market to insane levels here in Los Angeles. Its so insane here that I make nearly 100k/year and have to share a rental with a couple other guys to afford living here. People knew what they were doing when they took out these loans. They simply expected their house to rise 20%/year indefinitely.


taught.

IMO, This is a consumer fraud issue and I don't think the lenders should be bailed out at all. But I DO think homeowners who have been scammed like the millions who have should be helped to find a way out of their horrible situations by getting new affordable loans at fixed rates or they should be allowed to walk away from the loans without the foreclosure showing up on their TRW and ruining their lives.

no cheating now

There have been plenty of news reports on TV, in the newspapers about these risky mortgages and the long term affects, especially with the interest-only mortgages.

No one forced these people to buy houses they knew they couldn't afford with a traditional 30 year mortgage, much less an interest-only mortgage.

I have no problem with people buying houses instead of renting, but a lot of these people who are facing foreclosure now because they bought houses too big and too expensive with interest-only mortgages or some other creative financing are responsible for their own actions.

I saw a news report about a young couple (with an infant) who bought a $990,000 home with an interest-only mortgage. Their combined income was less than $100,000. The reporter asked them what they were going to do when the five years are up and they will have to start paying principal plus interest. The couple just shrugged it off and said that they should be making more money by then and besides, they want to have fun now and worry about that later.

I don't want my tax dollars bailing out people like them.

... whether one is actually committing the immoral acts, or merely trying to justify his inaction in the face of someone else's wrongdoing.

It's what every con artist says: my victims should have known better.

:eyes:

Also, it's rather telling that despite the wording of your title, the body of your post focuses on your animus against the borrowers only. I've noticed that this "personal responsiblity" doctrine always ends up being preached primarily against the weaker party in any dispute. Why do you suppose that is?


In any case, the bottom line is this: we had a duty to regulate banking in the interest of preserving the common good. And we've always had a moral duty to punish usury.

We failed to do those things, and this is the result.

Because we have a real and serious interest in not letting our society go straight to hell, we would be wise to make sure that people who foolishly got into debt -- and their innocent families -- have a place to live. We would also be wise to seize this rare opportunity to rid ourselves of the speculators and usurers by letting them swiftly go broke.

why shouLd my tax doLLars go to poLicing agencies that try heLp victims of sexuaL predators. if they were fooLish enough to be victimized, then too bad. whatever happened to personaL responsibiLity?

Why not to the victims they prey on?

So now we're the cold-hearted party of personal responsibility? Our government has allowed predatory lenders to go after people our public education system has failed. So they should just suck it up? Sorry your pursuit of the american dream fucked your future! We're going to clean it up and regulate sometime in the future. Sorry about the trail of bodies.

I'm one of those inconvenient compassionate liberals. Ma and Pa were wronged and I'd just as soon see our government use its resources to make them whole. I think we ought to help the people of New Orleans and the Gulf Coast too.

Of course, that still wouldn't stop the tut-tutters who are obviously better than everyone else from mocking people who are now getting screwed by this fiasco.

I've found that most people who lecture others on "fiscal responsibility" when debts go crazy or something like this happens have never tasted the ugly side of life.

and it's not the first time that they have posted on this subject.:(

Perhaps you meant to use this one? :sarcasm:

At least I hope so.
Otherwise--ICK.

...and anyone not in a gated community has to live with them.

But you knew that.

Maybe we should all go buy baseball bats and club all the homeless people and the rest of the poor to death too while we are at it. :sarcasm: