People will go to extreme lengths to maintain the facade of success.
Mastercard posted a 17% increase in profits last year, which was higher than expected. I was not surprised. The magic HELOC has become more illusive. First people borrow from their home (HELOC), then run up the credit cards, then start selling their boat, RV and other things (like the four pieces of furniture they bought at pottery barn for 20k – kind of a surprise to find out it all is worth $1,500 on the secondary market). Depending on their embarrassment threshold, some will start calling family for a loan at any point in the above. The car only goes when they are threatened with reposession. However, if they are underwater on it, they will just start parking it two streets over.
"People will go to extreme lengths to maintain the facade of success. Mastercard posted a 17% increase in profits last year, which was higher than expected. I was not surprised. The magic HELOC has become more illusive. First people borrow from their home (HELOC), then run up the credit cards, then start selling their boat, RV and other things (like the four pieces of furniture they bought at pottery barn for 20k – kind of a surprise to find out it all is worth $1,500 on the secondary market). Depending on their embarrassment threshold, some will start calling family for a loan at any point in the above. The car only goes when they are threatened with reposession. However, if they are underwater on it, they will just start parking it two streets over."
I’ve witnessed it within my own family. I, however, learned from their many mistakes. Unfortunatly, I’m the only the one who learned. The cycle repeats….
I was watching a House Hunter show last night where the couple chose a 250K house. When they showed them six weeks later, there was at least 25 – 30k worth of pottery barn furniture in the place. It was all a new because I recognized those items from the current catalogue.
One reason why houses are still selling.
Credit is still plentiful.
I receive an ad by Richmond American (don’t know why they are sending to me):
Lower payments put your dream house within reach:
$641,990 payment as low as $2389/mo
$701,900 payment as low as $2609/mo
$719,900 payment as low as $2646/mo
100% financing, interest only ARM, and other fine print.
