[quote=pri_dk]…Why can’t people understand that a loss is a loss – doesn’t matter if it’s the stock market or a down-payment?
We sold our place in west LA in 2004 along with another investment property and bought our current home in Temecula. We basically reduced our “position” in real-estate by about 75%.
I knew owning any real-estate in 2004 was risky from a purely financial perspective – we could have reduced that risk by renting – but we had three young kids and wanted our own place.
Since then we’ve lost whole 20% we put down. And we don’t care either. Raising our kids, becoming friends with our neighbors, and a million other good memories have been associated with living in this home.
Count your blessings and carry on.[/quote]
pri_dk, in the past you (and SDR) have not appeared to have been ignoring me but if you both choose to begin doing so today, I would consider that a compliment :=)
I kept my property through the “loose-lending era” for all the same reasons you did. I would not have had a place to raise my kids and have pets had I rented.
My intention was to retire in place, until another tragedy befell my family and I recognized my own mortality, realized I did not want to spend another 40 years here and instead wanted to be elsewhere when I had the chance to leave.
I was busy with other things and did not have time to pay attention to what was really going on in the RE market until about 2010. In the interim, a saw a couple of houses around me sell for what I thought was way too high a price (and get subsequently foreclosed upon) but did not internalize then that the sole function for the high prices was “loose lending.” When I got to know one of the families losing their home, I realized one was a school worker and the other a tradesman. It DID dawn on me why this family was able to qualify for that mortgage but again, I didn’t put two and two together in their case because I was involved in other things and it was not a priority or of interest to me. I DID have a couple of “clients” in 2007-2009 who were were losing their homes. One gave cash for keys and another got foreclosed upon. I did end up reviewing all their loan docs and helping the one who lost her home with a mod application (refused by lender) but was actually hired by them to prepare legal papers in other matters. Both were longtime owners but in those cases, it became apparent to me that they were grossly taken advantage of by loan officers and accepted usurious terms while attempting to save their properties from foreclosure. They both had gotten into that situation by systematically bleeding cash from their properties over the years.
When I explained all of this to each of them, they both stated that the only thing going thru their minds at the time was to “save” their homes from foreclosure and get desperately needed cash.
I didn’t watch any TV for several years and still only watch less than one hr per week so if there were “talking heads” and MSM discussing the “loose-lending” phenomenon, I wasn’t paying attention to it.
I agree with SDR in that it is outright and blatant theft to take cash out of a property and then subsequently default. The sad part is that these thieves get to live for free in “their” homes for many months after that and also keep their new vehicles, consumer goods and vacation memories they bought with their “pseudo-equity.”
I think what’s really going on here is that no one wants to discuss the elephants in the room (the practice of rampant “cash-out-then-default” AND extremely low-priced SS closings pushing appraisals down). Perhaps because it hits too close to home. Perhaps because it has been over-discussed here in years past. I discussed the “cash-out-then-default” issue with a friend last night – a native San Diegan. He seemed to think that homedebtors in general thought they could recover from their repeated “cash outs” because they thought RE would always increase in value. I told him I thought this may be true of younger homedebtors (1st time buyers) who perhaps did not have older relatives in the area for counsel. I believe most of the age 40+ crowd who took cash out in recent years to buy more properties or enhance their lifestyles HAD to have remembered when $10K – $50K was the typical “cash out” taken (usually for home improvement). In the 80’s and 90’s, a $100K+ cash-out refi/2nd TD/HELOC was virtually unheard of in properties worth less than $1M! I believe the majority of “millenium-boom” cash-out mtgs were deliberate attempts to steal and the borrowers had every intention of defaulting on them. When they first decided to systematically bleed cash out of their property once per year in 2004, 2005, 2006 and 2007 was when they consciously put they (and their family’s) property in the line of foreclosure. Like my “clients” told me, they just needed/wanted the cash. They didn’t care about the consequences.
Taking “cash-out” during the millenium boom actually didn’t occur to me at the time. I guess I was never that desperate. In any case, had I done so, I would have lost my property to foreclosure by now as I don’t have a “backup working co-owner” to help with the bills.
Aside from possible past over-discussion of this issue here, I’ll bet the Piggs claiming I’m “whining” here have a little or a lot more time to recover from this mess than I do (which seems to be out of our control).
If you could put yourselves in the shoes of a prudent local homeowner who is on the threshold of “retirement,” then I guarantee you would feel much differently about the issue.
In addition, my “detractors” here appear to have not owned any piece of RE for ten years or more AND put 30% down of their own funds initially on that long-held property or if they ARE longtime homeowners, they have already removed a substantial amount of cash from their propertie(s). So they DON’T YET KNOW how they’re going to feel ten+ years after ownership if they have been making mtg payments religiously all that time and did NOT remove cash, ONLY to find the value of their property is now dependent solely upon the financial responsibility of their neighbors (even more than location, size, condition, etc).
I’m not looking for sympathy here. Since this forum is mainly slanted to the buyer (who wants the lowest price and frequently complains about recalcitrant sellers), I’m just offering a glance of what the other side of the coin looks like :=]
